Building and Construction Minister Maurice Williamson has thumbed his nose at public watchdog the Ombudsman by refusing to refund hundreds of thousands of dollars in illegally gathered industry levies to plumbers and other tradespeople.

Mr Williamson is already under fire for fast-tracking legislation to retrospectively legalise the collection of the money which was used by industry regulator the Plumbers Gasfitters and Drainlayers Board to chase "cowboys" out of the industry.

But on Friday, the day after Mr Williamson's bill was fiercely debated in Parliament, Ombudsman David McGee released his final opinion and recommendations on a complaint he received about the board's "disciplinary levy".

Mr McGee upheld Wellington plumber Wal Gordon's complaint that the fee was illegal and he estimated the amount illegally collected by the board between July 2010 and January 2012 at $600,000.


Mr McGee recommended that the board should negotiate an arrangement "whereby the excess levies paid could in whole or in part be refunded over a period or some credit could be given in respect of future fee or levy payments in compensation".

But Mr Williamson yesterday dismissed Mr McGee's recommendation.

"I think the Ombudsman's Office is wrong. The board would be technically insolvent if they had to pay this money back," he said.