Senin, 07 Oktober 2013

'What are we doing...' Minister Goward on our 'broke' public housing system

Family and Community Services Minister Pru Goward has given The Australian a big-picture briefing on the state of public housing in New South Wales. According to the paper's precis of the Minister's comments, 'the public housing system in NSW is broke, incapable of breaking the cycle of disadvantage and an institution from which people need to be "freed".'


Minister Goward is quoted:
"What are we doing when 47 per cent of people in public housing are employable but aren't employed . . . I find that statistic to be shocking, just shocking."
Quite right that it's shocking – and worse, Housing NSW makes it so. 'What we are doing' is making it hard for public housing tenants to get and stay in work.

Two policies are especially to blame. The first is the policy of increased rent rates for tenants on 'moderate incomes'.

As we discussed recently, most public housing tenants pay a rebated rent of about 25 per cent of their household income. However, if you get a job that puts your income into the 'moderate income' range, the rate slides up to 30 percent (depending on where you are in the range). That might sound like a modest increase, but it's not, because that higher rate applies to all your income, not just the amount that's in the moderate range. Expressed as a marginal rate, the moderate income rent rate is a punishing 50 per cent – in other words, 50 cents in each additional dollar earned in the moderate income range goes to Housing NSW in rent. Then there's income tax, reduction of Centrelink payments, and other costs of working. A public housing tenant who works could easily lose more money than they earn.

The second policy is that of reviews as to continuing eligibility for public housing, which applies all public housing tenants who have since 2005 signed up to fixed term agreements. This policy means that if towards the end of your fixed term your income is found to be above the moderate income range, your tenancy will be terminated, and you'll be looking for housing in the private rental market instead, which is both less secure and more expensive than public housing.

Faced with that prospect, very few public housing tenants fail the review: to stay housed, they stay poor. Staying poor also means that fewer tenants are moving out of their own volition: since 2007-08 (the first year of the reviews), exits from public housing have declined by 25 cent.

So not only are public housing tenants missing out on jobs and incomes, people on the waiting list are missing out on public housing.

We've spoken with public housing tenants who have grappled with these work disincentives, and come down with a decision to knock back work opportunities because of it. They don't like the decision, but it is rational, even wise, in the mad context of these policies.

There's lots to be done to fix our broken public housing system, but this first repair could be done in an instant: let public housing tenants work without fear of loss.