The best way is to get money into the hands of low-income people and adopt other practical and effective measures, such as affordable housing, education and training and so on. The other way is to define poverty out of existence by statistical sleight of hand: Tell the poor, and everyone else, that the poor aren’t really poor, and hope that they just go away.
The Fraser Institute, the private-market-obsessed policy institute, opted for numerical dexterity as it published its latest research paper on poverty in Canada. Author Christopher Sarlo makes the astonishing claim that poverty in Canada has shrunk to a statistically tiny level in recent years.
]]>The best way is to get money into the hands of low-income people and adopt other practical and effective measures, such as affordable housing, education and training and so on. The other way is to define poverty out of existence by statistical sleight of hand: Tell the poor, and everyone else, that the poor aren’t really poor, and hope that they just go away.
The Fraser Institute, the private-market-obsessed policy institute, opted for numerical dexterity as it published its latest research paper on poverty in Canada. Author Christopher Sarlo makes the astonishing claim that poverty in Canada has shrunk to a statistically tiny level in recent years.
Sarlo’s conclusion is at odds with the wealth of recent income data from Statistics Canada and well-respected policy institutes such as the University of Toronto’s Centre for Urban and Community Studies and the Canadian Centre for Policy Alternatives.
So, how is it that smart and sensible people can come to such widely varying conclusions?
Here are some observations to help make sense of the Fraser’s very odd dollars:
First, COMPLEXITY. “No single indicator or group of indicators can possibly capture the full complexity of income poverty in the UK.” Those are the opening words of an excellent overview of the tricky and politically-charged task of developing reliable poverty indicators by the UK’s New Policy Institute. Unlike Europe, Canada doesn’t have an officially-approved poverty indicator or indicators. Instead, we have two widely-accepted measures called the Low Income Cut-off (LICO) and the Low Income Measure (LIM) which measure relative poverty, or income inequality. And we have a whole variety of “market baskets” which measure absolute poverty by adding up a list of necessities to create a basic income required for meagre existence. Sarlo exploits the lack of consensus in Canada to dance around the methodological questions and create his very own definition of poverty.
Second, RELATIVE POVERTY. Canada’s LIM is very similar to the official poverty measure of the European Union, which counts the number of people who have incomes that are well below the median income (the statistical middle of all incomes). You’d think that Sarlo and the Fraser Institute would love LIM because what it measures, most fundamentally, is access to private markets. Markets for housing, food and all the other private commodities in Canada - at least according to market theorists - respond to average and median incomes. So, a measure that counts how many people are included (or excluded) from markets would seem to be pretty useful. The trouble is, relative poverty measures in Canada have set a disturbing trend: Incomes in the middle are shrinking, while those at the bottom have been growing, along with those at the top. This growing gap between rich and poor makes market purists uncomfortable, so Sarlo rejects relative poverty measures even though most independent statisticians know that they are very useful to measure how widespread low-income (another word for poverty) is. To be technical, relatively measures are used around the world - and here in Canada - by just about everyone except the Fraser Institute to measure the incidence of poverty.
Third, ABSOLUTE POVERTY. There is another measure of poverty that is widely used to gauge the depth of poverty. Sometimes called the “market basket” approach, absolute poverty creates a bundle of basics (housing, energy, food, medicine, drugs, dental, transportation, clothing and so on) and then prices them. Anyone who falls below the income required to buy that basic basket of goods is considered poor. Sarlo says that his basket of goods includes all the basics and is also sensitive to regional variations (it costs more to rent a home in Toronto than, say, Montreal). All well and good, but the “poverty line” that Sarlo sets out on page 8 of his report is so meagre that it’s impossible for imagine anyone could actually survive on that. No wonder Sarlo is able to proclaim that poverty is virtually non-existent in Canada.
Fourth, REALITY CHECK. Sarlo says that his "basic poverty needs income" for a family of one is $10,520. Consider this: If that single person was living in the neighbourhood of the Wellesley Institute (which includes Central Toronto, with some very low-income neighbourhoods such as St James Town, Regent Park and Moss Park), the average annual rent for a bachelor apartment (the cheapest form of accommodation) in 2007 was $10,056. Toronto Public Health reports that in 2007, a nutritious food basket for a single young man was $2,615. A Metropass on the TTC Discount Plan is $1,200 annually (the cheapest transportation option for Toronto). Add up those costs, and our low-income Torontonian already needs an income of $13,871 - and that’s before paying for energy, clothing, medicine, dental, drugs and the other basics that Sarlo says is part of his basket. So, how can Sarlo get his numbers so low, when the real costs are so much higher?
