UPDATED 5.28pm

Labour says two of the 85 overseas students who took part in a programme to campaign for the Labour Party may not have had the visas required to take part in it.

In a statement, Labour's General Secretary Andrew Kirton said he had spent the past week sorting out the programme, including checking the immigration information of the US and UK students on it.

"In the course of that work we have become aware that two individuals may not have held the visa necessary to participate in the programme."

He said all participants were advised of the need to obtain working holiday visas.

"The two individuals concerned both chose to leave the programme last week while Labour Party Head Office was still in the process of establishing control over the programme and confirming the status of the individuals concerned."

He said one of those had left the country. He had not referred the issue to Immigration New Zealand.

Kirton said all the volunteers who were staying in New Zealand had valid working holiday visas.

The Herald has seen documentation the interns were sent which stated they should apply for a working holiday visa.

National campaign chair Steven Joyce said Labour should take responsibility for not ensuring the checks were done of the interns when they arrived.

"I think it's time the Labour Party stepped up and accepted this was a programme that was under their control, that they have been incredibly lax about it and they've let a lot of people down."

Earlier today, Labour leader Andrew Little also revealed a senior Labour office holder had stood down from the party's ruling council for his part in the botched intern scheme for 85 students from the United Kingdom and United States.

Little said Labour's Auckland regional chairman Paul Chalmers had decided to step down from the NZ Council for his role in the intern scheme, which was set up in May by former Labour staffer Matt McCarten and run by two Labour Party workers.

Little also confirmed the party would probably be left to cover some debts from the scheme - and an investigation would be done into the situation and why senior Labour members weren't told the full scale of it and the problems earlier.

"We are taking responsibility, we take moral responsibility and that means any creditors or suppliers have to be looked after too."

McCarten told the Herald last week that the scheme was paid for by a "private funder" who believed it was a valuable idea and that payments to the marae hosting the students were up to date.

It is understood McCarten has refused to tell the party who the funder was - but Little said the party would have to consider what was required to meet donations disclosure and election spending rules.

"He would have been reminded the party has disclosure obligations."

The Herald understands there were some outstanding costs the party now has to pay, as well as a contribution to any extra costs incurred by the interns as a result of the changes to the scheme - such as the cost to change flights home.

Little said he did not know how much it had cost the party so far.

McCarten stepped away from the scheme last week after Labour's general secretary Andrew Kirton stepped in.

The party is laying the blame for the failed scheme directly at McCarten's door - Little described it "fantasy land" and continued to maintain neither he nor the party's head organisation had known how large it had become or that it had funding and organisational problems.

Little said the two party workers who ran the scheme still worked for the party.

He said McCarten left his job as Little's Auckland director when his contract ended in May because McCarten wanted to get involved in campaigning. Little had told him he could not do that while he was being paid from Little's Parliamentary budget.

Little said it was not unusual for political parties to use overseas interns, but Labour had not had them in such numbers before.