Mr Greiner was speaking on Monday at a meeting of business and community leaders, who had gathered to find solutions to the problems of burgeoning demand and a near absence of new supply, exacerbated by increasingly unaffordable private housing.

Social housing is a vital safety net for society's most vulnerable, yet the state's waiting list has blown out to almost 60,000 households. The flailing system runs at a loss of about $300 million a year. The government has controversially been selling properties, such as historic homes at Millers Point, to raise funds – an approach described by the NSW Auditor-General as "not financially sustainable".

Mr Greiner said that though the Baird government had achieved much on its 2011 election promise of "Making NSW No. 1 again", the state took the wooden spoon on social housing.

"This is an area where something bloody well ought to happen," Mr Greiner said. "Frankly it needs some courage. I don't think the area is being distinguished by courage from political leadership on both sides."

He said that though "you can fiddle the numbers … there's been no new [net] supply for a very long time."

"At the end of the day the existing stock is crap and the new supply is non-existent," he said.

"It's pretty obvious, there's been no new government money for a while [and] there's going to be no new government money – state or federal, Liberal or Labor."

Mr Greiner said he had made little progress on social housing while in power, and little had been achieved in the 23 years since.

Public servants were not spared the criticism. Mr Greiner described the Department of Family and Community Services and the NSW Land and Housing Corporation as "conservative in the worst sense of the word, worried about failure rather than worried about trying things".

Former Labor Premier Morris Iemma said housing supply was insufficient and did not meet the needs of the 20 per cent of tenants with a disability or mental illness.

Mr Iemma said that during his time in government, he had met "frustrations and obstacles" from caucus and cabinet. He also came up against hesitant government agencies that were "risk-averse, not wanting to reform and not making it a priority".

On Monday, Housing Minister Brad Hazzard released a summary of feedback on the government's social housing discussion paper. It included calls for more involvement from the private housing and community housing sectors, and recognition of the link between the private housing market and social housing demand.

Mr Hazzard said forum participants could share knowledge with government officials to help improve social housing.

"There's been lots done to date by the … government but the pressures are building, forcing more and more people to seek social housing," he said.