Prime Minister John Key says he has no responsibility for a $50,000 donation made to the National Party by a BMW dealership the day after the Government renewed its VIP transport contract.
The Government renewed the contract, which was signed while Labour was in power, to replace its ministerial fleet of 34 BMWs at a discount to the usual $200,000 per car.
On Wednesday, Labour MP Chris Hipkins asked Mr Key in Parliament if he was aware that the day after his chief of staff met with VIP transport to discuss the upgrade that Team McMillan, a BMW dealership in Auckland made a donation to National.
Mr Key replied he had no responsibility for that. He said BMW New Zealand is not the same entity as the one named by Mr Hipkins.
The Prime Minister says Labour has resorted to the gutter yet again with false allegations.
Bob McMillan, the owner of BMW Team McMillan, says the claim he donated money to National the day after the party agreed to a contract for ministerial cars is ridiculous.
Mr McMillan says the contract had nothing to do with him or his dealership, as it was signed between BMW New Zealand and the Government.
Mr McMillan says the donation was made months earlier, in June 2010.
He says Labour's allegations are like water off a duck's back, but if they persist or become more serious he will consult a lawyer.
The Department of Internal Affairs, which is responsible for the fleet upgrade, says it has no commercial relationship with the BMW dealership in Auckland.