Social Services Minister Steve Maharey today told the Employment Court that Christine Rankin's high profile damaged the perception of her department and meant she could not continue in the position.
Mr Maharey was giving evidence at the hearing of Christine Rankin's $818,000 action alleging political interference in the StateServices Commissioner's decision not to reappoint her.
He told the court that while he made no personal comments about Ms Rankin's dress code, he did say the public view of the department was coloured by her personal style.
"I said she needed to think about how her personal choices impacted on the perception of a department she obviously cared about," he said.
He said both the department and Mrs Rankin were perceived to maintain a culture of waste and extravagance.
If the State Services Commissioner had recommended her reappointment, he would have rejected it.
Earlier in court the head of the ministerial inquiry into the Department of Work and Income denied claims that the review was a witch-hunt.
Don Hunn denied all claims made by Ms Rankin last week - including that the inquiry he headed last year had been set up as a witch hunt to try to discredit her.
Mr Hunn says it became apparent there were major problems within the department, but he was determined to be balanced and fair in his report.
Meanwhile a former Income Support Services board member told the court that Ms Rankin's career could be unfairly jeopardised by the Government's treatment of her.
Wira Gardiner, a former head of the Ministry of Maori Development, later became a member of the Income Support board, but resigned before Rankin became chief executive.
Mr Gardiner spoke of Ms Rankin's "unparalleled passion" for her job.
Gardiner said the commissioner's decision not to reappoint her is one rarely taken and would affect her reputation.
Before coming to court Mr Maharey answered questions from opposition MPs on a parliamentary select committee about the Government's treatment of Ms Rankin.
He acknowledged the Department of Work and Income had done "very well" while under her leadership. ACT MP Muriel Newman asked Mr Maharey if the proposed merger of the Department of Work and Income with the Ministry of Social Policy was motivated by a wish to get rid of Ms Rankin's position.
Mr Maharey said he denied that absolutely.
Mr Maharey also rejected a suggestion from Dr Newman that the merger of the two welfare agencies was unprecedented in the public sector.
