The New Zealand prime minister, Helen Clark, will decide on Friday whether she will sack her controversial Foreign Minister Winston Peters.

Our New Zealand correspondent, Kerri Ritchie, reports Mr Peters' job is on the line over a large donation from a billionaire businessman.

New Zealand's Serious Fraud office has launched an inquiry into donations made to Winston Peters' New Zealand First Party.

Mr Peters says he didn't know billionaire businessman Owen Glen had given him $US70,000 dollars to pay for legal fees.

But Mr Glen says the Foreign Minister asked for the money and said thanks when he got the cheque.

Prime Minister Helen Clark will meet with Winston Peters to discuss his future.

He maintains he's done nothing wrong.

"With the concrete evidence she will know that these allegations are vile and wrong," he said.

New Zealand's Opposition leader, the National's John Key, says Mr Peters has lost all credibility and must be stood down.

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