What is the situation? We are all affected by high housing prices in some way. Housing prices across the country, particularly in metropolitan areas, are rising at a rapid rate. From 2000 to 2010, median rental prices in Melbourne have increased by 71 per cent compared to only a 58 per cent increase in average weekly earnings. 1 However, low income earners 2 are being particularly squeezed because their wages are not rising nearly as fast. Those living on government allowances saw their income grow by only 39 per cent this decade. Currently, a weekly Newstart payment for a single adult with no children comes out to be just $35 a day. This is only 45 per cent of the national minimum wage 3 and a mere 17 per cent of the median wage in Victoria. 4 Such low income makes it difficult to cover basic living costs, particularly rent. Recent analysis by the Tenancy Union Victoria found that all house- holds receiving income support across Melbourne are experiencing housing stress, paying more than 30 per cent of their income in rent. In some cases, people are paying over 90 per cent of their income just to cover rent, 5 leaving nothing for utilities or food. Half (76,000) of all Newstart and Youth Allowance recip- ients in Victoria receive some level of Commonwealth Rental Assistance (CRA) in addition to their income support payment to help them cope with high costs of housing. However, CRA has not kept pace with rising housing costs either. In 2013, nearly half of the individuals who received CRA payments were still in rental stress and five out of every 40 recipients were in extreme rental stress, paying more than 50 per cent of their income on rent aſter receiving CRA payments. 6 1 ABS CA No 4102.0 Australian Social Trends Data Cube – Housing. (11 December 2012) Table 2.2 Housing, Vic. Summary 1998-2012 & ABS (2011) TABLE 11B. Average Weekly Earnings, Victoria (Dollars) – Trend. Cat No 6302.0. 2 Defined as in the boom 40% quintile of income earners by the ABS. 3 National minimum wage at the time of publication was set at $622.2 per week calculated on a 38 hour work week or $16.37 per hour before tax. Aſter tax ($60 a week) minimum wage is $562.20 a week in disposable income. 4 Percentage is calculated based on November 2013 minimum wage. ABS (2014) TABLE 11B. Average Weekly Earnings, Victoria (Dollars) – Trend. Cat No 6302.0 5 Tenants Union of Victoria. (September 2013) Private Rental Affordability Bulletin, Melbourne. 6 Report on Government Services 2015 Table GA.24 Number and proportion of income units receiving CRA paying more than 30 per cent of income on rent, with and without CRA, by geographic location, 2009 to 2013 (per cent) and GA.34 Number and proportion of income units receiving CRA with more than 50 per cent of income spent on rent, with and without CRA, by special needs and geographic location, 2013 (per cent) For low income earners who are unable to afford private rental, there are few alternative options. Wait lists for public housing can take years and commu- nity housing remains scarce. The lack of affordable accommodation options puts this group of vulnerable renters at risk of homelessness. What are we doing? The Salvation Army’s calling to work with the most disadvantaged and vulnerable people in our commu- nity means we work with many people who have experienced homelessness and may have a long history of health, mental health and addiction issues. However, a large proportion of our clients are also low income earners living in private rental who are at risk of homelessness. While The Salvation Army cannot resolve structural issues that put people at risk of homelessness like low government allowances and high housing prices, we are able to offer them a variety of other supports that may help people get back on their feet such as finan- cial counselling, private rental brokerage programs, and access to social housing through The Salvation Army’s Red Shield Housing. HOUSING AFFORDABILITY REFORMING SOCIETY The Salvation Army’s agenda for change Issue 3 Victoria Social Programme and Policy Unit - Australia Southern Territory - sarmy.org.au/vsppu