Prime Minster John Key has continued his attack on official unemployment figures, saying the survey on which the rate is based is of "no value".

Mr Key and Labour leader Phil Goff have been in a war of words over the rate and definition of youth unemployment, which is historically high, but has been declining in recent months.

The official rate is determined by the Household Labour Force Survey, which had the unemployment rate for those aged 15 to 19 at 27.6 per cent for the June quarter.

The overall jobless rate was 6.5 per cent.

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Yesterday, Mr Key claimed the real figure for the 15 to 19 age group was about 5 per cent, to which the Opposition responded that he was "conning the public".

The PM said 60 per cent of 15- to 19-year-olds defined as unemployed in the survey were studying at school or university, and these teenagers were not unemployed in the way most people interpreted the term.

Statistics NZ confirmed that figure to the Herald yesterday - 60.7 per cent of unemployed youths in that age group were at school, university or in training.

Mr Goff said the Prime Minister was "twisting figures in an attempt to pull the wool over New Zealanders' eyes".

"He's ridiculing and denying figures provided by the Government's own statistician and the Household Labour Force Survey because they don't suit his political spin."

The survey has been the source of the official unemployment rate since 1986, and defines the unemployed as out of work, looking for at least one hour of regular work a week, and available for work in the past week or in the next four weeks.

Mr Key said he saw no value in the survey, and the number of unemployment beneficiaries was a better measure of who the Government was targeting.

He put the unemployment rate for those aged 15 to 19 at about 5 per cent.

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"It's 15,000 [teenagers], the ones that aren't in school, aren't in education and aren't in training, and that's 5 per cent of the total cohort of 15- to 19-year-olds."

During question time in Parliament yesterday, the confusing swirl of unemployment numbers ensnared the Prime Minister.

Under questioning from Mr Goff, Mr Key stood by the claim that 60 per cent of NEET youth were studying; NEET stands for Not in Employment, Education or Training.

"By definition if you're not in education or training, you can't be in education or training," Mr Key said later.

Meanwhile, a letter tabled in Parliament yesterday showed that Social Development Minister Paula Bennett did not support a payment card controlling the spending of all beneficiaries.

"Such oversight by the Crown would be highly intrusive and rob individuals of their freedom of choice," Ms Bennett wrote.

The Government wants to introduce the card for beneficiaries aged 16 and 17.

BREAK IT DOWN
Unemployment rate, June quarter:
* Ages 15 to 19: 39,300 (27.6 per cent)
* 60.7 per cent are in education

Not in employment, education or training, June quarter:
* Ages 15 to 19: 26,900 (8.4 per cent)

Numbers of young people on the unemployment benefit in July:
* Ages 16 and 17: 1600
* Ages 18 to 24: 16,530.