Sydney - The police minister in Australia's biggest state has resigned over claims that during a wild party in Parliament House, he stripped to his underpants and simulated sex with a fellow New South Wales lawmaker.

Noreen Hay, the woman whom a witness said 37-year-old Matt Brown "mounted," denied Thursday that anything untoward happened during the alcohol-fueled party three months ago that her adult daughter also attended.

"I don't want to do myself any disservice here, but there are a number of very attractive young women in that Parliament and to suggest that Matt Brown would do something like that, particularly with me, is ridiculous," she said.

Hay, 51, denied a claim in The Australian newspaper that a near-naked Brown had straddled her on a green leather couch and then called out a lewd comment about Hay to her daughter.

Brown, speaking through a spokesman, denied he made the comment but did not challenge the other allegations about what went on.

"I regret the incident," Brown said.

Premier Nathan Rees, who was sworn in last week, said Brown had initially lied to him about the incident and Hay "certainly has what I believe to be an incomplete picture" of what transpired that June evening.

"I'm very confident that brick-by-brick, day-by-day, we'll rebuild confidence in this administration, but it's pointless pretending that the last 24 hours hasn't been a setback," Rees said. (dpa)