Providing homes for the homeless

More than $7 million is spent annually on health, justice and social services to sustain Sydney’s 246-strong population of people sleeping rough on the streets, according to a new study.

The study, by homelessness experts from the City of Sydney, Faces in the Street, the Nous Group and Neami, concentrated on a group of 35 rough sleepers in the inner city and found that the average cost of services provided to each person was $28,700 per year. This is about $26,000 more than the cost of the same services provided to people in the general population.

The results form a new report, The Economic Costs of Sleeping Rough, which was presented at the seventh National Homelessness Conference in Melbourne in early September.

City of Sydney Homelessness Unit Manager, Liz Giles said the study showed there was a strong economic argument to underpin the moral one: that solving homelessness makes good fiscal policy.

“Access to housing, health and other services is one of our most basic human rights, and it is also smart economics,” Ms Giles said.

“Investing in housing, health and other support services that are necessary to assist people in getting off the streets and living independently will ultimately pay for itself in the savings generated over time.”

The $28,700 estimate included the cost of health, justice and other support by non-government organisations, but did not include welfare support payments.

The study also included, for comparison, a group of 15 former rough sleepers who had been living in supported housing for 12 months or more, and found that the costs for each of these people was $43,700 a year, excluding the cost of accommodation.

Faces in the Street Director, Kay Wilhelm, said the amount was greater in the first year due to the intensive input needed to support former rough sleepers when they enter housing.

“We are confident that the ongoing study of this group will show costs decreasing over time as the individual spends more time in housing and their health and other social needs are stabilised,” Professor Wilhelm said.

Merrilee Cox, Manager of Social Development, which includes Neami’s research department, said the study estimated that reduced service costs from positive changes in health, substance abuse and social engagement among former rough sleepers would be observed after just two to three years in stable housing.

“This would be consistent with the findings of other research conducted locally and overseas,” Ms Cox said.

Ms Giles said Neami’s Way2Home program, jointly funded by the City of Sydney and Housing NSW, had helped 150 people find accommodation since it was established two years ago and proved that the Housing First model was successful.

“The maths is simple: the service costs $1.4 million to fund annually and when you compare that with what we are spending on services to support people while they remain homeless, it doesn’t make sense,” Ms Giles said.

Greg Joffe, from management consulting firm Nous Group, said, “From a purely pragmatic perspective, ending homelessness in the inner city is good for the bottom line.

“From a human perspective, it must be an imperative, surely.”

Last month, almost 180 volunteers, including City staff and peer advisors, conducted the winter street count in the inner city and found there were 246 people sleeping rough — the lowest figure since the count began in August 2008.

The Economic Costs of Sleeping Rough, built on the 2008 research by Paul Flateau, Kaylene Zaretzky and others, found that people experiencing homelessness received above average health and other services compared with the general population.