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Prime Minister Helen Clark yesterday stepped up her criticism of Australian Foreign Minister Alexander Downer, effectively accusing him of interfering in New Zealand domestic affairs twice in one month.
But Mr Downer hit back last night through a spokesman who said Australia had felt strongly about comments from New Zealand that were regarded as "unfriendly".
To cap off the transtasman strains, New Zealand announced yesterday it would take Australia to the World Trade Organisation disputes proceedings over market access for New Zealand apples, though the decision is unrelated.
At her post-Cabinet press conference Helen Clark said Mr Downer had broken an "unspoken convention" not to address party conferences in each others' country - Mr Downer addressed the National Party conference this month.
And she said he had weighed into an essentially domestic row about revelations that Air New Zealand had flown Iraq-bound Australian troops to Kuwait, a move roundly condemned by the Labour-led Government which opposes the war.
"[Australia] chose to weigh into an issue that is fundamentally not about them," Helen Clark said.
"It's about the way in which public servants report to ministers here and it is about the relationship that you would expect as a Government to have with a national airline which is 80 per cent [Government] owned."
Helen Clark also said she was amazed that Australia appeared to have told a New Zealand journalist of its intention to convey its "extreme displeasure" to the head of Foreign Affairs, Simon Murdoch, ahead of the actual meeting which he had yesterday with Australian High Commissioner John Dauth.
The phrase was used in a Weekend Herald column by Fran O'Sullivan.
"I'm absolutely staggered to read about it in the newspaper. It certainly didn't come from the New Zealand Government," Helen Clark said.
It is understood that Helen Clark was not informed of that meeting until it was over.
Mr Murdoch was not briefed by the Government on a counter-message to deliver about Mr Downer interfering.
Helen Clark told reporters she did not intend asking for Mr Dauth to be formally called in.
Instead she used megaphone diplomacy to get her own extreme displeasure across yesterday.
Asked if the events had eroded trust in the transtasman relationship, she said: "I think it is a sign that people should stay out of other people's politics. We have always endeavoured to do that with respect to Australia."
Yesterday's meeting between Mr Murdoch and Mr Dauth followed one in Canberra on Thursday when the New Zealand High Commissioner was called to Mr Downer's office where he said the Australian Defence Force would no longer use Air New Zealand in any capacity.
Helen Clark pointed out yesterday that Air New Zealand, the very next morning, had conveyed Australian troops to Honiara. She rejected a suggestion that Mr Downer had every right to comment on an issue that appeared to be a slight on Australia.
"It is not a slight at all. Australia is known for having brave, fighting troops but it is a matter of record that New Zealand and Australia had different positions four years ago on the war in Iraq."
A spokesman for Mr Downer last night said the minister had regarded the New Zealand Government's criticism about Air New Zealand flying Australian troops as "unfriendly".
"It was an attack on an issue surrounding Australian troops. The Australian Government had entered into a commercial arrangement with Air New Zealand and there was a great furore about it.
Mr Downer's announcement not to use Air New Zealand "was hardly interference", the spokesman said.
Mr Downer had no comment on the Australian position being in the media before being put to New Zealand.
Mr Downer's spokesman said the National speaking engagement had been discussed when Mr Downer and Helen Clark held formal bilateral talks in an airport lounge two months before the conference.
Helen Clark denied having been briefed by Mr Downer.
