"It is time to recognise the special responsibility we have for the young people leaving the state's care," Tracey Martin said.
"For too long they have been left to fend for themselves with little support, in a way we would never accept for our own children when they leave home.
"For these young people, the transition to adulthood often comes early, abruptly and with little in the way of a safety net."
It had been a huge hole in the system of care.
"It's time to fix that."
Young people themselves had been engaged in the design of the transition service which would largely be provided by NGOs, iwi and Maori organisations.
The transition support was recommended in the 2015 expert panel in their report Modernising Child, Youth and Family.
Over four years, the funding will cover:
• 175 new specialist support staff for day-to-day support for young people leaving state care;
• 60 accommodation places for young people transitioning to independent living;
• $25 million to support arrangements for young people to stay with their caregiver from age 18 to 21;
• $9 million for advice and assistance to young people transitioning to independence up to age 25.
Martin said teenagers leaving should have the right to expect what any young person would want – "knowing there is someone to turn to if they need help; a warm bed to sleep in; some help and encouragement when it is needed".
The service would provide that by allowing young people to stay longer with their caregivers and providing specialist transition support workers.
