The National Party says it would have cancelled winter energy payments for the elderly.

Photo: RNZ / Claire Eastham-Farrelly

Under the government's policy, beneficiaries and superannuitants are eligible for up to $700 to keep themselves warm from 1 July.

The government has said there will be an opt-out option for people who do not need the assistance.

National party leader Simon Bridges told Morning Report that the government's Budget wasn't ambitious enough and it splurged on low-value policies such as paying winter power bills.

"What we would do is actually a better targeted support for those who really need it. The reality is my parents will get - and they'll enjoy getting - that winter energy payment but they don't need it."

Mr Bridges also said the government's decision not to build the mega prison in Waikeria was wrong.

He said Labour was focused on reducing prison numbers, therefore moving towards softening bail laws.

This was not safe for the community, he said.

In last week's Budget, more funds were allocated to build temporary units to hold the country's growing prison population, but the government again put off a decision on how to deal with the rundown facility at Waikeria.

Mr Davis declined Morning Report's request for an interview this morning but did send through a statement.

"I can confirm, we will not be building a mega prison with 2500 beds as proposed by the National government. But that decision alone does not deal with the challenges I have mentioned. And we will take action, but it will be considered and not reactive."