The Labour Party is calling for the Government to invest some of the dividend it demands from Housing New Zealand back into the maintenance of state houses.
The agency, which has been under fire over damp and mould causing health problems in state houses, has said it spends an average of $10,000 a home on repairs and renovations.
Labour leader Andrew Little said it would cost about $35 million to bring all state houses that need repairs up to an adequate standard.
"They're taking $90 million a year out. This is an easy fix.
"Cut the dividend, spend the money on fixing the houses up, and we'll stop having kids having to go off to hospital because of the poor state of housing."
The responsible minister, Bill English, said the Government had already made a significant investment - and the amount it expected back in dividends was not unreasonable.
"We've been demanding more efficiency but also we have high expectation that they will maintain the houses," he said.
"We spend hundreds of millions on lifting the quality of the housing. There's still some way to go."