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Under the Government's new youth welfare policy, announced by Prime Minister John Key at the weekend, 16- and 17-year-old beneficiaries would receive a payment card for food and clothes from approved stores. They would not be able to use them to buy goods such as cigarettes and alcohol.
In a letter she wrote in March, Ms Bennett responded to a suggestion for a special credit card system for beneficiaries which she said would require the Government to make "moral judgements about the appropriateness of each decision".
"Such oversight by the Crown would be highly intrusive and would rob individuals of their freedom of choice," Ms Bennett wrote.
"Spread across the entire benefit system, this kind of oversight would impose an enormous administrative burden and cost upon Work and Income."
This morning she told Radio New Zealand that was in response to a suggestion quite different from the policy her party was adopting.
"How ridiculous to say it's a backtrack," she said.
"That is not at all what we've just proposed in the weekend...and was me writing in response to one correspondent, who was proposing something very different."
Ms Bennett accepted the new policy was intrusive but said she saw 16- 17-year-olds as a special group.
"I do see it as a bit intrusive and I do see it as pretty hands on but, I think there are exceptional circumstances in this case and am prepared to do that, almost feel a moral obligation to be doing that."
However, Ms Bennett would not then rule out extending it to other beneficiaries.
"The Government's currently working its way through what is a very extensive group of recommendations from the Welfare Working Group, we are making our way through that, looking at what happens with other groups of beneficiaries at the moment," she said.
"I can't say it's (a payment card's) a priority and I don't think it will be but I can't rule anything out at this stage because that would be pre-empting announcements that are yet to come."
Ms Bennett said Social Welfare had been using payment cards for about 2-1/2 years for hardship assistance and special needs grants. In those cases it was up to staff to ensure purchases were appropriate.