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A great deal and a great deal of trouble

Peter Wilson, Political Writer

John Key knows a good deal when he sees one and getting a $350 million convention centre for free was a winner.

SkyCity was the only one of five "interested parties" prepared to put up the cash, and for that the government was prepared to change the law so it could have up to 500 more pokies in its casino.

What the government apparently didn't see was the absolute need to keep the deal squeaky clean.

The auditor-general's office knew that and nudged the Treasury, which sent a memo to the Beehive about the "the need for probity".

No one could have taken much notice of it because Deputy Auditor-General Phillipa Smith's report, released on Tuesday, reveals a litany of deficiencies in the way the tender process was handled.

Despite this she reached the conclusion: "We have seen no evidence to suggest that the final decision to negotiate with SkyCity was influenced by any inappropriate considerations."

That paragraph has been quoted dozens of times by Key and other ministers who say it "absolutely exonerates" the government from opposition claims that the other players were shut out, SkyCity was exclusively given information which helped its bid and the tender process was a sham.

A question they've been trying to get a straight answer to is this: Was SkyCity offered "regulatory relief" in exchange for building the convention centre with its own money?

In other words, did a minister or a government officials say to SkyCity, "How about we change the law so you can have more pokies?"

Ministers have danced around this one.

Key says he told SkyCity to "think outside the box", without any specifics. It's been suggested SkyCity might have worked out what that meant.

Subsequent to that there were several meetings between officials and SkyCity, and Key's chief of staff Wayne Eagleson took part in some of them.

It isn't known whether he made any suggestions about what "thinking outside the box" might mean.

Labour, the Greens and NZ First are convinced it was a shonky deal, and have said so inside and outside parliament.

Its MPs have tried to nail ministers all week. They have failed, and unless they can find evidence which directly implicates the government they aren't going to succeed.

But they will keep it alive, because they think SkyCity might start building the convention centre in 2014 - an election year.

MPs say it will be a campaign issue and even if the tender process issue is dead by then they have something else - allowing SkyCity to have more pokies cuts straight across the government's policy to reduce them because of the harm problem gambling causes.

Key rationalises the SkyCity deal by saying even though the casino will have more, nationwide the numbers will continue to fall.

It's a strange contradiction and opposition parties say it brings the government's commitments into serious doubt.

If the government wants that convention centre so badly, $350m is a drop in the fiscal bucket.

Ministers must be wondering whether getting it for nothing is worth the trouble it's causing.