The Dotcom spy saga has been an unwelcome and embarrassing episode for the Government and the Prime Minister.
It has put wind in the sails of Labour, the Greens and New Zealand First and left the Government once again struggling and spluttering to hold on to the political agenda.
Of particular concern for National is that this saga has directly involved the Prime Minister and exposed him to a strong line of Opposition criticism, that being that he has done a poor job of overseeing New Zealand's spy agencies.
In his defence, John Key can point to the Justice Neazor's report and with some justification say he was badly let down by officials who made some terrible errors at an operational level.
But blaming officials (even if it is justified) can only go so far in politics and Mr Key knew as the Minister responsible for the GCSB and SIS that he had to take some responsibility for the debacle.
This, it seems, is why he took the rare step yesterday of apologising to Kim Dotcom and the New Zealand public over the matter.
The apology will take some of the heat out of it. However it may not to be over yet.
Opposition parties want someone held to account and are now likely to push hard for a wider inquiry, that among other things looks into the issue of why Mr Key wasn't informed earlier of the GCSB's involvement in the Dotcom case.
As New Zealand First leader Winston Peters has pointed out, the GCSB has held 15 regulation briefings with the Prime Minister this year.
Mr Key argues it's not unusual for him not to be informed about operational matters and has already signalled he think's Justice Neazor's report is enough.
Although Mr Key's very strong criticism of the GCSB yesterday suggests to me at least that the possibility of some heads rolling over the affair can't yet be ruled out.
Assuming Mr Key has put the issue to bed for now, I don't think the damage from this particular saga will be too lasting for National.
However what is of more concern is that the saga comes on top of a raft of other bad news events for the government which are forcing it to be reactive and defensive rather than proactive.
Particularly damaging has been the high profile round of job losses in the manufacturing and commodity sectors.
This has been a regular feature of the news cycle for the last few weeks and has helped the Labour party build an argument that we have a manufacturing crisis due to the high New Zealand dollar .
The Government has been desperately trying to hit back by arguing out that the economy is actually growing more strongly than in many countries and that any attempt to interfere with the currency is simply 'voodoo economics'.
However, Labour's promise of action in the form of changes to the Reserve Bank Act and a capital gains tax is gaining some traction in this type of environment.
And, at this rate, come election time Labour may well have achieved its goal of making its more 'interventionist' economic strategy less scary and unorthodox.
Lastly, the Government has also run into trouble again with the education sector. It's announcement of school closures in Christchurch has not gone down well in the city and has drawn people to the streets in protests.
Mucking around with school closures is fraught with danger for any government - whether the changes are justified or not.
National knows this is a sensitive area and it is going to have to tread more carefully with these changes over the next few months.
If it doesn't, its support in Christchurch could take a significant hit.
At 45 per cent in the latest One News Colmar Brunton Poll , there is hardly cause for panic in National's ranks yet.
However, remember that with ACT on the slide and United Future unlikely to ever offer more than one seat, National is without friends on the right.
A further dip in support come election night and it would find forming a government to be very complicated.
Not least because it may have to entertain the possibility of relying on the support or abstention of New Zealand First.
A possibility that, unlike in previous elections, Mr Key simply may not have the luxury of ruling out.