Labour and the Green Party have signed a memorandum of understanding to work together to change the Government at the next election.
The parties called a joint news conference at Parliament this afternoon, where they announced the team-up.
Labour leader Andrew Little says last week's uninspiring Budget shows the Government is out of touch.
"It is time for a change and Labour and the Greens have reached an agreement, common ground, that now is the time to start the work so we get a change in Government in 2017.
"Not only do New Zealanders need a change, far too many New Zealanders are missing out and they're being left behind. We need to have a different style of Government, a Government that respects all New Zealanders, not just those at the very top."
Mr Little says the relationship with the Greens has grown to a point where they're now "comfortable" in formalising the agreement.
The first manifestation of the alliance will come as Mr Little speaks at the Greens' conference this weekend.
"This is a significant agreement and it is a significant milestone between our two parties."
However, he says there will still be much work ahead for both parties to take on National at next year's election.
The parties have had an unofficial alliance until now, supporting and campaigning with each other on a number of policies including keeping state assets, the manufacturing industry and NZ Power -- a single buyer of electricity -- ahead of the 2014 election.
Greens co-leader Metiria Turei says while their shared history is clear, voters need more certainty at the ballot box.
"They want to know whether they're voting for change or for the status quo. This memorandum of understanding provides that crystal clear clarity that has been lacking for the past two elections," she says.
"I'm convinced that when we work together to change the Government, we will change the Government."
While they are distinct parties with their own policies, Ms Turei says both have enough common ground to work together.
Mr Little says discussions around what positions would be filled post-election should the alliance come into Government haven't been made, except Grant Robertson will be Finance Minister.
He says the collaboration wasn't a "monogamous relationship" and welcomes any other parties which wants to help change the Government.
But New Zealand First leader Winston Peters says the "jack up" is against what his party stands for.
"We do not like jack-ups or rigged arrangements behind the peoples' back. We'll go into this election just ourselves and our policies seeking to change how this country is governed," he said.
He said no arrangement between other parties will affect NZ First "whatsoever".
"If I was a Green member, I would wonder why I'm compromising my party's position. If I was a Labour supporter, I would be wonder why I was compromising my party's position. But if you were a NZ First supporter you'll never wonder that question because it's not happening to us."
The two parties will work more closely together at Parliament -- they might cooperate in question time and in select committees, or support each other's members' bills and supplementary order papers. Party leaders, chiefs of staff and non-parliamentary party representatives will hold meetings at least once a month. They'll brief each other on major announcements and speeches and they'll invite each other to party events. Andrew Little gets the ball rolling this weekend, speaking at the Greens' annual conference.
Yes. In the first paragraph of the MOU it says Labour and the Greens will work cooperatively while respecting they are separate political parties.
Both parties agree that in an MMP environment, it's better to work together to try and change the Government. Mr Little says Labour and the Greens intend to build on the agreement and offer voters the basis of a "stable, credible and progressive alternative government". Metiria Turei says when the parties have worked together in the past, Kiwis have perceived them as a credible alternative to National.
There's an "agree to disagree" protocol in the MOU. It says that while many of their policies are compatible, Labour and the Greens accept that as independent parties, there will be differences in specific policies and strategies. They support each other's right to express alternative views, but they'll discuss this with each other before getting involved the public debate.
Labour and the Greens say parties are welcome to join them, but the ball is in their court.
Labour and the Greens are investigating a joint policy and/or campaign in 2017, but no decisions have been made. In 2014, Labour under then-leader David Cunliffe rejected the idea of a joint campaign with the Greens.