Minister of Education Hekia Parata's sister Apryll Parata has been given one of the ministry's top jobs.
News of the appointment has swiftly drawn criticism and concern from political and administration quarters.
The newly created deputy position answers to secretary for education Lesley Longstone, who moved from the UK to take up leadership of the department. Longstone announced the changes this month.
She told the Herald on Sunday the new title made Apryll Parata responsible for performance and change, meaning she would be making key decisions within the ministry.
Rawiri Bell would move from deputy secretary for early childhood and regional education to Apryll Parata's former role, group Maori.
"The changes are part of an ongoing reorganisation within the Ministry of Education," Longstone said.
Hekia Parata said she had nothing to do with the promotion of her sister.
However, the appointment followed an outcry this month from Labour MP Trevor Mallard over the appointment of Hekia Parata's husband, Sir Wira Gardiner, to run hui on the sale of state-owned assets.
Mallard said the appointment was inappropriate given his relationship to a Cabinet minister - though there was nothing to suggest she was involved in choosing him.
Labour spokesperson for education Nanaia Mahuta said there was a concern Apryll Parata's promotion came so quickly after her sister was appointed minister.
"There is a perceived conflict of interest. People will draw all sorts of conclusions given the proximity of the appointment."
Green spokesperson for education Catherine Delahunty said Apryll Parata had been involved in education for a long time.
"It's not someone who is coming in from the outside with no knowledge. It does become interesting when it's two sisters running the Ministry of Education because it does sound to the public like it puts power in the hands of one family."
She said her main concern was about the direction the ministry was taking, not the personnel.
Post Primary Teachers Association president Robin Duff said in his view the promotion would have seemed more legitimate if the role had already existed.
"We have some real concerns about public perception."