A LOCAL welfare organisation involved in the government housing scheme under police investigation for alleged fraud says the program was “open to rorting”.
Centacare Ballarat successfully built 39 units with incentives from the New South Wales-based property-broker accused of extortion under the National Rental Affordability Scheme (NRAS), but Centacare chief executive David Beaver said the system was poorly designed.
“Developers saw it (NRAS) as a way of making money.
“It should have been restricted to community housing groups,” he said.
NRAS was rolled out by the former Rudd government in 2007 to tackle homelessness across Australia.
Mr Beaver hoped the “bungle” wouldn’t “blacken” the idea of governments investing in future housing schemes.
In May the federal government announced the suspension of round 5 of NRAS incentives, while those holding existing incentives from previous rounds of the scheme will have to “use or lose” them by December 23.
Ballarat developer Elmstone Property Group was approached by the NSW-based property-broker in 2012, claiming it had incentives to fund five houses Elmstone planned to build in Ballarat.
Elmstone director Stuart Benjamin, who didn’t pay the property-broker to secure government incentives at the time, described himself as “lucky” compared to other Ballarat companies allegedly defrauded by the company.
Elmstone’s request, via the property-broker, to swap incentives was rejected by the Department of Social Services (DSS) in August – three months after DSS became aware of alleged fraudulent activity under the scheme.
He said the rejection didn’t impact the 100 other NRAS dwellings under construction in the region.
Victoria’s largest NRAS incentive provider, Ethan Affordable Housing, has administered government funds for about 200 properties in Ballarat.
Managing director Ashley Fenn said NRAS had allowed it to provide rental discounts of $60 to $100 a week for low-income earners in Ballarat.
Mr Fenn said the Liberal government had “gone out of its way” to tighten compliance.
Ballarat MP Catherine King said NRAS had boosted affordable housing for those under housing stress in Ballarat.
“Reports of rorting and misuse are certainly concerning and, if this scheme was used fraudulently, those responsible should be held to account,” Ms King said.