Increasing funding in line with inflation won’t fix our growing homelessness problem

Yesterday the Federal Treasurer, Josh Frydenberg, announced a ‘new deal’ delivering $2 billion of funding for Victorian homelessness services under the National Housing and Homelessness Agreement (NHHA). The announcement resulted in some complimentary media coverage which failed to examine any of the shortcomings of this new agreement.

It’s easy to bamboozle with big numbers when it comes to funding announcements. Two billion dollars of Commonwealth funding over five years for Victorian housing and homelessness services sounds significant. A $250 million increase sounds impressive. 

Don’t let the numbers fool you. In real terms, we’re not seeing a single extra dollar of Federal homelessness funding despite more Victorians needing help than ever before. 

The $250 million ‘increase’ touted by the Federal Treasurer is, in fact, simply keeping up with inflation.

Here are some other big numbers. Last year, 109,000 Victorians sought homelessness assistance, a 20% increase in four years.

And thousands more turned up to homelessness services and were turned away because there wasn’t sufficient accommodation and resources to help them.

When services are already turning away 91 people a day it is shameful for the Government to be congratulating itself on providing funding that simply keeps pace with inflation.

The cost of paying for a crisis bed has gone up, staff wages have increased, the cost of helping a vulnerable family pay the rent has skyrocketed, and the housing crisis continues unabated, driving so many into homelessness.

It means we’re at best, treading water on our homelessness problem, rather than actually reducing it.

And the stagnant funding is not the only problem with the new NHHA.

The NHHA funding provided to each state is based on homelessness figures collected from the 2006 Census, which is now 12 years old. There have been two Censuses conducted since then, the most recent being 2016.

Each state and territory receives NHHA funding based on their share of the homeless population. Today, Victoria has 21.3 per cent of Australia’s homeless population. In 2006, the figure was 19.4 per.

By using old data to model how the funding pie should be sliced, Victoria is being short-changed and our homelessness services will struggle to manage the demand at their doors.