Image copyright Getty Images Image caption New Zealand's flag incorporates the Union Flag of the UK

New Zealand is to hold a binding referendum in 2016 on whether to change the national flag.

The announcement by Prime Minister John Key of the referendum came after his government last month won a third term in a general election.

A panel of "respected New Zealanders" will lead the public discussion on potential designs for a new flag.

Mr Key has previously said he would like to see a new flag featuring a silver fern, on a black background.

That would be similar to the banner already used by many New Zealand teams such as the All Blacks national rugby union team.

"I believe that this is the right time for New Zealanders to consider changing the [flag's] design to one that better reflects our status as a modern, independent nation," Mr Key said.

Image copyright Getty Images Image caption Some in New Zealand would prefer to see the silver fern on their national flag

A cross-party group will select a group of prominent and respected New Zealanders to sit on a panel that will seek public submissions on new flag designs, and review draft legislation that would enable two referendums to go ahead.

The first, to be held next year, would allow the public to choose a preferred option from a range selected by the committee.

A second referendum is planned for 2016, when voters will choose between the existing flag and the new design.

"Retaining the current flag is a possible outcome of this process and the consideration of options will be done carefully, respectfully and with no presumption in favour of change," Mr Key said.

When he first announced the intention to hold a referendum earlier this year, Mr Key said the design of New Zealand's flag symbolised "a colonial and post-colonial era whose time has passed".

Both the New Zealand and Australian flags include the Union Flag - the UK's national flag.

In March, Australia's Foreign Minister Julie Bishop said there was "no great demand" to change the national flag.

"Many Australians have fought and died under that flag, sadly," she said. "We have competed in Olympic Games under that flag and there's a sense of pride in it."