The axed department will be folded into a new mega-ministry covering environment, housing and urban development, transport, and some local government functions in a proposal submitted to the country's parliament on Thursday.

Deputy prime minister David Seymour is also hoping to axe the ministries for ethnic communities, women, Pacific peoples and Maori development.

Seymour said those ministries spent their time "justifying their existence" rather than delivering essential services.

But the main opposition Labour Party said the move was a "powerful symbol" of the "government's rejection of the environment".

And the Green Party's Lan Pham asked "what happened to caring about the environment?"

"We need to actually make decisions that set up our kids and grandkids into the future," she told parliament.

Since assuming office in 2023, New Zealand's coalition government has sought to cut back the size of the public service in Wellington by asking agencies to cut budgets by up to seven percent.

State broadcaster RNZ has reported more than 9,500 jobs were cut, and the government said it had saved NZD$1.57 billion (US$940 million) annually with the cuts.

New Zealand is considered particularly vulnerable to climate change.

Last year, scientists warned the waters around the Pacific nation were warming much faster than global averages -- threatening thousands of coastal homes as sea levels rise.

Officials have insisted the new mega-ministry will remain committed to the environment.

"Bringing related portfolios together in one department will provide integrated, practical advice that both protects our environment and lifts prosperity for communities across New Zealand," Chris Bishop, a government minister tasked with cutting red tape, said.