Attorney-General Chris Finlayson has described as "nuts" a theory that removing the Union Jack from the New Zealand flag would give the Government more power.

Despite that, Finlayson said that "in the world in which I live" the theory was "quite moderate".

"I have people alleging that - old grandmothers write in and say that the GCSB is spying on them, and that the Romans and Phoenicians were here before the Maori, so in terms of insanity it's only moderately nuts."

According to the theory, removing the Union Jack from the flag would remove the "due authority" of the Crown in government matters, as the Union Jack represents the monarchy. "It also means we take away the very power which enforces both the 1990 Bill of Rights Act (the closest thing NZ has to an entrenched Constitution) and the founding plank upon which the Treaty of Waitangi has meaning," reads one blog post.

Asked if removing the Union Jack from the flag would have any effect on New Zealand's constitution, Finlayson replied: "Absolutely not. It would be a novel constitutional argument that the sovereignty of New Zealand was dependent on one corner of the New Zealand flag."

If he was being uncharitable he would describe the theory as "nuts", Finlayson said. "If I was charitable, I'd say it was novel and interesting."

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In February, the Government appointed a 12-member Flag Consideration Panel to "engage with the public about a possible new New Zealand flag". More than 10,000 designs for a possible new flag were sent to the panel, which whittled the suggestions initially down to 40, then down to four.

In late November and early December there will be a referendum in which people will be able to rank the four flag alternatives, then next March there will be a second referendum at which people will be asked to choose between the current New Zealand flag and the preferred alternative design.

The $26 million being spent on the process has been criticised but Prime Minister John Key said the cost was worth it for such an important constitutional issue.

Ben Vidgen, who wrote the blog raising concerns about due authority, said the issue was not the change to the flag by itself, but how it was related to other changes, including the replacement of the Privy Council by the Supreme Court.

"You can stick a picture of a cat on a flag. If that's the only thing that happens it doesn't matter," Vidgen said.

But changing the flag was just part of a process. "Part of that process has already occurred. We've already changed our court system. That's the most important thing."

Beyond the court system and the flag was the work of the Constitutional Advisory Panel - which reported to the Government in late 2013. Among issues looked at by that panel was whether New Zealand should have a new head of state, Vidgen said.

"Once the flag debate is out of the way, the next debate is probably going to be whether we keep a governor-general or have a president."

Vidgen said he was worried about the possibility of a centralisation of power but it was hard to guess what constitutional changes would be made. "We should be having that discussion right now."