Labour leader David Shearer has accused the Government of "extraordinary arrogance" for refusing to halt negotiations with SkyCity over an international convention centre while an investigation into how the deal was brokered is held.
The Auditor-general's office announced an inquiry yesterday into the way the Government sought proposals for the Auckland convention centre.
The Government is negotiating a deal under which the casino operator would build the $350 million centre in exchange for gambling-law changes that would give it more pokies and other concessions worth about $42 million a year.
Labour and the Greens, who made the original request for an inquiry, called yesterday for those negotiations to be suspended until the inquiry is complete.
But Economic Development Minister Steven Joyce said the Government was "very relaxed" about the inquiry and negotiations would continue: "It doesn't change anything at all. We're confident of our position."
Mr Shearer said Mr Joyce was being "extraordinarily arrogant in continuing to run this process".
Not only should negotiations go on hold until the inquiry was complete, but the tender process should restart from scratch.
Labour said the inquiry struck at the heart of Prime Minister John Key's credibility.
"He's the person who took the SkyCity deal forward. He's the person who stopped the business case, he's the person that had the talks behind closed doors. He's the person who staked his credibility around it," Mr Shearer told One News.
Mr Key has acknowledged he approached SkyCity to make a bid to build the centre but has rejected claims he had an unfair amount of influence over the tender process.
He said yesterday he was "delighted" by the inquiry.
"I have absolutely no concerns about the outcome."
Some Opposition statements about the deal were factually incorrect, he said.
"The great thing about this is the Auditor-general will be able to demonstrate to everybody those statements are incorrect."
The inquiry was not into himself or his Government's role in the deal, but the Ministry of Economic Development "and the process they went through in terms of the tenders".
In a statement to the stock exchange, SkyCity said it would co-operate fully with the inquiry.
SkyCity shares fell 3.4% on news of the inquiry, which will be conducted by deputy auditor-general Phillippa Smith. Auditor-general Lyn Provost will not be involved because she has a small shareholding in SkyCity.
