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Ms Bennett said more than 21,000 beneficiaries had their benefits cut in the past nine months for trips abroad that did not meet the rules.
Although there have long been penalties for those on the unemployment benefit who travelled other than for health or compassionate reasons, they were further tightened as part of the welfare reforms last July. The restrictions now cover a wider range of people, and also allow Work and Income to immediately cut off the benefit if it was not told of the trip.
Ms Bennett said the numbers were "staggering".
"Every day we hear stories of how people cannot live on the benefit. Today you're hearing that literally thousands can not only live on it but can afford to travel overseas as well."
Auckland Action Against Poverty spokesman Alastair Russell said Ms Bennett's comments were "a cheap publicity stunt trying to vilify beneficiaries".
Labour's social development spokeswoman, Sue Moroney, said there had always been penalties for travelling without valid reason, but Ms Bennett was wrong to claim beneficiaries could clearly afford to travel. Often the money was scraped together by other family members or was a gift.
"I think Paula Bennett's attempts to paint this picture of beneficiaries off living the high life at Club Med is not accurate. If Paula Bennett thinks it's easy to live on a benefit and somehow have money left over to go travelling, she needs to have a go at living on a benefit for a while and see how she gets on. Might have been the case in her day, but it's not the case now."
Ms Bennett, who was on the domestic purposes benefit in her 20s, said she did not believe she had travelled overseas while on the benefit. She denied she was "beneficiary bashing" and said the policy was fair.
"It proves nearly 10 per cent who have been job tested can afford to go overseas. I think a lot of the time someone else has paid, but it's still what many New Zealanders would consider a luxury."
There was also provision to appeal against the decision - as happened in 38 cases in January. Ms Bennett said in most of those cases the person had to travel at short notice because of an emergency and had not notified Work and Income, but had their benefit paid back after it was reviewed.
Under the rules, beneficiaries in the "Jobseeker" category can go overseas only for compassionate or health reasons or for approved travel for job interviews. The maximum allowed is 28 days in any one year. If Work and Income is not told of an overseas trip, the person's benefit will be stopped.
- Claire Trevett, NZ Herald