A report into Auditor-General Martin Matthews' actions as head of the Transport Ministry will not be made public after he resigned hours before its expected release.

Matthews was head of the Ministry of Transport during the time Joanne Harrison carried out fraud on tax payers to the tune of $725,000. Harrison was jailed for three years and seven months in February.

The report by Sir Maarten Wevers into how the ministry handled the fraud was being considered by the Officers of Parliament committee when Matthews' resignation came in writing to Speaker David Carter.

RNZ The $27,000 report at the centre of the Auditor-General's resignation won't be released by the Officers of Parliament committee. The MP in charge, David Carter, joins us.

Carter told Stuff the committee, which had representatives from National, Labour, Greens, NZ First and the Maori Party, had decided unanimously not to release the report.

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"We had received a substantial report from Mr Wevers and a substantial rebuttal from Martin Matthews.

CHRIS SKELTON/STUFF Transport Ministry manager Joanne Harrison stole more than $720,000 of taxpayers' money.

"Then as we were working through the whole issue he tenders his resignation and the committee said there's no point in going any further in analysing the report."

In a statement Matthews said he had tendered his resignation as Controller and Auditor-General.

"The issues and speculation about how I handled matters in relation to the fraud committed on the Ministry of Transport during my term as CEO have made it untenable for me to continue in this role."

CAMERON BURNELL/STUFF State Services Commissioner Peter Hughes said fraudster Joanne Harrison "wreaked havoc" within the Ministry of Transport.

"I deeply regret and apologise for the fraud that was committed by an accomplished fraudster when I was Secretary for Transport, prior to my appointment as Controller and Auditor-General," he said.

"I wished it had never happened but I accept I am accountable for everything done in and by the Ministry when I was CEO and I am ultimately responsible."

MPs on the committee had decided unanimously to review Matthews' position in response to a request from him to do so, and Matthews agreed to stand aside while it was completed.

CAMERON BURNELL/STUFF NZ First Leader Winston Peters says Matthews' resignation is "seriously regrettable".

The report was finalised in June but it was not officially "received" by the committee while Matthews was given the opportunity to comment on its findings.

The only information made public in relation to the review is a two-page briefing from the committee to Parliament.

It notes Matthews "tendered his resignation in writing ... with immediate effect".

NZN VIDEO It would be difficult for Martin Matthews to continue in his role, Greens co-leader James Shaw said.

"His resignation therefore brings to an end the matter before us."

'THE NZ PUBLIC HAVE A RIGHT TO KNOW'

But United Future leader Peter Dunne called for the report to be released, as did the public sector union the PSA.

"The New Zealand public have a right to understand the full context of Martin Matthews' resignation as Auditor-General and the content of Sir Maarten Wevers' report into Matthews' suitability for the role," the PSA national secretary Glenn Barclay said.

He said the briefing document from the committee was not good enough.

"The role of Auditor-General is of critical importance to the running of the country, and the public need to feel that appointments to the office aren't made lightly, especially when an elaborate fraud case like this has been hanging over the people involved."

The PSA believed it was in the interests of all concerned - including Matthews - for the full report to be made public.

"It's vital that public trust in the integrity of the Office of the Auditor-General is maintained, and the reluctance to release this report could call that into question and invite all manner of speculation on the case."

The PSA welcomed Matthews' decision to step down and understood "that he must not have done so lightly".

"But New Zealanders would surely like to understand his reasons for stepping down, and how much was known about this fraud case during his appointment to the role."

"Given that the Committee's documentation will not be accessible under the Official Information Act, it's crucial that the report is provided proactively in the interests of transparency and good governance."

Assistant Speaker Trevor Mallard, who was on the committee, said it had not completed its deliberations and members had handed back their copies of the report.

Asked if a payment had been made, or if a deal had done not to release the report if Matthews quit, Mallard said he was not aware of any arrangement of either sort.

"I don't think he was in a position to ask for that or us to offer it."

Carter endorsed Mallard's comment.

MATTHEWS SAYS HE 'ACTED SWIFTLY'

Matthews said that until April 2016, when he received some concerning information, he regarded the staff member who perpetrated this fraud as an able and high performing member of the leadership team.

"I believe I acted swiftly and thoroughly to detect the fraud and bring her to justice when I became aware of her potential wrong-doing. I wish that I had detected her criminal activity much earlier."

A State Services Commission report last month found whistleblowers who flagged Harrison's fraud should be offered compensation.

Staff who alerted ministry bosses to Harrison's behaviour and conduct were made redundant, and while the report says that was not directly related to Harrison getting rid of them, what followed was alarming, State Services Commissioner Peter Hughes said.

In a statement deputy auditor-general Greg Schollum acknowledged Matthews' decision to resign and thanked him for his contribution.

"I also want to thank my staff for their continued hard work. It has been a challenging time for all concerned."

NZ First leader Winston Peters said it was clear the government and the system were slow to move over the fraud by Harrison.

"The whistle-blowers should never have been treated in the way they were and deserve a serious explanation as to why the system failed them – and they lost their jobs – when they were doing a public duty in lifting the lid on illegal activity. In this country there should be one rule for all."

Labour MP Sue Moroney, who was instrumental in the issue being made public, said the results spoke for themselves.

"It's a really important piece of work that me and my team have been working on for the last year and i'm really happy with the result."

WHAT COULD BE IN THE WEVERS REPORT?

The report's briefing outlines the circumstances of Matthews standing down, and notes he was not paid during that period.

It said the terms of reference of the Wevers review was to investigate the suitability of Matthews to hold the role of Auditor-General based on his career history and performance including at the Ministry of Transport.

It was also to investigate and report on any matters that could have made a difference to the committee's decision to appoint him in late 2016, but that were not known at the time.

It said at the heart of its consideration was the constitutionally important role the Auditor-General played "and therefore the need for the office holder to demonstrate the highest standards of judgement, and to have a reputation that is beyond question".

The report was completed at the end of June and in the interests of natural justice the committee asked not to receive it but to first allow Matthews to read it and comment.

He was given until July 24 to respond and a report was received prepared by Matthews' lawyer.

The committee had also given the Clerk the authority to provide Matthews with "a significant volume of documents" collected as part of the review.