The City of Toronto's plan to pay people to act as homeless people in an upcoming survey is being decried by street activists as "disgusting" and a waste of money.

The 50 decoys, who will each receive a pre-approved credit card with a $100 honorarium, are being used in next month's street-needs assessment of people on the city's streets.

Volunteers conducting the survey are instructed to stop every person they see, regardless of how they appear, and ask them if they have a place to stay that night.

Patricia Anderson, manager of the city's shelter, housing and support unit, insists the decoys are a necessary tool to identify where help is needed.

Anderson noted that about 20 per cent of federal funding for homelessness is directed at aboriginal services after a previous street-needs assessment in 2006 found a corresponding percentage of number of aboriginal people on Toronto's streets.

"We take action based on this survey," Anderson told CBC News on Monday. "The last thing you want to do is organize this very large project to do this survey and then have results that are statistically invalid."

Anderson said the city has all the decoy spots filled, but housing officials still need to hit their target of 1,000 volunteers to conduct the survey itself.

Activist Rosemary MacDonald, an Ojibway Cree who herself spent seven years on the streets, said she doesn't understand how the city would need to make up homeless people.

"With the population that they have in the shelters already, I figure why don't they use the original street people on the streets, instead of faking it?" she told CBC News.

"I find it very disgusting using people who already have homes when there are people on the streets who really need the money."