The budget commitment follows a recent Productivity Commission report that found more than a third of Canberrans who experienced homelessness in 2019-2020 did not receive accommodation services.

The commission also found the proportion of homeless Canberrans who did not receive other support services they required rose to 8.8 per cent in 2019-2020.

Additionally ACT had the second highest rate of repeat homelessness nationally at 6.6 per cent in 2019-2020. Repeat homelessness refers to multiple periods of insecure housing within a 12-month period.

The $2.6 million commitment from the ACT government is part of a parliamentary agreement to spend $18 million over four years in the sector.

The ACT government plans to invest $300,000 for the Early Morning Centre, to extend operations to a seven-day-a-week service.

Homelessness advocacy agency OneLink will receive a $450,000 funding boost.

The government committed $700,000 over four years to ACT Shelter.

A further $1.2 million will go towards maintaining and expanding housing services.

Some of that $1.2 million will go towards maintaining Mackillop House and Winter Lodge; housing providers established in 2020 to address the spike in homelessness following bushfires and COVID-19.

The rest of the $1.2 million will fund the expansion of Axial Housing service.