We thought we were out of Government before Peters spoke - Bill English

National leader Bill English said he knew ahead of Winston Peters' big announcement last Thursday that his party weren't going to get a fourth term in Government

While they weren't told directly, Mr English told The AM Show they had a feeling they would be relinquishing power to Jacinda Ardern's Labour Party.

"We felt we had negotiated the basis of a sensible Government," the former Prime Minister said.

"By the time the announcement came, we were reasonably sure it wouldn't be us. It was always 50-50, but these are the risks you take in politics.

"Looking back on the negotiations and the way the process had gone through Thursday, I just thought it was likely they were wanting to change the Government."

Mr English said while he's upset with the outcome of the election, he accepts that's how the MMP system works - and he knows there's a large proportion of Kiwis who remain behind National.

"I'm naturally disappointed, as are the nearly 45 percent of voters out there who probably assumed that the largest party would transition into Government," he said.

"It's an unusual result but a legitimate one, and we'll get on with our job of holding the Government to account - because actually, a significant number of New Zealanders believed the country was going in the right direction.

"The Government's got some challenges trying to decide how much change they think this result means, when the largest opposition party has more seats and votes than Labour and NZ First put together."

Mr English says he is intrigued by the direction the new Government will take - particularly in regards to the economy, because they've made some bold promises about incomes.

"The way [the Government] got put together means it is going to take a while for the programme to become clear," he said.

"We're keen to know what it means to change capitalism, what the Government means when the Deputy Prime Minister [Winston Peters] says the economy is going to slow down, and put that alongside the very high expectations that people's incomes are going to lift."

Mr English said Mr Peters' assertion the economy will slow due to international markets is just a cover for all the negative effects the new Government's policies will have.

"He might've realised during the negotiations that there's a lot of policy there that could cause a slowing in the economy, and all the parties that have those policies have got together," he said.

"He does seem to be preparing the wider public for the impact of the policies."