The US threatened to spy on New Zealand during the height of their row over nuclear issues and the breakdown of their military alliance, according to papers published in New Zealand yesterday.
The claims are made in the private papers of former prime minister David Lange which were released to the Sunday Star-Times, and also include lists of countries and agencies on which New Zealand was spying.
Lange, who died last August, took a strong anti-nuclear line.
His government's decision in 1985 to ban nuclear-powered and nuclear-armed ships angered Washington and led to New Zealand's suspension from ANZUS -- the regional security alliance with the US and Australia.
Among the documents is a letter from former Cabinet minister David Caygill, written on March 21, 1986, in which he describes how then US ambassador Paul Cleveland had asked him if he realized what was at stake in the dispute.
"I asked him what he meant. He replied trust. I asked him what he meant by that and he said that until now the USA, Canada, UK, Australia and New Zealand had had a unique relationship. `We have not spied on each other. If you go ahead with your policies we will not be able to trust you,'" he wrote.
"I took the clear implication from his remarks that if our relationship with the US deteriorated further, then the US would no longer feel any inhibition in conducting intelligence gathering operations against us," Caygill wrote.
In another letter a fortnight later, the newspaper reported that Lange's chief of staff, John Henderson, said he also lunched with the ambassador, who raised the same issues "and it was difficult not to reach the same conclusions as Caygill reached."
Also contained in Lange's papers is the 1985-1986 annual report of the Government Communications Security Bureau (GCSB), the government's electronic spying agency, which was marked "top secret" and "umbra" -- the highest security classification given to intelligence documents.
It shows that while the intelligence flow to New Zealand from the US dropped after the anti-nuclear policy, the GCSB maintained significant links with US intelligence agencies.
The report lists the countries and agencies on which New Zealand was spying including UN diplomatic communications, Argentine naval intelligence, Egypt, Japan, the Philippines, Pacific Island nations, France, Vietnam, the Soviet Union, North Korea, East Germany, Laos and South Africa.