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Call for public housing review

THE contraction in public housing is at the core of Australia's housing affordability problem, with an overhaul of Government policy essential to redress the imbalance, a study shows reports Brian Robins in the SMH of October 22, 2007.

A report commissioned by the Australian Housing and Urban Research Institute has found the amount of public housing nationwide has fallen over the course of this decade, compounding the difficulties of the less well-off in Sydney, the most expensive city in the country.

"Public housing is the bedrock of affordable housing," Dr Jon Hall, senior research associate at RMIT University in Melbourne and one of the authors of the study, said. "You have to fix this part of the system."

The research highlights policy changes forced on the state housing departments by the Federal Government, which give priority to those most in need.

It says this has left public housing dominated by people living on pensions, unable to pay the higher rents needed to finance overdue maintenance costs. They now make up nearly one in three of all people in public housing, up from one in five a decade ago.

"This policy has been dumped in most advanced countries, due to the distortion it introduces in managing public housing, since it results in rising costs of public housing, pressuring the public purse, and making it more difficult for governments to continue to expand the amount of public housing available," Dr Hall said.

"Most advanced countries seek to get a mix of low-income [earners] and the needy into public housing. In the past, new dwellings were added every year, increasing the amount of public housing. But that is not happening now."

This policy has resulted in the annual "loss" from public housing in NSW running at about $300 million, compared with only about $100 million for states such as Victoria and Queensland, the research found.