Opposition leader Simon Bridges has hit out at the government on Twitter after Housing New Zealand said it would compensate people evicted from state houses after dodgy methamphetamine testing.

The Crown agent announced last week it would compensate tenants on a case-by-case basis for household items they disposed of and moving costs, and cancel all methamphetamine-related debt.

A Housing New Zealand report acknowledged the agency misused health guidelines that led to an estimated 2500 people being kicked out of about 800 state homes.

But Mr Bridges described those evicted as "meth crooks".

What cynical timing by this weak Govt; today we’ve seen a troika of unpopular plans to tax Kiwi families more, compensation for meth crooks & and more on the Meka Whaitiri saga — Simon Bridges (@simonjbridges) September 20, 2018

As many as 800 current and former state house tenants will be eligible for some form of assistance.

Mr Bridges told Morning Report the tenants who will be compensated caused harm through the smoking or cooking of meth.

"Compensating those tenants for unlawful behaviour, for breaking their tenancy, I think is wrong."

The government should be compassionate, re-house tenants and look out for the interests of children, he said.

He said most New Zealanders would also think it was wrong to compensate.

"I'm not going to sugar coat it, it's incredibly serious, this is a Class A drug."

While most of the cases may have been for smoking meth, there would certainly be cases of tenants cooking, he said.

He admitted that there is not evidence to a criminal standard, despite calling the tenants "meth crooks".

Housing Minister Phil Twyford said the previous government should apologise to the hundreds of tenants evicted from state homes based on the flawed testing.

"No one that I'm aware of is challenging ... that the actual testing for methamphetamine was in any way wrong," Mr Bridges said.

However, he accepts the testing standard for safe levels was too high.

He said he doesn't believe there should be a blanket policy of evicting tenants who smoke meth because it sends the wrong message and leads to "terrible anti-social behaviour".

"I think if you are smoking a class A drug in a state houses consistently in a state house when there are 9000 people at the moment and families waiting for a state house, I think actually where it's determined that it is you, you should at the very least go into the queue while the house is made safe rather than having other people there."

The compensation in total is expected to cost up to $5 million and a further $2 million in outstanding debt wiped.

Affected tenants are expected to receive between $2500 and $3000 in compensation.

A spokesperson for Housing Minister Phil Twyford this morning said the minister has been very clear from the start, that people who were prosecuted for methamphetamine manufacture or supply will not receive any compensation.

"However Housing New Zealand has acknowledged a lack of natural justice [in how they handled the issue of meth testing] and families whose houses were under the Gluckman level will be eligible for compensation."