WELFARE recipients could see their rent assistance increased by more than 15 per cent in a bid to get more people out of social housing and into competitive rental markets under a controversial proposal by the Productivity Commission.
Additional payments could also be made to enable welfare beneficiaries to live in a high cost area — such as the inner city — if a genuine need or desire is demonstrated, such as to be closer to employment or a particular school.
But experts warn the plan could be a disincentive for welfare recipients to return to paid work and could even make it harder for Australians to secure a rental property.
SOCIAL HOUSING ‘BROKEN’
The government’s peak review body will today deliver a draft report into Human Services which includes a significant focus on social housing, palliative care and health services.
The Commission labels social housing as a “broken” system in desperate need of repair.
Among the recommendations on social housing include extending Commonwealth Rent Assistance (CRA) to cover all tenants in public housing, increase the CRA by 15 per cent and indexing the payment to reflect changes in rental prices nationally.
The benefit is paid as 75 per cent of rent paid above a threshold, up to the maximum amount.
Those in social housing receive reduced rents as a percentage of their overall income.
Welfare recipients in social housing may also be eligible for CRA putting them at a significant advantage over those in the private market.
Around 400,000 households currently live in social housing, a further 1 million are on a waiting list.
A total of 1.3 million households receive rental assistance, costing the federal government $4.4 billion in expenditure annually.