Defining poverty rates so low that virtually no one in Canada could be called poor may make good ideological fodder, but in the real world that most people inhabit, Sarlo’s dollars just don’t make any sense.
]]>There is real expertise and a great deal of wisdom from the "ground up" about practical solutions to poverty in Ontario - that's been the experience of the Wellesley Institute over the past 10 years as we have been the leader in funding community-based research. And that was the first message that we delivered to Ontario Minister Deb Matthews, who is chairing the Cabinet Committee on Poverty Reduction, during a four-hour session in Ottawa that included representatives from across the province.
]]>There is real expertise and a great deal of wisdom from the "ground up" about practical solutions to poverty in Ontario - that's been the experience of the Wellesley Institute over the past 10 years as we have been the leader in funding community-based research. And that was the first message that we delivered to Ontario Minister Deb Matthews, who is chairing the Cabinet Committee on Poverty Reduction, during a four-hour session in Ottawa that included representatives from across the province.
Poverty is fundamentally about a lack of income, but there are important dimensions to poverty, including the lack of affordable housing. So, we advised the Minister that there are both important strategic indicators of growing housing need in Ontario (such as Core Housing Need), a reliable set of targets (from the Ontario government's own Provincial Policy Statement 2005), practical and effetive strategies to get us from here to there, and important and tangible ways to measure progress.
Stay tuned as we work with others, including our partners in the 25-in-5 Poverty Reduction Network , to put much more detail on the emerging framework to make a real and substantial reduction in poverty in Ontario.
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It was particularly heartening to see representatives from Toronto's business, tourism and entertainment all stand in support of this plan - along with the Wellesley Institute. Even Toronto Police Services spoke against criminalizing panhandling and in favour of the approach that tackles the fundamental concerns. Just one year ago, many business groups and others were clamouring for a police-led crackdown on panhandling.
]]>It was particularly heartening to see representatives from Toronto's business, tourism and entertainment all stand in support of this plan - along with the Wellesley Institute. Even Toronto Police Services spoke against criminalizing panhandling and in favour of the approach that tackles the fundamental concerns. Just one year ago, many business groups and others were clamouring for a police-led crackdown on panhandling.
The TO plan, which still needs the approval of City Council later this month, calls for a "housing first" approach to dealing with panhandling. It recognizes that growing poverty and housing insecurity are driving most people to beg on the streets, and that a significant number also suffer from physical and mental health concerns, including substance use. But instead of condemning the poor for being poor, the Toronto plan commits about $5 million to help panhandlers find affordable homes, an adequate income and the supports that they need.
The Wellesley Institute, in our submission to the committee, noted that the Statistics Canada data released last Thursday confirms the dire trend in growing income inequality in Toronto. We also pointed out that many cities - including New York City - have tried to criminalize activities associated with homelessness (including panhandling), only to find that this costs more and doesn't actually reduce the number of homeless people. And we called on the city to re-double its efforts to ensure that there is adequate housing and services for those who need it.
We've noted in our municipal budget submission that Toronto needs to ramp up its spending on housing and services, needs to re-double its efforts to convince senior levels of government to renew critical investments in housing and other social infrastructure and, until a comprehensive housing and anti-poverty strategy is adopted and funded by senior levels of government, needs to ensure that the city's emergency relief system - including homeless shelters - are properly funded.
One key factor that swayed many councillors was a simple message: The cost of doing nothing far outweights the cost of an effective and practical solution. That's the core message from the Wellesley Institute's Blueprint to End Homelessness, which was released in 2006, and city councillors and city officials quoted our Blueprint in support of sensible and humane plan to address the real needs of panhandlers.
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The City of Toronto has announced a series of public meetings to hear recommendations about the HOT plan. These include:
Wednesday, May 14 – Scarborough Civic Centre, 6:30 to 9 p.m.
