New Zealanders in Yemen are already being monitored, Prime Minister John Key said today.
In a revelation on More FM breakfast radio, Mr Key justified changes to the Government Communications Security Bureau (GCSB) law by saying some people in New Zealand were being trained by al-Qaeda in places such as Yemen.
In "the real world", powers to spy on civilians were necessary, he said.
He said there was the "odd person" here who presented a potential threat, either on the international stage or domestically.
Mr Key later said he had signed warrants to observe people from New Zealand who were currently in Yemen and that he knew who they were.
"There are very specific and unique examples where we know that there is a threat or a potential threat and we have to take those responsibilities seriously," he said.
"People have trained in New Zealand and gone off to those camps and that's just the way things are."
Mr Key would not reveal how many people were involved, or give their names.
But he said some of them could be New Zealand citizens and they were already being monitored.
"There are small numbers of radicalised New Zealanders who have either gone over to those environments or returned. Some are off-shore and some are in New Zealand."
Mr Key said those being monitored had not necessarily broken the law.
"The fact some of them might have a link might be the sort of reason why the Government raises a warrant to observe their behaviour."
Opposition parties were quick to accuse Mr Key of attempting to frighten the public in the hope of pushing through the law to give spy agencies even greater power to monitor New Zealanders.
Labour leader David Shearer accused Mr Key of simple politicking.
"Bringing up threats to national security like this - it's not the type of thing you'd usually expect the Prime Minister to raise on breakfast radio."
Green Party Co-leader Dr Russel Norman accused Mr Key of using "politics of fear" to justify a law change.
He said Mr Key had previously raised the spectre of the Boston bombings to justify the bill, which has been condemned by the New Zealand Law Society, former Prime Minister Sir Geoffrey Palmer, New Zealander of the Year Dame Anne Salmond, the Human Rights Commission and the Privacy Commission.
"What is needed is an independent inquiry to examine the activities of our spy agencies which the Law Commission could then use as a starting point to see if our laws need changing," said Dr Norman.
"A law change should be the last step in the process, not the first, especially for a law that will have such a chilling effect on the privacy of New Zealanders."
Otago University head of politics Professor Robert Patman said the threat to the country's security was apparently "relatively minor".
There needed to be a "delicate balance" between maintaining democratic freedoms and being vigilant against terror threats, he said.
Otago University deputy director for Peace and Conflict Studies Professor Richard Jackson added that Mr Key's claims of people working with al-Qaeda were likely "exaggerated".
"There might have been one person who did it, or there might have been two or three - but if he's making out that al-Qaeda has some major connection to New Zealand, I'm highly doubtful.
"I'd like to see the evidence."