National leader John Key condemned Whale Oil blogger Cameron Slater for the first time during tonight's leaders' debate, and confirmed that the blogger's emails will form part of an inquiry into Judith Collins' conduct.

And Mr Key hinted that his plan for tax cuts for low to middle income earners, to be announced next week, would not be more than $30 a week.

He also claimed Labour's capital gains tax would capture 300,000 family homes held in trusts, which David Cunliffe left unanswered in the debate, and the party scrambled later to discredit.

Read more of the Herald's coverage of the debate
Who won the second leaders' debate?
Second debate: As it happened


The debate, hosted by The Press and streamed online, became quite heated at times, as the leaders traversed topics from poverty, the Canterbury recovery and the fallout from Nicky Hager's book Dirty Politics.

Mr Cunliffe criticised the inquiry into Ms Collins, saying it was so narrow that it would not even look into Slater's emails, which sparked her ministerial resignation.

"And that is a joke. If we want to move on, then we have to clean up the mess."

Mr Key responded: "They will take into account those emails."

When questioned, he condemned Slater for his role in what appeared to be a smear campaign on the Serious Fraud Office.

And he took a swipe at Labour's failed attempts to dig dirt on him, and at the "three or four" staffers in Mr Cunliffe's office that wrote in the left-wing blogosphere.

"It's a known fact that Jason Ede in my office talked to a blogger. There are people in your office who have written on blogs.

"It happens on your side and you know it ... and I can name them if you want me to."


Mr Key said he would announce his tax cuts plan next week.

"Even if it's a small amount, we want to reward New Zealanders for working hard, whether it's $10 or $20 or $30 bucks [a week], it adds up to $500 or $1000 for an individual or a couple [a year]."

He lambasted Labour's capital gains tax, asking repeatedly whether it would apply to the 300,000 family homes held in family trusts.

In a moment reminiscent of the "show me the money" moment in last election's leaders' debate, where then-Labour leader Phil Goff was caught out not knowing policy details, Mr Cunliffe avoided the question.

Mr Key said: "The answer is you will, because you are not the owner/occupier."

Mr Cunliffe focused on Labour's wider tax policy, saying Labour would raise $1 billion more revenue than National and still pay down debt faster.

He defended Labour's proposal of a new top tax rate of 36 per cent on income over $150,000.

"I'm happy to pay a little more tax as long as I can leave to my children a country that we think is fair and decent."

He also pointed to forecast growth falling in coming years, saying that New Zealanders were asking: "If that was the recovery, how come I never got a slice of it?"

The debate became heated during a discussion of the Canterbury rebuild, and Mr Cunliffe called Mr Key a "school-yard larrikin" at his repeated interjections of "whatever".

Earlier the leaders discussed standards of living and the different approaches to lifting people out of poverty.

Mr Cunliffe pointed to Government assistance, including Labour's Best Start payment for parents, while Mr Key said employment was the best path out of poverty.

Mr Cunliffe retorted: "There are 100,000 children growing up below the poverty line where parents are working. It's not just about work."

Mr Key said the minimum wage promises from Labour and the Greens would cost jobs.

"You want to send 16,500 people to the dole queue, David."