Homelessness and poverty in Australia

A game of musical chairs

James O'Donnell

Government and governance, Social policy, Health | Australia, The World

21 October 2019

The link between homelessness and poverty is well known, but evidence of its relationship over time is only just emerging. As it is deeply entrenched in disadvantage and housing insecurity, responses to homelessness must be re-thought and scaled-up, James O’Donnell writes.

In 1990, US academics Elliot Scalar and Kay McChesney likened homelessness to a game of musical chairs. The analogy was made off the back of a dramatic and highly visible increase in homelessness in the US in the 1980s and early-mid 1990s and a torrent of research seeking to measure and understand this change.

Much of the research concluded that homelessness was fundamentally the result of poverty and an inadequate supply of affordable housing.

In the musical chairs analogy, affordable housing is the chairs. If there are too few chairs – affordable houses – when the music stops, someone is left standing – homeless. Yes, those left homeless are more likely to have personal problems such as mental health and substance use issues, but this is a sorting effect, a result of the competition for scarce housing.

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The actual level of homelessness is the outcome of how labour markets interact with social security systems and the supply and affordability of housing.

Almost 30 years on, what we have learned since reinforces and extends the metaphor. What we might conclude now is that the game of musical chairs is continually playing.

The music stops at various times but then starts again. A combination of factors ensures that the number of players and chairs is in constant flux.

In other words, housing and households are volatile for a large population experiencing poverty and disadvantage. Housing deprivation and homelessness, as a result, is much more common and deeply ingrained in the experience of poverty than often assumed.

In Australia, the 2014 General Social Survey (GSS) estimated that 351,000 adults had experienced homelessness in the previous year, 573,200 in the previous five years and 1.4 million in their lifetimes – and these exclude anyone who was homeless at the time of the survey.

These figures dwarf estimates of homelessness on any given night, indicating that while the problem may be long term and chronic for a section of the population, it is also far more widespread and episodic than it seems. It reflects a pervasive level of housing insecurity, particularly among disadvantaged households.

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The GSS suggests that the majority of people who find themselves homeless stay with family or friends. Indeed, the burden of homelessness is largely carried in private. This is comforting to the degree that people have a roof over their heads, and in many cases, the support of family and friends can provide a pathway back into stable housing.

However, support is often time-limited. People wear out their welcomes and the goodwill of their hosts, and their hosts may be experiencing housing volatility themselves.

People can find themselves churning through different sets of friends and couches, each time exposing themselves to the risk of running out of support and finding themselves on the street.

For this reason, family and friends cannot be the last, nor only line of housing support.

State and federal governments play an important role, but in their current responses barely touch on the wider problem. Social housing does a good job of providing housing security and preventing housing loss, while supported accommodation provides stable pathways out of homelessness.

Such direct forms of support, however, are tightly rationalised and deeply under‑funded. Funding must be increased to scale-up what we already know works.

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In the private rental market, regulations that protect tenants are lax – though there are signs of improvement – and must be strengthened. Research shows the risk of formal and informal evictions expose vulnerable people to homelessness, compounding the already very serious effects of financial shocks and family breakdown.

Government rent subsidies can improve affordability and are a useful policy tool for their flexibility, wide coverage of the population, and their ability to integrate people within mainstream communities.

However, in their current form, a high proportion of households are still paying unaffordable rents even after receiving subsidies, and they have few protections from sudden change. Subsidy schemes must be re-designed in conjunction with tenancy reform to improve affordability and strengthen tenant protections.

The solution to the musical chairs problem appears simple at first: provide more affordable housing. The reality, of course, is more complex, because we are faced with a continually moving dynamic –the lives and circumstances of vulnerable individuals continually intersect with the people around them, their housing tenures and job opportunities, and their physical, mental and social health and wellbeing.

On top of this, we face an uncertain economy, competing political and economic interests and ideologies, and an unpredictable housing market.

Through this complexity though, we can assert a very clear objective – to provide a home that is affordable and secure for everyone who needs one. Although achieving this objective may not eradicate homelessness, one thing is certain: it is a critical and necessary first step in an ongoing challenge that is far too important to be deterred.

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One Response

  1. Godfree Roberts says:

    98% of China’s bottom income quartile own their homes free and clear.

    If they can do it, we can do it.

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