John Armstrong: Stakes higher with PM's reputation on the line

Prime Minister John Key. Photo / Mark Mitchell

Of all the self-inflicted crises, sideshows and distractions that have bedevilled National this year, the "extra pokies in exchange for a national convention centre" wrangle is something of an exception. It has one very prominent character who is central to the action - the Prime Minister. And that ups the political heat to pressure-cooker levels.

John Key's response to the news that the Office of the Auditor-General will conduct an inquiry into how SkyCity became the preferred bidder for the construction of a national convention centre was accordingly to play down its significance.

The worst thing would have been to appear defensive and besieged. Key instead made light of the inquiry. He welcomed it. He expressed confidence that allegations of shonkiness, cronyism and short-circuiting of established tender practices would be proved to have no foundation.

The Prime Minister is gambling on today's "Key embarrassed" headlines turning into "Key vindicated" headlines after the inquiry's findings are released.

The convention centre is the Prime Minister's pet project. He is up to his neck in it. Even the mere hint of anything remotely dodgy will be a huge blow to his credibility - and quite possibly a lasting one.

The Opposition can smell blood. Or at least they want to think they can. Labour leader David Shearer almost suggested Key should stand himself down from the Cabinet until the inquiry is completed.

He and Greens co-leader Metiria Turei - whose complaint to the Office of the Auditor-General sparked the investigation - insist that negotiations between SkyCity and Ministry of Economic Development officials be halted.

Key and Steven Joyce, who holds the Economic Development portfolio, refuse to do so. That is something of a slap in the face for the Office of the Auditor-General.

That office is the independent parliamentary watchdog of how public money is spent. It thinks very carefully before making an investigation. The sight of politicians treating the office as little more than a nuisance is disturbing.

For Key and Joyce, however, suspending negotiations would only give the inquiry more prominence. So it is business as usual.

Those negotiations have been dragging on for a year almost to the day. There is not a high expectation of them bearing fruit before the investigation is completed.

If a deal is hammered out beforehand, it is highly unlikely it would be announced before the release of the inquiry's report.

One argument is that the Office of the Auditor-General will be looking at past events - not the current negotiations. So the latter can continue unimpeded.

Some in the Beehive are drawing comparisons with the current investigation into hydraulic fracturing by Jan Wright, the Parliamentary Commissioner for the Environment. That inquiry is not stopping oil companies from "fracking". Neither is it blocking Government approval of mining and exploration licences.

But then that inquiry is dealing with inanimate objects. The pokies-convention centre inquiry is in a rather different league. It may well turn out to be the case that everything has been above board. It had better be for Key's sake.