So the two main changes to come from the electoral review are that the single seat coat tails clause should be dropped and the party vote threshold dropped from 5 to 4 percent. Neither of these, do I have any problems with.
The coat tail clause, whereby a party will get their full proportion of MP's even if they gather less than 5% of the party vote, provided they have a single electorate seat has been the cause of some oddities in years past. Such as when Act, managed to get 5 seats on approximately 3% of the vote where NZ First managed to get get just over 4 percent and got no seats. It's been the part of MMP that I have been least happy with. If you can win an electorate seat, fine take the electorate seat, that shouldn't then give you a free pass for meeting the threshold that everyone else has to meet. I've heard it said that this will reduce the proportionality of the system since parties with less votes than the threshold won't get any extra MP's that they might have got, despite being below the threshold. I don't think this is an argument in and of itself though, it's a variation on the "there shouldn't be a threshold argument" - i.e. that you think that even if they got less than the threshold that they should get a proportional number of MP's.
There is an argument to be made for having no threshold - true proportionality. It's not necessarily a bad one, but nor is the argument for having a threshold - workability. It's possible that without the threshold we wouldn't get a number of smaller single issue parties getting in, gumming up the works and holding the larger parties to ransom on their pet policy. It's not a given that that wouldn't happen though and I think a threshold is a good way to prevent it. It means that only parties of a significant size, i.e. that have worked up a comprehensive policy platform (hopefully) that covers wide areas of the governments remit will be participating in government. Again, not a given that you won't get a bunch of single issue ideologues, but with a threshold, less likely I think.
Dropping the threshold to 4%, will on average I think increase the level of proportionality and get rid of the ability of a single electorate to dictate the make up of parliament as Epsom have been (knowingly) doing for the last couple of elections.
The interesting part of the review for me is the getting rid of overhang seats - if you get more seats than your party vote entitles you to it won't increase the size of parliament, it'll just limit the number of seats the other parties get. I'm not sure how that will play out and am thus, intrigued.