Prime Minister John Key has asked the Security Intelligence Service to put on ice any active files it has on MPs after a report found they should be treated as a special case.

Mr Key requested a report by the Inspector General of Intelligence and Security Paul Neazor after Green MP Keith Locke discovered a file the SIS had on him since he was a child had been updated since he became an MP in 1999.

Justice Neazor said as a general rule, he believed MPs should be excluded from SIS surveillance because of their jobs and standing.

The law required the SIS to be politically neutral, but monitoring of MPs could amount to political interference or inhibit them from doing their proper jobs.

However, he said any solution had to take account of the "unpalatable" possibility that an MP could be involved in activities which amounted to a threat to security.

He suggested a system in which the SIS required the Speaker's permission to collect information on sitting MPs. In such a case, the agency should have to show it had "good grounds" for believing the MP in question was taking part in activities which were prejudicial to national security.

He said personal files on people should be "deactivated" while they were in Parliament and not added to unless the file was reopened with the Speaker's approval.

Mr Key said he had written to SIS head Warren Tucker "inviting" him to take up the recommendations. He had also asked the Speaker to begin considering it and would ask Justice Neazor to do a follow-up report in about six months.

Green MP Keith Locke said he was pleased with the finding and hoped it would stop the SIS "spying" on MPs.

"MPs must be free to criticise the government of the day without being viewed as a security risk, as was the case with me."

He said the party was happy to consider measures for "exceptional" cases where MPs were involved in security issues if there were genuine reasons for it. He also called for a wider inquiry into why the SIS had so many files on "legitimate dissenters".

In explaining his findings, Justice Neazor said it was relevant that MPs were elected to serve the public interest and swore an oath of allegiance.

There was also the possibility a constituent could try to involve an MP in such activity and care had to be taken not to give constituents any immunity from scrutiny.

He said any new process should still allow the SIS to include information on dealings with MPs that other people under its watch had.

Justice Neazor's report looked at the adequacy and appropriateness of SIS policies on keeping files on people.

Overall, he said the SIS had suitable processes for opening a file and collecting information. However, more thought should be given to limiting the kinds of information it kept.

Of Mr Locke's file, Justice Neazor said his belief that the SIS had added to its file because of his critical stance on intelligence agencies was partly supported by a note on one of the papers in Mr Locke's file which "was certainly unprofessional and ought not to have appeared on a file of a neutral intelligence agency".

* Recommendations

"Deactivate" files of any person who becomes an MP.

Require the SIS to get Speaker's permission to put any MP under surveillance.

SIS must show good grounds for believing the MP is involved in activities which endanger security.

Limit the information the SIS can keep on any other person's dealings with an MP.