The controversy could strain the two parties' Memorandum of Understanding, which commits them to working together until election day. Davis said Labour would assess whether Turei's latest revelations could damage Labour.
He and Ardern had not discussed Turei's admissions, but he told the AM Show "we're just going to have to have a good discussion about how this is going to affect us, because we don't want to be seen to be condoning this sort of stuff".
It was up to the Green Party to deal with their own problems, he said.
"The Greens have made their bed and now they have to lie in it."
"It's pretty ugly and I just think if you're going to open up about yourself like that, then you've got to tell the whole truth and nothing but the truth."
Turei admitted last night admitted that she enrolled at a Mt Albert address where she did not live in 1993 so she could vote for a friend. Enrolling to vote at an address you do not live at is an offence.
Turei also confirmed her mother was a flatmate for part of the period she claimed the benefit in the 1990s. She said they were financially independent at the time.
She revealed last month that she did not disclose to Work and Income in the 1990s that she had extra flatmates while she was a solo mother on the domestic purposes benefit.
But she did not reveal then that one of them was her mother.
"It's turned to mushy peas for her, hasn't it?" Davis said on the AM Show.
Former Green MP Sue Bradford, who is a beneficiary advocate, said today that Turei had underestimated the political and legal risk of her admission.
She said Turei had been "courageous" in announcing a radical welfare policy and telling her story, but did not appear to have calculated the "detrimental" impact it could have on her political career.
"I'd like to hope she could survive, I'd hate to see her step down as a result of this.
"I'm not prepared to commit either way on this, but I think she has put herself in a precarious position."
Former Winz head Christine Rankin said it was common for beneficiaries to be living with their parents, but this had to be disclosed because it would affect their welfare payments.
"Benefit fraud alone is appalling. Having your mother is just one of those things, it could happen to lots of people. But it needs to be assessed and declared.
"Because when you become a beneficiary, you literally hand over your life to Work and Income. You have to tell them everything."
Turei said last night that she was the sole provider for her daughter Piupiu when she was on the domestic purposes benefit.
Her enrolment at an address she did not live at was "a mistake - one of many I, like many other people, made as a young person".
Act leader David Seymour earlier told Newstalk ZB he doesn't buy Turei's explanations, accusing her of "spinning, spinning, and spinning". He said if Turei was any other MP she would have been gone by now.
If you look at any MP resignation in the past 10 years, they've happened for much less than this, he said.
Even Green Party supporters are split over whether they support Turei following the revelations. Former Greens co-leader candidate Vernon Tava told Nadine Higgins that a poll from last night indicates 74 per cent of people think she made a mistake admitting what she'd done, and just 18 per cent support her.
He says even among Green voters, it's split roughly half and half on whether it was a good idea. Tava says they're unclear about whether a short-term political gain in publicity was worth the long term damage to Turei and the party.
Serial litigant Graham McCready this morning said he was taking a private prosecution against Turei, alleging she had committed electoral fraud and filed false tax returns.
McCready, who has taken legal action against several politicians, said he had made complaints to both Inland Revenue and the Electoral Commission.
