Cabinet has agreed in principle to establish a travel bubble with Australia early next year, Prime Minister Jacinda Ardern says.
Speaking from about 2pm, Ardern has welcomed attendees to what is expected to be the final post-Cabinet media briefing of 2020, "a year no one would have imagined".
She says ministers have discussed travel bubbles with Cook Islands and Australia this afternoon.
A travel bubble with Australia can be expected in the first quarter of 2021 "pending confirmation from the Australian Cabinet and no significant change in the circumstances in either country", she says.
Officials have been working on preparations for that, Ardern says, while acknowledging that one of the criteria was 28 days of free of community transmission.
Clear plans will need to be made in the event of a community outbreak, she says, with enough space for potential returnees if borders shut again and arrangements for air crew and airlines.
A date on a trans-Tasman quaratine-free travel bubble will be announced in the new year.
Austrailan Health Minister Greg Hunt said the federal government welcomed New Zealand's announcement, describing it as the "second half of the equation".
Hunt said the federal government would "absolutely" approve the agreement, and that increased travel between the two countries would benefit both economies.
"We consciously opened up Australia to people coming from NZ because their case numbers were negligible and we knew there would come a time when our case numbers would give them confidence," he said.
"Now this gives the chance for New Zealanders [and] Australians to visit New Zealand ... without having to quarantine.
"It's the first step on a return to international normality."
Hunt said an agreement would be easy to reach with their counterparts, as some Australian states have already welcomed New Zealand travellers.
New Zealand's decision to allow a travel bubble with Australia follows Queensland's decision last week to open its border to the country.
All other states had already opened to New Zealand travellers, although Western Australia requires 14 days' quarantine on arrival.
Since October, New Zealanders have been able to travel to Australia without going into quarantine in certain states, but not the other way around.
Ardern says there is more to work through, including segregation of staff and making sure contingency plans are in place, and these were key to finalising any arrangement.
Minister in charge of Covid-19 Response Chris Hipkins says he will be heading to Auckland airport tomorrow to look at how they will be doing the operational separation of passengers.
"Airlines have indicated they do need a notice period - you'll be aware they grounded a lot of their fleets. They have a lot of crew not currently working so they need the opportunity to bring them back and get them current again.
"We have been clear we want to see separation between crews who are working in the safe zone versus crews working elsewhere, so that requires logistical rearranging for them."
The Cook Islands are expected to be available for quarantine-free travel first, Ardern says.
Over the weekend, New Zealand and the Cook Islands said they agreed to open a quarantine-free travel bubble by end of March next year.
More work is needed to ensure there are precautions in place that give the government confidence New Zealanders can safely travel there, she says.
"I think New Zealanders desperately need a break. Of course we want to progress these issues including quarantine-free travel but we haven't taken risks before that mean New Zealanders won't be able to keep their freedom and I certainly don't want to take those risks right now."
Hipkins will be providing an update tomorrow about a resurgence plan and what will be in place over the summer.
He urges people to continue sticking to the same public health measures.
Airport supportive of announcement
Wellington Airport welcomed the announcement, but said there was work that had to be done before the bubble began.
Wellington Airport general manager of corporate affairs Jenna Raeburn said: "First, airlines and airports need to be ready. Wellington Airport has been ready to make safe travel to the Cook Islands and Australia a reality for several months now.
"We have invested heavily in new infrastructure and processes to make safe travel zones work. In order to maintain these preparations, it would be very helpful to have clear signals of intention and we are looking forward to the government's confirmation of a target date in the new year."
The airport would be ready to go as soon as the government and airlines could confirm arrangements, she said.
However, she also noted the need for the Australian Cabinet to sign off.
"We are very hopeful this will occur soon, given the positive steps the Australian state and federal governments have already taken to reopen travel from New Zealand."
The airport was also pleased the government was working on a plan to deal with the event of a resurgence of Covid-19 within the trans-Tasman bubble, Raeburn said.
Bubble comes far too late - National Party
National has accused the government of "dragging the chain" on a trans-Tasman bubble.
Covid-19 Response spokesperson Chris Bishop said while it was welcome news, it came "far too late".
"Much like the Cook Islands non-announcement on the weekend, today's news gives the glimmer of progress without any real substance to it. Businesses are still none the wiser on when we will see Australians able to enter New Zealand without quarantining."
The delay would cost New Zealand businesses and their staff dearly, Bishop said.
"About 40 percent of people in MIQ facilities are from Australia, filling up spots while others wait offshore. Every day that goes by without a travel bubble is another day where people can't travel to New Zealand for compassionate reasons or to fill critical shortages in industries."
The government needed to be much more flexible and pragmatic in assessing the risk from particular countries, Bishop said.
ACT leader David Seymour accused the government of sitting on its hands.
