UPDATED 8.49AM: State Services Minister Paula Bennett says Iain Rennie made it seem his sympathies lay with Roger Sutton when they appeared at a press conference together.

She told Mike Hosking she didn't like that, and it was quite inappropriate.

"What Mr Rennie was most concentrating on was Mr Sutton's resignation which he genuinely thought was best for the complainant, best for CERA, best for Christchurch, and in that I think he made some errors of judgement," she says.

There'll be no call for Mr Rennie's resignation.

Paula Bennett says he's quickly accepted responsibility, and assured her nothing like this will ever happen again.

But Labour's appalled at the government washing its hands of the Roger Sutton debacle - saying it should call an inquiry into how the State Services Commission handled the matter.

Labour leader Andrew Little says Mr Rennie's decision to hold a press conference with Mr Sutton was a shocker - and a wider inquiry's needed.

"I think it shows his decision-making to be completely flawed. It goes beyond just a mistake - this goes to a pretty fundamental issue about the quality of his judgement," Little says.