More not less funds needed for public housing and homelessness

In recent weeks, the media has reported on the Federal Government’s plans to overhaul the National Housing Affordability Agreement (NAHA), casting uncertainty over the future of $1.35 billion of annual funding to housing and homelessness services across the country.

The NAHA currently delivers $1.35 billion a year in funding for public and community housing and homelessness services. Of this, Victoria receives around $340 million.

The rumoured changes to the NAHA have alarmed the homelessness sector, with service delivery at risk through the potential loss of the $275 million for homelessness services in the agreement, and the existing challenges in accessing scarce public and community housing set to increase tenfold if funding of these housing options is decreased

Since the initial reports, the Government’s message has tempered. Federal Treasurer Scott Morrison has provided reassurance that the $275 million homelessness funding [paywall] component will continue, but insists that the NAHA needs an overhaul, foreshadowing significant changes to give a bigger role to the private sector in delivering affordable housing.

There is no clarity around whether the amount of funding will remain the same, or whether these vital resources currently directed towards public housing would be redirected. This possibility is extremely concerning in its own right. A further considerationis is that any redirection could be towards affordable home ownership or rental housing for middle income, rather than low-income, households.

In the course of the debate the Treasurer has suggested that the NAHA has failed to deliver, because the amount of public housing has declined.

As staunch advocates for increases in public housing we thought this merited a #factcheck.

The NAHA is intended to increase social housing (both public and community housing), so should fairly be assessed against total social housing growth.

According to the Productivity Commission, Report on Government Services, the total number of social housing units in Australia increased between 2007 to 2016, by 10%, or 40,141 properties, and in Victoria by 14% or 9,672 properties. Over this period most states transferred some of their public housing stock to community housing to support growth in that sector, and to capture Commonwealth Rent Assistance, as this is paid to community housing tenants, but not to public tenants.

This explains the decrease in public housing, and some of the increase in community housing, evident in the charts below.

Aus_public & community housing

Vic_public & community housing

This increase in social housing was due both to the NAHA, and to the Rudd Government’s investment of $6.6 billion into creating 20,000 new social housing properties as part of the Nation Building Stimulus Package. Community housing also draws on other revenue sources, such as philanthropy, to increase their stock portfolio.

Nonetheless, total social housing stock – even net of Nation Building – has grown.

Meanwhile, the NAHA has also provided the subsidy needed to continue provision of existing public housing to 320,000 households. This is a subsidy to meet the gap between the rent received and the cost of providing public housing. This gap has grown as the average incomes of public tenants have decreased – a result of the increased targeting of public housing to households with the greatest need.

Overall, this indicates that the NAHA has achieved important outcomes.

At the same time, Council to Homeless Persons, like others, calls for Federal and State Government to do more.  Nationally 200,000 households are on waiting lists for public housing; 33,000 of whom are in Victoria; and there is a national shortage of 500,000 private rentals that are available and affordable for people on low incomes.

At the same time, Council to Homeless Persons, like others, calls for Federal and state government at the national level. Any reform must be directed to increasing public and community housing opportunities available to the lowest income households.

One sensible change would be to separate funding for the operating subsidy needed to house the lowest income households, from a growth fund to be directed to increasing the overall public and community housing stock. This would increase both transparency, and accountability.

But growth, whether funded directly, from a future fund, or by a targeted tax incentive, would require additional investment.

You can get behind our efforts to secure investment in growth of public and community housing in Australia by signing this petition which is calling on the Federal Government to release an affordable housing and homelessness plan.

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