Labour's claiming the government's contradicting itself when it comes to the sale of state housing.

The government could sell thousands of homes from the state housing portfolio.

Labour's Acting Deputy Leader Annette King says the government is washing its hands of responsibility.

She says the government talks about the state houses being the wrong size and in the wrong place, but then says they'll be sold to social housing providers.

PM: 'It's not an asset sale'

The Prime Minister says his National Party's policy on social housing's not an asset sale.

The Government's looking to divest some of it's state housing stock to social housing providers - a move Social Housing Minister Paula Bennett acknowledged as an asset sale on TV today.

But John Key takes a different view.

"If we sell some individual state houses it's not an asset sale.

"If we sold Housing New Zealand or a part of it, it would be and we have absolutely no plans to sell Housing New Zealand."