The idea was floated by the Northland DHB in a position statement aimed at influencing policy in the area and the rest of the country.
It was trying to fight an "obesogenic environment", a society that makes it easier for people to make bad health decisions, it said.
The SDHB’s medical officer of health, Dr Susan Jack, said it was the DHB’s role to support health-promoting environments.
"We acknowledge that sugar-sweetened beverages are a significant source of sugar in the diet of New Zealanders, are energy-dense and nutrient-poor, and displace healthier food and beverage options."
She said the health authority backed a World Health Organisation objective to end childhood obesity.
"We similarly support the Northern District Health Board in advocating for healthy food and drink including through reducing exposure to children from unhealthy food marketing."
But the general manager of Oamaru company Rainbow Confectionery, Brent Baillie, said the plain packaging idea was "unrealistic and unnecessary".
He recommended health boards concentrate on other areas, which in the case of the Southern DHB, was to address its financial concerns.
"I actually thought they would have better things to work on to be honest ... like worrying about their deficit and not the packaging on lollies.
"It’s about prioritising your efforts, isn’t it? I think the health boards could put more effort into prioritising the things they look at and prioritising the packaging of lollies is pretty much down the list. I think most of the public would agree."
He earlier told Radio New Zealand the idea was ridiculous.
"Cigarettes are an addictive item, lollies aren’t. Cigarettes have addictive chemicals in them that influence the brain, lollies don’t," he said.
Multinationals were unlikely to toe the line, he said, and there was nothing wrong with using packaging to distinguish between products.
Lollies were not a staple food item, nor part of an everyday diet.
"They’re just a thing you grab when you feel like you deserve a treat. And what’s life without a treat?"
Northland DHB chief executive Nick Chamberlain said healthy foods were at an unfair disadvantage compared with foods in bright packaging aimed at influencing children and families.
"Plain packaging would help challenge the power of corporate snack manufacturers and put unhealthy foods on a level playing field with unbranded fruits and vegetables," he said.
A public health doctor who founded the sugary-drink opposition group FIZZ, Gerhard Sundborn, agreed sugary treats deserved the cigarette treatment.
"We’ve talked about sugar being the new tobacco. And so I think measures that have been used in tobacco, like plain packaging, smoke-free environments and taxes on smokes ... will work on unhealthy foods," he said.
— Additional reporting Jacob McSweeney and RNZ
