"It's entirely appropriate for Housing NZ to provide accommodation in these cases. Homelessness is a complex issue, that often involves mental-health issues or substance abuse, but the outcome should always be getting people into long-term housing."
He also said local councils were in the best position to help in these situations, with help from the Government, rather than charities or non-government organisations.
"This should all be part of the modern welfare state."
Mr Twyford said minimum standards for rental accommodation should also be introduced. He said, at the minimum, landlords should provide one modern heating appliance and properly insulated homes before renting them out.
He said few landlords had taken advantage of incentives to insulate their properties, "those incentives are mainly taken up by owner/occupiers".
Rotorua MP Todd McClay agreed homelessness was a complex issue but said "councils have enough to do already". "There are organisations in the community that are better placed to do this kind of thing.
"There are also government agencies such as DHBs and the Ministry of Social Development, where support is fully available."
Mr McClay said introducing minimum standards for landlords could backfire.
"Landlords do have a responsibility, but this probably won't change anything except passing more costs on to landlords, who would pass those costs on to their tenants."