Leaders' debate's fiery exchange

John Key and Phil Goff are featured in the first leaders debate of the Election 2011 campaign. Photos / APN

Pike River, Christchurch and the Rena disaster were the focus of the first leader's debate last night, which also became mired in a heated exchange about whether John Key was a "liar".

It was the first chance for voters to see how Labour leader Phil Goff performed in such a forum - and Mr Goff spent much of the debate addressing John Key directly.

He called him "John" and challenged him on his record, saying 100,000 more New Zealanders had moved to Australia under Mr Key's watch and he had given himself a big tax cut while giving little to the poor.

In response, Mr Key said Labour's policies would rack up $17 billion of debt, force businesses to lay off staff to meet higher KiwiSaver contributions and a higher minimum, and that Mr Goff was "spending like a drunken sailor".

The pair got into a tense exchange after Mr Goff accused Mr Key of being a "liar" by promising not to increase GST after the election.

Mr Key responded angrily, saying he did not call Mr Goff a liar because he had respect for the office of Leader of the Opposition.

Mr Goff responded by saying that he did not do so lightly.

"But you have to respect the truth."

The subject also came up later in the debate, when the politicians were asked whether it was ever alright to bend the truth.

Mr Key said it was a "dynamic" world and he had tried to keep every promise he had made - but National had to abandon some policies, including a round of tax cuts, because of the global environment.

"Sometimes circumstances change ... but I've been very careful about keeping my word to New Zealanders."

However, Mr Goff said there was never a time when a politician should lie. He said Mr Key had gone back on promises not to touch Kiwisaver, Working for Families and GST.

After the debate, Mr Goff said Mr Key introduced a new word to the English language "dynamic".

"That means you can actually change your story, promise one thing and do the opposite, but that's because the environment is 'dynamic'. Those are weasel words."

He said he had enjoyed the debate and had tried to directly challenge Mr Key because it was the first chance to confront Mr Key one on one.

Mr Key said he took exception to being called a "liar", saying Mr Goff had misrepresented what he had said about GST.

"It's a very strong term and I don't believe I've ever used that about Phil Goff. I'm not a liar."

He believed he had defended National's record well - and cast questions on Labour.

"They do have a $17 billion hole in their policies."

During the debate, when asked what his biggest mistake in office was, Mr Key said it was the handling of the buying of the new Crown BMWs.

Mr Goff said that the biggest mistake from his time in politics was selling state assets, something he learned from.

"John Key, you haven't learned that."

The debate covered the more controversial policies fronted by the two parties for the election - with Mr Key saying Labour's promises were costly and would rack up $17 billion in debt.

Mr Goff said leadership was about having the guts to make the hard decisions - a reference to his policy.

"I'm not doing it as a form of self flagellation - it's because I know and New Zealanders know that we cannot go on the way we have."

Inside the TVNZ studio, both appeared slightly nervous when they first entered the debate in front of a public audience.

One of the Pike River miners' relatives, Neville Rockhouse, also asked on one of the viewers' questions what would be done to recover the bodies from the mine.

Mr Goff said it should be a precondition of any sale of the mine.

Mr Key said money was not an issue, but it was a dangerous matter.

"I don't think politicians can make that decision to go in - it was one of the saddest days of my life going to see those boys off at the memorial service - but I am not going to overrule the experts and send another 15 brave men in there to lose their lives."

Mr Goff said he did not believe the safety rules had been strong enough.

Mr Key said he did not believe the Government could have done more to prevent the damage caused by the Rena's grounding, despite Mr Goff's claim that Transport Minister Steven Joyce "sat on his finger" rather than act.

"Yes, people get frustrated, and I share their frustration - it's very, very annoying." However, he said everything possible was done. He also did not believe the Rena incident should warrant a ban on deep sea mining.

Asked what he felt strongly enough about to march in the streets, Mr Key said "equality of opportunity."

Mr Goff said he had marched to stop mining in national parks, to support low fees for ECE, and ACC fee hikes. He also had some sympathy for the Occupy Wall Street movement that had spread through the world.