"Mr Peters in my view has always been pretty attuned to constitutional issues. I would have thought it would require much more than a simple majority of Parliament."
However, unlike general electorates, the Maori seats are not entrenched in legislation, meaning it would take a simple majority to change or abolish them. It takes a 75 per cent majority for changes to laws relating to general electorates.
Mr Key said his stance would remain the same.
"We accept the Maori seats have a role, we accept they will stay. One day they may go, but that will be with the good will of Maori."
Asked about a possible further binding referendum on the smacking law if it was the price for Conservative Party leader Colin Craig's support, Mr Key said he believed the current law was working.
"But in the end if there was a referendum that would be for the people of New Zealand and if it went back to Parliament it would be a conscience issue.
"I don't genuinely believe in a third term National Government that would be the priority issue."
However, he said that could depend on what voters delivered on Saturday.
"Anything's possible after the election. I understand that's one of the things [Mr Craig ] wants -- a referendum. What that referendum might be about, the process of how it might work, they're negotiations for another day."
He did not believe the previous referendum on the issue was sufficient to justify changing the law now because the public view would need to be re-tested.
National's policy used to be to abolish the seats but that policy was shelved for the past six years under its agreement with the Maori Party.
On the Newstalk Leader's Breakfast, Mr Key refused to say what he was considering offering Mr Peters "because he'll bank that and add five other things".
He did not believe Mr Peters would drag coalition talks out as long as in 1996.
He said Mr Peters' views of New Zealand were stuck in the 1950s economically and were very insular. However, that did not necessarily bar a coalition agreement.
He said the Conservative Party appeared to want a referendum. "We could give them a referendum on something. If we have to."
He said National was polling strongly so was likely to be a dominant part of a coalition and "that gives you more leverage".