Welfare payments for emergency housing have skyrocketed almost 200 per cent over the last year, while hardship payments for food have risen 38 per cent.
The Opposition says this is due to the rising cost of living, but Social Development Minister Carmel Sepuloni says it is because of the housing crisis.
Meanwhile, Ministry of Social Development officials will meet tomorrow with Hawke's Bay apple growers, who have been struggling to find workers.
The latest MSD figures for the December 2018 quarter, released today, show that 9.9 per cent of working-age people are on a main benefit - up slightly from 9.8 per cent in December 2017.
Over the same period, government assistance through the Families Package has contributed to a 10.5 per cent drop - 7567 fewer people - in Temporary Additional Support/Special Benefit, which cover living costs when income is not enough.
But the number of special needs grants for emergency housing leapt from 6172 in the December 2017 quarter to 15,676 a year later - a 154 per cent increase.
That amounted to $19.5 million in government payments, a 198 per cent increase from the December 2017 quarter.
Hardship payments for food also jumped, from $14.3 million in the December 2017 quarter to $19.8 million in the December 2018 quarter - a 38 per cent rise.
Sepuloni said the increases were due to the housing crisis, with Auckland in particular being a "one of the biggest pressure points".
The Government announced in last year's Budget that it wants to build 6400 state houses over four years.
Sepuloni said it would take time for the Government's programme to have an effect on the number of emergency housing grants, but she did not want to say how long it might take.
"I'm not a clairvoyant ... All I can say is that, as a government, we've prioritised housing and we're working as quickly and as responsibly as we can to address the demand."
The rise in hardship grants for food was directly related to the housing crisis, she said.
"Obviously people are not having enough for their basic needs because housing costs are so high."
Benefit numbers for December 2018 quarter
• 299,345 working-age people getting a main benefit, or 9.9 per cent of the working age population - up 9557 from a year ago.
• 134,048 were on Jobseeker Support - up 11,007 from a year ago.
• 64,788 people getting Temporary Additional Support/Special Benefit - down 7567 from a year ago.
• 385,043 hardship assistance grants worth $108.9 million were made, up from 290,070 grants worth $76 million a year ago.
• Those getting Sole Parent Support (59,870 people) continued to decline -a pattern that has continued for five years.
National Party social development spokeswoman Louise Upston said it was "inexplicable" that Jobseeker Support numbers had increased as the unemployment rate dropped to 3.9 per cent - the lowest since 2008.
"The minister needs to explain why so many more people are lining up for a benefit, while at the same time there aren't enough people to plant Shane Jones' 'billion' trees or to pick fruit from our orchards."
Sepuloni said many factors contributed to how many people were on Jobseeker Support, including a temporary dip in demand for construction jobs in Auckland and Christchurch.
She expected demand to "ramp up" in response to the Government's housing programme.
Upston said there had been a 42 per cent drop in the number of people being sanctioned, but Sepuloni said this was because too many welfare payments were being wrongfully cancelled or suspended.
She said a case manager used to be able to cancel or suspend a benefit without anyone double-checking it, but that no longer happened.
"We haven't changed the rules around why we might sanction. We're just putting the checks in place, because we were hearing far too many times that people were having their benefits cut or suspended wrongfully, and that was obviously throwing them and their families into further hardship."
Green Party co-leader Marama Davidson said the increase in special needs grants meant that too many people were struggling to pay for the basics, and benefit payments needed to increase.
The Government is reviewing the welfare system as part of Labour's confidence and supply agreement with the Green Party.
The Welfare Expert Advisory Group is expected to deliver its report at the end of February.
Meanwhile, MSD officials will meet with apple growers tomorrow in Hawke's Bay, who have been asking for a labour shortage to be declared.
Last year MSD declared a regional labour shortage, and the ministry placed more than 1000 people - mostly job-seekers - to the region to meet demand.
Following tomorrow's meeting, Sepuloni said MSD officials would "work furiously to try and find the workforce to fill any gaps that may exist".