The sheer number of people affected by Housing New Zealand's zero tolerance approach to meth contamination is "mind-blowing", the Drug Foundation says.

Executive director Ross Bell said he was shocked by the scale of the problem, estimated at around 2400 people evicted from state housing because of meth contamination.

"I don't think anyone anticipated the huge numbers that were affected. That's mind-blowing that the impact of those policy choices that were made were huge."

Housing New Zealand (HNZ) has a big job on its hands now to identify those people and provide the appropriate compensation, Bell said

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He said the $2500-$3000 reimbursement per tenancy estimated by Housing New Zealand was far too low.

"If you take into account that the costs to those affected people would have been huge in terms of destruction of their property, having to find a new property, potentially paying market rate because they were banned from social housing," he said.

Bell called for HNZ chairwoman Adrienne Young-Cooper to stand down.

"She was responsible for all of this. The report clearly shows the board failed to be governors. They delegated a lot of these shitty decisions to management and in terms of accountability it needs to extend beyond just an apology."

A report by HNZ on its previous approach to meth contamination in its houses shows 800 tenants were kicked out of their state houses for meth contamination and 542 tenants were charged nearly $7 million in total for meth contamination between 2013 and 2018.

HNZ spent $120m on decontaminating and restoring properties, and demolished 40, while using a meth standard now found to be safe.

HNZ admits it was wrongHNZ chief executive Andrew McKenzie, who fronted at a press conference along with Housing Minister Phil Twyford and acting HNZ board chairman Vui Mark Gosche, estimated that for each of the 800 tenants evicted, another two people went with them – adding up to around 2400 people evicted.

HNZ has admitted it was wrong and ignorant in its previous approach and gave no regard to natural justice.

It will formally apologise to affected tenants and reimburse them for the costs they incurred.

It is also considering establishing a fund for tenants and their families to access for addiction and rehabilitation services, and other support they might require to sustain their tenancies.

HNZ said its past zero tolerance approach had had a far-reaching effect on tenants, including losing their tenancies, their possessions, being suspended from the waiting list, poor credit ratings and being made homeless.

"Housing New Zealand failed, in some individual cases, to follow the principles of natural justice, by applying its suspension policy without providing sufficient detail to allow tenants to respond meaningfully to a notification that they were being considered for suspension.

"Housing New Zealand failed, in some individual cases, to take sufficient care in examining methamphetamine test results before seeking to end a tenancy," the report said.

McKenzie said the report showed HNZ's previous approach had poor outcomes for tenants and their families.

"I apologised in June and we do so again to those tenants and their families who had their lives disrupted.

"We plan to put things right and that means not just looking to rehouse those tenants who had their tenancies ended but to provide other forms of assistance."

Twyford and McKenzie said the reimbursement did not prevent former tenants from taking legal action.

In May, the Prime Minister's then Chief Science Adviser Professor Sir Peter Gluckman produced a report which said there was no evidence that third-hand exposure from methamphetamine smoking caused adverse health effects.

The report found remediation in most cases was needed only in homes that had been former clan labs producing the drugs and where meth had been heavily used.

The report said levels that exceeded the current standard of 1.5mcg/100cm2 should not signal a health risk and exposure 10 times higher (15mcg/100cm2) would also be unlikely to have any adverse effects.

Because the risk was so low, testing was not warranted in most cases.

Twyford said at the time that the new regime would make 200 previously unsafe Housing New Zealand houses available and save HNZ around $30 million a year in testing and remediation.

No heads to roll

Today he said he held the former government responsible for the "fiasco" and called for former social housing minister Paula Bennett to apologise for the policy and her regular "gloating" about the eviction of tenants.

He said no one at HNZ would lose their jobs and neither would Young-Cooper.

"This was an organisational failure. It recognises that its zero tolerance approach was wrong," Twyford told reporters.

If he felt the agency was shirking its responsibility, he would have fired people.

Twyford said it was clear that HNZ had been told by the previous government that it should operate with a zero tolerance approach.

"It's not about punishing individuals."

Gosche, who was appearing because Young-Cooper was overseas, said the board offered a heartfelt apology.

In her foreword to the report, Young-Cooper said the board accepted that significant harm was done to tenants.

"We have been particularly dismayed at the scale of the human impact of the zero tolerance policy which this review has revealed."

She said the board accepted criticism that it had been using the wrong standard for meth contamination but HNZ had made "strenuous efforts" to find a suitable level.

Reassurance sought on meth standard
Minister of Commerce and Consumer Affairs Kris Faafoi said he had asked the new Chief Science Adviser, Professor Juliet Gerrard, to work with the Ministry of Business, Innovation and Employment to ensure Standards New Zealand's standard-setting process was robust.

While MBIE's independent review of the process for creating the methamphetamine standard complied with the law, he had broader concerns.

"We need to have confidence in our system and to ensure issues such as those encountered by Housing New Zealand tenants do not recur," Faafoi said in a statement.

National defends policy
National's housing spokeswoman Judith Collins said Twyford needed to explain why taxpayers were compensating people for breaking the law.

"The fact is the previous National government acted on the best available expert advice. We repeatedly questioned that advice but it remained - it was unsafe to put people in a house which had been used for smoking methamphetamine," she said in a statement.

"Mr Twyford has decided to compensate people for being moved out of their state house for breaking the law or their tenancy agreement. He's paying out millions of dollars including to people who were smoking or cooking P in state houses while deserving, law-abiding families waited on the waiting list."

But she conceded there may have been cases where people were unfairly removed.

"If that's the case they should be compensated and Housing New Zealand management should answer for it."

Green Party co-leader Marama Davidson said the "baseless hysteria and mismanagement by National whilst in government resulted in hurt and pain for vulnerable Kiwis, including the elderly, who just needed a home".

The Government had now removed the requirement for HNZ to make a profit, and was also putting new social objectives into the Housing Act to ensure that tenants' wellbeing was put first.

"These changes, alongside a financial assistance programme by Housing New Zealand to support affected tenants and their families, will hopefully turn the ship around for so many tenants who have been hurt by the way National ran Housing New Zealand," she said in a statement.