Helen Clark shrugged off concerns about the Ministry of Foreign Affairs.

Helen Clark shrugged off concerns about the Ministry of Foreign Affairs.

Prime Minister Helen Clark puts the Air New Zealand fiasco down to a "bad-hair" day for Foreign Affairs secretary Simon Murdoch.

But National leader John Key believes it could point to a breakdown between the present Government and the bureaucracy.

Mr Murdoch failed to alert the Government to Air New Zealand's interest in a tender to transport Iraq-bound Australian military personnel to Kuwait, which the Government would have opposed.

Mr Murdoch flagged no issues of sensitivity when the airline sought advice from him in January.

Asked if it had reduced her confidence in the Ministry of Foreign Affairs, Helen Clark said: "I do work very closely with them and it is highly unusual for something like this to happen so I have to put it down to one bad-hair moment for the chief executive."

She rejected any comparisons between New Zealand flying military engineers to Iraq in 2004 with the two flights of Australian troops in June - which ministers discovered only this week.

New Zealand had sent military engineers to do work which could have been done by civilians had it not been in a war zone. They stuck very strictly to those humanitarian tasks and defended only themselves. "They did not engage in any way."

"The sensitivity about transporting the Australian Defence Force is that Australia was one of a handful of countries which was part of the so-called Coalition of the Willing which supported the entry into Iraq and what followed."

Asked if the New Zealand Government would have had the same concerns about transporting troops to Iraq from a country that was not part of the Coalition of the Willing she said "I think we would have to look at it case by case and what the position of the country concerned was at the time."

Helen Clark would not say whether Labour would moderate its on-going attack on National leader John Key over his party's position on Iraq.

But she believed National would have committed troops to Iraq "and we would probably have had Air New Zealand helping out flying them up and back, and flying the body bags back."

Mr Key said last night said Air New Zealand had acted totally professionally in seeking advice from MFAT "and I think the right advice from MFAT should have been to tell them not to do it, simply because by association it involves them in something with which the declared position of the Government was not to be involved."