The chair of the panel reviewing Child Youth and Family is worth the $2000 a day she is being paid, Social Development Minister Anne Tolley says.
The government sought a special exemption to pay Paula Rebstock double the usual maximum fee.
Ms Tolley said she wanted Ms Rebstock to chair the panel from the outset because of her previous work for the government, and that she was worth the money.
"This is a big job and I think these kids deserve to have the very best people designing a system to make sure they get good lives," Ms Tolley said.
Ms Tolley said she didn't know how much Ms Rebstock had been paid so far, but said it was the State Services Commission that negotiated Ms Rebstock's $2000 a day fee.
But Cabinet documents show Ms Tolley flagged a special exemption for Ms Rebstock months before the panel was officially announced.
State Services Minister Paula Bennett also had no qualms about the fee, saying that was what would be paid for Ms Rebstock's level of experience.
The Prime Minister John Key also defended her fee today.
"The work that she was doing actually relates to an area where we do need to see significant change, where the Government's going to be investing hundreds of millions of dollars over time - so getting good advice is important.
"I'd say the advice would be worth it."
'It's a disgrace'
Labour Party leader Andrew Little said it was a disgrace that Ms Rebstock was being paid so much.
"I think for a government department that is under-resourced, struggling to do its job, dealing with some of the most vulnerable young people in the country, to have somebody come along and being paid $10,000 a week to review it - it's a disgrace," Mr Little said.
Labour Party state services spokesman Kris Faafoi said he thought most New Zealanders would struggle to comprehend such a daily fee.
"If you walk down most main streets of New Zealand and asked people what they thought of that, they would think that would be exorbitant," Mr Faafoi said.
"And I think it just starts to add up to the case that this government is spending money on exorbitant amounts on consultants, TV screens, doing up offices with expensive furniture, and I think it's starting to get a little bit out of control."
Mr Little said Ms Rebstock should be offering to do the review for a much lower fee.
The Greens' industrial relations spokesperson, Denise Roche, said Ms Rebstock's previous reports for the government had led to benefit cuts and public services being slashed.
She said it was prepared to pay Ms Rebstock whatever she wanted because it knew it would get the answers it was seeking.
"I think they've got an agenda and they employ the people - at inflated rates - that they can get to deliver the sort of reports that they want."
An exemption has also been granted for an international member of the panel, Duncan Dunlop, who is being paid $1500 a day.
The panel was established in April and its interim report was made public in September.
It is due to release its final report on overhauling CYF in December.
Who is Paula Rebstock?
Paula Rebstock is an economist and company director.
Ms Rebstock's current roles include being chair of the ACC board, chair of the Work and Income board, deputy chair of KiwiRail and chair of the Insurance and Savings Commission.
She is also a member of the University of Auckland Business School advisory board, and is a director of Auckland Transport.
Her previous roles include being chair of the Commerce Commission, a lead reviewer for the State Services Commission and she was also formerly a director of the Foundation for Research, Science and Technology.
Annual reports show that last year Ms Rebstock earned $98,000 for her ACC role, and KiwiRail's 2013/14 annual report shows she earned $50,000 annually in that position.
In 2010, Ms Rebstock was employed by the government as the chair of the Welfare Working Group.
In 2012, she was also appointed by the government to investigate a leak of restructuring plans at the Ministry of Foreign Affairs and Trade (MFAT).