By Laura McQuillan
The Greens will be a major beneficiary of the leadership debate that is consuming the Labour Party, says Prime Minister John Key.
Mr Key, speaking in Darwin on his way to the East Asia Summit in Cambodia, says the squabble is evidence that Labour was not fit to govern.
"Let's face it, the Labour Party can't even run a conference, how on earth could they run the country?
"What they're demonstrating is they just fundamentally do not like each other and it's no great surprise that a lot of New Zealanders don't like what they are doing," he said.
Labour will hold a caucus meeting tomorrow afternoon where leader David Shearer will seek a vote of confidence from his MPs in a bid to extinguish the threat posed by his rival David Cunliffe.
Mr Key told reporters on the fourth anniversary of National coming to office that regardless of the vote's outcome, Labour was struggling.
"I always treat whoever the leader of the opposition is with respect ... but the simple bottom line is if you go and have a party which is going to be internally consumed, which will be the case whoever wins, in the end it's a really bad news story for Labour.
"The only winner out of this will be [Greens leader] Russel Norman."
Mr Key wouldn't express a preference for either leadership contender, saying "either way, whoever's left standing is going to have a warring faction buried deep within their own party".
The leadership row has taken the gloss of Labour's $1.5 billion housing plan which aims to see 100,000 families assisted into their own home over the next 10 years and Mr Key says the plan lacks substance.
"The truth is that it's a very complex issue ... I don't think some fanciful concept is really going to fix the problem."