Party leader Judith Collins made the remarks in a speech to party members today in Auckland at the first of a series of regional conferences being held around the country.
Collins has doubled down on her opposition to the government's proposed Māori Health Authority.
The Māori Health Authority - announced by Health Minister Andrew Little 10 days ago - will sit alongside new health body Health NZ, which will have four regional divisions, as well as district offices.
It's intended that the Māori Health Authority will set policies for Māori health and decide and fund those who will deliver services.
Collins was criticised earlier this week for calling the policy "racist separation and segregation".
Today she said the proposed plan will create "separate systems of governance" which will lead to worse outcomes for everyone.
"Labour has said its changes are about meeting Treaty obligations, and Labour has interpreted Article 2 and Tino Rangatiratanga as requiring Māori decision-making at all levels of the system.
"The proposed Māori Health Authority will not only have the ability to commission its own work, but also the ability to veto decisions made by the government on general health.
"That is a veto power over $20 billion worth of government health spending. That is not something that is designed to address inequities."
She said that approach prompted two questions.
"First, is this what the Māori chiefs and [Governor William] Hobson imagined in 1840 when they agreed: we are now one people? And second, is this the way New Zealanders today, in 2021, want to move forward as a society? Do we want separation of governance along ethnic lines?"
She said separate systems will lead to worse outcomes for everyone.
"It will mean decisions are slow, fraught and inefficient. It changes the fabric of who we are as a society and it divides our communities."
Collins acknowledged Māori suffer worse health outcomes, but said this would be best addressed by targeted programmes, like Whānau Ora, not structural change.
Other sectors will follow health
She said National will not accept the implementation of separate entities "by stealth" and the government's plans are broader than just the health sector.
They could lead to separate education, justice and resource management systems based on a report called He Puapua which she described as a "divisive" document.
It also contemplates a separate Māori Parliament or upper house - able to veto any decision of the New Zealand Parliament, she said.
"So, my message to Labour is this: New Zealand cannot and will not accept the implementation of two systems by stealth.
"If Labour believes that the Treaty intended two systems for everything, and that this is the model we want in 2021, then this is a fundamental change to our society. We cannot accept this via a health reform, via Māori wards, and via justice changes."
She said there needed to be a national conversation where everyone's voice was heard and if necessary, the issues could be decided by a referendum.
