Fears of a homelessness explosion once wage subsidy runs out

An emergency housing provider is concerned there will be a wave of homelessness once the Government's wage subsidy scheme runs out.  

More than $13 billion has been spent on keeping people in jobs since the pandemic hit earlier this year through the Government's wage subsidy scheme. Applications for the scheme's eight-week extension close at the end of August, and the Government has no plans to extend it further at this stage.

"We are quite concerned there's going to be a second wave of homelessness once the Government's wage subsidy has run out and people can't afford to pay their rent or mortgage," Jo Denvir, chief executive charity Lifewise, told The AM Show on Thursday.

"I think people who have never been faced with potentially being homeless before are likely to be homeless now." 

The Government is spending increased amounts of taxpayer money on housing the homeless in motels and holiday parks, figures released to Newshub under the Official Information Act show. 

In 2017 - the first full year the grants were paid out - $36 million was spent. That rose to $51 million in 2018 and $143 million in 2018.

In the first quarter of 2020, $52 million was spent - rising to $79 million in the three months to June, Stuff reported on Tuesday. 

The number of distinct clients rose 75 percent, from 8311 in 2017 to 14,519 in 2019. In the first three months of this year 6772 clients were housed.

People are also spending longer in emergency accommodation. In 2017 the average stay was 27 days, in 2019 it was 42 and so far in 2020, it's 54. 

"Unless we get new housing stock built, more affordable housing, [the problem is] not going away," said Denvir.

"We're moving people into more permanent accommodation quite fast at the moment, but it's only a certain target group that's being moved because we don't have housing options for everyone." 

Jo Denvir.
Jo Denvir. Photo credit: The AM Show

The recent closure of the border won't be much help, she said, because most of the accommodation it freed up is suited for international students living alone. 

"It doesn't suit couples very well, it certainly doesn't suit families. We need a big range of different affordable options to be built." 

The official unemployment rate is updated quarterly, with the first post-lockdown figure coming in about a week. Interim data released by the Ministry of Social Development released last Friday estimated around 6.4 percent are currently on a Jobseeker benefit - about 192,300 people - and another 18,592 are receiving the larger COVID-10 Income Relief Payment. 

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