Barnaby Joyce has moved to return a $40,000 cheque handed to him by mining magnate Gina Rinehart on Tuesday night, a cash award described as "very unusual and concerning" by Opposition Leader Bill Shorten.
Mr Joyce took time out from campaigning in the New England byelection to attend an agricultural sector event where Ms Rinehart, a long-time supporter, presented him with the inaugural award and labelled him a "champion of our industry".
The National Farmers' Federation, which was involved in organising the National Agriculture Day event, has quickly distanced itself from the cash prize. President Fiona Simson said the organisation was not consulted and "completely surprised" by it.
Labor questioned why Ms Rinehart would award the prize and why the former deputy prime minister and agriculture minister would accept the cheque in the first place.
"This is very unhealthy for our democracy. It's not right, it doesn't look right, it doesn't smell right. This is very, very unusual and concerning conduct," Mr Shorten said.
Mr Joyce - who is fighting a byelection after being booted from Parliament for holding dual citizenship - said on Tuesday night that "all I'm thinking about now is the things I'm going to do on my own farm" with the money.
When handed the novelty oversized cheque, he exclaimed: "Hooley dooley! Rightio."
But Mr Joyce has now confirmed he will not accept the cheque and would like to see the money used at next year's event.
"I was very humbled to receive the National Agriculture Day Award but very surprised to receive the novelty-sized cheque," he said on Wednesday.
"I did not take any cheque from the event and as soon as office hours resumed today, I took immediate action to politely decline any acceptance."
Greens leader Richard Di Natale said: "The fact that Barnaby Joyce was even prepared to accept a $40,000 gift from a mining magnate is everything that's wrong with politics. It shows how normalised the culture of donations and gift-giving has become in Canberra."
Senator Di Natale renewed the Greens' call for a federal anti-corruption body.
Presenting the prize, Ms Rinehart said Mr Joyce had been a "dedicated, understanding and enthusiastic minister" and expressed her hope he would emerge victorious from the New England contest.
The Nationals leader in exile is expected to be returned in the safe rural seat, which will go to the polls on December 2.
The relationship between Mr Joyce and the scion of Hancock Prospecting has come under scrutiny before, with Ms Rinehart contributing $50,000 to his 2013 election campaign.
She also famously paid for Mr Joyce, deputy Liberal leader Julie Bishop and former Liberal MP Teresa Gambaro to fly to a lavish family wedding in India in 2011. The trio also claimed more than $12,000 in "overseas study" allowance to pay for the flights home.