Wednesday, May 28 – North York Civic Centre, 6:30 to 9 p.m.
Wednesday, June 4 – Etobicoke Civic Centre, 6:30 to 9 p.m.
Monday, June 16 – Affordable Housing Committee
Deputations – 1:30 p.m., City Hall, Committee Room 2
The City of Toronto has announced a series of public meetings to hear recommendations about the HOT plan. These include:
Wednesday, May 14 – Scarborough Civic Centre, 6:30 to 9 p.m.
Wednesday, May 28 – North York Civic Centre, 6:30 to 9 p.m.
Wednesday, June 4 – Etobicoke Civic Centre, 6:30 to 9 p.m.
Monday, June 16 – Affordable Housing Committee
Deputations – 1:30 p.m., City Hall, Committee Room 2
Statistics Canada has released this morning an update to its Human Activity and the Environment series that reports, among other things, that the emission of green house gases are up by 25% from 1990 to 2005. Lots more troubling indicators, including a stunning chart showing the remorseless rise in mean global temperatures.
Clean air and moderate temperatures are fundamental to good health. As Toronto braces for more smog days and extreme heat alerts, it’s important to remember that a safe and healthy environment, like most other determinants of health, is a fundamental health equity concern.
Some people in our city are more financially able to mitigate some of the worst effects of smog and heat than others (with air conditioning, vacations out of the city, etc.).
]]>Statistics Canada has released this morning an update to its Human Activity and the Environment series that reports, among other things, that the emission of green house gases are up by 25% from 1990 to 2005. Lots more troubling indicators, including a stunning chart showing the remorseless rise in mean global temperatures.
Clean air and moderate temperatures are fundamental to good health. As Toronto braces for more smog days and extreme heat alerts, it’s important to remember that a safe and healthy environment, like most other determinants of health, is a fundamental health equity concern.
Some people in our city are more financially able to mitigate some of the worst effects of smog and heat than others (with air conditioning, vacations out of the city, etc.).
Toronto enjoyed a spectacular weekend this past Saturday and Sunday – and we also puffed our way through the first two smog days of 2008. These smog days have come about a month earlier than expected. If this keeps up, we’ll be on track to beat the last record for smog days set in 2005. In that year, Toronto’s Medical Officer of Health released an epidemiological report surveying death data over several decades and reported that many more Torontonians are dying of heat and smog-related causes than cold injuries.
On the good news front, the provincial government announced today new rules to ban cosmetic pesticides and herbicides. They have taken the lead from the City of Toronto, which adopted its own anti-pesticides bylaw several years ago thanks to a vigorous campaign that was led by Toronto Environmental Alliance staff and volunteers.
It's been more than two years since Toronto City Council adopted an Urban Heat Island Mitigation Strategy - an acknowledgement of the serious environmental issues facing the city from killer heat and killer smog. Practical and effective action is still required.
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According to the report, more than one-third of all calls to Vancouver police involve people with mental health issues. The failure of capacity throughout the mental health system - from crisis response to supportive housing to services, along with failures in basic information-sharing - are causing a massive personal cost. The Vancouver study documents the ravages of increased illness and suicide for the people suffering mental health concerns. And there are heavy costs for the police service.
The report makes several key recommendations:
- a new mental healthcare facility for moderate to long-term stays;
- an urgent response centre for crisis intervention;
]]>According to the report, more than one-third of all calls to Vancouver police involve people with mental health issues. The failure of capacity throughout the mental health system - from crisis response to supportive housing to services, along with failures in basic information-sharing - are causing a massive personal cost. The Vancouver study documents the ravages of increased illness and suicide for the people suffering mental health concerns. And there are heavy costs for the police service.
The report makes several key recommendations:
- a new mental healthcare facility for moderate to long-term stays;
- an urgent response centre for crisis intervention;
- increased services for people who are dually diagnosed;
- more supportive housing;
- speeding up the admission process at local hospitals; and,
- a system to share information among mental health service providers.
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The provincial and territorial ministers left the meeting disappointed. Not only did they fail to get any specific commitments from the federal minister regarding the expiry of the three major national housing and homelessness programs this year, but the provincial and territorial ministers failed to get any promises regarding the deteriorating federal support for the country's existing social housing or even some much-needed attention to the urgent housing concerns facing Aboriginal people.
