Former Act leader Rodney Hide has ruled out standing in a by-election should his successor John Banks stand down from his Epsom seat, but Conservative leader Colin Craig says he would take a shot.

Mr Banks has come under fire in recent days over whether he knew about donations to his 2010 Auckland mayoral campaign that he said were anonymous. Police were looking into the matter.

Prime Minister John Key has ruled out sacking Mr Banks as a minister, saying Mr Banks had assured him the donations complied with the electoral law.

But Mr Banks' handling of the issue has raised questions over the Act Party's future.


Former leader Rodney Hide told TV3's The Nation today that he would not look for a return to politics if there was a by-election in Mr Banks' Epsom electorate seat.

"I loved every minute I was in Parliament and it was a huge privilege to be the MP for Epsom, but I think it's important that we do have a turnover of politicians and get the next generation in."

But while Mr Hide has ruled out another tilt, Mr Craig told The Nation it was "very likely" he would stand in Epsom if there was a by-election.

"Such a decision would have to be confirmed by the board of the party, but I think it's very likely," he said.

It was harder to predict if there would be a by-election in the electorate, he said.

"I don't know, but if it happens, we'll be there."

Mr Craig's Conservative Party did not break the 5 per cent threshold in last year's election, getting 2.65 per cent of the vote, so winning an electorate seat could be seen as an attractive route into Parliament.

But Mr Craig said the party had taken a lot of support from Act at the election and he did not want to rely on winning a seat.

"We want to be in a position next time where we can get there on our own merits.''

Mr Craig said despite some policy differences, including on asset sales and Government spending, the Conservatives could be a long-term partner for National.

Mr Hide said the Conservatives could work with National in the future but that would be up to the voters.

"Gosh, I know in politics that a lot can happen in a couple of days, and so I wouldn't write off Colin Craig at all."

Mr Hide said the risk was if the party got some votes, but not to get over the 5 per cent threshold.

"The challenge is always to win an electorate seat. That's tough, very tough to win a seat and to hold it - the Greens couldn't do it, Winston Peters couldn't do it. And so that's the tough thing for that support party."

Mr Hide said he believed Act could return to Parliament at the next election.

"It's always tough for the Act Party, God, don't I know it. And when you're supporting the Government, particularly with just one MP you do come under a lot of heat.

"I think it's in for a difficult time, but I wouldn't write it off. Act's been written off many times before and it's still there.''

Mr Hide said Mr Banks had been under fire but there was a need to "all take a deep breath''.

"It's moved on from what he might have done wrong or not done wrong, to actually how he's handled it, which hasn't been great. He's hasn't covered himself in glory.

"But you go back to the fundamental problem, we actually need to all take a deep breath, have the police investigation - or indeed there's going to be one - and find out whether he did break the law or not.

"That's the issue."