Christopher Luxon says he supports organisations rather than giving money to homeless after PM spotted giving cash to person in need

National Party leader Christopher Luxon says he doesn't give money to people in need, instead preferring to "do it properly" through organisations. 

It comes after Prime Minister Jacinda Ardern was spotted appearing to give cash to a person in Wellington's CBD on the weekend. 

Luxon told AM on Wednesday his preference is to support organisations around the country instead of giving money.

"A good example for me recently was Butterbean Motivation David Letele's group and foodbank, they do an excellent job. They're exactly the kind of organisation, frankly, the Government needs to help power up more, particularly with the social investment model," he told fill-in host Patrick Gower. 

"For me personally, I've done it occasionally but [wife] Amanda and I prefer to give to some organisations that can help underneath and try and do it properly through a proper organisation." 

Luxon believes by giving to organisations, they're in a better position to help people who are in need. 

"The amazing thing is, up and down this country, there are incredible community organisations that see the pain, the hurt, the need, the frustration. They are really well positioned to actually get to people and try and get to the underlying causes and actually give them more structural support," he said. 

"For me personally, that's sort of how I've approached giving over a number of years. It's just working out the organisations that we can support that can actually help people in a more structured, systemic way. 

"It's not to say that it's wrong. It's up to each individual to make their own decision about how they want to help people. But for me, that's sort of the way we've approached it." 

The cost of living crisis is continuing to hit Kiwis hard in the back pocket. Annual inflation is currently sitting at 7.2 percent, down slightly from its June peak of 7.3 percent but significantly higher than the Reserve Bank of New Zealand's 1 to 3 percent target. 

Inflation remained high due to massive price increases for construction, rentals and local authority rates, Statistics NZ said.

Food inflation is also at a 13-year-high, with fresh produce costing 8 percent more than the same time last year, Statistics NZ data from September showed.