The federal minister wouldn't even agree to a formal meeting (the meeting on Wednesday was not a formal federal, provincial, territorial housing ministers' summit, but an informal meeting organized after federal Minister Solberg boycotted the last formal meeting in Vancouver in early February).
]]>The provincial and territorial ministers left the meeting disappointed. Not only did they fail to get any specific commitments from the federal minister regarding the expiry of the three major national housing and homelessness programs this year, but the provincial and territorial ministers failed to get any promises regarding the deteriorating federal support for the country's existing social housing or even some much-needed attention to the urgent housing concerns facing Aboriginal people.
The federal minister wouldn't even agree to a formal meeting (the meeting on Wednesday was not a formal federal, provincial, territorial housing ministers' summit, but an informal meeting organized after federal Minister Solberg boycotted the last formal meeting in Vancouver in early February).
Provincial and territorial ministers have agreed to meet again in September in Newfoundland and Labrador, and have challenged the federal minister to attend.
The full communique from the provincial and territorial housing ministers is printed below.
- Michael
* * *
Provinces and Territories Disappointed with Federal Government’s Lack of Engagement on Housing Issues in Canada
Provincial and Territorial Ministers Responsible for Housing met last night with the Honourable Monte Solberg, Federal Minister Responsible for Canada Mortgage and Housing Corporation in Gatineau, Québec, to discuss a series of critical housing issues.
The Provincial/Territorial Housing Ministers expressed their great disappointment that Minister Solberg is not able to provide a firm response to any of the issues they raised.
“It has been nearly three years since this country has had a formal Federal/Provincial/Territorial discussion about the state of housing in Canada and that’s not acceptable”, said Newfoundland and Labrador’s Minister Responsible for Housing, Shawn Skinner and co-chair of the next Housing Ministers’ conference.” The Federal Government doesn’t appear to see housing as a priority for Canadians. We are very concerned by the lack of commitment by the Federal Government to address the country’s critical housing issues. We will continue to do our utmost to impress upon the Federal Government the urgency of Canada’s housing situation.”
This meeting provided an opportunity for Provincial/Territorial Housing Ministers to reiterate the necessity of having formal discussions regarding the major issues facing the future of housing in Canada and more precisely the importance of establishing a federal-provincial partnership based upon the principles they adopted in White Point, Nova Scotia in 2005. These shared principles defined the roles, responsibilities and funding mechanisms for current and future housing initiatives, including adequate sustainable funding.
As a first step, the Provincial/Territorial Housing Ministers urged the Federal Government to immediately extend its financial contribution to housing, especially in the areas of Residential Rehabilitation, Homelessness and Affordable Housing which are currently slated to expire in March 2009. They unanimously requested that the Federal Government begin to work immediately with them regarding long term, predictable and sustainable funding for housing in Canada.
Ministers pointed out the need for funding to support Canada’s existing social housing stock. Declining federal funding, increasing operating costs and “flat” rents threaten the viability of this $100 billion public asset.
Provincial/Territorial Housing Ministers also raised the issue of Aboriginal and Northern housing concerns with Minister Solberg.
Finally, there has not been a Federal/Provincial/Territorial Housing Ministers meeting since the September, 2005. Provincial/Territorial Ministers impressed upon Minister Solberg the need for the Federal Government to commit and participate in a Housing Ministers’ Conference.
Since the Federal Minister could not commit his presence at a conference in the next few months, the Provincial/Territorial Ministers will meet in September 2008 in St. John’s, and it is expected that the Federal Government will be there to address the critical needs of 1.5 million Canadian households.
Despite that welcome promise almost three years ago, no progress has been made on a comprehensive framework and plans for a Canadian Housing Framework are apparently not even on the formal agenda of the today's housing ministers' meeting. Federal housing minister Monte Solberg wants to talk about tax cuts, and the provincial and territorial ministers want to talk about the expiry of funding for all three national housing and homelessness programs during this fiscal year.
