A Palmerston North couple who sublet a state house in Auckland were among more then 300 tenancies terminated by Housing New Zealand this year.

The couple sub-let the Auckland property for one year and lied about their income for four years.

When interviewed by Housing NZ, they denied sub-letting but an investigation established they were living in Palmerston North, where their children were enrolled at school.

The tenancy was terminated, and both tenants were convicted and sentenced to 150 hours' community work each. They are now repaying $22,486 to Housing New Zealand.

In the Lower North Island, 41 tenancies were terminated by Housing New Zealand in the year to June 30 after investigations found the tenants had obtained a state house or taxpayer-subsidised rent by lying about their circumstances.

Nationally 312 tenancies were terminated. Housing Minister Phil Heatley said the figure is up from 241 last year and 114 in 2010.

“There has been a sharp increase in the number of state tenancies ended for dishonesty over the past couple of years,” Mr Heatley said.

“Housing New Zealand has worked hard to identify and remove tenants committing fraud and to make sure those most in need are assisted for as long as they have that need.

“We have built a very effective and skilled team of investigators who are very good at detecting, investigating and dealing with tenants who are deliberately ripping off the system,” he said.

In addition, during the past 12 months Housing New Zealand established $9.6 million in Crown debts for overpaid rent subsidies - bringing the total over the past four years to nearly $23.3 million.

“In one recent case the courts ordered the former tenant to repay over $75,000 in rental subsidies. It's very important that we not only end tenancies, but also seek to recover the taxpayer-funded rent subsidies that these people received by knowingly lying about their circumstances.

“A state house is not an automatic entitlement - and people who deliberately lie about their circumstances are depriving families in real need and receive benefits that they are not entitled to.

“By freeing up 312 homes in the past 12 months, a total of 709 over the past three years, Housing New Zealand is able to help a significant number of people on the waiting list who desperately need a state house.”

- © Fairfax NZ News