Dr Pat Tuohy, the ministry's chief adviser of child and youth health, said to invest in pepi-pods it would need "a greater level of evidence of effectiveness and safety than is currently available".
New Zealand, which has the worst rate of sudden infant death in the Western world, is leading the charge on safe sleep devices through grassroots funding and gaining the praise of international health networks.
Professor Jeanine Young of the Sunshine Coast University, who has worked on sudden infant death for 25 years, now helps to give pepi-pods to at-risk Aboriginal families in Queensland.
"It will be two to three years before we start seeing the same sorts of [infant mortality] reductions that have been achieved in New Zealand," Young said.
"You've got four years of data showing a reduced infant mortality and I'm not sure how many years of data your Ministry of Health needs." She said funding should be a "no-brainer".
Fourteen out of 20 district health boards currently shuffle their budgets to fund pepi-pods.
Hawke's Bay DHB has rolled out more than 1500 pods.
"While we agree with the ministry that the evidence on pepi-pods isn't settled yet, we do believe pepi-pods have a role to play in helping to prevent unexplained deaths in babies," a spokeswoman from the DHB said.
Child Youth Mortality Review Committee spokeswoman and public health physician Dr Gabrielle McDonald said the Government "likes to see some evidence of benefit" before it invests. "The difficulty with [sudden infant] deaths is that the numbers aren't huge and proving that one particular thing is responsible is quite difficult."
Stephanie Cowan, who has led the pepi-pod distribution through Change For Our Children, said it might have been appropriate for the ministry to be cautious about the pods four years ago. But various studies and feedback from communities showed the devices had been preventing deaths, she said.
"In the absence of scientific evidence, you use the best evidence you have."
The Herald has reported that the ministry restricted the reach of pepi-pods through a lack of funding. The pods let mums safely co-sleep with babies.
Visit tinyurl.com/pedi-pods to read the Ministry of Health's full response.