]]>Despite that welcome promise almost three years ago, no progress has been made on a comprehensive framework and plans for a Canadian Housing Framework are apparently not even on the formal agenda of the today's housing ministers' meeting. Federal housing minister Monte Solberg wants to talk about tax cuts, and the provincial and territorial ministers want to talk about the expiry of funding for all three national housing and homelessness programs during this fiscal year.
Canada has a long history of using tax-based measures to deliver affordable housing, and that history is mostly one of failure. In 2003, TD Economics, in its major review of affordable housing, devoted several pages to a detailed examination of a series of tax measures to stimulate affordable housing. The conclusion from the senior economist of one of Canada's largest banks:
"In conclusion, tax changes are unlikely to bring the biggest 'bang for the nuck' to affordable housing. Some of the provisions, such as the capital tax and the distortion between property taxes on rental and owner-occupied buildings, should be fixed on their broad merits. The other recommendations would no doubt increase the supply of rental housing, but the benefits would be diluted across the full spectrum of housing and have a limited 'trickle down' effect to affordable housing. A greater benefit-cost ratio could be realized through initiatives to directly target the lower cost segment of the market."
In plain language: Tax cuts to stimulate new affordable homes aren't particularly efficient and there are much better policy options, such as direct investment in new affordable supply.
Canada has a long history of tax measures that tweak around the edges of private markets in an effort to create new affordable homes, and that history is largely one of failure. Tax incentives such as the MURB scheme about two decades ago were very costly, and they didn't deliver the affordable homes that Canadians so urgently needed.
Meanwhile, the imminent expiry of funding for all three major federal housing and homelessness programs (affordable housing investments, the national housing repair program and the national homelessness strategy) in the current fiscal year comes at the same time that overall federal investment in affordable housing is locked into a steady annual decline.
The "step-out" of federal housing dollars started with a decision by the federal governent i 1996 to transfer administration of federal housing programs to the provinces and territories. At that time, Canada became the only major country in the world without a comprehensive and properly funded national housing strategy.
The federal withdrawal from housing at a time when the nation-wide need for affordable homes remains deep and persistent.
Canada Mortgage and Housing Corporation , the federal government's housing agency, estimates that its funding for affordable housing will drop by almost $100 million over the next five years and the number of households that it will assist will drop by almost 30,000. All this at a time when CMHC projects that its annual operating profits will increase to $1.3 billion and its total equity will grow to $11.9 billion.
One final note: as the Wellesley Institute's National Housing Report Card (released in early February of 2008) shows, a number of the provinces don't come to Ottawa with a strong record of investment in affordable housing. Most provinces have failed to meet the affordable housing commitments that they made when they signed the Affordable Housing Framework Agreement of 2001 (and the federal government has fallen short of its promises, as well).
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The meeting will take place on Thursday, April 3, and it will last for 90 minutes (not the 30 minutes that another official reported earlier). Ninety minutes is obviously better than half an hour, but it is far short of the usual day-long meetings that federal, provincial and territorial housing ministers have held in the past - meetings that have included a session with non-governmental housing groups.
As noted previously, one key item on the agenda is the expiry of federal affordable housing, housing repair funds and homelessness funding at the end of fiscal 2008.
]]>The meeting will take place on Thursday, April 3, and it will last for 90 minutes (not the 30 minutes that another official reported earlier). Ninety minutes is obviously better than half an hour, but it is far short of the usual day-long meetings that federal, provincial and territorial housing ministers have held in the past - meetings that have included a session with non-governmental housing groups.
As noted previously, one key item on the agenda is the expiry of federal affordable housing, housing repair funds and homelessness funding at the end of fiscal 2008.
]]>The Wednesday meeting comes at the last minute - just days before Minister Solberg's promise was due to expire. One report suggests that the meeting will only last 30 minutes - not exactly the day-long, detailed sessions that federal, provincial and territorial housing ministers have attended in the past.
In late January, the Wellesley Institute released its national housing report card which documents the deterioration in housing spending at the national level, and in many provinces and territories.
]]>The Wednesday meeting comes at the last minute - just days before Minister Solberg's promise was due to expire. One report suggests that the meeting will only last 30 minutes - not exactly the day-long, detailed sessions that federal, provincial and territorial housing ministers have attended in the past.
In late January, the Wellesley Institute released its national housing report card which documents the deterioration in housing spending at the national level, and in many provinces and territories.
