Trials are being rolled out with the hope to improve the "health, independence and quality of life of people living with dementia and their carers", in an effort focused on helping the newly diagnosed and those who care for them.
It's an "essential first step in improving dementia support", Associate Health Minister Ayesha Verrall said.
Verrall said it would support respite services for the carers of people with Dementia, "so they can get the support they need in order to continue to look after their loved one".
"Caring for someone with dementia is a full time job. It can be incredibly demanding and we know there are issues with carer burnout, that's why this is a priority for one of the first actions we're taking."
"The respite options we will focus on will help improve the mental and physical wellbeing of carers by offering them the ability to take a meaningful break, while maintaining confidence that their loved one is being cared for in ways that meets their needs," she said.
She said that traditional respite services are not always suitable, "as we know unfamiliar settings and people can be difficult and stressful for people with dementia".
"We're also funding pilots of intensive support immediately after people are diagnosed because that really helps link them in with services, provides good quality of life and promotes better outcomes."
It is the first two steps of four major areas in dementia support the Government is looking at.
The $12 million investment over four years will go to trialling post-diagnostic support programmes to help people who have just found out they have dementia and will also test new respite options for carers, focusing on their mental and physical wellbeing.
It comes as dementia campaigners have been calling for more help, labelling the current level of service funding "woefully inadequate".
Alzheimers NZ chief executive Catherine Hall told 1News dementia was a big and growing issue in New Zealand, with a rapid rise expected.
"New Zealand has not prepared for it and our health system hasn’t prepared for it."
Hall said there was about currently about 70,000 New Zealanders living with dementia.
"That number is going to more than double in the next generation and increase even faster for Māori, Pacific and Asian communities.
Hall described the funding about more current services as "woefully inadequate".
She welcomed the latest funding addition, that she said focused money on areas that the sector had indicated were important and placed priority on Māori, Pacific and rural and young onset dementia, "all groups that desperately need more and better services", Hall said.
However, that funding barely scrapes the surface, she said.
"Those trials are just that - trials. Then the second problem is there is still a very, very massive under funding in the sector."
She said of the New Zealanders with dementia, about 30,000 people were missing out on support.
There were consequences of not adequately preparing for the impending rise, Hall said.
That included a rise to what it could cost New Zealand, thought to be up to about $6 billion a year for services and support, the risk of the health system being overwhelmed, and the financial, physical and emotional impact on carers, many who may have to give up or reduce employment.
"Not only are they exhausted... they are also suffering a work and economic disadvantage and an impact on their own health," Hall said.
There was an immediate need of $10 million a year to cover the shortfall for dementia community service, but even that won't deal with the increase in demand.
Anne Schumacher, chief executive at Dementia Wellington, said for many years their services have been "completely underfunded, and we know the number of people with dementia is increasing".
"We know our services are barely touching the tip of the iceberg at the moment and we know that we need to do so much more to prepare for these increases we know are going to be coming."
Dementia Wellington had an estimated $280,000 shortfall per year
"Underfunding is chronic and it has gotten worse. the reason it has gotten worse is because our numbers of the people with dementia is steadily increasing," Schumacher said.
"We need to take dementia a lot more seriously and we need to be preparing for the future because we know that the number of people with dementia is increasing and we know that funding at the moment is inadequate. We need to address that now and for the future."
Schumacher said some of the funding gaps included around diagnosis.
"Many people don't get a diagnosis and the reason for that is predominantly around the stigma still associated with dementia.
"There's a lot of shame and we really need to support the wider community to know and understand what dementia is, and what it means for people with dementia to be living with it in our communities."
She said talking about dementia was crucial in breaking down the stigma.
"Talking about it helps to dispel the myths and the fear. The more we know about it, the less we're fearful of it.
"When people think of dementia, they immediately think of the end stage of dementia, when the person is very dependent on other people for their care and well being. We focus on people who are in the very beginning, these are people living at home, who often engage in activities that they always have enjoyed like golf or singing."
Sue Forbes' husband was diagnosed with dementia about two years ago
"That was a big thing to have happened, and try to think, where do we go, what do we do from here on and just trying to find all the avenues to go down. It's very hard, there's just not the information right out there. The dementia services do an absolutely wonderful job but it definitely needs more funding," she said.
On being a carer, some of the hurdles she experienced was "battling with that person, there are some that are in denial of it too, they don't believe they have it".
"They're obstinate saying, 'I'm not going to go there, I'm not going to go here.'"
"You're just needing support from people, that's the big thing."
Jeanette Brunton, whose husband Robin has dementia, agreed.
"We were fortunate our GP picked up what was happening. When Robin said he was having trouble with his short-term memory, it was made clear that was dementia."
She said it was important people had support at the start, "to help them get through the first bits, which is awful to have to come to grips with the fact that the man or the woman you married, or your mother or your father or whoever in your family it is, has got dementia, is going to be a different, going to change, and you're going to have to understand and go with that change that is happening".
The change of abilities, because they're still the person that they are. I have a t-shirt that says, 'still me', because I am still me and my husband is still Robin.
"We've been on the journey for 10 years, so it's been hard many times, but we've had so much support from family, our church, from community, from the courses we've done, from the information we've had and from various organisations and the groups we've joined - like social drama for seniors.
Robin told 1News they create situations that they are familiar with.
"We choose something, act that out, and explore different ways of responding to, usually normal situations that people find themselves in."
Robin Fenwick said that "undoubtedly the most difficult times" people have relates to diagnosis of dementia, including accessing specialists to determine what type of dementia it is.
"There's a lot of grief that goes on, we think of grief as something that happens at a funeral or over days or weeks, but with dementia the grief goes on over four, five, maybe 10 years.
"The 'well' partner is seeing the 'unwell' partner drifting away. You grieve for the person that you once knew. The grieving goes on for that whole period... the grieving that happens at the funeral is strangely guilty that you've been grieving for so long and it's all over, or is it all over? That is probably the saddest part."
He said having support for those involved would be extremely beneficial.
"Having people around you who have been through the exercise is extraordinarily valuable."