"The decision to stop temporary release of prisoners will be in force for at least the next two weeks, while we complete a comprehensive review of our processes and look at where we need to tighten our policies."
Mr Smith said Release to Work prisoners would be excluded from the bank, and those released to supervised programmes.
Prisoners with special circumstances such as a bereavement could still have escorted temporary removal.
"Corrections' Chief Custodial Officer arrived at Spring Hill Prison today to begin the investigation into the circumstances that allowed Mr Smith's breach of custody," Mr Smith said.
"We are also working closely with the Police to help ensure this prisoner's return to New Zealand."
In a rare move, the Parole Board issued a statement this afternoon saying it did not recommend Smith be given temporary leave.
"The board in its decisions about Mr Smith?consistently identified that Phillip Smith posed a significant risk to the community," said New Zealand Parole Board chairman Justice Warwick Gendall, QC, said.
"While it supported the position for very cautious and slow steps for reintegration - as and when the Department of Corrections consider appropriate - this is a sentence management decision for the department," he said.
"Media reports stating that Phillip Smith's home leaves were granted because of Parole Board recommendations are incorrect," Justice Gendall said.