Pressure continues to build on the government over a controversial $80 million deal it struck to buy back water from a company called Eastern Australia Agriculture.

The business, founded by Energy Minister Angus Taylor before he entered politics, was registered in the Cayman Islands. Labor is questioning whether taxpayer money has been misused.

The issue blew up even further last night when Barnaby Joyce, who was the minister responsible for the deal, conducted an extraordinary interview with ABC radio host Patricia Karvelas.

Mr Joyce said he had been kept at “arm’s length” from the negotiations with Eastern Australia Agriculture.

Today Agriculture Minister David Littleproud wrote to the Auditor-General and asked for all purchases in the Murray Darling basin from 2008 onwards to be examined.

Prime Minister Scott Morrison faced his own grilling on the subject during an interview with ABC News Breakfast this morning. Host Virginia Trioli was sceptical of Mr Joyce’s claim.

“He was not involved at arm’s length. Correct?” Trioli asked the Prime Minister.

“He was dealing with a legal entity. There is no suggestion that the company that was involved in the transaction was not a legal entity. The Labor Party did a deal with the same company,” Mr Morrison said.

“There was no questions raised about the integrity of the company with which Labor did a deal. Why would there be questions raised if the Liberal Party does one? I am not sure what the double standard is there.”

“I will share with you potentially another double standard there, and that is the government’s at pains to criticise Labor for everything, but now you’re prepared to rely 100 per cent on Labor and they are the font of all wisdom and truth when it suits you in this particular issue,” Trioli said.

“I’m not quite sure the accusation you’re making there,” said Mr Morrison.

“You’re saying Labor did it, so therefore it is fine for the government to do it,” she said.

“If you let me answer the question,” the PM shot back.

“I am simply saying the policy of how strategic water buybacks are done, are done under the framework set under COAG.”

Trioli went on to ask Mr Morrison about the fact that Eastern Australia Agriculture donated $55,000 to the Liberal Party before the 2013 election.

“Does that cause you discomfort today?” she asked.

“It is a fully disclosable donation. Donations are disclosable in Australia. There is no evidence to suggest that played any role in this arrangement. Are you suggesting that?” Mr Morrison said.

“Do you see the impression it causes?” Trioli responded.

“No, I am saying that I would think the department that negotiated this at arm’s length — remember this was initiated by the Queensland government, this entire buyback,” he said.

Trioli said Mr Morrison was being “rather casual about accountability and transparency”, and “seemingly unaccountable about value for taxpayer money”.

“Virginia, I think they’re pretty strong accusations you have just made without providing any foundation for them,” the Prime Minister said.

“What I have simply said is the strategic water buyback program has been run strictly in accordance with the rules and accountability and reviews by the Auditor-General.

“I don’t know how you could make those allegations in the way that you have. I would seem to think that would be over the top from you.”

“We will see what the court of public opinion thinks,” she replied.

Our eardrums are still recovering from Mr Joyce’s interview with Karvelas.

The interview lasted more than 20 minutes, and it felt even longer, as Mr Joyce repeatedly avoided answering questions about whether he had sought to determine where the profits from the taxpayer-funded water buyback would flow.

Clearly frustrated, he said the same questions should be asked of his Labor counterparts Tony Burke and Penny Wong.

At one point, he literally just repeated, “Labor, Labor, Labor, Labor, Labor,” in response to Karvelas’s questions.

“Let’s just calm down,” Karvelas told him.

“Let’s just do this respectfully,” she said, adding she wanted to avoid a “shouty interview”.

Mr Joyce echoed a defence put forth by Scott Morrison earlier in the day, saying the deal took place at “arms length” from himself and other ministers.

“Are you taking me to confessional or do you want the water? The Labor Party bought water off these people, we bought water off these people … people at arms length to me made the decision to buy this water,” he said.

Towards the end of the interview, Mr Joyce managed to turn the tables and accuse the Radio National host of “ducking and weaving”.

“You’re ducking and weaving, go on, spit it out,” Mr Joyce said as he insisted a broad question about government beneficiaries of the scheme was specifically about Angus Taylor.

Mr Taylor was once a director of the company that benefited from the $80 million deal.

“Let me finish my question, you keep talking over me,” Karvelas said. “I do need to finish and complete sentences.”

Mr Joyce did make mention of Mr Taylor, only to say, “I wouldn’t know him if he stood up in my cornflakes”.

Labor has demanded the Department of Agriculture publish documents by 5pm today explaining the process that led to the $80 million deal.