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Mr Horan today told the New Zealand Herald he used his parliamentary-funded cellphone to call the TAB about 140 times during 10 months in Parliament as he was entitled to do, and the total cost to the taxpayer was only about $20.
Mr Horan's parliamentary cellphone records showing calls to the TAB were leaked to media last week, a few days after he was expelled from the NZ First caucus following allegations he had improperly accessed his dying mother's bank account.
Mr Horan's brother Mana Ormsby has claimed the MP used the money to buy food, hire DVDs and fund a gambling habit.
Mr Peters has said Mr Horan's use of his parliamentary cellphone to place bets was one of the reasons he sacked the MP.
When asked about the possibility of National using Mr Horan's proxy vote, Mr Key said the party would want to understand exactly what Mr Horan was accused of, before having that discussion with him.
"Using his mobile phone - to the best of my knowledge and I might stand corrected - is not a reason to sack a member of parliament.
"I use my mobile phone to ring my wife, I use my mobile phone to make restaurant bookings."
Mr Key said he understood that kind of personal use was permitted as a fringe benefit.
He also questioned whether the frequency of Mr Horan's calls to the TAB indicated he had a gambling problem.
"Ringing 14 times a month; is that an addiction? I reckon that would be a stretch."
Mr Horan, who says his name will be cleared, is staying on in Parliament as an independent MP but is expected to be kicked out of the NZ First party when the board meets this evening.
This afternoon he told the Herald he had asked for the return of his phone records which it is understood were originally supplied to NZ First by the Parliamentary service with Mr Horan's permission.
"I was very concerned for the people who had rung me in confidence"he said.
They included KiwiRail contacts he spoke to while exposing alleged safety issues at the rail operator, including thousands of rotting sleepers.
Mr Horan said he had approached both the police and the Privacy Commissioner about the leak of his phone records.
"I wasn't at all concerned about the amount of TAB calls on my line. There's an average of 14 a month, that's nothing.
"The costs would have been about $20 over 10 months. There's fringe benefit tax paid on our cell phones for our personal calls and it falls well within that.
"I would just say that whoever leaked them was politically irresponsible in the extreme ... they were used selectively for political gain."
However, Mr Horan is under fresh pressure in the form of media reports that forensic accountants examining his late mother's affairs have raised issues with a number of cheques.
Meanwhile, Mr Key this morning said it was possible the Government may move to reinstate some form of "waka jumping"legislation that would prevent list MPs, such as Mr Horan, from staying on if they no longer represented the party which took them into Parliament.
Previous legislation dealing with the issue expired in 2005.
"Parliament might hold hands and look at this issue and decide once more to try and put something more permanent in place," Mr Key told TVNZ's Breakfast programme.
"The issue is it's really difficult to write the rules, but if you in theory could write the rules then it's possible."
In an interview with RadioLive's Duncan Garner this afternoon, Mr Horan said his lawyers would be dealing with the allegations later this week.
That would make it clear that: "I have never stolen a cent from my mother".
However, Mr Horan did not deny he had received money from his mother.
"My relationship with my mother was such that if I ever required anything, all I needed to do was ask."
Asked whether that included money, Mr Horan said: "this is all going to be brought out in a few days".
While NZ First's board may choose to cancel his membership, Mr Horan believed he still had a mandate to stay on in Parliament.
"I've done nothing wrong first and foremost, and I was elected for the term in Parliament.
He would "absolutely"stay on as an independent MP until the 2014 general election.
- By Adam Bennett of the NZ Herald