"We want to work with industry to try and get that rate of use down. Try and encourage industry to do that themselves. But we are leaving all options on the table.
"We are making sure we use some of the options that still exist before that [considering a sugary drinks tax]. There are examples in the UK where they got salt down dramatically by working alongside industry. We should make use of those options."
Professor of Population Nutrition and Global Health at the University of Auckland Boyd Swinburn said Labour was right not to rule out tough action including a sugary drinks tax.
"It is actually very refreshing to see a government who is prepared to look at the evidence and look at every possibility that's on the table that's been recommend. So this is a breath of fresh air," Swinburn told Newstalk ZB.
Labour accused the last Government of inaction on the issue of obesity and accused some manufacturers of rigging a labelling system designed to flag healthy products to shoppers.
Health Minister David Clark said his preference was to work with the industry to develop a better front-of-pack labelling system, and to set firm goals to reduce sugar content in packaged food.
Clark said there was "growing evidence" around the effectiveness of a sugary drink tax, but such a step wasn't a silver bullet because it was only focused on drinks.
"I want to talk with industry first before going down any track like that."
One likely change will be to labelling on food packaging. Currently there is a Health Star Rating System that is meant to signal the healthiness of the product by the number of stars on the front of the packet.
Clark believes there is a flaw in the voluntary system, in which manufacturers can "cancel out" the effect added sugar and other unhealthy ingredients have on a star rating if the product contains healthier ingredients like grains.
He said he would seek further advice on whether the Health Star system would be retained, or a new front-of-pack system introduced.
"There are some anomalies in the current system. It seems strange that breakfast cereals can have some fibre in them and then suddenly they get a high star rating despite having a lot of sugar."
Asked if front of package health labelling could be made mandatory, Clark said he would consider all options but wanted to get advice first, and talk to industry.
Labour's previous health spokeswoman, Annette King, said she agreed with celebrity chef and healthy food campaigner Jamie Oliver that people would be more conscious of what they were eating if they knew the number of teaspoons of sugar or salt that is in their food, and Clark has said a label that displayed such information could be helpful.
"I think there is room for more explicit labelling to indicate the amount of sugar in food products," Clark told the Herald.
"And I also want to have constructive conversation with industry about how they think they could reduce sugar content over time in products. Personally, I think the most constructive approach is to work with industry. But I have also indicated that if the result that we need isn't achieved then we are prepared to regulate."
Timelines would eventually be set, Clark said, but he acknowledged that wouldn't be straightforward.
"My experience is industry prefers to have clear expectations and be able to manage its own destiny. So I'm hoping that there will be a constructive relationship there."
The New Zealand Food and Grocery Council declined to comment.
Sue Chetwin, chief executive of Consumer New Zealand, said the current Health Star system had serious flaws and her organisation supported an overhaul, and wanted it to be mandatory across more products including frozen foods.
"What they really need to do is change the algorithm ... a cap would be a simple way so once you got to a certain level of those bad foods then you couldn't get a Health Star rating that was, say, above two or something like that."
Another change supported by Consumer that will likely be made under the new Government is a requirement for country of origin labelling on single ingredient food such as fruit and meat.
Former Green MP Steffan Browning's Consumers' Right to Know (Country of Origin of Food) Bill is at select committee stage, having been supported at first reading by all parties except Act.
