Andrew Little says many defendants can't leave remand as rule stops them being bailed to state homes. Phil Twyford disagrees.

Justice Minister Andrew Little says there are many defendants ready for bailed release who can't get out of remand facilities because Housing New Zealand won't let them be bailed to state homes.

But Housing Minister Phil Twyford and the Ministry of Social Development (MSD) says Housing New Zealand has no such policy.

Little said lawyers were telling him all the time that Housing New Zealand were refusing to allow bailed defendants to move in with their relatives or friends who already lived in state homes.

"The policy is Housing New Zealand has to give approval, and people at the coalface are saying that approval is routinely withheld."

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Twyford said Housing New Zealand had no such policy, while Housing New Zealand directed inquiries to the MSD - who handle state home eligibility.

"Housing New Zealand does not have a blanket ban of housing people who are on bail or on remand," Twyford said.

"The position is that Housing New Zealand treats people coming out prison or on remand in exactly the same way as everyone else - there are no special policies."

He had seen "no indication" that staff might believe that they should deny applications from bailed defendants.

Little said Housing New Zealand should make their policy clear in case the lawyers were mistaken.

"Lawyers are telling me is that it is a policy. And if Housing New Zealand says it isn't a policy, it's a very simple matter to put that in writing," Little said.

"I'm meeting with lawyers and law firms every week and this comes up at every meeting."

Housing New Zealand directed queries to the MSD, who handle tenant applications.

MSD said people released on bail and parole are eligible for public housing provided they met certain criteria.

"We work with anyone who comes to us with help for housing, including someone on bail or parole, to ensure we're getting the full picture of their needs and situation so we can provide the appropriate support,' deputy chief executive for housing Scott Gallacher said.

"We use the social allocation system (SAS) to assess people's level of housing need. Those with nowhere to live are given the highest priority on the social housing register."

Little rejected a comment from National's Judith Collins that bailed defendants would be getting ahead of other deserving prospective tenants, given almost 8000 people were waiting for state housing as of March 31.

"That is a typical Judith Collins misunderstanding. This is about people who have family or whanau who are in a Housing New Zealand house that is a suitable place for them to be bailed to for stability and a bit of peace," Little said.

Twyford said there was some work he and Little were hoping to do to make sure social housing supported people and their families who had recently been incarcerated, as while there was not a policy against bailing people to social housing the process could be difficult.