KEY POINTS:
Prime Minister Helen Clark today said the row over Corrections Minister Damien O'Connor taking a suspended prison guard on a parliamentary rugby trip to France would be an issue when she considers a Cabinet reshuffle due soon.
The blunder is the latest in a series of actions by Cabinet ministers that point to a major reshuffle rather than the usual mid-term tinkering.
Mr O'Connor is likely to lose his Corrections portfolio and it is possible that the error of judgment could even force the West Coast-Tasman MP to resign from the Cabinet before the reshuffle, expected within six weeks.
Helen Clark did not rule out that possibility last night but said "that's not what's on my mind at the moment. I'm working on a reshuffle and it will be announced in due course."
But today she went further and said the matter would be taken into account in an upcoming Cabinet reshuffle.
"Obviously I am contemplating a reshuffle at some point and I will take all those issues into account," she told Radio New Zealand.
She added: "I think Mr O'Connor could have made it very clear that this gentleman should not have been in the team.
"Had it come to my attention I would have suggested that Mr O'Connor not go himself."
She is likely to discuss the gravity of the misjudgment with senior colleagues, gauge public opinion and speak to Mr O'Connor after he returns from Europe tomorrow before making any decisions.
Mr O'Connor also holds the Rural Affairs, Tourism and Associate Health portfolios.
National Party leader John Key yesterday called for Mr O'Connor to be sacked, saying his "unbelievable stupidity" in allowing suspended prison guard Jim Morgan to play in the parliamentary rugby team in France was the final straw.
Mr Key said the situation was not a "perceived" conflict of interest; it was an "actual" conflict of interest.
"What message does it send to those who are reviewing Mr Morgan's case that the Minister of Corrections thinks it is fine for him to hang out in France with him on a rugby trip?"
Many of Corrections' troubles occurred under other ministers and Mr O'Connor and chief executive Barry Matthews were painted as the fresh team to tackle the problems.
But the department has attracted criticism under their leadership over such issues as Parole Board decisions, the transportation of prisoners and killing of Liam Ashley, and allegations of mismanagement and corruption among prisoner officers.
Mr Morgan is employed at Rimutaka Prison and his wife, Marie, is Mr O'Connor's senior private secretary. Mr Morgan has played in the parliamentary team for several years.
When the guards were suspended over allegations of mismanagement and corruption, Mr O'Connor passed responsibility for the issue to Associate Justice Minister Clayton Cosgrove.
He used that as a rationalisation for allowing Mr Morgan to join the trip, saying at the weekend that he thought "because I had recused myself of any ministerial involvement in relation to the employment investigation into Mr Morgan there would be no issue with my participation [in the tour]".
"In hindsight this may have led to a possible perceived conflict of interest."
Helen Clark believed the "insulation" from the matter caused him to make the wrong call.
Mr Key said Mr O'Connor was one of several ministers under a cloud for their performance and Justice Minister Mark Burton was "on his way out".
- with NZPA
