Funding fall 'locks workers out of housing'

People who cannot afford to rent or buy suitable homes have been locked out of public housing because of a drastic fall in national funding, a Sydney conference has heard.

The conference, organised by affordable housing lobby group Shelter New South Wales, is focusing much of its attention on the State Government's plan to reform public housing in the wake of the funding drop.

The amount spent on Commonwealth-State Housing Agreements fell from a peak of about $1.1 billion in 1994-95 to $955 million in 2006-07, according to Federal Government and Parliamentary Library figures.

Inflation and rapidly increasing land prices have made this fall in funding much larger in real terms.

Shelter NSW executive officer Mary Perkins says the drop has barred many low-income working households from public housing.

"Over the last 10 years plus, our public housing system has been, by process of attrition, constrained of funds considerably," she said.

"In response to that, our governments have basically rationed it and targeted who's eligible and who's not eligible. Now we have a situation where only the most needy of the most needy are eligible for public housing."

Ms Perkins says this leaves many low-income earners ineligible for public housing but unable to afford to buy or rent suitable homes.

"We've created a new middle ground of people - people who were too poor to get into home ownership and who are too rich now to get into public housing, people who 20 years ago would have expected to have assistance in the public sector," she said.

"Those people are now struggling like mad in the private rental market in quite desperate circumstances."

'Targeting resources'

Housing NSW director-general Mike Allen says the department has to target its limited resources into areas that seem to be most in need.

"We are principally here to help those people who are on low income," he said. "That's our first and foremost priority."

Mr Allen says the department is trying to encourage the development of more affordable rental housing by other groups, including private industry, community groups and local government.

"We do have a role to also try and be a catalyst or a facilitator for other people to establish affordable rental housing that takes the pressure off the public and community housing system," he said.

He says he hopes federal funding will soon increase to facilitate a broader role for Housing NSW and fund more public and community housing.

"We've begun very positive negotiations with the new Australian Government around replacing our current Commonwealth-State Housing Agreement with a new national affordable housing agreement," he said.

"Those discussions and negotiations are only in their very early stages, but I'm very hopeful that they will lead to increased resources for us in NSW."