The intelligence agency watchdog has flagged "significant concern" about how long the Security Intelligence Service (SIS) has taken to respond to her about whether some of its activities were lawful.

Inspector-General of Intelligence and Security (IGIS) Cheryl Gwyn has revealed her displeasure with the tardiness of the response in her office's annual report.

In early 2015, Gwyn raised a serious issue about whether certain SIS activity was lawful and, if not, how that could be remedied.

"I raised the issue with the Director in June 2015 and provided the Director with detailed provisional findings on my view of the legality of the activity in August 2015. The NZSIS provided its first substantive response to the questions raised in March-April 2016," Gwyn wrote in the annual report, released today.


While she appreciated the issue was complex and substantial work is underway on the questions raised, Gwyn said the "time taken to engage with and resolve this significant issue is in itself a matter of concern".

"To ensure it operates lawfully, the NZSIS must be able to deal with such issues in a more timely way. I will report fully on this issue as soon as possible."

Minister Responsible for SIS Chris Finlayson said he was satisfied with the response from the agency.

"And it was largely a result of my instruction. I said, if we are going to change long-standing practice, I want to be absolutely certain that things are done properly and things are right.

"The Solicitor-General is at the moment looking at that particular issue, and then I will want to have a look at it.

"Where you have lawfulness established or accepted over a lengthy period of time, and then someone comes in and says, 'Hold on, is that right?' Before you start changing your view of things you have to be absolutely certain that a change is warranted."

But Green Party co-leader Metiria Turei said Gwyn was right to raise concerns over the response, and the SIS should be rolled into the Police.

"As a stand-alone agency it has been a demonstrable failure.


"We have had continual reports from the Inspector-General that the SIS, their service, their timeframe, their capacity is failing."

As IGIS, Gwyn fulfils an independent watchdog role over the Government's two intelligence agencies, the SIS and Government Communications Security Bureau.

During the year ending June 30, her office reviewed 15 interception warrants and 30 access authorisations issued under the GCSB Act, and 39 domestic intelligence and 18 foreign intelligence warrants issued under the NZSIS Act.

Those reviews included one emergency authorisation for domestic warrantless surveillance - the first time such a power had been used.

Under law, which has been in force since December 2014, the maximum time period the power can be exercised is 24 hours.

The fact the power had been used was revealed in a sparse report from SIS director Rebecca Kitteridge in March.

The SIS followed up its urgent surveillance with an application for a warrant "in relation to the same subject matter", continuing the intelligence operation.

Gwyn's office reviewed the authorisation and provided comment on how it could have been "framed more clearly, but did not consider there to be any material concern".