The Prime Minister has been accused of withholding critical information on proposed mass surveillance from the public ahead of new spying legislation going through Parliament.
The claims have come from Pulitzer Prize-winning journalist Glenn Greenwald, Opposition parties and his own coalition partner, United Future leader Peter Dunne.
Greenwald and Mr Key are engaged in a high-stakes game of chicken over claims Kiwis are spied on - the journalist says spies at the Government Communications Security Bureau (GCSB) are carrying out mass surveillance, while the Prime Minister says he stopped plans for such a scheme in March last year.
The face-off ends tonight in a Kim Dotcom-organised event at the Auckland Town Hall dubbed "The Moment of Truth" at which the entrepreneur says he will prove Mr Key and Hollywood conspired to have him extradited. The event's billing includes the participation of the US National Security Agency whistleblower Edward Snowden and WikiLeaks founder Julian Assange.
In an interview at Dotcom's mansion yesterday, Greenwald said Mr Key made a "come clean" admission over plans for mass surveillance which would be detailed tonight and on The Intercept news site.
"The NSA ... [was] pressuring New Zealand into providing this access to improve information coming from New Zealand."
He said public meetings around new spy laws last year showed "real debate" on surveillance to which the PM could have responded.
The face-off between Greenwald and Key ends tonight in a Kim Dotcom-organised event at the Auckland Town Hall dubbed "The Moment of Truth".
"All throughout this time there was this critical huge fact he failed to disclose, and even misled the public about."
Greenwald said the PM's decision to tell the public now by declassifying secret documents raised questions over whether the public could have been told last year. "If they were legitimately classified, why is he going to declassify them now?"
Greenwald said spy agencies were "relying" on the new laws for the mass collection of metadata and surveillance of citizens. "They had a view on this law that was the exact opposite of what John Key was saying in public."
He said the bureau went beyond simply considering mass surveillance. "It was far more concrete than that and they took active steps to make it happen."
He said stopping it would have required a "radical" change of direction after May 2013, the point at which Snowden's access to NSA information ceased.
Yesterday, Mr Key said he personally intervened to stop the plan because it was too intrusive, and he would declassify documents to prove it. "There's no ambiguity. No middle ground. I'm right. He's wrong."
Mr Key said cyber attacks in 2011 led the Cabinet to approve an investigation into wider cyber protection which he stopped in March 2013. Yesterday, asked why he hadn't revealed the details earlier, he said: "I didn't need to."
A spokeswoman for Mr Key's office said last night that "appropriate declassification processes have been followed" and the documents would be released after Greenwald spoke.
Edward Snowden. Photo / AP
Labour leader David Cunliffe, Greens co-leader Russel Norman and Mr Dunne - National's coalition partner - all said last night that Mr Key should have disclosed the plans at the time of public concerns over mass surveillance.
Mr Dunne, who copped abuse for his support of the new spy laws, said: "It would have been nice to have known but I didn't know and I can't be held accountable for things I didn't know."
Mr Cunliffe said the information Mr Key was planning on making public should have already been disclosed. "Legislation was passed through Parliament without the public or the parliamentary Opposition having any information about what was worked on for what seems to be a year at Cabinet level."
Dr Norman also said the public should have been told last year and failure to do so hurt Mr Key's credibility. "It was absolutely critical to the debate at the time."
Can the GCSB look at citizens' metadata (logs about who contacted whom and when, not the content of communications)?
Yes, with a warrant from the Prime Minister and the Commissioner of Security Warrants.
Can the GCSB look at the content of communications?
Yes, with a warrant from the Prime Minister and the Commissioner of Security Warrants. The law makes no distinction between metadata and content. It is all classed as "communications" so either requires a warrant.
Under what circumstances can the GCSB spy on citizens?
When the GCSB believes there is a cyber-security threat related to government communications or private sector businesses that could impact on the security or economic well-being of New Zealand. John Key set out limited conditions for such surveillance during a speech in Parliament but it carries no statutory effect. It can also help the police and the Security Intelligence Service execute lawful warrants and help the Defence Force.
Could the GCSB undertake widespread surveillance of citizens lawfully?
Technically, yes, in the event of a cyber security threat, but the GCSB would have to make a strong case to the Prime Minister and the Commissioner of Security Warrants as to what the threat was in order to get the warrants.
Does the law ban the GCSB from spying on New Zealanders in any circumstances?
Yes. The Government Communications Security Bureau is New Zealand's foreign spy agency and so the old law and the amended GCSB law ban the spying on citizens or residents to gather intelligence, unless the person is an agent for a foreign government or organisation.
- additional reporting: Derek Cheng