Michael Coutts-Trotter has come from the NSW Department of Finance and Services to be the Director General of Family and Community Services (FaCS). His move coincided with the same move by the Land and Housing Corporation (the owner of public housing) joining Housing NSW within FaCS. Here, Mr Coutts-Trotter reflects on the housing challenges and describes redeveloping higher value public housing as the one big lever to pull to be able to invest in social housing.

By Michael Coutts-Trotter

Thank you very much for the chance to offer some very early thoughts about the responsibilities of my new job, and specifically our work in social housing.

I won’t pretend expertise I don’t have, or a grasp of policy I’ve not yet achieved.

That said, in my last job I was for two years responsible for the public housing portfolio. That taught me some uncomfortable truths, all of which are contained in the Auditor-General’s recent report on public housing.

I know many people will have read it for themselves, but here’s my summary of the major point.

Look past the effects of the national economic stimulus and the transfer of some properties to the community housing sector and the NSW public housing portfolio has been shrinking.

In fact, the portfolio has been depleting at an average of 2.5 properties a day for a decade. Properties have been sold and not replaced to help fund maintaining the balance of the portfolio in reasonable condition because rent and Commonwealth and state government funding haven’t been sufficient.

This isn’t sustainable. And there are no easy answers.

Government revenue – state and federal – is under pressure. Revenue is produced by economic activity which is vulnerable to problems elsewhere in the world. Furthermore, the Australian economy is now producing lower levels of revenue from the same level of activity than it used to.

This is explained by decisions over time to lower taxes and a shift in patterns of consumption, with a greater share now going to health, education and food, all of which are GST exempt. Long story short, GST revenue to NSW in the next four years is now many billions of dollars below estimates of only three years ago.

Given that, and commitments to invest in health, education and disability support, there’s no realistic prospect of major increases in government investment in social housing.

In public housing there’s one big lever to pull – the potential to more actively redevelop higher value land under the portfolio to provide ongoing returns to reinvest in social housing. This would take time to achieve but is promising.

There are many other things that we can do to get the most – and most appropriate – housing out of the portfolio including encouraging a better match between tenants and housing, improving the performance of our maintenance program and possibly introducing contestability into tenant management services.

Other opportunities include helping to develop the capacity of the community housing sector, including Aboriginal community housing providers, encouraging Aboriginal home ownership, reforming homelessness services and making it easier for people to do the right thing as tenants in social housing.

We should also look to encourage more private and philanthropic entrants into low cost housing.

These things will all help but the only long-term solution is to reduce demand for social housing.

This means finding ways to help as many people as possible to move through social housing to greater independence. This isn’t an achievable goal for all social housing tenants, but it can be for many.

If this becomes our clear and urgent objective, it will require changes in our department – in how we’re organised, how we partner inside and outside government, how we prioritise our efforts and above all in the extent to which we empower and support the staff closest to our clients to make decisions about meeting their needs.

We made an important step forward in early September when we reorganised ourselves in 15 districts that exactly match local health district boundaries.

The new districts will help us to make more people decision- makers – and give people closest to the action more authority and support to make choices about how best to help the people we serve.

Our aim is to empower staff on the front line to begin to change how things run and make it easier to do great work.

Together with non-government organisations and other parts of government I’m sure we can find with new ways of using our shared resources, experience, skills and knowledge to do something fresh and brilliant for the most disadvantaged people we serve.

I look forward to working with you all.

These comments by Michael Coutts-Trotter first appeared in Shelter NSW’s Around the House no. 94 in September 2013 and are reprinted with permission.

Published in Inner Sydney Voice Issue 118 Summer 2013-14