Paula Bennett

Wellington, April 30 NZPA - A beneficiary who laid a privacy complaint against Social Development Minister Paula Bennett has admitted she made up a story about being offered money to end the inquiry.

Natasha Fuller, a solo mother, was at the centre of a controversy last year after she talked about her inadequate study grant, then saw details of her benefits released by Ms Bennett.

Ms Bennett met her on Wednesday, and it is now known the minister was taking advice from the Privacy Commission.

TV3 News reported last night it had emails about the meeting and suggested a monetary settlement was discussed.

Ms Bennett strongly denied that, and issued another rejection today.

"These allegations are completely untrue," she said.

"During this complaint process my actions have been entirely appropriate and in line with Privacy Commission advice."

TV3 News reported tonight it had spoken to Ms Fuller, who had admitted she had been "lying and joking" when she sent emails to a friend in which she referred to money.

"Fuller has told 3 News Bennett apologised for breaching her privacy last year and she also made the point she never asked for compensation," tonight's report said.

Ms Bennett said 3 News owed her an apology and she was considering her legal options.

Privacy Commissioner Marie Shroff said today it was not unusual for parties to a complaint to meet face to face as part of an investigation.

"We have a strong focus on conciliation," she said.

"Past settlements have included an apology, an assurance an action will not reoccur, modest compensation or personal gestures, such as flowers or vouchers."

Ms Shroff said the commission was required by statute to maintain confidentiality about individual complaints.

She asked the media to respect the privacy of Ms Fuller and Ms Bennett "with regard to a process which is still continuing".

The Labour Party says Ms Bennett shouldn't be allowed to get away with resolving the issue behind the scenes and intends raising it in Parliament next week.