I generally say something like "You can use whatever libraries you like but I reserve the right to ask you to implement them yourselves". This allows them to focus on the part they want to focus on and shows good decision making about not re-inventing the wheel, but if they "outsource" the core of the problem (or we just have extra time) there is an obvious step deeper that can be taken.

I usually even say that they can make up library APIs if they want, because I don't really care if they have memorized the python stdlib, I just want to seem them think about and work on a coding problem.