John Key's 'teapot tape' payment may breach guidelines

Prime Minister John Key (AAP)
Prime Minister John Key (AAP)

Prime Minister John Key plans to put an undisclosed out-of-court cash settlement with cameraman Bradley Ambrose on the taxpayer tab -- but it could land him in more hot water.

Mr Key has already billed the taxpayer for all his legal costs defending the teapot tapes defamation case so far.

But now there's a problem, and it's entitled 'Guidelines for Payment of Members' Legal Costs'.

It's the official document written up by Parliamentary Service that's given to every Member of Parliament on their induction.

It clarifies which member's legal costs can be funded from the Leader's Office budget -- in this case, it's Mr Key's taxpayer-funded account.

The guidelines point out that legal costs include costs for legal advice and representation and do not include "payments made to settle a legal action".

In short, Mr Key will breach these guidelines if he uses his leader's budget to pay the settlement to Mr Ambrose.

There's also this provision: "No payment or reimbursement to a member will be made under these rules unless the party leader has recommended it and the Speaker has approved it."

Mr Key says all legal costs so far have been billed to his leader's budget -- which means the Speaker must have approved it in advance.

Greens co-leader Metiria Turei is appalled Mr Key's making the taxpayer fork out for both the legal bills and the settlement.

"When Colin Craig took us to court in 2014, our party paid. We crowd-sourced the money to defend Russel Norman. We never expected the public to pay.

"John Key was the one who abused the cameraman, he should pay for the settlement himself, not the public," she says.

The Speaker's yet to approve Mr Key using his leader's budget to pay for the settlement, and if it's rejected, Mr Key says the National Party will cover it.