John Key has described how Education Minister Hekia Parata just didn't gel with former Ministry of Education chief executive Lesley Longstone.
But he says Lesley Longstone's exit package of more than $425,000 after little more than a year in the job was a relatively small sum.
The Prime Minister says such payments are not uncommon in the public and private sectors.
“At the end of the day sometimes from time to time these things will happen, the overall scheme of things relative to the amount of expenditure that’s undertaken – it’s obviously a very small fraction – a lot the payment was actually her standard contract and would have been paid anyway.”
Ms Longstone left the ministry just 13 months into her five-year contract after a year of botch-ups and a relationship breakdown with minister Ms Parata.
Ms Longstone received $267,952 in severance payment and $157,523 in holiday pay and payment in lieu of notice.
Ms Parata, the State Services Commission and Steven Joyce, the minister responsible for Novopay, all refused to take questions on Ms Longstone's departure and payout.
Labour leader David Shearer put the blame for the golden handshake squarely on Ms Parata, saying Ms Longstone was a "scapegoat".
"We're finding out today, for example, that officials were telling Hekia Parata – with regard to the Christchurch school closures – slow down, don't do it so fast, take a more measured approach. She ignored that advice," he told Firstline this morning.
"Hekia Parata's now got rid of Longstone to make herself look better, and now we're having to foot up the bill of a $420,000 payout. Now, look - that buys a lot of teachers, that buys a lot of assistance and support to schools.
"Right now, schools could do with it – they're struggling with Novopay."
Mr Shearer says teachers are "demoralised" under Ms Parata's leadership.
"Teachers are just fed up – it's Novopay, it's school closures, it's expanding classroom, it's charter school – it's a whole bunch of things that are really ill-advised being thrust onto teachers… I actually believe that Hekia Parata is not up to the job, and we're covering her tracks by giving big payouts to people who have only been in the job for a little while."
Ms Parata, the State Services Commission and Steven Joyce, the minister responsible for Novopay, all refused to take questions on Ms Longstone's payout.
Mr Key is currently in Mexico, on the first leg in a trade tour of Latin America.
3 News / RadioLIVE