If anything has become a signature for John Key in his first year as Prime Minister, it is his laid-back style and sunny optimism.

It was on full display on January 15 this year when he agreed to a request by Maori Party co-leader Pita Sharples to fly the Maori flag on the Auckland Harbour Bridge on Waitangi Day.

In the full flush of the new governing arrangements, Dr Sharples had made the request, characterising it as "a symbol of the new direction this Government is taking by inviting the Maori Party to be part of it [with needing its numbers]."

When Mr Key returned from his Hawaiian holiday a few days later, he reciprocated the sentiment, volunteering to even fly the flag from Parliament.

The only proviso was that Maori had to agree on the flag and what it meant.

Mr Key was betting on his low-fuss attitude being followed by the rest of the country. He and everyone else had bigger things to worry about - the global financial crisis for starters. It seemed inconsequential, and a long way off.

Now the decision has been sanctioned by the Cabinet, and the directives given, it may not be as insignificant as Mr Key would like.

If he had confined himself to the Auckland Harbour Bridge and his own residence, Premier House, it might have remained low key. The symbolism would have been recognised, but limited.

But the tino rangatiratanga flag will now fly at Parliament, and at Government House in Auckland and Wellington. The constitutional symbolism is much greater - and it follows that the resentment some have will also be much greater.

It remains to be seen whether the flag has a part to play in the constitutional review National and the Maori Party agreed to establish next year as part of their confidence and supply agreement.

Mr Key refers to the "Maori flag" rather than the tino rangatiratanga flag and says it symbolises the Crown-Maori relationship that has grown out of the Treaty.

He has had largely positive experiences in his own dealings with Maori in Government.

For many, including many Maori, the Maori sovereignty flag is a symbol of separatism, not partnership.

Mr Key probably could not have announced his decision any earlier because of the toxic effects of the Hone Harawira emails, which offended so many Pakeha.

The saga illustrated how fragile attitudes to race relations remain.

The political environment is not as benign as it was back in January when Mr Key chirpily agreed to fly the flag. He slipped four points in his personal ratings in the TV3 poll after that saga.

In the same poll, 59 per cent of respondents believed race relations was potentially a major issue or one of the country's biggest issues.

Vanquished New Zealand First leader Winston Peters was on the case last night. Labour leader Phil Goff found nothing positive to say yesterday about the flag gesture other than to point out there were bigger issues to deal with.

Perhaps the most powerful symbolism will be what happens to the flag on Waitangi Day.

The Waitangi National Trust Board will consider at a January meeting whether to allow the flag to fly on the Treaty grounds, where for decades the protest movement has sought to hoist it.

Whether its decision is Yes or No, no amount of optimism on John Key's part will minimise the fuss that will cause.