The massive bill for rebuilding Christchurch will not put the Government off spending more money on Auckland, Prime Minister John Key says.

To the children it's a place to play; to the Nelson council it's a death-trap to be torn down.

Auckland Council should follow its new focus in asking its agencies to get better value from its commercial assets, says the Government.

The owners of Auckland's Palace Hotel could be prosecuted after the release of a damning report identifying severe damage to the heritage building before it was knocked down.

The Palace Hotel was moving by up to 5mm an hour towards the street when the decision was made to knock it down, the Auckland Council said today.

Structural engineers should work with conservation architects and architectural historians to ensure that no quake-damaged heritage buildings in Christchurch are demolished in haste, a heritage campaigner says.

Earthquake Recovery Minister Gerry Brownlee says the focus on heritage buildings after the devastating earthquake in Christchurch is 'unacceptable' at a time when thousands of residents' lives have been disrupted.