Advocates fear funding aimed at reducing homelessness is being jeopardised by the Victorian government's failure to evaluate its programs.
Acting Auditor-General Peter Frost looked into whether Victoria's work as part of a national agreement on homelessness has been effective in reducing homelessness.
But in his report tabled in parliament on Wednesday, Mr Frost says the lead agency, the Department of Human Services, has only evaluated three of 24 initiatives aiming to reduce homelessness.
"It is not possible to know which initiatives are more effective than others in tackling homelessness," he said.
Mr Frost says this lack of information will have an impact on how much money the state and federal governments devote to the cause.
"It is likely that robust and reliable evaluations will not be available in time for state budget processes," he said.
Council to Homeless Persons chief executive Jenny Smith said a failure to measure and evaluate funding under the National Partnership Agreement on Homelessness could jeopardise future funding of the agreement.
"If we don't properly measure what services are delivered and how they improve people's lives, we can never make the case that you can solve homelessness and that investing in homelessness programs works," Ms Smith said.
Ms Smith says it is critical the Victorian government commits $31.2 million in the 2013/2014 budget to secure funding for a one year extension of the agreement.
According to 2011 census data, the rate of homelessness in Victoria rose by a fifth in five years.
In 2011, more than 22,000 Victorians were homeless on census night. Sixteen per cent were children under 12.
Mr Frost made several recommendations including that the Department of Human Services evaluate initiatives and inform the state and commonwealth governments of their effectiveness.