New Zealanders have voted in favour of keeping the current national flag in a referendum, after a 17-month exercise that cost taxpayers $NZ26 million ($A23.18million).

Prime Minister John Key, who was the main advocate for a change, accepted the people’s decision in a tweet.

Those who wanted change said the existing flag, featuring the United Kingdom’s union jack in the corner, was too closely tied to colonial history and was too easily confused with the Australian flag.

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Former All Blacks captain Richie McCaw, a prominent supporter of the new flag, said he realised this before last year’s Rugby World Cup final against Australia.

“The moment when I decided a new flag would be great for our country [was when] running out at Twickenham and seeing the two flags looking so similar,” McCaw wrote on Facebook last month.

The proposed alternative was a silver fern on a black-and-blue background, which retains the four stars.

New Zealand has voted to retain our current flag. I encourage all NZers to use it, embrace it and, more importantly, be proud of it.

— John Key (@johnkeypm) March 24, 2016

The design was meant to highlight the silver fern, widely considered New Zealand’s national symbol, but was likened by critics to both a towel and a corporate logo.

‘Ugly and embarrassing’

Created by designer Kyle Lockwood, it beat four other proposed flags in a preliminary referendum last December.

“I voted to keep the flag, not really because I didn’t like the idea of change, more because the proposed new flag is so very ugly and a bit embarrassing,” Wellington resident Sarah Newbold said.

“And it reminds me too much of rugby and a corporate logo.”

Local media reported the current flag won 56.6 per cent of votes, and the proposed one received 43.2 per cent, out of 2,124,507 votes.

Those results did not include any ballots that were already in the post but had not yet been received.

The final results, which are not expected to significantly change, will be released on March 30.

Quirky designs

More than 10,000 potential designs were submitted when Mr Key announced the referendum in October 2014, before that was whittled down to a shortlist of 40.

One of the quirkier suggestions featured a native kiwi bird with laser beams shooting from its eyes.

One of 10,000 initial submissions for an alternative flag, this one did not make the short list. Photo: www.govt.nz

These were highlighted with glee by international media and comedian John Oliver, who offered his own suggestions which included references to bungee jumping and sheep.

The multi-million-dollar price tag for the flag referendum had caused some grumbling by voters and opposition politicians, but no major political fallout is expected.