The Nation Building – Economic Stimulus Package Progress Report identified changing demands and higher than expected efficiencies as the main reasons behind the cuts.

Peak body for community housing providers, the Community Housing Federation of Australia (CHFA), condemned such logic as a cruel reward for efficiency.

CHFA said that the funds cut sent the wrong message to not-for-profit housing providers.

Ciaran Synott, Chairman of CHFA said that cutting funds based on high efficiencies in the social housing program was a poor reward, significantly diminishing the expectations of the community housing sector.

“State and territory governments have thus far been responsible for the development and construction of the majority of the dwellings approved for construction through the social housing stimulus funding. However, at the same time community housing providers have stepped up to the mark and have put up equity or taken on debt in order to provide as much social housing as possible,” said Synott.

“These actions were taken in good faith that further opportunities would be available with stimulus funds and the community housing sector has been gearing up to play a more prominent role in the second tranche of the stimulus rollout.”

While Australian Council of Social Services (ACOSS) CEO Clare Martin congratulated government efforts to date, the severity of the shortage of affordable housing meant that ongoing future funding was critical to ensuring that tens of thousands of low income Australians have secure, affordable housing.

“This is a big problem which needs long term planning and ongoing investment to meet demand. There is a shortage of 251,000 rental dwellings available for lower income families and individuals,” Martin said.

“With 180,000 people on waiting lists for social housing around Australia, there is a vital need to ensure an adequate supply of social housing now and into the future.”