They give a bunch of reasons for this. While there has been a formal legal opinion from Crown Law that anti-trans discrimination is covered under the "sex" clause, there's been no definitive ruling from the courts, or even from the Human Rights Review Tribunal, and so the law remains unclear. An explicit clause would solve this, and it would also "have an important educational and symbolic function. It would make a clear statement about what forms of discrimination are not allowed in Aotearoa New Zealand". Ultimately though, it boils down to this: trans people are subject to discrimination, and do not feel protected, despite what Crown Law says. An explicit amendment would fix that, and protect their dignity as human beings.
Of course, there's a lot of details to sort out: what form an amendment should take, how it would interact with the various exemptions in the Act and with other law. The Law Commission is currently seeking submissions on all of this. The terfs will no doubt bomb this with hate, trying to pretend trying to pretend that they're something other than a tiny bigot cult, so if you care about this issue, please submit. Submissions are due by 17:00 on Thursday 5 September 2024.