Dr Ashley Bloomfield says he rejected an application for banks to be allowed to operate branches in Auckland under alert level 3 because no one told him banks had been allowed to operate under the earlier lockdown.
On Sunday the director general of the Ministry of Health rejected a bid by the Reserve Bank to allow banks to operate limited branch networks in Auckland under the current alert settings.
Around 24 hours later Bloomfield then changed his mind and approved the application, which followed intervention from officials in the Prime Minister's office.
This followed banks - which had been nervous that they were operating outside the Ministry of Health's orders in the previous week - announcing on Monday that they were closing because of Bloomfield's decision.
On Tuesday the Ministry of Health refused to tell the Herald why it rejected the application citing undefined "privacy issues".
But at a press conference in the Beehive on Wednesday, Bloomfield appeared to blame bad advice from his team.
"I approve or decline exemptions based on advice from my team who go through a thorough process of assessing applications," Bloomfield said.
"When I initially declined the application for that exemption, the team wasn't aware of information that previously in alert level 3, these banks and credit unions and so on had been allowed to open at one point when we came out of alert level 3. Once that was made known to us, I asked them to reassess the application and it was on the basis of the updated advice that I gave the approval for the exemption."
Even under the level 4 lockdown in March and April, banks had operated a limited branch network on reduced hours to cater for customers who needed face-to-face transactions, usually because they cannot access the internet or ATM machines.
Both the Reserve Bank and the New Zealand Bankers' Association issued statements before the March lockdown that the sector was considered an essential service and that some branches would be open.
Bloomfield went on to say that his team had requested more information, even though it had already refused the application.
"What wasn't clear to the team was what was the formal decision to allow that and so they sought clarification and that was provided quite quickly, the next day, that did confirm that a decision had been made, previously under alert level 3."
An official at the Reserve Bank has indicated that its application for an exemption for banks did include reference to the fact that banks had been able to operate under the earlier lockdown.
So far the Ministry of Business, Innovation and Employment (MBIE) has refused to discuss what information it provided to the Ministry of Health about whether banks should be allowed to operate.
The Ministry of Health's handling of exemptions to operate under the current alert levels, with National MP Andrew Bayly describing the handling of issues around the domestic border into Auckland as an "absolute shambles" with confusion and delays around handling exemptions.
Bloomfield maintained that the ministry was equipped to handle exemptions, which were previously handled by the MBIE under the first, nationwide, lockdown.
"We don't just rely on our own staff. We have a team of over 70 people processing these exemptions, most of them have come from other organisations to bolster our team" Bloomfield told reporters.
Most of the applications came from businesses or other "non health" organisations, Bloomfield said.
"We work with the relevant Government departments, whether its MBIE, [the Ministry of Primary Industries], and so on, to get the important information we need," Bloomfield said.
"It may have been because in this case [banks] it was Sunday afternoon, it may have been that they couldn't access the information at that time."
Act leader David Seymour has said it was inexplicable that the Ministry of Health had been given powers to determine what businesses could operate under the latest lockdown.
"If the director general of health doesn't know what the alert level 3 rules are, how can small businesses be expected to know? It's not just the cost but also the uncertainty of lockdowns weighing on New Zealanders," Seymour said.
"Setting clear rules of the game is one of Government's most basic jobs in this epidemic. Act has been saying that we need a Taiwanese-style multi-disciplinary Epidemic Response Unit because the Ministry of Health is not the right agency to solve many of the problems we face in a pandemic."