Winston Peters has described Labour's original COVID-19 commercial rent dispute proposal as "poorly targeted" amid National claims that businesses are the "victim of coalition dysfunction".
Justice Minister Andrew Little has announced a temporary law change to force commercial landlords and renters to consider COVID-19 in disputes over rent issues, almost two months after the Government first floated the idea.
But to be eligible, business must have 20 or fewer full-time staff at each leased site and be based in New Zealand. Also, businesses and landlords who have already reached agreements in response to COVID-19 cannot access it.
New Zealand First leader Winston Peters said Labour had proposed the solution for all existing lease arrangements, and claims his party is responsible for watering the policy down.
"This would've been poorly targeted policy and affected many landlords who've sensibly adapted to the changed circumstances brought by COVID-19," Peters said on Thursday.
"Using a sledgehammer to smash a nut is not common-sense. We must remember the sanctity of contracts is a crucial dimension to settled law."
Peters said New Zealand First made sure it's only available for New Zealand-based businesses with 20 or fewer equivalent full time staff, and that it cannot be accessed by businesses that have already come to an agreement with their landlord.
"We believe that as a Government we need to show New Zealanders we're aware of the fiscal costs of every policy decision reached - therefore we've insisted on better targeting," Peters said. "This is why we urged our coalition partner to better define the size and problem of commercial rent disputes."
The Government is investing $40 million to provide access to arbitration - basically independent dispute settlers - to support small or medium businesses to reach agreement on a fair rent.
The $40 million will provide a subsidy of up to $6000 per arbitration, meaning in many cases, the Crown will cover about 75 percent of the arbitration cost.
National's finance spokesperson Paul Goldsmith said small businesses have been the "victim of coalition dysfunction for two months while they've wrangled about what to do".
He told Newshub the Government's policy is "too little too late" and that what small businesses needed more than a month ago was "some cash in the hand to help deal with those ongoing business costs".
The Government has helped businesses through COVID-19 by spending around $11 billion subsidising wages, providing temporarily interest-free loans, and tweaking the tax system to provide financial relief.
It comes amid recent public disagreements between Labour and New Zealand First.
Peters has frequently said we should be at COVID-19 alert level 1 now, and while she insists it had nothing to do with political pressure, Prime Minister and Labour leader Jacinda Ardern has brought forward the decision on exiting level 2 by two weeks.
New Zealand First MP Shane Jones told TVNZ's Breakfast show on Thursday the party will not "tolerate being absorbed" by Labour ahead of the election.
Newshub's latest poll showed New Zealand First down to 2.7 percent, and on that number it would not get back into Parliament unless it won an electorate.