Q Shelter urges the Treasurer to consider impact of indexation rates below the true rising costs of service delivery

Abstract

Below is an excerpt from our recent letter dated 13 July 2022 to The Hon Cameron Dick, Treasurer and Minister for Trade and Investment. To read the full letter, please click here.

Dear Treasurer ,

Indexation for funded housing and homelessness services

Q Shelter recently wrote to the Minister for Communities, Housing and the Digital Economy, The Hon Leeanne Enoch, to raise concerns about indexation levels for the housing and homelessness sector. Q Shelter also provided input to QCOSS’s recent letter to you on the same topic and our representatives were present at the recent QCOSS State Budget, where you confirmed the State Government will look into this issue. For the record, Q Shelter commends the Federal Government for supporting an increase to the minimum wage. So many people on low-middle wages simply cannot afford basic living costs, including housing. The increase of both the National Minimum Wage and Modern Award Minimum Wages are important steps in poverty reduction.

Q Shelter highlighted to the Minister, that the housing and homelessness sector is under increased demand pressure from more and more households including working families. Yesterday’s report from the Auditor General shows extraordinary demand for assistance without adequate housing supply. Yesterday we also heard from a Q Shelter member that they had only just been informed of their indexation rate which is 2.49%. This is lower than the indexation rate applied to other community services at 2.88%. It is also significantly lower than the rise in wages and other costs borne by community sector employers…

The longer-term impact of indexation rates below the true rising costs of service delivery paints a grim picture for the future of community services. If this trend continues, the sector will continue to reduce support services, and targets for the growth of social and affordable housing will need to be adjusted.

We urge you to bring forward actions to increase the rate of indexation for this year to cover the true costs of wage rises and other employment related expenses. We also urge you to work with other relevant Ministers to address the timeliness of advice to the sector in support of high standards in governance including the timely preparation of sustainable budgets.

We hope this letter helps you to consider the needs of our sector. Every part of the community services industry is impacted. Because housing need and homelessness is such a growing concern, we write to highlight a strong case for working with Treasury to guarantee no nett loss to service delivery and housing growth projects in this portfolio area.