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Solving homelessness will save Australia billions – so what’s the big delay?

By Emma Dawson, Executive Director of public policy think tank, Per Capita

Winter 2020 wasn’t a happy time for most Melbournians. The rapid spread of COVID-19 saw our city locked down as people adjusted to working from home, juggling the needs of fractious kids who were struggling with online learning and playground closures while rationing toilet paper and torturing ourselves trying to master a sourdough starter.

But for Melbourne’s population of rough sleepers, that winter was not one of discontent. Almost overnight, people sleeping rough on our streets were given shelter, as the State Government acquired hotel rooms for emergency accommodation. This measure ensured that people without a roof over their heads could be protected – as were the rest of us – from the virus rampaging through our city.

That street homelessness was virtually eliminated, if temporarily, during the height of the pandemic did not pass unremarked: if we can do this now, advocates asked, why couldn’t we do it before? Didn’t this prove that the failure to act on homelessness was due simply to a lack of political will by governments of all stripes? What made the pandemic so different?

Put simply: the cost–benefit analysis of housing people in a pandemic was obvious. The benefit of spending whatever it took to get everyone securely accommodated and sheltered from the virus was undeniable. Don’t do it, and the cost of COVID spreading among the homeless community – and then to everyone else – was too high to contemplate. And so, for a brief time, rough sleeping was eliminated in the Victorian capital, and virtually no one complained about the expense of doing so.

Three years later, homelessness is again on the rise in Melbourne and across the country. The current housing crisis, which has seen rental prices shoot up by as much as 20 per cent in a year, is putting enormous pressure on housing services and increasing the ranks of people experiencing housing insecurity, housing stress and homelessness at a rate not seen for generations.

Yet, in just three years, we seem to have forgotten an important lesson: that we could provide a home for everyone who needs one if only that cost–benefit analysis stacked up.

The thing is, it does stack up. It always has.

There is abundant evidence to show that eliminating homelessness has one of the best returns on investment of any public policy measure. Building enough social (public and community) housing to ensure everyone has a long-term, secure home would return at least double the benefit to the economy – more than just about any other infrastructure investment a government can make.

Indeed, research released last year put the cost of not acting to resolve homelessness at more than $25 billion a year by 2050. The Give Me Shelter report found that over 30 years, eliminating homelessness would reap economic returns that far exceeded the cost of providing the social and affordable housing necessary to do so.

The moral case for eradicating homelessness is clear. With family homes in our biggest capital cities now averaging over a million dollars, it’s obvious to anyone with a brain and a heart that the growing inequality in our country is indefensible. Particularly when it comes to the fortunes of First Nations Australians, the extent of homelessness and housing insecurity is a shameful indictment of our priorities as a community.

Yet we too readily assume we can’t afford to meet this challenge – despite the fact that we are among the world’s wealthiest nations; despite the fact that we are among the least densely populated landmasses on earth; despite the fact that just three years ago, we met a comparable challenge with ease.

In the pandemic’s early stages, the usual fiscal rules that constrain government spending didn’t apply. We spent what we needed to spend to keep our population safe. The cost–benefit analysis was simply beyond doubt.

The fact is, when it comes to eliminating homelessness, that cost–benefit analysis stands up every day of the week. It shouldn’t take a once-in-a-century pandemic to prove the bleeding obvious: give people homes, and watch our society thrive.

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