Fresh evidence about the Bain family murders has surfaced 25 years after the notorious shooting in Dunedin.

For the first time in the 25 years since the murders took place, two Dunedin residents have said they saw David Bain on the morning of the murder. The sighting could assist either the prosecution or defence case.

If correct the sighting could support Bain manipulating his paper run to bolster his account of the morning. It also goes to his unreliability about his movements. However it could also fit with Bain being so shocked at seeing his family dead he temporarily blocked out everything.

The pair say they gave their accounts to police years ago but police can find no record of their statements on the file.

David Bain, 22 at the time of the murders, was convicted of fatally shooting his parents Margaret Cullen, 50 and Robin Bain, 58, and his siblings Arawa, 19, Laniet, 18, and Stephen, 14, after a trial in 1995.

After an appeal to the Privy Council he was retried in 2009 and acquitted. He served about 13 years of his 16 year sentence.

His bid for compensation was turned down but he was awarded about $900,000 for problems with the process.

The witnesses, Fiona Clare McLellan and Greg Shane Wilson, claim they saw a tall paper boy who looked like David Bain around 7am in a location near Every St.

If correct, the sighting puts Bain, who was in 2009 acquitted of murdering five members of his family, outside of the Bain house when he claimed to be inside the house at 65 Every St, recoiling from finding his family shot.

Bain has always struggled to account for most of the 25 minutes between the time he arrived home from his paper run to calling 111 on June 20, 1994. He later recovered memories or snapshots of finding his family dead in the house.

McLellan and Wilson, then 25 and 26 were romantically involved at the time. They say they gave up trying to have their information taken seriously after both the police and Bain's defence team at the time appeared uninterested.

The pair said police interviewed them soon after the murders and wrote notes which the two dated and signed. In June, 1994, McLellan and Wilson had been going out for about six months.

On June 20, the day of the murders, McLellan had to be at work to start her shift at the Cadbury chocolate factory at 8am.

Wilson had stayed the night with her and accompanied her to the bus stop on the corner of Every St and Highcliff Rd, not far from McLellan's flat in Pukatai St.

McLellan wanted to have a cigarette before the bus arrived, hence they planned to arrive early. She also liked to be early for work so she could have a chat and a cup of coffee.

Wilson also started work, at Dunedin Hospital, where he worked as an orthotic technician, at 8am. He intended to walk slowly to work after getting off the bus in central Dunedin with McLellan.

Although the two are now vague on exact times, they still clearly remember walking towards the bus stop from the Puketai St flat and seeing a tall paper boy who seemed too old to be doing a paper run.

They watched him come down Highcliff Rd, bump into a lamppost and carry on down Every St.

McLellan remembered him staggering as though drunk but Wilson thought his gait was typical of a tall person. Both remember him carrying a yellow delivery satchel and McLellan recalls he had a paper in his hand.

"It's just too much of a coincidence for it not to have been David Bain," Wilson said.

Stuff inquiries have confirmed Cadbury, in 1994, had a shift starting at 8am and a bus timetable from 1995 for the area shows a 7.15am pick-up.

The new testimony, if correct, puts David Bain outside his house on a road that was not on his paper run but near to it.

Previous evidence about sightings of Bain indicated he was outside the gate of his home at 65 Every St between 6.40am and 6.45am.

His defence centred around the evidence that he was seen outside his house when the Bain family's computer was turned on, which negated the Crown contention he wrote the message: "Sorry you are the only one who deserved to stay."

However, the sighting and the computer turn-on time remain imprecise and the Crown have always argued that Bain had enough time to turn on the computer when he returned home.

It was also possible Robin Bain turned on the computer.

In any event David Bain said he did not leave the house after arriving about 6.45am and calling 111 at 7.09am.

If McLellan and Wilson are correct he was outside the house around 7am.

McLellan said she was working as a packer at Cadbury and had been there for 18 months before the murders.

She caught the same bus every day and had never seen a paper boy before as she waited for the bus. If early, the bus would wait at the corner bus stop until 7.15am. It would then turn and go back in the same direction from which it came.

"I said to Greg he must be filling in for his younger brother. It was odd."

When speaking to police, she recalled the officers did not appear happy with her and Wilson's accounts.

"I kind of looked at Greg to say 'that was a waste of time'. But it's something you don't forget. It's bugged me all these years."

Wilson said the paperboy they saw was "huge compared to the average paperboy".

"He stuck out like a sore thumb."

Wilson added it was only about six weeks after the murders that they realised the significance of what they had seen.

"Police were calling out for people who had evidence and we rang them. We were fully expecting to get a summons to court.

"After the statement we heard nothing at all for years."

Joe Karam became David Bain's advocate after the first trial in about 1996 and started appealing to the public for information. Wilson said he called the number given out by Karam and spoke to someone, but did not hear back.

Karam was approached for comment this week but declined an on-the-record response.

Wilson said he later spoke to private detective Wayne Idour (now deceased) who assisted Karam and the Bain camp and whose wife had taught him at school.

"He told me they already had and they already had what they needed.

"I sort of let it all go because I thought what I saw didn't matter."

McLellan said she also called the Bain defence team but did not hear anything back.

Both McLellan and Wilson thought their evidence would be helpful to David Bain because it showed he wasn't at home when the computer was turned on.