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Monday, 27 June 2016


How much is Community Housing costing the tax-payer?

In the absence of any real political analysis by the media regarding the privatisation of Public Housing, the general public may not be aware just how heavily Community Housing Organisations rely on Commonwealth Rent Assistance - CRA- if they are going to provide even a percentage - up to 50% - of its vacancies to people on low incomes and pensions. The vague 'up to' guideline has been criticised by the Auditor General's Office.

CRA was never intended as an operating subsidy for Community Housing Organisations but has effectively become one over time. In fact CRA adds around 50% to rental income across a Community Housing Organisation's whole operation over and above what would be received if rents were not 'optimised' for CRA.  'Optimised' means that rents are calculated to extract the maximum CRA available, where tenants are eligible for it. The peak body acknowledges that 'from a financial standpoint there is a disincentive to take on tenants on lower paying benefits ( and especially tenants that are not eligible for CRA' )
This ongoing tax-payer funded income-stream is deemed to be 'crucial' by the peak body if their businesses are to be financially sustainable. This equates to corporate welfare.

By contrast, public housing tenants require no CRA at all since rents are genuinely affordable and within their means. Furthermore Public Housing rents go back into the public purse, and provide councils with millions of dollars in revenue each year. One has to ask 'Which system is the real subsidized, tax payer-funded housing?' 

Interesting how the truth can be very different from commonly held assumptions...
Source-  Allocation,eligibility and rent setting in the Australian Community Housing Sector
pp 22,24, 45,44

Desperate people are not being housed. 
Presumably in exchange for being given so much Public Housing, a protocol was written up. In it the Vic State Government stated its expectation that 'up to' 50% of prospective tenants would be taken from the public housing waiting list. These would be referred to Housing Associations by the state government, and would comprise of those in the 'greatest housing need.'

An analysis of figures from 2013-14 shows that although targets were reached in allocating people on and /or eligible to be on the Public Housing waiting list - the number of desperate people actually referred by DHS to the 8 large Housing Associations ranged from 0-18% !
7 out of the 8 Housing Associations scored under 2% !

A review into these figures stated that the outcome was 'less than desirable.'
What an understatement!

These major players, the eight large Housing Associations, are likely to be the recipients and beneficiaries of any future mass public housing stock transfers.They are also property developers.

In response to the Auditor General's criticism that community housing organisations favour people on higher incomes who can pay more rent - and this vehement criticism has also come from various groups including ours - CHFV's response is not to deny it, but to draw attention to the fact that there is no 'financial compensation' paid to them by the government for housing those on very low incomes..

In its definition, registered housing agencies are 'viable businesses partnering with both the government and community'. But in reality, all government guidelines are just that - meaningless guidelines.

The peak body- Community Housing Federation of Victoria - CHFV -states that Community Housing Organisations are "independent bodies and are not subject to the control or direction of government unless there is a specific legal or contractual obligation to do so"  It goes on to say that, "the DHHS guidelines are perhaps therefore better understood as a statement of general intent by the government as to its desired outcomes"

The writing is on the wall...If, as a society, we want to ensure that everyone is housed - including people on low incomes and those with high and complex needs, the solution is not to 'pass the buck' by creating a 'homelessness industry'. 

State and federal governments must consider their Duty of Care and not privatise public housing by handing it over to business interests.

Access to Community Housing in Victoria Nov 2015   pp 6,8,11
Protocol for the referral of public housing applicants to Housing Associations

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