Prime Minister Christopher Luxon's announcement of a sudden Cabinet reshuffle today comes after controversies embroiled his ministers overseeing disability issues and the media sector.
The reshuffle comes only five months into the coalition government's term.
Luxon said today: "It has become clear in recent months that there are significant challenges in the media sector. Similarly, we have discovered major financial issues with programmes run by the Ministry of Disabled People."
"I have come to the view it is important to have senior Cabinet ministers considering these issues."
Melissa Lee said she was told about the broadcaster's restructuring announcement on Wednesday.
Media and Communications Minister Melissa Lee faced a high-profile sacking today, as she was demoted from her broadcasting portfolio and told she would no longer be around the Cabinet table.
She retains her roles as Economic Development and Ethnic Communities Minister.
During Lee's time as media minister, Warner Bros Discovery revealed it would shutter Newshub while TVNZ confirmed it would cancel long-running current affairs programmes Sunday and Fair Go, and cut back at youth news outlet Re: News.
The redundancies were announced amid an environment where prominent media companies have faced restructuring and a loss of journalists in the past year, amid an ongoing slump in advertising revenue.
Almost 300 positions to go in Newshub closure, TVNZ calls time on Sunday show.
Since February, Lee said she has been working with officials to develop a plan to support the sustainability of journalism. The plan is yet to be released.
In the time since, hundreds of journalists face losing their jobs, with concerns about the impact on the public and democracy.
Lee was criticised for a slow response to developments, and for a stalled Cabinet paper - which was reportedly held up by the Government's coalition partners.
Meanwhile, Disability Issues Minister Penny Simmonds has also had her portfolio taken off her today. However, she remains around the Cabinet table as Environment Minister and Tertiary Education Minister.
Penny Simmonds says some of the funding has been going towards carers rather than disabled people.
Luxon said: "This will free Penny Simmonds up to focus on the environment portfolio and the major changes she is progressing to improve tertiary education."
A move in March by the Ministry for Disabled Peoples to remove respite care funding for families with disabled children caused anguish in the community.
The moves also changed purchasing rules for disabled people's support services and equipment, with little warning for carers.
Simmonds later admitted that the ministry had done an inadequate job of conveying the changes. She said: "I absolutely accept that we haven't been clear enough."
She also caused controversy when she claimed carers had been taking advantage of a "broad" funding criteria to use public money "for massages, overseas travel, pedicures, haircuts" for themselves.
The minister said her ministry had made the drastic changes as it was "days" away from running out of money, resulting in Cabinet taking greater control of the situation.
At the time, opposition leader Chris Hipkins called for Simmonds to be sacked over what Labour described as an "absolute debacle".
The Labour leader said the Minister for Disability Issues should be sacked from Cabinet over a recent funding row.
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