The head of the country's mental health services has no idea how many patients are being discharged into caravan parks.
A report released Wednesday found "in some places there is limited availability of community services, such as suitable accommodation, to discharge people to".
"Workarounds are sometimes put in place, such as discharging people to caravan parks," the report said.
Dr John Crawshaw, the director of mental health at the Ministry of Health, told The AM Show on Thursday he doesn't know how many patients have been released to "less-than-ideal" housing.
"What the report shows is there is much room for improvement, which is what we are focused on," he said.
"From time-to-time we are aware people are discharged into less-than-ideal circumstances. That's often due to challenges in terms of finding supportive accommodation."
Mental Health Foundation chief executive Shaun Robinson says demand for services has risen 70 percent in the last decade. Mental health services are being overwhelmed, struggling to make space for new patients without discharging the old into sub-standard accommodation, thanks to the housing crisis.
"We made a lot of advances coming out of the 1990s, but those advances have ground to a halt in the last few years," he told Newshub.
Mr Robinson says the Government's starting to acknowledge there is a problem, but isn't doing enough to remedy it.
"Once again it's just really demonstrating too many cases where it is not looking at the whole situation for the person, and not coming up with a response that gives them much of a chance of actually being able to get back on their feet."
Mr Robinson says a cash boost in the Budget was a start, but leadership will make-or-break struggling mental health services.
Dr Crawshaw says it's not his place to "have problems" with the discharge process, and won't be asking district health boards (DHBs) to ban the practise.
"I'm not responsible for the running of every service in the country," he told The AM Show.
"For me, the issue it not about regulating DHBs and the services - it's much more about how do we improve the overall practise, and as is identified in the report, how do remove some of the variability in the standards of practise?"