John Key steps down as Prime Minister

Prime Minister John Key has resigned, saying he can "die happy" having had the privilege of running the nation.

He made the announcement at a news conference in Parliament on Monday afternoon.

"Being leader of both the party and the country has been an incredible experience."

The new Prime Minister and National Party leader will be decided at a Caucus meeting on December 12.

It'll end Mr Key's chances at a historic fourth term - something that, as early as January this year, he indicated he would be seeking at next year's election.

Mr Key spent much of his announcement recounting his and his Government's achievements over the past eight years.

He cited pressure on his family as one of the reasons for stepping down.

"Throughout these years I've given everything to this job, the job that I cherish and for the country I love."

Mr Key choked up when he began talking about the cost of the job on his family.

"All of this has come as quite some sacrifice for the people who are dearest to me - my family. For my wife Bronagh, there have been many nights where she was alone, many occasions that were important to her that I simply couldn't attend."

As for his future, Mr Key says for him "and the National Party, this is a good time to go".

"I don't have any plans. I'm a commercial guy - I'm not looking for any postings overseas.

"It'll be a slightly quieter life."

It could involve being on a number of company boards, or international speaking engagements.

He says he'll back whoever the rest of the caucus picks as his replacement.

"Whoever the caucus selects will have my unwavering support. If Bill English puts his name forward, I will vote for him."

Mr Key has put his weight behind Mr English to take over as leader.

"What I didn't want is ambiguity on my part... secondly, I've worked with Bill for 10 years. We've had a great working relationship, and to me it would feel a bit odd if I didn't back the guy I've been working alongside for a decade."

Mr English was previously leader of National in 2002 where the party lost the election, but Mr Key says things are "different" now.

'I've taken the knife to some other people, and now I've taken the knife to myself'

Mr Key has held the Helensville electorate since 2002, and was elected unopposed as the party's leader in 2006. He has consistently been New Zealand's most preferred Prime Minister during his reign.

"It's been a remarkable journey. It's been an incredible experience and it's been a privilege. I'm going to die happy.

"A good leader knows when it's time to go, and it's time to go.

"I'll be blunt - I've taken the knife to some other people, and now I've taken the knife to myself."

Mr Key says he told Cabinet members individually, which was met with "a bit of surprise and shock", but also with support.

"They can understand it."

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