Homelessness and the Budget: Oped from our CEO Tony Keenan

George is young man of thirty and already has been homeless a few times. Like many in this position he has not had an easy life, he was in a number of foster homes and has not had a job in two years.  He has never had a stable family to support him and bounces between dodgy rooming houses, emergency accommodation and, at the worst times, the street. When things get bad for him he uses drugs and alcohol, and research tells us the longer George is homeless, the worse his substance and mental health issues are likely to become.  George, like many who seek assistance from homelessness organisations like mine, is on Newstart, a government payment that is both so perilously low and so restrictive in terms of the compliance measures that it imposes on recipients, it is possibly the single biggest barrier George faces in terms of ending his homelessness. Getting housing is the one thing that will best increase his chances of getting a job and keeping it.

And while last week’s Budget included the very welcome news that homelessness funding, which was previously insecure, would now become ongoing, there was a sting in the tail too. In the latest instalment of welfare changes  Newstart recipients will now have to prove that they are spending 50 hours a fortnight looking for work or working for the dole in order to continue to qualify for this payment, which is significantly more than the current 30 hours.  Under a new ‘three strikes and you’re out rule’ Newstart recipients will have fortnightly payments suspended and will not be able to reapply for four weeks.  In a new trial, welfare recipients will be drug tested and will be subject to having payments suspended if they are found to have used drugs.  Families in receipt of Family Tax Benefit A, many of whom are on Centrelink benefits, will cop a fall in real incomes because indexation for this payment has been frozen.

I wonder how clients like George will cope fulfilling these requirements.  It isn’t that he doesn’t want to work – he is desperate to.  But being homeless and fulfilling the new compliance requirements is going to be a challenge.  The main employment assistance scheme won’t be that helpful either. Jobactive rewards providers who can place jobseekers quickly into work, they have few incentives to assist the more complex jobseekers like George or indeed anyone who has been unemployed for a long time. A recent survey of Launch Housing clients found that just 10% of them had found paid work in the last 12 months, and that all of them had found work through their own efforts without the assistance of employment assistance providers.

Sustaining private rental on Centrelink benefits is tricky at the best of times, but data suggests that it is getting much harder.  A recent Launch Housing analysis of DHHS data has found that over the past 10 years, the proportion of rental properties that are affordable for lower income households in Metropolitan Melbourne has fallen from 27% to 8.2%.  The situation is even worse for people on unemployment benefits.  Our analysis showed that in June 2016 there were just 25 one bedroom properties across the entire Melbourne metropolitan area that were affordable for a single person receiving Newstart.  Neither Newstart nor Commonwealth Rent Assistance are linked to rents and so fail to keep pace with Melbourne’s galloping rental market.

Housing is an increasingly wobbly pillar of Australia’s welfare system, yet stable housing is fundamental to people getting into work.  We have a much lower proportion of public housing than almost any other OECD country.  In a country so dependent on the private rental market to house so many of its vulnerable citizens we are very cavalier about introducing policies that weaken the ability of welfare recipients to pay rent.  In the UK, researchers have found a clear link between cuts to housing benefit (a drop in income) and rates of homelessness.

Like most Melburnians I have found the increasing rates of rough sleeping in our city very confronting and it would be short-sighted to pretend that this has nothing to do with the adequacy of our welfare system.

George though, has been lucky and had a short reprieve.   He is in a property subsidised on a time limited basis while he looks for work. He has lined up an interview for a job as a cleaner.  But if the job doesn’t work out he will be back where he started.

There are many people like George throughout the homelessness system.  Expecting people who don’t have housing to be able to present for a job interview and win a job doesn’t meet the common sense test.

Until we develop employment support programs for people experiencing homelessness  that genuinely addresses the barriers they face (most notably housing) we will continue a policy more suited to  Alice in Wonderland that the economic and social realities of 2017 Australia. This will require us to develop effective, evidence-based programs to support people into employment, address the totally inadequate income support levels when people can’t find work, and continue to increase the supply of affordable housing. Any other response will simply condemn people like George to a life where he is constantly at risk of homelessness. It would be nice to think we could do better than this.

Tony Keenan, CEO, Launch Housing