Finance Minister Grant Robertson has refused to express confidence in Treasury Secretary Gabriel Makhlouf over the cybersecurity blunder that enabled access to sensitive Budget information.
On Thursday, Treasury issued a statement admitting that people were able to access secret Budget information via its website's search function.
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The National Party later said that was how it was able to find out some details of the Budget days before it was meant to be released publicly.
Questions are also swirling about how long Treasury and Makhlouf knew the search function was the cause of the blunder, having originally told the public on Tuesday that on available evidence it appeared the website had been hacked.
Newshub learnt before Treasury's Thursday admission that the "human error" was well-known within Treasury to middle-management level, with one source telling Newshub the department was telling "lies" to the public.
The AM Show host Duncan Garner asked Robertson on Friday if he had confidence in Makhlouf in light of the events.
"I have got confidence in the Budget that the Treasury helped put together. It does do the things that we want it to do and they did a great job of putting it together," Robertson told The AM Show.
"Clearly, the things that happened this week with the ability for people to get into the Treasury system the way they did is hugely disappointing."
He also expressed disappointment that Makhlouf referred the issue to police before investigating more and finding that the search function was to blame.
Garner again asked if he had confidence in the secretary, and while Robertson said he had confidence in the leadership Makhlouf had shown in putting the Budget together, he stopped short of saying he retained confidence in him now as the agency's head.
"I have got confidence in the leadership he has shown to put the Budget together. That has been a great piece of work.
"We have really changed the whole way we are doing Budgets to be able to look at the long-term and make sure we have got agencies and departments actually working together.
"But the events of the last week are now the subject of an inquiry, and I say that is how it should be."
The State Services Commissioner Peter Hughes is looking into the "adequacy of Treasury policies, systems and processes for managing Budget security".
Newshub also learnt on Thursday evening that Hughes was considering allegations that Makhlouf misled Robertson. National Party leader Simon Bridges says Makhlouf sat on information about the alleged Budget hack.
"Treasury has known since Tuesday exactly what happened, and they covered it up," Bridges said on Thursday. "The Secretary of Treasury's position is untenable - he must resign," Bridges said.
Robertson said Makhlouf came to him after referring the matter to police on Tuesday night and said there had been 2000 attempts to hack the Treasury. But he didn't know how it happened or what information had been exposed.
Regardless of the blunder, Robertson said he was exceptionally proud of the Government's first Wellbeing Budget, which, among other things, committed $1.9 billion to mental health support.
"The frontline service programme we have announced that means that anybody will be able to get the treatment they need when they need it… that is going to take five years to roll out and that is because we have to train the staff.
"There is investment right across the system, in suicide prevention services, in getting on top of those addiction issues, both in the community and in prisons, dealing with the homelessness issues that are connected to mental health."
Newshub.
