A reform of New Zealand's intelligence agencies is "highly likely" following a report into how they run, the Prime Minister says.
The Intelligence and Security Committee, which John Key chairs, has received the independent report by Sir Michael Cullen and Dame Patsy Reddy, which considered whether the legislation was up-to-date and adequate.
The committee will meet next week to discuss the report, after which it could be publicly released.
Mr Key says the report is a "thorough review", with a number of recommendations on how the agencies can work better.
He would not discuss specifics of the report since it is now before the committee.
"There's a general perspective that the SIS legislation is not fit-for-purpose. I think there are areas where they can see improvement in the way the GCSB and SIS can work together.
"They're doing their best to come up with something which is both workable and far more practical for the modern environment we're in, and hopefully acceptable for National and Labour."
He would not comment on whether a recommendation was to merge the two agencies.
"It is the Government's intention to try and reach bipartisan support, and so I'm very reluctant to move ahead if we can't get Labour's support on the legislation and the recommendations, so one of the things is to see where there is areas of common ground and what we can craft in terms of a legislative response."
Mr Key says it is "extremely unlikely" new legislation based on the report will be passed this year, but it will possibly be introduced into the House.
The review also looks at whether the current oversight has enough protections to ensure the agencies act lawfully and also maintain public confidence.
The meeting of the cross-party committee on March 8 will determine when the report will be tabled in Parliament.