Cabinet Minister Shane Jones is denying his role in a decision to fund a group from the regional growth fund is a conflict of interest.
Before he became minister Mr Jones was involved in plans to build Manea Footprints of Kupe, a culture heritage and education centre in Northland.
He declared a conflict of interest in the project when he became a Minister in November 2017.
But in February 2018 he attended a meeting of Ministers where he spoke about the project, providing reassurances about its management.
Finance Minister Grant Robertson then approved a $4.6 million grant, despite Treasury recommending it not go ahead.
Mr Jones said he gave only factual information at the meeting and was not otherwise involved in the decision.
But National MP Paul Goldsmith said the Prime Minister must demand answers from Mr Jones.
"If you've declared a conflict of interest you shouldn't be in the room," Mr Goldsmith said.
"He was in the room, responding to questions, we don't know to what extent, and so he's left himself wide open to perceived conflicts of interest and not doing things as they should be done."
Act leader David Seymour said the Prime Minister must sack Mr Jones over his involvement in the project.
Mr Seymour said it was "completely inappropriate" for Mr Jones to be involved in the meeting which decided to grant the project $4.6m.
In an answer to a Parliamentary question, Mr Jones said he had attended no formal meetings about the project since becoming a Minister.
He said Mr Jones' misleading answer showed he is not fit for ministerial office and Prime Minister Jacinda Ardern has no choice but to sack him.