The Government Communications and Security Bureau will be able to spy on New Zealanders under proposed law changes unveiled today. But it will need the prime minister's permission.

New legislation to overhaul the rules governing the GCSB was released this afternoon by Prime Minister John Key.

The GCSB has been under scrutiny since it was revealed the intelligence agency illegally spied on internet millionaire Kim Dotcom.

The agency was meant to assist with international intelligence and cyber security, but was not supposed to spy on New Zealanders, that was the role of the Security Intelligence Service.

However, under proposed changes the GCSB would be able to monitor New Zealand citizens and residents with the permission of the responsible minister - usually the prime minister.

"The GCSB will require an authorisation from the responsible minister and the commissioner of security warrants when its cyber security and information assurance functions are being performed in relation to the communications of New Zealanders," Key said.

He said the operating environment of New Zealand's intelligence agencies had changed and it was vital the rules kept pace.

The legislative changes would allow the GCSB to provide support to police, the Defence Force, and the SIS.

"The GCSB will only be able to provide that support when those agencies are acting within their own lawful duties," Key said.

The GCSB would also be required to provide advice and help to other public and private sector organisations.

The Government Communications Security Bureau and Related Legislation Amendment Bill included changes to the Government Communications Security Bureau Act 2003, the Inspector-General of Intelligence and Security Act 1996, and the Intelligence and Security Committee Act 1996.

Key said the changes would strengthen the oversight of New Zealand's intelligence agencies.

It followed a report by Cabinet secretary Rebecca Kitteridge which found "difficulties in the legal interpretation of the GCSB Act".

The bill also strengthened the inspector-general of intelligence and security role.

It was due to be introduced into Parliament this week.