Homeless isn’t just something that impacts the person without the home, it effects everyone.
How Dickensian. Nothing is being done to you, so I fail to see how this could be seen as "punishing." It's not like living at the mercy of a state program is a good outcome -- before this program was announced, the life situations of many of these people and their dependents who "contribute less" was far, far more precarious. Why not just see this as an act of overdue mercy -- an act of your greater community pulling together to overcome a devastating plague that profoundly affected us all?
Also, how do you know that this is giving the recipients any advantage? If they're behind on their rent, they're already in shitty financial circumstances and probably already received credit score decreases.