Living somewhere safe and affordable

2020 Victorian Budget Analysis

The importance of having safe and affordable housing has come into sharp focus during COVID-19. Complying with stay-at-home orders is impossible without a safe place to live. Before the pandemic, there were 25,000 people homeless on any given night, 105 people were turned away from homelessness services every day and 100,000 people were on the waitlist for public and community housing.

The Big Housing Build Package provides $5.3b to build 12,000 new social and affordable homes over the next four years. This historic investment is a massive step forward in solving the housing crisis, with the potential to provide thousands of Victorians with a warm, safe, secure home.

A range of budget initiatives will help address the underlying causes or impacts of homelessness, including funding for mental health, out-of-home-care reform, and family violence.

In March 2020, the Victorian Government funded homelessness services to provide assertive outreach and temporary hotel accommodation for people experiencing homelessness The From Homelessness to a Home initiative extends these supports to transition people from temporary hotel accommodation into long-term housing, through provision of private rental assistance and head leasing arrangements in the private rental market. This is a smart, evidence-based approach based on a permanent supportive housing model, responding to a cohort who may not have been engaged with social services previously, and who would have otherwise not been able to access housing.

The Budget also extends funding for emergency measures that have been essential to keeping people housed during the pandemic and the subsequent economic downturn. This includes continued operation of the Consumer Affairs Victoria rent support program, the Residential Tenancies Dispute Resolution Scheme, the Rent Relief Grant, and remote Victorian Civil and Administrative Tribunal hearings. While VCAT provides an essential forum to safeguard rights in the private rental market, especially related to evictions, many renters do not attend in-person VCAT hearings. VCOSS understands that remote hearings during the pandemic have resulted in higher attendance rates, and we welcome this initiative enabling more access to justice for renters.

 

Positive initiatives

 

Big Housing Build

$2.7b is provided in 2020-21 ($5.3b/4yrs) to construct 12,000 new social and affordable homes across metro and regional Victoria, under the Big Housing Build. This investment will build 9,300 new community housing homes, replace 1,100 public housing homes and build 2,900 affordable and market homes.

Partnerships with the community and private housing sectors will deliver diverse social and affordable housing stock on existing and acquired public land, including spot purchase of existing developments and new build-to-rent developments. This package also funds ongoing social housing capital upgrades.

The package includes targeted funding allocations to ensure housing meets community need, including a 10 per cent allocation for Aboriginal housing, 2,000 properties for people with mental illness, and a 25 per cent allocation for regional Victoria. This package also funds ongoing social housing capital upgrades.

The Big Housing Build will create around 10,000 jobs per year and includes social procurement targets to engage cadets, apprentices and trainees, as well as attract new jobseekers to the construction industry, including women, Aboriginal Victorians, people with disability, social housing tenants and people from diverse backgrounds.

 

 

From homelessness to a home 

$84.5m in 2020-21 ($150.8m/4yrs) to extend emergency hotel accommodation and provide support to transition to long-term housing for up to 2,000 Victorians experiencing homelessness. This funding includes additional private rental assistance, flexible support and head leasing arrangements of more than 1,000 private rental properties.

 

Family violence refuge responses  

$6m in 2020-21 ($18.2m/2yrs) to support case management and operation of two new Aboriginal-managed and 13 redeveloped core and cluster refuges due for completion in 2020-21, continuing implementation of recommendations of the Royal Commission into Family Violence.

Therapeutic interventions (flexible support packages)

$21.2m in 2020-21 ($87.3m/4yrs) for therapeutic and flexible support for children, young people and adults impacted by family violence. This includes providing 5,700 family violence flexible support packages for victim-survivors of family violence each year, which fund Safe at Home responses, preventing victim-survivors of family violence from falling into homelessness.

 

Operating the Residential Tenancies Dispute Resolution Scheme and the Residential Tenancy Relief Scheme   

$6m in 2020-21 to Consumer Affairs Victoria to administer and operate two key programs established in the COVID-19 response, the Residential Tenancies Dispute Resolution Scheme and the Residential Tenancy Relief Scheme.

 

Victorian Civil and Administrative Tribunal remote hearing services

$0.8m in 2020-21 to the Victorian Civil and Administrative Tribunal (VCAT) for a Digital Service Transformation project and immediate information and communications technology infrastructure upgrades, to enable VCAT to hear matters remotely.

 

Big Housing Build: Victorian Homebuyer Fund

$50m in 2020-21 ($300m/4yrs) to support Victorians to buy established and newly built homes. Supporting more people into home ownership will assist with relieving pressure on the private rental market.

 

Energy efficiency upgrades for homes

$163.7m in 2020-21 ($447.7m/4yrs) for energy efficiency upgrades for 250,000 low-income households and over 35,000 social housing properties, delivering lower energy bills, improved thermal comfort for families and climate-resilient housing.

 

Further policy directions

The Victorian Government has established a new statutory authority, Homes Victoria, to develop and oversee a ten-year public and community housing growth plan. VCOSS looks forward to working with Homes Victoria to ensure access to social housing is provided for people who need it most, including people with disability, people leaving care, hospital or prison, and people with complex needs. A steady pipeline of public and community housing stock, accompanied by the planned review of social housing regulation, is the best way to make sure all Victorians have a safe and secure home.

Providing safe, affordable and stable housing is the number one way to address homelessness.  However, we know that for many people there are other factors that contribute to their homelessness – such as family violence, mental ill-health, problems with substance use, or unemployment. To maximise the outcomes of the Big Housing Build, it is important that people have access to the health and community services they need to address these issues and stay housed.

The Budget commits funding to maintain the COVID-19 Emergency Measures to protect renters from financial hardship and housing insecurity. However, the legislation that authorises these measures is due to lapse in March 2021. With this end to the Victorian Emergency Measures in sight and Commonwealth income support measures already being wound back, there are growing concerns about a financial cliff looming

Community sector workers have been essential in supporting communities during the pandemic and will remain essential as we move into recovery. The Big Housing Build package acknowledges that housing is unaffordable for many people on average wages. This includes community sector workers, who are increasingly priced out of living close to work. The affordable housing component of the package provides an opportunity to explore how community sector workers might benefit from such housing, especially in parts of regional Victoria where access to affordable housing may help to address a twin challenge of workforce shortages.

Future budgets can continue to increase the supply of affordable housing by introducing mandatory inclusionary zoning.

Stamp duty is a regressive tax that encourages property speculation, dampens economic activity, falls heavily on young buyers and discourages people moving to better homes or new jobs. In the 2021-22 Budget the Government should consider switching to a broad-based land tax, with appropriate concessions and deferrals, to provide a more stable, efficient and fair system.