Internal documents obtained by TVNZ under the Official Information Act and publicly reported last month, revealed that New Zealand’s Ministry of Social Development (MSD) is systematically denying emergency housing to people in the dire and desperate circumstances.

A letter sent to regional managers within MSD explained that their job performance would be graded based on whether they met the government’s “reduction targets” for the number of people receiving unemployment benefits and the number receiving emergency housing support.

When it took office at the end of 2023, the National Party-led government set a target to reduce the number of people in temporary emergency housing by 75 percent. The number of households in state-funded emergency housing, typically motels, dropped from 3,141 in December 2023 to 471 two years later.

Reducing access to emergency housing is one component of a sweeping austerity program designed to make the working class pay for the increasingly severe economic downturn, exacerbated by the ongoing, illegal US war against Iran.

The government does not keep records of where people go once they leave emergency housing, or when they are denied access to it, but numerous organisations have highlighted an increasing number of people living on the street.

Helen Robinson, chief executive of the Auckland City Mission, told TVNZ that the instructions from MSD meant that “decision makers are incentivised to say no” to people who need housing.

Jill Hawkey, who runs the Christchurch Methodist Mission, said the performance targets created a “perverse incentive to actually keep people out of emergency housing,” adding: “I don’t think anybody should be rewarded for denying somebody their human right to shelter, and that’s essentially what’s happening.”

There are indications that hundreds, possibly thousands of homeless people have been turned away. TVNZ reported that, according to MSD’s call logging system, “For 16 months in a row, there were over 1,000 more initial inquiries to MSD about emergency housing per month than official applications that were subsequently submitted.”

Under MSD’s policies, staff have the power to deny someone emergency housing if they are deemed to have “contributed” to their own situation by moving out of previous accommodation “without a good reason” or because they “damaged the property” or did not follow the landlord’s “rules.”

In response to TVNZ’s revelations, Associate Housing Minister Tama Potaka told Radio NZ (RNZ) that he was not across “the detail” of MSD’s performance management and that the matter was “the purview of the chief executive” of the Ministry, Debbie Power. Potaka also falsely asserted that “in Auckland, homelessness and rough sleeping has reduced considerably.”

Robinson said she had “never seen this scale of homelessness in my 13 years. There are literally hundreds of people who are rough sleeping here in Auckland.” A survey by Auckland Council found that the numbers of people living without shelter in the city had more than doubled between September 2024 and September 2025 from 426 to 940. In January 2026 the number dropped to 706 people.

Asked by TVNZ if MSD had created incentives for staff to deny legitimate requests, Potaka conceded: “I can see that that’s one interpretation reasonable people can have.”

Chief executive Power, meanwhile, defended the letter sent to MSD managers, telling RNZ on July 3: “These… are targets that the government has given us to achieve, and so, of course they are part of our performance suite of what we’re expecting our staff to achieve.”

Prime Minister Christopher Luxon told a media conference on June 29 that Potaka had done “an exceptionally good job getting kids out of emergency housing and into permanent, warm, dry homes”—even though there is no record of where people who leave emergency housing, or are denied access to it, end up.

Expressing the ruling class’s contempt and indifference, Luxon also told the media he was unaware that there is no night shelter for homeless people in Auckland, a fact that has been widely commented on in the media.

In a further indication of the worsening crisis, RNZ reported on July 9: “Data from Health New Zealand shows the number of homeless people being hospitalised has doubled in six years… from just under a thousand in 2018/19 to close to 2000 in 2024/25.”

The denial of emergency housing goes hand-in-hand with the government’s plan to give police sweeping new powers to criminalise the very homelessness it is creating. It intends to pass legislation that will empower police to issue “move on” orders against people as young as 14 who are begging, rough sleeping, or attempting to “inhabit a public place.” Those who breach an order face fines of $2,000 or three months’ imprisonment.

The government’s intensified austerity measures will make the situation worse. Its May budget included an increase in rents for 84,000 public housing tenants, reduced access to emergency grants for food and other essential costs, and foreshadowed 8,700 public sector jobs. Thousands of unemployed teenagers are also being pushed off welfare benefits, while youth unemployment is above 17 percent.

Meanwhile, the government is pouring $477 million into prisons, with the prison population having surged from 9,508 to 11,255 in two years. Unemployed youth will be pushed into the armed forces as the government, with the opposition Labour Party’s support, amid moves to double military spending from 1.2 to 2 percent of GDP in preparation to join imperialist wars.

The Labour Party has responded to the MSD scandal with promises of a more humane policy to address homelessness. At Labour’s annual congress on June 28, leader Chris Hipkins declared that “houses should be homes first, investments second” and pledged to deliver “a fair go for everyone.”

These statements must be judged against Labour’s record. The 2017–2023 Labour-Greens coalition government—which included the right-wing NZ First in the first three years—was elected with promises to end child poverty, solve the housing crisis and end homelessness. The reality was the opposite.

The number of children living in “material hardship” increased from 135,000 in 2017 to 143,700 by 2023.

On housing, Labour’s record was one of broken promises. The flagship Kiwibuild policy, which promised 100,000 “affordable” homes, delivered just over 2,300 by 2024—built in collaboration with private developers and sold at market rates beyond the reach of working class families.

Census figures confirm that homelessness rose sharply under Labour. The number of people in “severe housing deprivation” increased from 99,462 in 2018 to 112,496 in 2023—2.3 percent of the population. Those living without shelter surged by more than a third, from 3,624 to 4,965.

In 2023 Hipkins, then prime minister, ruled out any increase in tax on the wealth hoarded by the country’s billionaires and multi-millionaires. Labour campaigned in the election that year on cutting spending and reducing public sector jobs. It lost in a landslide, its support almost halved from 50 percent to 26.9 percent.

Whoever wins the November election, the crisis will continue to deepen. Whatever tweaks a Labour government makes around the edges of the emergency housing policy will not fundamentally alter the ruling class’s program of austerity and war. The working class can only defend its interests by building its own party, independent of all the capitalist parties, based on a socialist and internationalist program that fights to put an end to the capitalist system that produces poverty, homelessness and war.