UPDATED 7.46PM: Justice Minister Amy Adams today announced that Teina Pora will receive $2.5 million in compensation. 

This comes after an independent review found that on the balance of probabilities, Pora is innocent of the charges for which he was convicted.

WATCH ABOVE: Teina Pora's lawyers talk to the media following the compensation announcement 

Cabinet has accepted that finding and agreed to pay just over $2,520,949.42 in compensation for his wrongful conviction and imprisonment.

“The Government has agreed to compensate Mr Pora after considering reports from retired High Court Judge Rodney Hansen QC, which confirmed Mr Pora’s innocence and recommended the compensation amount that should be paid to him under the guidelines,” Ms Adams says.

MORE: Amy Adams talks to Larry Williams after the announcement

At a press conference this afternoon, Ms Adams read out her apology letter to Mr Pora at his request.

“I am very happy to do so,” she said.

“I have written to Mr Pora to acknowledge his innocence and unreservedly apologise to him for the devastating impact his wrongful conviction and imprisonment has had on nearly 20 years of his life. 

“While it can never completely remedy the injustice Mr Pora has suffered, I hope that these findings, along with the compensation, can go some way in helping him and his family build a better future together.”

MORE: Rachel Smalley - How do you compensate for 21 years of wrongful imprisonment?

Mr Pora’s lawyer’s say they had hoped he would be offered more than $2.5 million in compensation.

Speaking this afternoon in Herne Bay, Jonathan Krebs and Ingrid Squire told media they had asked for up to $8 million in compensation from the Crown for the 21 years Mr Pora spent wrongfully imprisoned for a rape and murder he did not commit.

Mr Krebs said they had hoped allowances would have been made according to the Consumer Price Index increases.

They would have been satisfied with an offer of $4 million or more.

“The amount of $100,000 per annum that has been talked about a lot over the last 24 hours … has been in place for about 16 years.”

Mr Krebs said the spending power of $100,000 was significantly less now than it had been when first used as a starting point for compensation.

“We are disappointed with the quantum. We sought a considerable amount more than has been offered so it is natural we would feel some sense of disappointment and I want to make that clear that’s our feeling.”

Ms Squire said Mr Pora had been aware of the offer for about 24 hours and that for the moment it was just that – an offer he could accept or reject.

While she and Mr Kreb expressed disappointment with the $2.5 million offer, she pointed out that for Teina this was more money than he ever would have dreamed of having in his life.

“He needs an opportunity now to reflect on it and we need an opportunity to further discuss with him what that money looks like in real terms and that’s a process that will take some time for Teina.

“He has some idea what he would like to do with the money and we’ve had discussions about that for some time in the event he was successful in his claim for compensation.

“The reality is it’s a mindboggling figure … particularly for Teina.”

Ms Adams accepted that some people felt that the payout to Mr Pora should have been higher, saying that there were “a range of views” on the final figure.

Paula Penfold, a journalist who covered Teina Pora's case for several years told Kerre McIvor and Mark Dye the compensation figure is disappointingly low.

"When you adjust it to inflation and to Arthur Allan Thomas' figure as to what it mean in today's money it's not actually a record figure and Teina has done twice as long in custody as he did."

The minister said she was open to the reviewing the Cabinet guidelines for awarding compensation.

“That’s a decision we can certainly have. But the reality is that that would never have affected Mr Pora’s application because his application will be dealt with on the guidelines at the time.

“You can’t move the goalposts halfway through the process.”

Mr Hansen’s report showed that $1.9m of the compensation was for loss of liberty, $225,000 was for non-pecuniary losses, and $334,000 was for loss of livelihood, potential earnings and legal fees.

LISTEN: Caller Michael: Serving time with Teina Pora

The review said a higher threshold for innocence could have been met.

“The state of evidence is such that … Mr Pora could have proved his innocence to an even higher standard,” Mr Hansen’s report said.

