Liberal frontbencher Melissa Price has been accused of offending the former head of a Pacific island nation with comments about his region always demanding "cash".
The environment minister told parliament she bumped into Labor senator Pat Dodson, who was dining with former Kiribati president Anote Tong, in a Canberra restaurant on Tuesday night.
She was allegedly told Mr Tong wanted to meet with her about climate change.
"Is it about the cash?" Ms Price said in response, Fairfax Media reports.
Kiribati President Anote Tong. Source: AAP
"It's always about the cash. I've got my chequebook over there. How much do you want?"
When asked in parliament on Wednesday if she denied the exchange, Ms Price said she told Mr Tong the Pacific was a good friend and neighbour to Australia.
"I am very concerned that in some way president Tong has been offended in any way," she said.
Minister for the Environment Melissa Price during Question Time in the House of Representatives. Source: AAP
"I one hundred per cent disagree with what [Senator Dodson] said was the conversation."
Labor climate spokesman Mark Butler said the exchange was also witnessed by a number of other people.
The letter Labor Senator Pat Dodson sent Environment Minister Melissa Price after the alleged incident. Source: Twitter
The comments demonstrate a lack of respect for Australia's neighbours in the Pacific, he said.
"How a new minister with responsibility for climate policy can say those words to one of the most respected advocates of strong action on climate change not just in our region but around the world beggars belief," he told reporters.
International Development Minister Anne Ruston met Mr Tong on Wednesday to reaffirm Australia's commitment to the Pacific.
