Wairarapa Free Budget Advisory Service manager Grant Howard said it suppressed parents' freedom of choice.
"It's a breach of human rights - I don't know how the Aussies got away with it," Mr Howard said. "You can't force parents to vaccinate. People need incentives - not punishment."
Mr Howard said he supports vaccination, but understands parents' concerns about adverse reactions.
"My kids and grandkids are vaccinated - but they're all healthy, so we're lucky.
"If they were going to do something as drastic as [cut benefits], they'll need to test babies for allergic reactions ahead of time."
Wairarapa Advocate Services manager Trevor Mackiewicz also opposed the policy.
"Most beneficiaries I have met are very responsible about getting their kids immunised," he said.
"Benefits are low enough already, and this would be an added burden.
"Besides, who's going to police it - are doctors going to be ringing up and reporting families to [Work and Income]?"
Parents have also voiced concerns - including Masterton mother Wendy Roesler, who said she thought it was a "slippery slope".
"It terrifies me - if cutting benefits is the next step down, when's it going to end?
"Parents in Wairarapa struggle enough as it is - and this is a terrifying new level of control," she said.
"I am not against vaccines, but it's a choice."
Times-Age readers took to Facebook, many arguing the policy infringed on parents' rights, was "discriminatory" in targeting beneficiaries and a step towards "state control".
"So we starve and deprive the child of necessities of life if we choose not to vaccinate them? Way to go, Aussie," said one.
Others backed the policy - and argued the anti-vaccination movement had led to a rise in preventable illnesses.
Some admonished non-vaccinating families as "ignorant and foul", "misguided" and "selfish", and said "parental rights" should not come ahead of child safety.
"[The policy] is totally fair - if you want money from the Government, follow the regulations they want for a safer country," a reader said.
Masterton Medical general manager Paul Cocks said Wairarapa parents were already "following the regulations", with the region's general practices meeting the national health target of 95 per cent of children immunised by age 2.
Mr Cocks did not address the "no jab, no pay idea", but said immunisation was up to the parent: "We prefer to work positively with parents in making the best choice for their children."
The vaccinations' safety and effectiveness had been proven through clinical trials, he said.
