Social housing left high and dry in 2020 Budget

Housing and homelessness advocates say this year’s budget was a “missed opportunity”. 

Dreams of a social housing-led economy recovery have been dashed in this year’s federal budget, with the government favouring tax cuts to middle-income workers and big infrastructure spending as a way to reboot the economy. 

For months, community housing and homelessness advocates have said that investment in social housing would create 60,000 jobs over four years, building 30,000 properties and renovating 100,000 to decent standards. 

These calls received cross-sector support from industries including, unions, construction, economists, and community sector leaders. 

But Treasurer Josh Frydenberg’s budget announcement on Tuesday night failed to take the proposals on board, or even mention social housing at all. 

Frydenberg announced an additional $1 billion of low cost finance loans to support the construction of affordable housing, taking the total concessional finance that has been made available to community housing providers to $3 billion.

Steve Bevington, the managing director of Community Housing Limited, told Pro Bono News that while low cost finance would reduce the cost of debt to build housing, this would not help vulnerable people who are unemployed or on low incomes. 

“People in housing who are unemployed or on pensions have the lowest incomes of all. They need rents that are at 30 per cent or below their level of their Centrelink benefits. Such rents can only cover the cost of management, maintenance, insurance and rates, and leave nothing left over to meet interest repayments on even low cost finance,” Bevington said. 

“As far as affordable housing is concerned, where people have hung onto fast disappearing jobs then such financing is a great help, but $1 billion is just 13 per cent of what was sought in necessary grant funding under the request for social housing growth.” 

Kate Colvin, the policy and communications manager of Council to Homeless Persons, told Pro Bono News that investing in social housing construction would have “killed two birds with one stone”. 

“This was an opportunity of a lifetime to kill two birds with one stone, by creating jobs at the same time as creating homes, so that everyone has a decent, affordable place to live,” she said.

While $14 billion in new road infrastructure projects were announced, Colvin said these projects would not stimulate the economy anywhere near as fast as social housing projects would. 

“Road infrastructure projects take years to begin construction, and they won’t stimulate the economy at a time when the stimulus is needed,” she said. 

“It’s a budget that fails to stimulate the economy and protect vulnerable people in need.” 

Homelessness budgets also take a hit 

Budget measures also included a cut of $41.3 million from homelessness funding in July 2021, a move that has angered frontline and advocacy services. 

Homelessness Australia chair Jenny Smith said that in a year with huge increases in unemployment creating a surge in rental stress and homelessness, slashing homelessness funding was the wrong move.   

“The treasurer had a choice to make, and he has chosen homelessness for tens of thousands of Australian families,” Smith said. 

“Without increases in social housing and with even less resources for homelessness services, many families will become stuck in homelessness for a long time.” 

Remote housing receives one-off payment 

Smith added that the one-off $150 million payment for the Indigenous Home Ownership Program announced in this year’s budget to construct homes in regional areas still missed the mark.  

“Even with these short-term funds, annual funding for housing in remote Indigenous communities is $237.2 million, less than half the amount of $526.6 million spent in 2017-18,” she said. 

“The failure to invest in social housing growth in the 2020 Budget follows a 10 per cent cut to housing and homelessness funding over the three years from 2017-18 to 2020-21, most of which has been cut from remote Indigenous housing.” 

Colvin said that advocates would continue to highlight the impact a lack of adequate income support has on low-income families and individuals in the coming months, as well as fight the planned cuts to homelessness funding. 

“This is a budget that will make tens of thousands of Australians homeless because of gaps, which is very disappointing,” she said. 

“So we will continue to fight for the social housing that Australia needs, to make sure everybody has a home.” 

Our 2020 budget coverage is brought to you by Bendigo Bank.