Disadvantage and poverty are growing in the ACT, and demand for support services has increased, but funding is insufficient, and services are not adequately staffed, according to the ACT Council of Social Service (ACTCOSS)’s community sector snapshot, published this week.

“The findings from the survey tell us that the community sector in the ACT is struggling to meet demand as many individuals and families struggle with increased levels of poverty and distress,” Dr Gemma Killen, ACTCOSS interim CEO, said.

More than half of community sector respondents (56 per cent) reported disadvantage and poverty had increased among the groups they support during 2022. The top challenges were cost-of-living pressures (66 per cent), housing and homelessness (61 per cent), and lack of mental health support (60 per cent).

“Cost-of-living increases over the last few years and a spiralling housing affordability crisis have meant more and more people are turning to the community sector for support,” Dr Killen said.

“Our colleagues are seeing increasing numbers of clients in full-time work who cannot afford to keep a roof over their heads and food on the table.”

“I am seeing clients who are struggling to live day to day due to rising interest rates, rent and everyday cost-of-living increases,” one community sector worker reported.

“People on moderate incomes who are accessing emergency relief and food banks because they cannot afford groceries, they are extremely stressed and overwhelmed and cannot access adequate mental health supports. Clients are turning to unsuitable loan products and Buy Now Pay Later products to get by. Clients who are on Centrelink income support struggle even more.”

Two-thirds (67 per cent) of respondents reported that levels of demand for their main service had increased, and 69 per cent of service users had complex needs.

However, only 4 per cent of organisations could meet the level of demand; 47 per cent noted the number of clients they could not support had increased; and 43 per cent of organisations experienced longer wait times.

“In addition to increasing demand and the complexity of needs, inadequate indexation (particularly in the context of inflationary pressures) have placed enormous strain on services and frontline staff,” one community sector worker said.

“Exhaustion, burnout, and low morale are having a devastating effect on the workforce, and services are universally reporting difficulties attracting and retaining staff.”

Community sector organisations reported that funding was insufficient, uncertain, and unstable, making long-term planning difficult; 84 per cent stated that funding did not cover the full costs of service delivery, while 38 per cent found it more difficult to secure funding than in previous years.

“We are now grappling with the cumulative effect of years of inadequate indexation – and there simply is nothing more we [can] do to rein in costs or generate efficiencies without compromising our capacity to do our core functions,” one manager said.

Two-thirds (67 per cent) of organisations found it difficult to recruit and retain trained, experienced staff, due to a competitive labour market, limited funding, and high demand for skilled, experienced workers.

“We struggle to offer wages that are competitive with other sectors, particularly the public sector and given our location in the ACT,” one manager said.

Increasing demand for services led to a need for additional staff – but more than 80 per cent of CEOs and Senior Managers said they received insufficient funding to employ enough staff, and no organisations were funded for backfilling staff absences. Staff suffered increased stress and burnout.

“Without adequate funding to sustainably staff our organisations, vulnerable community members are being turned away,” Dr Killen said.

Poverty and disadvantage were growing among community sector workers themselves, Dr Killen said. Many could not afford the high costs of living in Canberra.

Priced Out: An Index of Affordable Rentals for Australia’s Essential Workers, published last week by Everybody’s Home, a national campaign to fix the housing crisis, found that “Canberra’s rental affordability problem for essential workers far outstrips the national average results”. Essential workers, many of whom Dr Killen said work in the community sector, spend up to 78 per cent of their income on rent. Aged care workers, for instance, spent 76 per cent of their income on rent, and nurses 70 per cent.

“Canberra has some of Australia’s highest income earners, driving up rents and adding to unaffordability for each of the essential workers we’ve studied,” Priced Out states.

“In reality, this could mean that many essential workers in lower paid sectors such as aged care and childcare could be forced to live in surrounding regions in NSW, commuting into Canberra.”

The problem is national. According to the Australian Council of Social Service’s report, At the Precipice: Australia’s Community Sector through the Cost-of-living Crisis, released on 19 April, organisations do not have the resources to meet community need. The report describes the community sector as “buckling … breaking … exhausted”. Faced with limited funding and financial strain, many consider leaving the sector.

Both ACTCOSS and ACOSS have called on the Federal Government to increase funding for community services in next month’s Budget:

1. Fund the full cost of service delivery, including infrastructure, management, workforce development and administration costs in all Commonwealth grants and contracts for community services.
2. Create a fairer tax system to fund quality essential services and a social security system that meets need starting by cancelling stage 3 tax cuts.
3. Lift base rates of income support payments like JobSeeker and Youth Allowance to at least $76 a day.

Dr Killen also invoked the ACT Government.

“Despite the challenges, we know the community sector, when well resourced, is best placed to address disadvantage in Canberra,” she said.

“We are ready to partner with the ACT Government to ensure the community continues to receive appropriate, supportive and sustainable care.

“It is clear that all levels of government must work closely with the community sector to ensure it is properly resourced and Canberrans have access to the services they need.”

Federal Government response

“The Australian Government is committed to supporting a stronger, more diverse and independent community sector, and providing an income support system that provides a safety net for people who need it the most,” a spokesperson said.

“Living on income support payments isn’t always easy, especially with increases to the cost of living. Australians need a welfare system that supports the most vulnerable, but is also sustainable for future generations.”

On 20 March, indexation of social security payments increased. The basic rate of JobSeeker for a single person with no dependents, for instance, increased by $24.70 a fortnight to $701.90 a fortnight (including Energy Supplement).

At the time, however, ACOSS observed that the JobSeeker rate only increased by $1.77 a day for people under 60, taking the payment from $47.75 to $49.50 a day – 57 per cent below minimum wage and 34 per cent below the age pension.

“Most recipients do not just receive JobSeeker Payment, but are supported through a variety of income support payments,” the government spokesperson said. “Where recipients have additional costs, such as those associated with renting in the private market and raising children, supplementary payments such as Rent Assistance and Family Tax Benefit are available.

“Higher rates of income support are also payable to individuals who need support, including some participants with children, participants with primary caring responsibilities, or participants who are over 60 and on payment for more than nine months.”

The government established the Economic Inclusion Advisory Committee in December, in keeping with its commitment to hear from stakeholders, recipients and experts when making decisions regarding spending priorities.

The Committee’s report was published this week. It recommended that the Government, as a first priority, substantially increase the base rates of the JobSeeker Payment and related working age payments.

It found that current rates of these payments were “seriously inadequate”.

“People on these payments face the highest levels of financial stress in Australia. Committee members heard from people who live on income support having to choose between paying for their medicine or electricity bills.

“Income support should better value unpaid caring work and support those who cannot be in full-time paid employment, including due to illness, disability or partial capacity to participate.”

The government is considering the Committee’s recommendations as part of the 2023-24 Budget.

“Community service providers touch the lives of many vulnerable and disadvantaged people around the country, and it is integral that we continue to support their work in the community,” the spokesperson said.

“The Department of Social Services will continue working together with service providers to design funding models that take into account individual service provider experience, cash flow, and evidence of past performance.”