Mr Key's hurried change to the rules for ministers' perks removed the requirement their self-drive car be based at their primary place of residence.
This allowed Mr English to have his car - believed to be a late-model Ford Mondeo - with his family in the Wellington suburb of Karori, rather than in Dipton in his Clutha-Southland electorate.
Mr English's assertion that Dipton was his primary place of residence has been controversial this year, because it allowed him to claim rent to live in the Karori property.
As minister responsible for Ministerial Services, Mr Key oversees their perks, which include an entitlement to one self-drive car.
Documents obtained under the Official Information Act show the rule that the car be based at a minister's primary place of residence was removed in a revised determination that took effect on May 26.
If Mr English had his car based in Wellington before then, he would have technically been in breach of the rules.
Last night, he would not answer questions about the car - a spokesman said he was "in meetings".
Labour MP Pete Hodgson said Mr English's wanting the car in Wellington further exposed the "fiction" of his assertions about his primary home being in Dipton.
He questioned Mr Key's handling of the rule change because it made him "complicit" in Mr English's rearranging his affairs to his own benefit.
A spokesman for the PM said he changed the rule because it was "impractical and silly" to require ministers to only have the cars permanently based at their homes outside Wellington.
Regardless of where the cars were based, there was no extra cost to the taxpayer.
He said Anne Tolley, Tony Ryall, Phil Heatley, Simon Power, Nathan Guy, Tariana Turia and Rodney Hide had their cars in Wellington despite having electorates elsewhere.
The ministers have chosen cars from a mix such as the Hyundai Santa Fe, Holden Captiva, Chrysler 300 and Peugeot 607.
The Prime Minister's spokesman said he did not believe Mr English had benefited from the change because "he gets a self-drive car under the old rules and he gets a self-drive car under the new rules".
The documents show Mr Key's chief-of-staff, Wayne Eagleson, worked on the rule change, which appeared to be an afterthought, because the PM had already circulated a revised version of the rules to interested parties.
In a letter, David Oughton, chairman of the Remuneration Authority, which sets MPs' salaries, said the change "may be of significant benefit to some members"
- Patrick Gower of the NZ Herald
