Stephen Joyce, minister for economic development announces the governments plans regarding the new Sky City Convention Centre.

SkyCity has agreed to change its plans for a controversial Auckland convention centre to meet the original budgets, preventing the need for a taxpayer top-up.

After submitting plans for a more expensive design than that agreed with the Government in 2013, the casino operator will now pare back its plans.

In a statement, SkyCity chief executive Nigel Morrison said the company respected the Crown's position that it would not put in extra cash.

Supplied CHANGE COMING: SkyCity's ortiginal drawings of its planned new International Convention Centre and hotel.

"Accordingly, we have agreed to review the design for the NZICC so that the expected total project cost, which SkyCity will be totally responsible for, will be more in the vicinity of SkyCity's $402 million commitment, as set out in the NZICC Agreement."

The company was committed to a "landmark" centre, Morrison said.

Economic Development Minister Steven Joyce said he welcomed SkyCity's agreement with the Government's approach.

ROSS GIBLIN/FAIRFAX NZ Economic Development Minister has labelled MBIE's latest big ticket spend as unnecessary.

"This clears the path for the project to continue.

"I have repeatedly stated since December that our least preferred option is for the Government to contribute funding for the project. I am pleased to confirm that will be the case."

READ MORE:

* John Key in retreat on SkyCity convention centre

* Govt at odds over SkyCity convention centre

* John Key: SkyCity will be an 'eyesore' without government money

* SkyCity CEO: Taxpayers always on the hook for higher costs

In recent days the Government has refused to say whether SkyCity could get millions in taxpayer funding for the convention centre, but ruled out additional gambling concessions.

Joyce said the Government "may be prepared to accept a slightly smaller [convention centre] if that is required to meet the agreed total construction cost."

The casino company, which has sites in New Zealand and Australia, would work on a fresh design in the coming weeks.

"The Government is pleased to be moving forward with this project which will create 800 permanent new jobs, an increase in GDP of $49 million, and an important public facility for Auckland," Joyce said.

The Government had come under widespread attack for refusing to rule out extra money for SkyCity, and the announcement was quickly welcomed by many of its critics.

"We're glad that the Government has [listened] to the concerns of taxpayers who very clearly did not want their money given to SkyCity," said Jordan Williams, executive director of the Taxpayers' Union said in a statement.

WEEKS OF DISCUSSION

At a press conference in Auckland today Joyce said there had been "some weeks" of "robust discussion with SkyCity before today's announcement.

He said there shouldn't be any "hanging around" with the project. "We need to get on and do it."

The Government could tolerate a reduction in scale of about ten per cent to reduce costs without too much concern, he said.

"By allowing it to be a little smaller we...alleviate some of the increased costs that they have been concerned about."

Joyce said Sky City remained "strongly motivated to build a convention centre that will be attractive to people."

"They have restated to me their enthusiasm about this project."

Joyce said he had been keen to have a public debate on the project and its costs.

"My main concern was to get it out to the public so they could have a bit of a say on it. When they went for resource consent I insisted that they lay the price tag on the table at the same time."

The Government's decision was made on Friday, with Sky City agreeing to the approach after a board meeting yesterday, Joyce said.

Joyce said he had spoken to Auckland Mayor Len Brown today.

"I said to him we are not seeking any help from them, apart from obviously any regulatory help. It's all about time now and how long it takes for the project to be completed."

NZ First leader Winston Peters said the performance of the Government on the convention centre deal had been pitiful.

"The only reason they responded today is because they have been exposed to serious public ridicule, as they should have been."

The Green Party welcomed the news, but called on the Government to calculate the benefit to SkyCity of putting a hotel on land compulsorily acquired for the the convention centre from TVNZ.

"This is a victory for everyone who has let the Government know that its plan to give SkyCity casino millions of dollars of taxpayers' money for their building costs overruns was irresponsible, said Green MP Denise Roche.

Labour said SkyCity had "suckered" the Government.

Its decision to drop its bid for taxpayer funding had nothing to do with Prime Minister John Key and Joyce playing hard ball, leader Andrew Little said.