Australian Prime Minister Tony Abbott says New Zealanders are family but not close enough for those living across the Tasman to qualify for welfare and other assistance.
In his meeting with New Zealand Prime Minister John Key in Canberra on Wednesday night, Mr Abbott rebuffed any suggestion New Zealanders who are not Australian citizens should get assistance.
"I'm happy to keep talking to Prime Minister Key and obviously I'm happy to have questions from New Zealanders on this subject but I'm very happy with the situation that exists right now," said Mr Abbott.
Australia's foreign minister Julie Bishop delivered the same message when she met Foreign Minister Murray McCully in Auckland earlier in the day.
The issue remains a sticking point between the two countries because Australians living here are treated the same as New Zealanders.
Mr Key says he will continue to push the issue with Australia. He says his main concern is to retain the right of New Zealanders to work and live in Australia.
However, despite that difference, Mr Abbott at least gave Mr Key the reassurance that the trans-Tasman relationship remained important to the new Australian Government.
Mr Abbott also praised the New Zealand Government as a role model for other centre-right governments.
He said Mr Key's Government had followed good economic policies without engaging in austerity.
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No fair go
The Labour Party says New Zealanders are not getting a fair go across the Tasman and Mr Key should have pushed their case harder during his visit to Canberra.
It is estimated more than 100,000 New Zealanders work in Australia but are not eligible for permanent residency.
Labour's foreign affairs spokesperson David Shearer says the current situation is simply not fair.
"We've got New Zealanders working in Australia, working really hard and not being able to get any of the benefits that come from paying taxes," he says.
"For example, the national disability insurance scheme, half a percent of their earnings goes to that and New Zealanders are not eligible for it."
Mr Shearer says Mr Key went to Australia talking big, but came back with his tail between his legs.