Last year the Privy Council quashed Mr Pora's convictions for the rape and murder of Susan Burdett.

Mr Hansen’s key findings in establishing Mr Pora’s innocence were:

• Mr Pora’s confessions to Police, affected by his foetal alcohol spectrum disorder, were a clear fabrication and cannot be relied upon.
• In particular, Mr Pora did not disclose anything to Police that he could have known only had he been present at the attack on Ms Burdett
• Evidence said to corroborate Mr Pora’s confession was unreliable as it came from family members who had already concluded that he was guilty
• Evidence relied on to show an association between Mr Pora and Rewa was also unreliable.
• Mr Hansen said the undisputed evidence lead to the “irresistible inference” that Rewa acted alone in the sexual violation and murder of Ms Burdett and that there was no credible evidence he was accompanied by Mr Pora.

Ms Adams defended the New Zealand’s justice system in the wake of the findings.

“By and large, New Zealanders enjoy a fair and effective criminal justice system,” she said.

“However, mistakes are possible in any system that relies on human judgment. It’s now clear the system has erred in this case, and this decision recognises this.”

Law professor Andrew Geddis said the amount compensated should come as no surprise given the length of Pora's sentence.

He said anyone who's looked at Pora's case in depth, can see he was wrongly convicted.

"Which meant an innocent man was in jail for 21 years, which is a terrible thing. So $2 million sounds a lot, but if you think about what you did for the last 21 years of your life, would $2 million pay for it?

"One thing we don't yet know about this compensation package is whether there'll be an apology connected with it, because one of the things that Teina Pora wanted was not just money, he also wanted someone to say sorry for what had happened to him. It'll be interesting to see whether the Government provides that."

MORE: Mike's Minute - Who deserves compensation?

The base rate for compensation in wrongful conviction cases is $100,000 per year.

But Law expert, and Massey University Deputy Pro Vice-Chancellor Chris Gallavin told Chris Lynch in today's world that's less than half what people received in historical cases.

He adds it's not a case where everyone thought he was guilty, and the entire process was riddled with issues.

"This case has been a systematic stuff up by the police from day one. Everybody who looked at this case said this was a clear injustice. Even retired cops were coming out of the woodworks."

Compensation for wrongful conviction, while rare, is not without precedent.

In 2001, David Dougherty received almost $870,000 after being wrongfully convicted for rape.

Perhaps one of the most famous cases was that of Arthur Allan Thomas who received a $950,000 payment in the late 70's after he was pardoned for the murders of Jeanette and Harvey Crewe.

Adjusted for inflation Thomas' payout would be worth around $4.8 million today.

Des Thomas, Arthur Allan's brother, said Pora should get something closer to $10 million, given that inflation and how long he spent in prison.

"Two million is really pittance for what he went through if he's been in there 22 years," Thomas said.

Labour’s justice spokeswoman Jacinda Ardern said the case underlined the need for changes in the justice sector, both to prevent further miscarriages of justice and also to ensure there is a “safety valve” when such miscarriages occur.

That meant making sure police were better equipped to deal with mental disabilities and the way that they affected confessions, she said.

Mr Pora’s case also underlined the need for an independent criminal case review commission, as is used in the United Kingdom.

“The minister says this case proves that our system works,” Ms Ardern said. “We believe it proves that there are failures and we need a safety valve.”

An independent commission would have allowed earlier and faster access to the appeals process, she said, and would not have relied on thousands of hours of legal work by volunteers.

At her press conference today, Ms Adams reiterated that the Government was not interested in creating a commission for wrongful convictions.

Ms Ardern also said that Mr Pora’s compensation payment should have been adjusted for inflation.

There was nothing in the Cabinet guidelines to prevent this from happening, she said.

The Government's still considering whether to pay David Bain compensation.

John Key said that's a more complex case than Pora's as he has "well and truly met the threshold of effectively being proven innocent."

"They're different issues when it comes to David Bain.""