The Government's housing developer Kāinga Ora has been dobbed in to the Public Service Commission watchdog by their own minister, Megan Woods.
The agency is under fire after Newshub revealed it covered up the fact it knew it was using a prospective Labour MP in its taxpayer-funded advertising.
Labour MP Arena Williams was up front about her political ambitions. She told Kāinga Ora about it before they paid for and published an advertorial featuring her.
"The discussion that I'd had was that I would like to be a labour candidate," Williams said back in June.
But as Newshub revealed on Wednesday night, they covered it up.
"I think there were quite unfortunate flippant comments that were made," Andrew McKenzie, CEO of Kāinga Ora, told Newshub on Thursday.
Asked if he'd overseen a culture of cover-ups, McKenzie said: "What's happened here is we've got one incident where a staff member has made some flippant comments. We've spoken to them."
Spoken to is the extent of the consequence.
Housing Minister Megan Woods is not happy about it. She called all the bosses, even the Public Service Commissioner Peter Hughes.
"I've spoken to both the chief executive and the chair of Kāinga Ora this morning, and also as a belts and braces approach, I've also written to Peter Hughes to seek advice whether there's anything further that needs to be done," Woods said on Thursday.
The emails are brazen, showing a senior communications manager saying Williams was "understandably nervous about people perceiving this as her electioneering ahead of her campaign announcement" but "we can just act as though we don't know anything!"
Public Service Minister Chris Hipkins is unimpressed too.
"They have to act on the information that they know and if that information is inconvenient for them, that's not an excuse to say 'let's just pretend we didn't know that'," Hipkins said on Thursday.
National's housing spokesperson Nicola Willis is concerned.
"It's a level of dishonesty and a disrespect for the public of New Zealand that I find deeply troubling," she told reporters.
On Wednesday the agency refused to front, instead sending regurgitated responses which failed to address and somewhat contradicted the fresh revelations.
"I was concerned over some responses to media inquiries that I've seen in the last 12 hours and did not consider the issue was being taken as seriously as I would have expected," Woods said.
McKenzie promises: "Things are being taken seriously."
It's now to the watchdog to decide.
Newshub received a statement from Public Services Commissioner Peter Hughes saying he'll look into the matter and advise the minister on what further actions, if any, are required.
He says it is not appropriate to comment further until he's responded to the minister.
Hughes has a well known mantra: own it, fix it, learn from it; and on the face of it, Kainga Ora's behaviour doesn't come anywhere near those expectations.
