Prime Minister Jacinda Ardern says ACT's campaign against hate speech reforms has "disheartened" her because the Government is yet to make any decisions.
But ACT leader David Seymour immediately pushed back, saying he's equally "disheartened" by the Prime Minister's suggestion his party is not willing to engage.
The long-awaited reforms of hate speech laws in the aftermath of the 2019 Christchurch terror attack could include expanded penalties for breaching the law, according to a Cabinet paper obtained by Newsroom.
The Cabinet paper purportedly says hate speech offences would move from the Human Rights Act to the Crimes Act, with a three-year penalty - more than assaulting a child, male assaults female, participating in a riot and common assault.
Hate speech would be extended from applying just to discrimination on racial, ethnic and national origin grounds to also include rainbow communities, religious minorities, as well as age or disability.
Seymour, a strong opponent of hate speech laws, has launched a free speech tour in 13 centres across New Zealand to raise awareness.
"Democracy and the ability to have civil and honest conversations is already becoming imperilled, which is why this is the worst possible time to empower lynch mobs who choose to take offence at ideas they don't support," he says.
"I am the first person to say we could all do better at being respectful in the way we deal with each other, but redefining free speech as a criminal offence will have the opposite effect as it is inconsistent with the rule of law."
But Ardern said on Monday the Government has not yet made final decisions.
"I'm really disheartened to see the ACT Party has started a campaign on something that has not even been concluded by the Government yet," she said.
"The reason I'm disheartened by that is because one of the things we've been really clear on is, once we have set up some ideas to firmly test, I want them to be tested with other political parties. I want this as much as possible to be something that we have some cross-party consensus around.
"What I see from ACT suggests to me that they're not willing to engage in that way because we haven't even concluded the debate yet and they've already started a campaign."
Seymour released a press statement immediately after Ardern's press conference, saying he was equally "disheartened" by Ardern's comments.
He said Ardern was wrong to suggest ACT is not willing to engage on hate speech laws, because ACT has written to Justice Minister Kris Faafoi agreeing for the caucus to meet with him on the subject.
He said it's also wrong to suggest the Government hasn't made any decisions, when Ardern promised during the election campaign to beef up hate speech laws if it won another term in power.
"Decisions have been made. Changing the hate speech laws was in Labour's election manifesto and the proposed laws have gone to Cabinet," Seymour said.
"New Zealander's deserve to be able to have a proper debate on this issue - that's why ACT has launched its free speech tour.
"Freedom of expression is one of the most important values our society has. ACT will continue to fight for this fundamental freedom."