Immigration Minister Erica Stanford has dismissed concerns the Migration 5 operation is "a very significant intelligence gathering and data sharing operation" developed "under a cloak of secrecy".
On Tuesday, MPs grilled the immigration minister and officials over the network, which was detailed in an RNZ investigation published this week.
The Migration 5 countries of New Zealand, the US, UK, Australia and Canada - which mirror the membership of the Five Eyes intelligence grouping - collaborate on border policies, technology and data-sharing.
Labour Party immigration spokesperson Phil Twyford said Migration 5 was operating under a cloak of secrecy, in a murky area exempt from privacy rules.
And Green MP Ricardo Menéndez March said New Zealand should rethink its involvement, calling on the government to make the case for its existence.
But Immigration Minister Erica Stanford told the education and workforce select committee that it was an operational matter and crucial to New Zealand's security.
"We are operating now more than ever in a very, very high risk environment - more asylum claims, more high risk cases. And we need to make sure that our borders are not compromised and so being able to share information with our partners is a crucial part of making sure we're keeping New Zealanders safe, and ensuring the integrity of our borders," Stanford said.
"It's a long-standing agreement, I don't think there's been any particular secrecy around it and it's been in place since 2008."
Immigration New Zealand (INZ) head Alison McDonald said so far this year it had received 727,000 data-checking requests from its four partners, and matched 185 people. It had sent biometrics on 865 people for checking with the M5 members, and received information on a quarter of them.
If errors, such as ones which happened with the No-Fly list occurred involving children, they could be rectified, she said.
"We would make sure that credentials were given so that when that child crosses the border, there's a very clear notification of what happened that it was a mistake and it shouldn't happen.
"There have been several examples in my tenure where we've done that, issued a notice to someone where perhaps we've declined an application and subsequently approved it, we've then gone on to give that person a letter to take with them in case there's any border stops."
Ministry of Business, Innovation and Employment chief executive Carolyn Tremain said strict protocols covered data-sharing, and Migration 5 was one of many such transnational collaborations.
"Similar groupings occur over many dimensions of government operational activity. Police, customs - we all have worked in an informal kind of arrangement with our Five Eyes partners."
'Cloak of secrecy' surrounds Migration 5
Labour's Phil Twyford described Migration 5 as "a very significant intelligence gathering and data sharing operation".
"[It] has largely developed over the years under a cloak of secrecy and the public New Zealand public, including people whose own data has has been shared, had no idea this was going on.
"It was all operating in a rather murky area completely exempt from the Privacy Act and the way that New Zealanders would expect data to be treated."
He was surprised at the extent of the work with the Five Eyes countries.
"It's really good that this is out in the open now. I think it's pretty clear that there should be some oversight mechanism to hold Immigration New Zealand accountable and provide some oversight to reassure the public."
That could be the Privacy Commissioner, he said, but given how significant intelligence gathering had become to the border operation, it might need to be the inspector-general of intelligence and security.
The border needed to be protected, Twyford added. "But that doesn't contradict the need for people's personal information to be treated in a way that's consistent with the Privacy Act and the expectations of New Zealanders."
Green MP Menéndez March called on INZ to make data publicly available, saying it should not take media and opposition MPs to search for information.
"I am not confident that the minister has enough oversight of an operation that is deeply sensitive in nature and I would claim goes far beyond an operational minor issue that she doesn't need to have oversight of, which seems to be what has happened over successive governments," he said.
"I think Immigration New Zealand and the minister should be making the case clear to the public as to why we should be participating in Migration 5 at all. That case hasn't been made politically to the public of New Zealand."
Data-sharing could have life-changing consequences for migrants, travellers and asylum seekers, he said, and redress options needed to be much clearer.