Labour calls for inquiry over GCSB appointment

The Labour Party is calling on the Auditor-General's Office to investigate the process used to appoint Ian Fletcher as director of New Zealand's electronic spy agency.

Mr Fletcher was appointed head of the Communications Security Bureau after being contacted by Prime Minister John Key, who suggested that he apply for the job.

Mr Key knows Mr Fletcher, but denies that they are friends. His intervention has sparked criticism from Opposition parties that the appointment smacks of cronyism.

It prompted State Services Commissioner Iain Rennie to hold a news conference on Thursday to reject criticism that Mr Key's involvement was inappropriate.

However, Mr Rennie also contradicted the Prime Minister's version of events, saying he was surprised that Mr Key contacted Ian Fletcher. On Wednesday, Mr Key said he had told Mr Rennie that he would.

Labour's deputy leader Grant Robertson says that disagreement just adds to the reasons to hold an independent inquiry.

"If the Prime Minister and the State Services Commissioner can't get their stories straight about what happened, then we need someone else to have a look at this.

"We need to know that this process has integrity. Iain Rennie's acknowledged that there are major perception issues - we're only going to get to the bottom of those if someone independent investigates."

Applications for the job at the GCSB opened in May 2011 and John Key said a shortlist of four candidates was rejected by the Mr Rennnie.

It was at that point he rang Mr Fletcher and one other person to see whether they were interested in applying.

Mr Robertson said the employment process was far from normal and it looks more like "a jack-up" to get Mr Key's mate appointed.

"I think there are still questions to be answered about the shortlisting process, Mr Key's role and how Mr Fletcher ended up being the only person being interviewed."

John Key has rejected accusations that the proper process was not followed.

"The process was run by the State Services Commissioner. There was lots of people that we talked to. I mean, in the end, there's a quite proper process that we go through. The fact that I might talk to somebody makes no difference."

Mr Key says he doesn't know what the fuss is about, because he has the power to appoint the director of the GCSB.

Listen to John Key speaking to reporters on Wednesday ( 3 min 28 sec )

'Baseless attack'

Iain Rennie said the panel which appointed Ian Fletcher to head the country's electronic spy agency was not influenced by his relationship with the Prime Minister or a phone conversation John Key had with him.

The State Services Commissioner said in a statement the panel was aware the two knew each other when it made the appointment in 2011.

He said the panel was made up of people of high standing in the state services whose integrity is beyond question.

Mr Rennie says he's outraged there have been baseless attacks on the credibility of Mr Fletcher's appointment, describing him as an outstanding public servant proven in Australia and the United Kingdom. He said it is not essential to have a military or intelligence background to do the job.

Mr Fletcher was chief executive of Queensland's Department of Employment, Economic Development and Innovation before taking up the GCSB job.

Mr Key said a report by the Cabinet Secretary Rebecca Kitteridge into the bureau confirms Ian Fletcher is the right man for the job.

Next story in Political: Governor-General meets Afghan president