Māori Development Minister Tama Potaka said since leaving Parliament, Prebble has provided pro bono advice to various Māori trusts, hapū and iwi on a variety of issues.
Prebble refused an invitation to be interviewed for RNZ's Morning Report programme today.
However, Labour's Māori Development spokesperson Willie Jackson was scathing on the appointment.
Jackson described it as "unbelievable" and "a kick in the guts" for Māori.
"I think we were all in shock [on Thursday] ... but what next - are we going to make Don Brash the new chair of the tribunal?," Jackson said.
While Prebble had skills and experience as a lawyer working in the Māori sector, the most important factor was his alignment with the ACT Party and its policies, in particular the Treaty Principles Bill, Jackson said.
Board members Derek Fox and Hana O'Regan who had a lot of experience in te ao Māori had been stood down with Prebble named as one replacement.
He believed former prominent National politicians like Dame Jenny Shipley, Chris Finlayson or Sir Doug Graham would have been better choices from the right of the political spectrum.
"It's incredibly disappointing - it's not personal with 'Prebs', we all know him. I've worked with him on the Māori Affairs select committee but he represents a party and David Seymour."
Jackson was adamant Prebble supported ACT's principles.
"I think that it's a real shock for Māori but it's virtue signalling from this government to ACT supporters. There's question marks now again over the prime minister."
He said he was also disappointed Potaka had allowed Seymour and other coalition members "to come over the top of him".
Comment has been requested from ACT leader David Seymour after Jackson's comments.
Seymour on Thursday said Prebble was exactly the sort of person who should be on the tribunal.
"Richard is also an experienced lawyer, MP and company director, with an extensive knowledge of te ao Māori.
"ACT looks forward to his contributions in ensuring that the Treaty of Waitangi is interpreted and applied in a manner that reflects what it actually says, including the promise of the same rights and duties for all New Zealanders," Seymour said.
Prebble would be joined on the tribunal by Ken Williamson; Kevin Prime was reappointed for a second term.
Minister of Māori Development Tama Potaka on Thursday said the new appointments, including Prebble, would uphold the work done between the Crown and Māori.
"Waitangi Tribunal members bring with them a range of knowledge and skills and are appointed for their broad expertise in the matters that are likely to come before the Tribunal," Potaka said.
"Ensuring we have a range of talented appointees on tribunals and boards is absolutely key to the delivery of better public services."
