Michael McCormack defends HomeBuilder scheme from critics

The $668 million plan for a "tradie-led" coronavirus recovery has been met with claims that the money could have been better spent on strengthening public housing.

HomeBuilder provides a $25,000 grant for people spending at least $150,000 on building or renovating their homes, which critics say excludes both low-income homeowners and those struggling to secure housing.

St Vincent de Paul Society National Council CEO Toby oConnor said Australia had been "going backwards on the social housing front for the last 15 to 20 years".

His organisation has for the last four years been advocating for a social and affordable housing fund and the development of a national housing plan to address long waits for public housing.

The Australian Council of Trade Unions has estimated a four-year social housing building program of 30,000 homes would create on average up to 18,000 full-time equivalent jobs a year.

"We believe the government can do better. It can boost economic activity in the building sector and address the chronic shortage of social housing at the same time," Mr oConnor said.

"Right now, there's an estimated shortfall of at least 438,000 dwellings and that's before the anticipated COVID-19 recession fully hits."

Mr McCormack said there were other assistance measures available for those who didn't fit the HomeBuilder criteria, and that the government was "not forcing people to do a renovation".

"What we're doing is providing the opportunity. So for many people who are going to build a new home, for many people who do have a renovation that is going to cost from $150,000 and upwards, the assistance is there for them," he said.

"I know here in Wagga ... it is and has been very, very welcomed and it's going to put tradies back to work."

The grant is not available for current investment properties, or new houses which would be used as investment properties.

Couples earning over $200,000 or individuals earning over $125,000 are automatically ineligible.