The Government has announced a massive new funding package for emergency housing that includes 1000 extra places for homeless families and individuals.

The $300 million package released this morning aimed to reduce the use of motels as emergency accommodation, Prime Minister Jacinda Ardern said.

It also required those using emergency housing to start paying rent for the first time, but at maximum rate of 25 per cent of their income.

The rest of the funding would be directed at measures to prevent homelessness.

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This included more budgeting, mental health and welfare support services to help those in existing tenancies keep their rentals and others move out of state homes into private rentals.

Housing Minister Megan Woods said the Government initially planned to use motels as a stop-gap measure for temporary stays up to seven days, but the average length of stay had now ballooned to seven weeks.

"Motels are not a suitable environment for vulnerable individuals, families and whanau, and they are also not cost effective," she said.

"So we will provide 1000 more transitional housing places by the end of the year in order to reduce the numbers on motels."

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The new funding package was part of a major effort to tackle a homelessness crisis created by the previous Government in the decade it had been in office, Prime Minister Jacinda Ardern said.

"The previous Government left us with a chronic shortage of houses and were selling off state houses that people desperately needed."

The new 1000 transitional housing places would cost $175m and be delivered by the end of the year.

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They would add to 1300 transitional places already created by the current Government and a further 4000 state housing places.

Unlike state housing, those in emergency motel accommodation had not been paying rent, but that would now change.

Social Development Minister Carmel Sepuloni said emergency housing tenants in motels would now pay rent of 25 per cent of their income after staying longer than seven days.

The Government would also spend more than $100m on preventative measures under the banner of a new Aotearoa New Zealand Homelessness Action Plan.

Prime Minister Jacinda Ardern has unveiled a massive funding package to deliver more emergency housing and better prevent homelessness. Photo / File
Prime Minister Jacinda Ardern has unveiled a massive funding package to deliver more emergency housing and better prevent homelessness. Photo / File

This included $25.6m on a Sustaining Tenancies programme to give support to those at risk of losing their rental in the form of budget advice, property maintenance and mental health and addiction support.

Another $20m would be set aside to work with Māori to prevent homelessness and expand housing supply delivered by Māori, while $17.5m would support young people leaving Oranga Tamariki into accommodation with wrap-around services.

A $16.3m boost would provide housing and wrap-around support for acute mental health and addiction inpatients move back into the community.

Another $24m would help provide faster and more responsive services to those in emergency housing, while about $9.5m would be spent helping other state housing tenants secure private rentals.

Families with children in emergency housing would also get access to a $9.3m wellbeing package that would help with services, such as paying for transport to school or early childhood education

Prme Minister Jacinda Ardern arrives at the City Mission Safe Haven, Te Whare Hinatore, with Auckland Mayor Phil Goff and Associate Minister of Housing Kris Faafoi. Photo / Michael Craig
Prme Minister Jacinda Ardern arrives at the City Mission Safe Haven, Te Whare Hinatore, with Auckland Mayor Phil Goff and Associate Minister of Housing Kris Faafoi. Photo / Michael Craig

Earlier, Ardern officially opened Auckland City Mission's new Te Whare Hīnātore service exclusively for women and those who identify as women, experiencing homelessness.

The inner Auckland facility would provide a safe haven for vulnerable women for up to 12 weeks and help them into a permanent accommodation.

The Government said its new measures brought together a balanced package of immediate and longer-term actions to tackle homelessness.

Since in Government it has so far set aside funding to create 6400 public housing places, maintain 2900 transitional housing places and funding for 1103 homeless families to move into specially designed Housing First accommodation.

TODAYS $300 MILLION PACKAGE

• $175m to deliver 1000 additional transitional housing places by the end of 2020

• $25.6m extra to the Sustaining Tenancies programme to help those at risk of losing their rental with practical budget advice, property maintenance, and mental health and addiction support

• $20m to work with Māori to prevent homelessness and expand housing supply that delivered by Māori

• $17.5m to support young people leaving Oranga Tamariki care into accommodation with wrap around support services

• $16.3m to help acute mental health and addiction inpatients transition into the community with housing and wrap-around support

• $13.5m to pilot a rapid re-housing approach for people receiving Emergency Housing Special Needs Grants

• $19.8m to expand intensive case manager or navigator support services for people in emergency housing longer than seven nights

• $8.7m for a new housing broker service to connect with local landlords and help more MSD clients secure private rental homes

• $740,000 to fund programmes to help people gain skills and confidence to secure and manage a private rental home

• $9.3m to support the wellbeing needs of children in emergency housing, such paying for transport to school or early childhood education