The one-in-five Canadians living in insecure, unsafe, overcrowded and/or unaffordable homes, along with housing advocates, will look to the housing ministers to make substantial progress in their long overdue Wednesday meeting on two critical issues:
First, the renewal and extension of the three national housing and homelessness programs that are all due to expire in fiscal 2008.
Second, the funding and launch of a comprehensive Canadian Housing Framework - promised by the housing ministers at their last national housing summit in September of 2005, but not delivered as yet.
The three national housing / homelessness programs that are due to expire this year (in annual dollars) are:
* $700 million for the affordable housing (a two-year allocation of $1.4 billion from Bill C-48 that was authorized by Parliament in 2005 and allocated in 2006; Ontario has managed to "re-profile" the funding, which means that it gets longer to figure out how to spend the money);
* $128 million for the housing repairs through the Residential Rehabilitation and Assistance Program; and,
* $135 million for homelessness through the National Homelessness Initiative.
]]>Budgets are about choices and, fundamentally, budgets are about dollars. The real choices are revealed in the spending and revenue columns.
When it comes to housing, Finance Minister Dwight Duncan has offered the millions of Ontarians who are suffering housing insecurity and homelessness $100 million for a social housing repair program (this money was first announced by Premier Dalton McGuinty last week). Some experts put the repair bill for social housing at $1.3 billion, so the $100 million is at best a modest down-payment.
There’s no additional money for new affordable homes and, overall, funding at the Ministry of Municipal Affairs and Housing is shrinking as federal housing dollars (which flowed through the province to municipalities) decline.
Compare that to the $1.5 billion the government has allocated to highway repairs and construction. That’s 15 times more money for roads than for homes.
]]>Budgets are about choices and, fundamentally, budgets are about dollars. The real choices are revealed in the spending and revenue columns.
When it comes to housing, Finance Minister Dwight Duncan has offered the millions of Ontarians who are suffering housing insecurity and homelessness $100 million for a social housing repair program (this money was first announced by Premier Dalton McGuinty last week). Some experts put the repair bill for social housing at $1.3 billion, so the $100 million is at best a modest down-payment.
There’s no additional money for new affordable homes and, overall, funding at the Ministry of Municipal Affairs and Housing is shrinking as federal housing dollars (which flowed through the province to municipalities) decline.
Compare that to the $1.5 billion the government has allocated to highway repairs and construction. That’s 15 times more money for roads than for homes.
Roads are, of course, very important and physical infrastructure investments are important for our communities and our economy. But so, too, are social investments in critical needs like new affordable homes.
The 2008 Budget sets out planned spending of $796 million for the Ministry of Municipal Affairs and Housing - down almost six per cent from the actual spending in 2006. One reason for the cut in planned spending is the drop of $18 million in federal social housing transfer funds. On top of that, the province is making a further $29 million in MMAH spending cuts.
Health spending is the single biggest item in the provincial Budget - about 46 cents out of every provincial dollar in 2008. The Budget proclaims: “The government’s plan for achieving better health is about keeping Ontarians healthy, providing high quality care if they become sick, and sustaining the public health care system for generations to come”. But when the dollars are added up, the biggest share of health investment from 2003 to 2008 has been to hospitals, doctors and drugs. This spending is vital to achieve the government’s second and third goals (high quality sickness care and a sustainable public health care system). Just a tiny fraction of health spending goes to public health and health promotion - critical components of a health equity agenda. The government says that “keeping Ontarians healthy” is a key health priority, but the budgetary dollars to support that commitment are missing. On its plans for a Poverty Reduction Strategy to address deep and persistent poverty across the province, the Budget proclaims: “The government is committed to improving the quality of life for all Ontarians, particularly the most vulnerable”. The poverty reduction dollars set out in the Budget add up to almost $270 million (not counting the $100 million in social housing repair funding). On the revenue side, the 2008 Ontario Budget offers more than $1.25 billion in tax cuts - with about half going directly to tax cuts for businesses. Corporate tax cuts are double the amount slated for poverty reduction. Tax cuts are being sold as vital to the economic