New Zealand is heading down the path towards "apartheid", NZ First leader Winston Peters said in a speech in which he likened "radical" Maori ideology to communist party indoctrination.

Peters delivered his state of the nation speech in Takapuna this afternoon.

He called for immigrants to "fit in" and warned that immigration policy and racial "appeasement" were dividing the country.

PETER MEECHAM/ Fairfax NZ NZ FIRST LEADER: Winston Peters arrives at the netball centre in Takapuna to give his "real" state of the nation address.

The speech contained no new policy – only a hint of a future tax break on private health insurance after a question from the audience.

It focused on concerns over race in New Zealand and from overseas, which Peters has used for years.

"As soon as you pass laws of racial prejudice, you're heading down the path of apartheid," Peters said shortly after the speech.

"We are constructing it in our country and I'm going to call things what they are.

"Just because some people's sensibilities don't like hearing the truth doesn't mean we're going to stop."

Blaming economic reform dating back to the 1980s as the cause of a range of issues facing New Zealand today, Peters said privatisation mainly affected Maori.

Instead of taking steps to fix the problems, successive governments had instead turned to appeasing Maori leaders.

This had fostered an industry where it was not possible to question what the Treaty of Waitangi "industry" did or said, just like in communist Russia, Peters said.

"New Zealand governments have faithfully followed a similar policy, where the Treaty of Waitangi grievance industry is concerned – the Treaty travellers are never wrong."

Immigration, once used to supplement skills, was now open door, Peters said, pointing to visas approved for people to become supermarket checkout operators.

"In total half a million people have moved into and out of New Zealand ... New Zealand has gone from a nation of united people to an urban collection of communities, many clinging to where they were, rather than where they are now," Peters said, calling for immigrants to "fit in".

"When people come to New Zealand, NZ First says they should fit in and contribute to our laws, our values, our culture, language and traditions."

Afterwards, Peters said that many people living in New Zealand did not identify as being from here, demanding steps be taken to ensure future migrants were committed.

"Far too many people today, if you ask them what they are, they'll say something other than a New Zealander," he said, adding that this was "not how nationhood is built".

Immigrants needed to be "pleased to be here, pleased to sign up to our flag and value our traditions, and be prepared to stand up for this country."

New Zealand had become a "trading country" but that a strategy used over the past 30 years continued to hurt the economy, Peters said.

"New Zealand has become a business with deals to be done, assets to be sold, and the cost of labour to be reduced."

He rubbished the description of New Zealand as being a "rock star" economy, saying growth was only just getting back to what would have been considered normal a few years ago.

HUKA LODGE OWNERSHIP

Following his speech, the government rejected Peters' claim that the famous Huka Lodge resort was being sold to Chinese buyers with the blessing of Prime Minister John Key.

After the speech, Peters claimed he had been told of the sale by real estate sources.

"My informant says John Key has said to these people: 'Don't worry about it, we'll smooth it through the Overseas Investment Office,'" Peters said.

But Land Information Minister Maurice Williamson said the claims were not true.

"The Overseas Investment Office has spoken to Huka Lodge director and shareholder David McGregor, and he has confirmed no sale has been made or is being considered," he said.

Earlier, Huka Lodge director of global sales and marketing Louise Smythe was first to scotch the allegation.

''None of it is true, no,'' she said.

Huka Lodge was last sold in 2003, following Overseas Investment Commission approval, when a Labour Government was in power.

Records showed the lodge was owned by Worldwide Leisure Ltd, according to Terranet data current to February 2014.