Peter Hughes justified the spending by saying he was not legally allowed to "move money out of [one] bucket and into other buckets of money".

Ministry of Education boss Peter Hughes says he would have broken the law if he had allocated almost $20 million earmarked for an office refit to special education.

Hughes came under fire from a select committee on Wednesday morning after it was revealed on Tuesday that the ministry's revamp included $2.5m on a 12-floor staircase named "the Stairway to Heaven" by the Opposition.

The MoE said the revamp of Matauranga House, in Bowen St just up the road from Treasury, will come in $3m under budget and save $27m on accommodation and running costs over the 15-year term of the lease.

SIMON EDWARDS/FAIRFAX NZ Labour education spokesman Chris Hipkins called the MoE spending "over the top".

Hughes defended the spend, saying the ministry was working across four buildings and the leases had expired so "we had to do something".

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Green Party education spokeswoman Catherine Delahunty questioned how the ministry could spend millions on an office upgrade when other areas of education, particularly special needs, were desperate for funding.

The ministry has previously come under fire for more than $32m of funding for children with special needs languishing in government coffers for two years.

"Your staff having good working conditions seems to be more important than kids having good working conditions," Delahunty said.

But Hughes said Parliament had appropriated the upgrade money and it was for politicians to change that.

"I get $600m a year to run this organisation, which is in one bucket of money. I can't move money out of that bucket and into other buckets of money – if I did that I'd be breaking the law and I'd be sacked," he said.

Labour's education spokesman Chris Hipkins has labelled the spend "over the top".

"Huge expenditure like this on a gold-plated office will certainly stick in the craw of teachers and students up and down the country. Is this the Stairway to Heaven? It would need to lead to somewhere pretty special for that sort of money," Hipkins said.

The building was formerly the headquarters of the Ministry of Business, Innovation and Employment (MBIE) but it was not MoE's first choice.

Hughes dismissed the ministry had overspent on furniture – about $3000 per person – when MBIE had completed their upgrade at a reported cost of about $1800 per person.

It has been revealed MBIE understated its furniture spend at the time - it spent about $2800 per person based on its website costings of $5.6m of furniture for about 2000 staff.

"At the peak we'll have 25 per cent more people in that building than MBIE ever had. You're comparing apples with oranges," Hughes said.

Hughes was also critical of comparisons of how much money was spent on furniture in schools versus the ministry.

"The spend on school refurbishment on repairs is the highest it's ever been.

"We're spending $500m on schools every year – this is a one-off spend of $19.5m," he said.

An MoE spokeswoman said the staircase was needed because there were only four lifts in the building and eventually it would have 25 per cent more staff than when MBIE occupied it. There would also be an estimated 1000 visitors a month.

It was not "a Stairway to Heaven" but was the cheapest way to handle the extra traffic. The alternative – a fifth lift – would have cost up to $4m.

Other changes would see phone costs cut by about $330,000 through scrapping traditional desk phones and providing staff with headsets and Skype.

Eventually all staff would "hot desk" with only a locker but no desk of their own – a first for a government department or ministry. The design was open plan, and even chief executive Peter Hughes did not have his own office.

MoE had effectively started with a shell.

It bought new furniture but the ministry had been running down its old furniture for some time, and had offered the surplus to charities but little was taken up.

MoE has refused to disclose the cost of individual items, saying the supplier was "quite sensitive" and did not want the figures made public to future customers. But she said the cost was within Government guidelines.

Hipkins said that was "tough luck" on the supplier but they should have been released. Keeping those costs confidential undermined the Official Information Act as well as notions of transparency and accountability.

The spokeswoman later clarified that MoE had planned to release itemised furniture costs under the OIA.

However, it was advised by the Government's centralised property management arm, the Property Management Centre of Expertise, it could not do so.

"We were told that was not allowed under the all of government contract, regardless of any view the Ministry or supplier might have."

Hipkins said Education Minister Hekia Parata had overseen the refit and the overall cost was "pretty hard to justify in the current climate, when teachers and students where dealing with mouldy classrooms, early childhood centres and tertiary providers were crying out for more funding".

He said they could have saved more with a cheaper refit.

He questioned why the ministry had installed a "Plaza" on level two, a "concierge-style" arrangement in reception and a "Koru Lounge".

But the MoE spokeswoman said the term "Koru Lounge" may have been used in an early document but there was nothing like that now.

She said the costs of the refit came from a different budget than that for classrooms and the money was saved over a number of years. "It was not money being kept from schools."

Education Miniser Hekia Parata said the revamp was a "saving on the current arrangement" and she was "confident the money has been prudently managed".



THE PROJECTED FINAL SPEND: