Covid-19 response minister Chris Hipkins has admitted New Zealand may not eliminate the virus after today's alert level announcement.

Prime Minister Jacinda Ardern today outlined the phased transition for Auckland in relation to alert level 3 restrictions, which would begin on Wednesday.

Step 1 included allowing outdoor meet-ups with loved ones in groups of up to 10 people and opening early childhood education centres - possible from 11.59pm tomorrow.

Steps 2 and 3 include allowing retail and hospitality businesses to open, however, when these steps will be introduced is not confirmed and will be under weekly review.

Speaking to Heather du Plessis-Allan, Hipkins accepted New Zealand may not return to days of zero Covid cases.

"We have been trending in that direction for the past few weeks and I think people won't be too surprised by that," he said.

He did say the Government would pursue a "zero-tolerance" approach to the virus through contact tracing and stamping out lines of transmission.

Hipkins wasn't able to specify when Auckland would transition to step 2 or 3.

He said it was possible Auckland could be in step 3 in two weeks' time, but there would need to be confident it wouldn't result in a spike in positive cases.

"I don't think we want to be stepping down restrictions if we were to see a sudden escalation of cases."

Asked about how Cabinet would decide whether to move to step 2 or 3, Hipkins said case numbers and vaccination rates would be considered.

However, he was reluctant to cite the necessary vaccination level Auckland would have to hit to relax restrictions.

"I wouldn't set hard and fast targets, but we know where we need to do better and that is younger people, people in poorer communities.

"This is a message for everyone across the country as we transition through this next phase, we need high vaccination rates everywhere if we want to continue the momentum going forward."

Asked whether Auckland's boundary would still be in place by Christmas if mystery cases were still being found, Hipkins said it would be unlikely the boundary would be in place then.

By Adam Pearse, NZ Herald