Community groups warn government not to scrap agreement, which sees $1.3bn a year given to states and territories

This article is more than 3 years old

This article is more than 3 years old

Homelessness services are warning the government’s plans to end a multibillion dollar housing agreement would be an “unmitigated disaster” for those sleeping rough.

The federal government is reportedly considering scrapping the National Affordable Housing Agreement (Naha) in May’s budget, because it has failed to improve affordable housing stocks or reduce homelessness.

The agreement, struck in 2009, sees $1.3bn of grants handed to the states and territories for public housing and homelessness services each year, according to Homelessness Australia. Community groups have warned that ending the agreement would effectively strip two-thirds of funding from specialist homelessness services.

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National Shelter executive officer Adrian Pisarski said the result would be “absolutely crippling”. “It would be an unmitigated disaster,” Pisarski told Guardian Australia.

“If Melbourne thinks it’s got a rough sleeping problem now, it would pale into insignificance compared to what would be unleashed by this,” he said. “It would mean that those services could not continue to operate, it would mean that the hundreds of thousands of people who use those services wouldn’t have anywhere to go.”

Other groups, including the Australian Council of Social Services (Acoss) and Homelessness Australia, issued statements warning the move would prove disastrous for those accessing homeless services and living in public housing.

Pisarski said he believes the federal government may not realise that ending the agreement would put homelessness funding in jeopardy. “My sense is that in flagging this they have actually forgotten that homelessness funding is part of the NAHA,” he said.

Acoss chief executive officer, Cassandra Goldie, said there had been a lack of consultation over the plans.

Goldie said that if the axing of the agreement went ahead, it would represent a betrayal by the Commonwealth of a vital program supporting disadvantaged Australians.

“The Naha is the only federal funding for public housing and homelessness services,” Goldie said.

“It would make no sense for the Commonwealth to abandon its responsibility to fund essential social housing and homelessness services at a time when people living on the streets is at crisis levels and housing affordability a chronic problem.”

Most groups agree the agreement is flawed in its design and operation. Community groups have long called for it to be reformed to improve accountability and transparency surrounding the funding, and to ensure Commonwealth money is matched by states and territories.

“It was a bit rushed and a bit poorly conceived even if the idea was a good one,” Pisarski said.

Homelessness Australia’s acting chair, Katherine McKernan, said the ending of the agreement would destroy homelessness services, at a time when they already face uncertainty over another major funding source, the $117m per year that flows from the national partnership agreement on homelessness.

“We are in the grips of a national housing affordability crisis which is driving homelessness and this is the worst time to be walking away from the problem,” she said.

“This is the time for action and greater investment, not razing the agencies and mechanisms that are dealing with homelessness.”