John Key and David Shearer were embroiled in a fiery exchange yesterday as both party leaders stood their ground over the ongoing Kim Dotcom saga.

Addressing Parliament after a two-week recess, the Prime Minister caused uproar in the house by clarifying when he was first informed about spying in the case, leading to raised voices and harsh insults across the room.

With two opposition MPs thrown out of the debating chamber during the row, Key corrected his previous statement about when he knew about the Government Communications Security Bureau's (GCSB's) role in the scandal.

"My answers to questions were based on my recollection at the time and the view of the director," Key said.

"And there was no direction to mislead the House."

But despite the admission the Prime Minister was branded a liar by the Labour Party last week, with Shearer calling on Key and the GCSB to confirm whether an audio-visual recording exists of the Prime Minister addressing staff at the agency during his much publicised visit in February.

"I've been advised by the director that there was no video, there was never a video and nothing has been deleted from the GCSB system," Key said.

"So quite frankly Mr Shearer should put up or shut up."

Shearer maintained his stance however, telling reporters:

"The bottom line here is what did John Key say to staff, does he know about GCSB's involvement in Kim Dotcom beforehand or not" he said

"That's the question, that's the big question here, not whether a tape exists."

As the drama continues in the case, Dotcom appeared to be enjoying the controversy, tweeting:

"Popcorn ready for 2pm live stream of my favorite sitcom: 'LIES, SPIES & SCANDALIZE' Today's episode: Clarification."