John Key acted unethically - Cullen

RADIO NEW ZEALAND: Revelations about Tranz Rail shares held by National Party leader John Key show he cannot be trusted, says Prime Minister Helen Clark.

Mr Key says he mishandled what he told the public about Tranz Rail after admitting his family trust owned 100,000 shares in the rail company, not 30,000 as previously reported.

The Government has accused Mr Key of acting unethically by trading in the shares while seeking commercial information as an opposition transport spokesperson.

In Parliament on Tuesday, Mr Key suggested Miss Clark has been covering up for New Zealand First leader Winston Peters.

But Miss Clark turned the tables on him, saying the only cover-up was by Mr Key who, during an eight-week period in 2003, asked parliamentary questions, lodged an Official Information Act request and traded shares, all the while claiming he never spoke publicly about Tranz Rail.

Earlier, Mr Key admitted he had mishandled what he told the public about shares held in Tranz Rail by his family trust.

He also said he should never have owned the shares while an MP and that the shares were sold at a loss.

Mr Key says the shares were independently managed by a broker and he ordered their sale when he realised Tranz Rail was going to be a political issue.

Mr Key says he did not intend to mislead the public, but did not realise the trust bought parcels of shares on different dates.

Mr Key says it is regrettable that he did not clarify earlier how many shares he held in Tranz Rail, and that he misled the public by failing to correct reports in June that he held 30,000 shares, when in fact his family trust held 100,000 shares.

Mr Key says he was not focused when asked by a journalist on Monday about the number of shares.

But deputy Labour leader Michael Cullen says Mr Key simply tried to lie when confronted about the matter on Monday night.