prosperity of the province, especially as Ontario faces a downturn and possible recession triggered by the U.S. subprime mortgage crisis. But tax cuts don’t create the smart and necessary social investments that will make a tangible difference to Ontarians bracing for even worse economic bad times. In our pre-budget backgrounder, the Wellesley Institute set out five key questions for Finance Minister Dwight Duncan as he delivers Budget 2008. Here are the questions, and the answers as revealed in the budget documents: ONE: Will Minister Duncan commit the funds to close Ontario’s billion-dollar housing deficit? ANSWER: No. Ontario’s billion-dollar housing deficit remains devastatingly wide. TWO: Will Minister Duncan ensure that the $150 million or more in unspent federal housing funds are allocated before the funding expires this fiscal year? ANSWER: There’s nothing in the Budget to acknowledge the critical delays in committing the federal housing dollars from last year’s budget which remain unspent, and which are due to expire at the end of fiscal 2008. A senior Ministry of Municipal Affairs and Housing official assured the Wellesley Institute that the Ontario government remains committed to spending the federal trust fund dollars and added that the $80.2 million in unspent federal off-reserve Aboriginal housing trust fund dollars have been “re-profiled” so that they won’t expire at the end of fiscal 2008, even if they are not committed by then. THREE: Will Minister Duncan complete the uploading of the cost of social housing programs back to the provincial level? ANSWER: No, the partial uploading remains just that - partial. The 905 municipalities had the cost of social housing uploaded in last year’s Budget. Toronto and the rest of the province must wait at least until a long-awaited provincial-municipal social services review is completed. It is now promised for the spring of 2008. FOUR: Will Minister Duncan ensure that the Ministry of Municipal Affairs and Housing, and other provincial ministries, have the capacity to fund and deliver critical housing and homelessness programs? ANSWER: No. Ministry of Municipal Affairs and Housing funding is down. FIVE: Will Minister Duncan use the 2008 Ontario Budget to make a major down-payment on a comprehensive Poverty Reduction Strategy, as promised in the government’s last Speech from the Throne? ANSWER: As noted above, the poverty reduction investment is modest. Finally, some general notes about housing and urban health: The Wellesley Institute’s National Housing Report Card from February of 2008 shows that Ontario has the worst record among Canada’s provincial / territorial governments in meeting the housing commitments it made under the Affordable Housing Framework Agreement of 2001. Under that deal, Ontario promised to increase provincial housing spending by $358 million but the province has actually cut provincial housing spending by $732 million since 2001 - creating a massive housing deficit of more than $1 billion. Average market rents have increased in recent years, while median renter household incomes have been falling, creating a housing affordability gap that measured $1,776 annually in 2005. That’s the difference between what a typical landlord charged and the amount that a typical household could afford to pay. Lack of new supply as Ontario’s population increases (and growing income inequality in many parts of the province creates a growing need for truly affordable homes); the increased need for new supportive housing for those with special needs; the urgent requirement for repairs as the province’s housing stock ages; and the critical need for affordability measures (such as rent supplements) to ensure existing housing is affordable to low and moderate-income households - all these add up to an urgent and unmet housing need. Growing housing insecurity and homelessness are a critical factor in increased illness and premature death among those directly affected, and they also disrupt communities as well as putting a brake on economic competitiveness.
TWO: Will Minister Duncan ensure that the $150 million or more in unspent federal housing funds are allocated before the funding expires this fiscal year? Parliament authorized $1.6 billion in affordable housing funding in 2005, and the federal government in 2006 assigned $312.3 million to Ontario for an affordable housing trust fund, and an addition $80.2 million for an off-reserve Aboriginal affordable housing trust fund. The 2007 Ontario budget announced plans for this spending, but as much as half, or more, of the dollars remain uncommitted. The single biggest spending envelope for the affordable housing trust fund was a housing allowance program that was supposed to benefit 27,000 households and cost $185 million. It is estimated that only half the funding has been committed. Not one penny of the Aboriginal funding has been committed, and it is estimated that as much as $80 million of the other fund remains unspent. If the money is not committed by the end of fiscal 2008, then it will revert back to the federal government.
