Industry Minister James Moore issued a statement Saturday saying the decision to grant Allan Schoenborn the privilege is an "insult."
Schoenborn has been held in a psychiatric facility since being found not criminally responsible for the 2008 killings of his 10-year-old daughter Kaitlynne and sons Max, 8 and Cordon, five.
The B.C. Review Board ruled Friday that Schoenborn's illness has been in remission for many years.
Its decision came despite being cautioned by the Crown to heed new federal legislation giving them the power to hold mentally ill offenders indefinitely.
Schoenborn's ex-wife Darcie Clark wants her former husband declared a "high risk" offender and Moore says the B.C. government should take a look at how such cases are dealt with in the future.
"Our hearts go out to Darcie Clarke and her family in this difficult time," Moore said in the statement.
"This decision by the B.C. Review Board is an insult and cannot be defended. It should prompt the B.C. Government to review and reform this area of our justice system to better protect victims and our communities."
B.C. Justice Minister Suzanne Anton said Friday that her "heart goes out" to the family but added it's important to respect the review board's independence, which is established under the Criminal Code.
The Crown has 15 days to decide whether to appeal the decision.
The board noted that prior to any outing, Schoenborn's mental stability and any risk he might pose would be assessed.