The decision on the development of Waikeria Prison has still not been made, with the Prime Minister acknowledging infrastructure issues with the ageing prison.
Jacinda Ardern today said Cabinet have not made a final decision, when asked to confirm the $1 billion proposed rebuild was not going ahead.
It comes after Corrections Minister Kelvin Davis said Corrections' proposal to turn Waikeria Prison into a 3,000 bed prison would not be approved, NZ Herald reports.
Yesterday, on TVNZ1's Marae, Maori Development Minister Nanaia Mahuta said the government "aren't going to throw 1 billion dollars at a prison in Waikeria".
Jacinda Ardern said today Labour have spoken in the past about their "general opposition to the idea of large scale mega prisons".
"With Waikeria, we have to acknowledge this is a prison that is very, very old, and has some significant infrastructure issues."
Ms Ardern said the government "inherited" a high prison population, and beds are currently at capacity.
"Those are decisions Cabinet are making collectively, very, very soon."
Justice Minister Andrew Little said on March 12 , the decision may be made at the end of that month.
When asked about if the 600 modular units to be built across New Zealand would be enough, Ms Ardern said, "that was something we had no choice around".
The Government has set aside $198.4 million to accommodate 600 more prisoners, "in rapid-build modular units in prisons by the end of 2019".
Mr Davis said in a statement the Government wants to reduce New Zealand's prison population by 30 per cent in the next 15 years.
"We're at maximum capacity, keeping in mind, actually our crime rate hasn't particularly changed, but our prison rate certainly is."
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