THREE: Will Minister Duncan complete the uploading of the cost of social housing programs back to the provincial level? In the 2007 budget, the Ontario government uploaded housing and other costs from the 905 municipalities to the provincial level, but left Toronto and the rest of the province to continue paying the costs for programs that properly belongs at the provincial level. In recent days, the provincial government has announced a $100 million capital repair fund for social housing and a $500 million loan program. There are reports that as much as $300 million in additional repair funding may be announced in the Budget or soon after. All this is an important down payment on the billion-dollar-plus province-wide capital repair bill for former public housing projects, but it is only one part of the huge financial burden that the province downloaded on municipalities starting in 1998. Municipalities may be well-placed to take on the administration of housing programs, but they cannot the financial costs - which properly belong at the provincial level.
FOUR: Will Minister Duncan ensure that the Ministry of Municipal Affairs and Housing, and other provincial ministries, have the capacity to fund and deliver critical housing and homelessness programs? The 2007 Ontario Budget reported spending cuts for the Ministry of Municipal Affairs and Housing in 2006 and again in 2007. Some experts have suggested that the difficulties in delivering housing programs at the provincial level (including the housing allowance, Aboriginal trust fund, affordable housing and other initiatives) is related to the limited capacity within the Ministry to develop and effectively administer programs. The Ministry was gutted in the 1990s to suit the political interests of the government of the day. Housing programs were fractured as they were downloaded to municipal service managers. Supportive housing - which provides a home with special physical and / or mental health supports - was transferred to the Ministry of Health. Recently, supportive housing programs have been downloaded by the Ministry to the Local Health Integration Networks (LHINs). LHINs, like municipal housing service managers, may be effective administrators at the local level, but they need the funding and program support from the province.
FIVE: Will Minister Duncan use the 2008 Ontario Budget to make a major down-payment on a comprehensive Poverty Reduction Strategy, as promised in the government’s last Speech from the Throne? Housing insecurity and homelessness are critical health issues, leading to increased illness and premature death. The links between poverty and poor health are recognized by the World Health Organization at the international level, and confirmed by countless research reports, including research funded by the Wellesley Institute. Some politicians, including federal Finance Minister Jim Flaherty, have called on Ontario to make additional corporate tax cuts in the hope that the benefits of these cuts will somehow trickle down to benefit those who are suffering from poverty, poor housing and poor health. But corporate tax cuts don’t create the social investments in housing, health, education and other fundamental determinants of health. While it make take the Ontario government a number of months to fully develop its Poverty Reduction Strategy, the 2008 Ontario Budget is an excellent place to start with a significant down-payment in the form of increased investments in housing and other fundamental determinants of health.
]]>Most low, moderate and many middle-income Canadians live in the one-third of homes that are in the rental markets. Rental markets have been increasingly troubled in recent years as average market rents charged by landlords have outpaced the affordable rents that renter households can afford based on stagnant or declining tenant household incomes.
However, the ownership market in recent years offered some hope to some, with relatively low mortgage rates and a relatively strong supply of new homes. But all of that is being swept away by growing unaffordability starting in 2007. Rapidly rising house prices in most parts of the country have outpaced the real incomes of owner households - creating the affordability squeeze.
]]>Most low, moderate and many middle-income Canadians live in the one-third of homes that are in the rental markets. Rental markets have been increasingly troubled in recent years as average market rents charged by landlords have outpaced the affordable rents that renter households can afford based on stagnant or declining tenant household incomes.
However, the ownership market in recent years offered some hope to some, with relatively low mortgage rates and a relatively strong supply of new homes. But all of that is being swept away by growing unaffordability starting in 2007. Rapidly rising house prices in most parts of the country have outpaced the real incomes of owner households - creating the affordability squeeze.
In the words of RBC Economics: “Nationwide housing affordability deteriorated in every consecutive quarter throughout 2007 to end up at its most unaffordable level since the housing bubble peaked in 1990. Back then, soaring interest rates and a recession sparked much of the trouble. Today, however, a long upward trend in house prices driven by sounder macroeconomic fundamentals like job growth is primarily responsible. Adding more fuel to this housing cycle is mortgage product innovation that has expanded the market to more potential buyers since mortgage insurance liberalization began two years ago. Only Alberta bucked the trend in the latest quarter. Outside of Alberta, affordability deteriorated in every single market and for each type of housing.”
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