"Suggestions that airlines with grounded fleets need time to get up and running is more of an indictment on the government than anything else," he said.
"The excuse, as I would call it, is frankly disingenuous. If that's true, it shouldn't stop the government setting clear rules and opening up. But to use other peoples' unpreparedness as an excuse for your own is incredibly disappointing.
"It's difficult to fathom what the government is up to. Everything that they are using as a reason for delay was given as something the government was to work on six months ago when this whole idea was first mooted," he said.
"The questions are, what have they been doing for the past six months and why do we expect they'll be more successful at solving the problems in the next four months?"
An initial deal towards resolving the standoff over Ihumātao was expected to go to Cabinet today, understood to be the sale of the land by Fletcher Building to the government.
It would be a major breakthrough in the ongoing dispute which would pave the way for a final agreement with mana whenua.
However, this afternoon Ardern refused to say whether the deal went before the Cabinet.
"I'm not giving you any confirmation of what was on the Cabinet agenda today.
"There's a number of areas where we've looked to have a resolution before Christmas, at a time and a place where we're ready to make announcements we will, but today's not that day."
She says they will be making announcements at the appropriate time but there was no timeline for that at this stage.
"I think it's understandable for an issue that has bubbled away for well over a year that there will be a lot of speculation."
"Throughout that entire year, with or without different government arrangements, it's always been our desire to find a resolution to this issue."
She says the government has consistently worked with the Kīngitanga, and continues to take advice from them including on when would be appropriate for her to visit.
She will continue taking the advice of the King on a visit but has no set date as yet.
"My focus, rather than a visit has actually been resolution," she says.
She says one of the criteria has to be that any deal does not undermine previous Treaty of Waitangi settlements.
"We've consistently working with Kiingitanga, they've played an incredible role in bringing together mana whenua to try and progress a solution that meets their needs and that work continues.
"We've been very specific that one of the criteria for any resolution at Ihumātao has to be that it doesn't undermine the Treaty process ... we just can't do that, it would be an act of bad faith for all other iwi and Treaty partners."
Mallard should remain as speaker
Asked whether the speaker of the House Trevor Mallard should retain his current role, Ardern says he absolutely should.
She says he has made a mistake, and no one is disagreeing with that fact.
"But does that change my view that he is the right person for that job? No it doesn't."
Mallard had to publicly apologise last week over comments in which he wrongly claimed an accused rapist was working on Parliament's premises.
A staffer was stood down and then launched defamation proceedings.
Mallard is expected to appear before a select committee on Wednesday to be questioned about the incident.
The National Party last week revealed the cost of the legal battle to have been $330,000, and along with ACT said it had lost confidence in him.
"We have to acknowledge as well the Speaker role, despite being independent of the government, is a politicised position," Ardern says, adding that very few past Speakers would not have been challenged by the Opposition parties.
She says his decision to appear in the Select Committee on Wednesday was the right thing to do.
Ardern says the fact the government has set up a support package for Canterbury claimants short-changed by Southern Response is not an indication the Crown has "thrown in the towel" on its legal battle.
"It's an acknowledgement of what people have gone through and what needs to be resolved," she said.
"What we need to keep in mind here is it's about fairness and whether or not those individuals have been treated fairly and that's what needs to be resolved after many many years of heartache and potentially down the track at great legal expense, and it makes sense for us ... to resolve the issue."
She did not have details of the costs of the legal battle on hand.
"Ultimately there are a range of issues in Christchurch that we have inherited and have tried to resolve. We were very open that in pursuing the case with the Dodds - and they understood why we were doing it - we just needed to get some parameters to understand fully what the court understood ... in order to make a judgment about how to finalise things with everyone else that was involved."
The year of Covid-19
She looks back at the year, saying it has been dominated by one topic - Covid-19 - but for her it has been "the year of the team".
She says New Zealand has the lowest Covid-19 mortality rate and lowest number of active cases in all OECD countries and among the widest testing regimes in the world, with only Hong Kong having a higher test per capita rate.
"Our hard and early approach broke the back of the virus and despite flare-ups since ... the vast bulk of New Zealanders have enjoyed freedoms for the majority of the year that few other countries have.
"I'm incredibly proud of what our team of five million has achieved but I also want to acknowledge the huge sacrifices and hardship many have had to face to get us where we are. Where we are is a place where work must still continue but everyone should still feel proud nonetheless.
She also paid tribute to all essential workers who will continue to work in the Covid-19 response over the summer.
Unemployment is significantly lower than expected and the government's books are already showing signs of improvement, she says.
"While we'll continue to face a challenging economic environment for sometime to come, there is no doubt our actions to date have put us in a stronger position."
"None of that is to say our response has been perfect, it hasn't, but that doesn't change what New Zealanders have achieved" she says, adding that the long-term economic impact will with us for some time in the recovery phase.