NSW Family and Community Services Minister Gabrielle Upton has defended cuts in the number of homelessness services in Wollongong, saying the best services had secured funding under government reforms.
Her comments came as she toured Southern Youth and Family Services on Thursday.
The minister said the "Going Home Staying Home" reforms had boosted funding in the region.
"There's a 20 per cent increase in base funding, there's more money and more early intervention," she said.
The reforms have reduced 336 state funded agencies to 149 funding packages, causing some services to consolidate and others to close.
Wollongong Women's Housing will shut its doors on November 2 after losing government funding in the reforms.
Its properties will be signed over to Supported Accommodation and Homelessness Services Shoalhaven Illawarra which secured $2.5 million in a tender process.
Women's Housing employees were not so lucky; all five will lose their jobs.
Kiama MP Gareth Ward said the Illawarra was a big winner from the reforms.
"For the first time, resources are allocated based on evidence not on history," he said.
"We have to make sure those dollars help young people, that's how the money should be spent."
Women's Housing employee Judy Doherty said her service had evidence of success: "We have operated for 25 years and in that time the Department of Family and Community Services referred cases to us so we were quite highly regarded."
Robyn Firmin made the long commute from Minto to Corrimal every day to attend high school until SYFS found her accommodation in Wollongong.
Robyn, now 20, was able to complete year 12 and go on to TAFE.
"I like the independence of having my own place and now I'm looking for business traineeships," she said.