More than $100 million was paid out in hardship grants by the Ministry of Social Development (MSD) in the last three months of 2018.
The latest benefit figures show that more than 385,000 grants were made in the December quarter - an increase of almost 95,000 on the same period the previous year.
People are able to access hardship grants to help pay for food, accommodation, medical costs and power bills.
Increasing demand for food assistance was one of the leading contributors to the growth in hardship grants, the ministry said.
Spending on food grants alone was almost $20m, an increase of more than $5m compared to the last three months of 2017.
Social Development Minister Carmel Sepuloni said many people struggled to make ends meet over the Christmas period, particularly when they were trying to find jobs and affordable housing.
"Demand for hardship grants is related to the cost of housing," she said.
"In places like Auckland, where rents and housing costs remain high, there's been an increase in people seeking extra support from MSD."
The number of people receiving a benefit increased from 289,800 in the December 2017 quarter to 299,300 this quarter.
As a proportion of the total working age population, that represented just a slight increase, from 9.8 percent to 9.9 percent.
The figures also showed that the number of benefit sanctions issued has continued to decline.
About 8500 sanctions were applied in the December 2018 quarter, a decrease of more than 6000 compared to the previous year.