Labor has accused Assistant Health Minister Fiona Nash of misleading Parliament, as the stoush over her former chief of staff's role in a lobbying firm grows.
On Saturday, Labor's health spokeswoman Catherine King called on Senator Nash to explain her "misleading" statements to Parliament that she was fully aware of the lobbying links of her former chief of staff, Alastair Furnival.
Mr Furnival resigned on Friday, days after Fairfax Media revealed he had significant links to the junk food industry when he was involved in the pulling down of a new healthy food rating website.
Both he and Senator Nash intervened to pull down the website, even though it had been in development for two years and was approved by state and territory food ministers.
Senator Nash made a late-night statement to the Senate on Tuesday to reveal Mr Furnival had a "shareholding" in lobbying outfit Australian Public Affairs, which is run by his wife Tracey Cain.
Senator Nash had previously stated he had "no connection" to the junk food industry.
But company documents lodged with the corporate regulator and revealed by Fairfax Media and News Corp on Saturday indicate Mr Furnival is in fact the co-owner of the company, through a parent company, Strategic Issues Management, which he owns with his wife.
Ms King said the reports demanded "an immediate explanation".
"The Prime Minister needs to clarify whether he believes there has been a prima facie breach of the Statement of Ministerial Standards by Senator Nash and clarify his office's role in the employment of Senator Nash's former chief of staff," she said.
"If this conflict of interest was known, serious questions are raised about why this conflict was not resolved earlier.
"Senator Nash must make a full explanation of what her knowledge of this conflict was and explain why she misled the Senate on multiple occasions. Senator Nash must also explain why she chose not to make reasonable inquiries as to whether this conflict had been resolved before she made no declaration to the ministerial council meeting she chaired in December last year."
Fairfax Media understands that the Prime Minister's office was aware of Mr Furnival's connection with Australian Public Affairs, but had expected him to divest himself of the shareholding.
It is understood that Mr Furnival's proposed appointment was held up by the Prime Minister's chief of staff, Peta Credlin, due to concerns over his background and commercial interests. A source revealed there was a level of frustration within the Prime Minister's inner circle over Mr Furnival, which had led to his initial appointment being temporary and subject to adequate performance. However, his appointment was eventually confirmed without any attempt to ensure he had cut his ties to the lobbying firm.
Until two days ago Australian Public Affairs was listed on the federal lobbyists' register as representing the Australian Beverages Council and Mondelez Australia, which owns the Kraft peanut butter, Cadbury and Oreo brands, among others.
It is still listed on state and territory registers as representing those companies, and others including Red Bull.
On Tuesday night Senator Nash told the Senate: "Prior to working for me, Mr Furnival was APA's chairman and because of that previous position, he has a shareholding in the company.
"Prior to his appointment to my staff, arrangements were put in place so that his previous business activities could not conflict with his obligations under the statement of standards for ministerial staff and indeed, with my obligations as a minister."
The revelations raise questions about whether Senator Nash - who repeatedly stated this week that she was fully aware of the extent of Mr Furnival's involvement with the company - had complied with ministerial standards and rules around contact with lobbyists.
Amid mounting pressure, Senator Nash again maintained her silence on Saturday.
Consumer and health groups have blasted Senator Nash's decision to pull the site down, two months after she axed the funding for Australia's peak drug and alcohol body, the Alcohol and Other Drugs Council of Australia.
Public Health Association head Michael Moore said preventive health groups were frustrated they had not been able to meet the minister since her appointment.
"I would like the opportunity to explain what this website would do and why organisations like mine had put so much time and money into this process," he said.
Consumers Health Forum spokesman Mark Metherell said it was disturbing that the government did not appear to be acting in the interests of Australians' health.
"The Prime Minister declares Australia is open for business," he said. "That should not be to the detriment of consumers."
Senator Nash has repeatedly claimed that Mr Furnival had no conflict of interest, as he distanced himself from the company he owns, receives no income from it, and his wife had committed not to undertake further lobbying in the health area after his appointment.
When he resigned, Mr Furnival said his wife and the minister had been dragged into a "smear campaign".
"I have [resigned] with a clear conscience but with recognition that this political attack is a distraction from the important health issues being effectively addressed by this government," he said.
Ms King said the government also still needed to explain why Senator Nash had personally intervened to remove the Health Star Rating system website.