[homeles_ot-l] Feds finally reach housing framework deal with provinces / territories - facts and figures - WI backgrounder

[Lynne Browne]

IMPORTANT news for Ottawa. With thanks to Michael Shapcott. 

Lynne Browne

Coordinator, Alliance to End Homelessness 

613-241-7913 ext. 205, lbrowne at ysb.on.ca <mailto:lbrowne at ysb.on.ca> 

 

From: Michael Shapcott [mailto:Michael at wellesleyinstitute.com] 
Sent: July-04-11 3:11 PM
To: Michael Shapcott
Subject: WI backgrounder: Feds finally reach housing framework deal with
provinces / territories - facts and figures

Three years after the federal government promised a five-year extension
of key national housing investments, a new short-term housing framework
agreement
<http://www.cmhc-schl.gc.ca/en/corp/nero/nere/2011/2011-07-04-0930.cfm>
has been announced with the provinces and territories. There's no new
money in today's announcement, and the new agreement mirrors the flawed
2001 federal / provincial / territorial affordable housing framework
agreement. But the good news is that despite significant cost-cutting
measures in many departments, the federal government intends to honour
its 2008 housing promise. A preliminary analysis of today's announcement
shows that:

AFFIRMING 2008 COMMITMENT: In 2008, the federal government announced a
five-year extension of several housing and homelessness investments.
Advocates had been worried that government-wide cost-cutting might claim
some of the previously announced spending. Today's announcement calls
for $1.4 billion in combined federal and provincial / territorial /
municipal and third party housing investments over a three-year period -
or about $470 million annually.

NO NEW INVESTMENTS: The Wellesley Institute's Precarious Housing 2010
<http://wellesleyinstitute.com/news/affordable-housing-news/new-report-p
recarious-housing-in-canada-2010/>  report notes that federal housing
and homelessness investments has been shrinking since 1989. The latest
corporate plan from Canada Mortgage and Housing Corporation
<http://www.cmhc-schl.gc.ca/en/corp/about/anrecopl/index.cfm>  notes
that overall federal housing expenses will drop sharply from $3 billion
in 2010 to $1.75 billion in 2014 - a cut of $1.25 billion. Today's
announcement doesn't add any new dollars that were not already
announced. The dollars in today's announcement are already included in
the CMHC corporate plan that documents shrinking dollars. The sharp drop
in federal housing spending is due to two major factors: The expiry of
short-term funding commitments (including the 2009 federal stimulus
dollars); and the "step-out" of federal housing commitments that was
launched in 1996 and accelerates over the years.

FEWER AFFORDABLE HOMES: The CMHC corporate plan notes that the number of
Canadian households assisted through federal housing investments will
shrink from 626,300 in 2007 to 540,800 in 2015. That's a drop of 85,500
households - or a 14% cut over nine years. Since the dollars in today's
announcement are already reflected in the CMHC corporate plan, the new
framework agreement likely won't affect the ongoing decline in
federally-assisted households.

NO TARGETS, NO TIMELINES, NO STANDARDS: The new framework agreement sets
out a series of general goals broadly similar to those in the 2001
housing framework. But there are no specific targets to determine
accountability for success. The latest framework agreement, like the
2001 deal, includes a commitment to "accountability," but there is no
mechanism to ensure true accountability. For instance, under the 2001
deal, provinces and territories were required to prepare annual audited
financial statements and annual performance reports that included
specific details on the dollars spent, and the housing built. The
communications protocol said that these statements were to be public,
but not one statement was ever released under the 2001 agreement,
despite repeated requests over the years. Today's announcement does not
mention any new mechanism to ensure transparency and accountability.

ESTIMATING NATIONAL HOUSING NEED: About 1.5 million households (13% of
all households in Canada) were in "core housing need" in 2006, according
to Canada Mortgage and Housing Corporation's main indicator of housing
need <http://www.cmhc-schl.gc.ca/en/corp/about/cahoob/data/data_013.cfm>
. The numbers have likely risen significantly since then due to the 2008
recession. There is no reliable national indicator of people who
experience homelessness, but the number is likely in the hundreds of
thousands. The funding in today's announcement will help to fund repairs
to perhaps 20,000 substandard homes; and perhaps 3,000 new affordable
homes annually. Over the three years of today's agreement, perhaps 9,000
new affordable homes will be built, and 60,000 rundown homes renovated.
In total, the new and renovated units in today's announcement will
barely make a dent in the national numbers of Canadians who are
precariously housed.

FURTHER LEGAL DEALS REQUIRED: The latest framework agreement, as in the
2001 deal, requires bilateral housing deals to be negotiated between the
federal government and each of the ten provinces and three territories.
It took four years to conclude the bilateral deals (the final bilateral
deal, between the federal and Ontario governments, was not signed until
2005).

DEFINING AFFORDABILITY: In his 2009 review of the federal-Ontario
affordable housing program, the Ontario Auditor General noted that the
definition of 'affordable' was so loose that the actual rents charged in
the new homes were much higher than the rents that low-income households
on waiting lists could afford to pay. The bilateral housing deals signed
under the 2001 agreement used private market rents as a benchmark for
determining affordability, but private rents have been outpacing renter
household incomes in recent years. To ensure that the neediest
households can actually afford the new homes, a new measure of
affordability will be required that is based on the real income of
low-income households, rather than the market rents charged by private
landlords.

CREATIVE ACCOUNTING: When federal dollars are transferred to the
provinces and territories, it is supposed to create new housing, and not
simply be used to replace provincial spending with no net gain in new
homes. Housing advocates noted that creative accounting by some
provinces may have led to a substitution of federal dollars for
provincial spending in the 2001 framework agreement. For instance, in
2009, the Ontario Auditor General
<http://www.auditor.on.ca/en/reports_en/en09/312en09.pdf>  noted that
the provincial government was unable to account for hundreds of millions
in federal dollars that were supposed to be spent on affordable housing.
This loophole in the 2001 agreement appears to remain wide open in the
2011 framework agreement.

HOUSING AND HEALTH: Housing is one of the most important fundamentals
for good health. Research by the Wellesley Institute and others at the
local, national and international level confirms the link between poor
housing and poor health, as well as premature death. Research also
suggests that good housing contributes to better health for people and
communities.

-          Michael

 

***

 

Michael Shapcott | Director, Housing and Innovation | Wellesley
Institute 

10 Alcorn Avenue, #300                        Tel: 416.972.1010 ext 231
Toronto, ON, Canada,  M4V 3B2           Mobile: 416.605.8316  
E-mail:   michael at wellesleyinstitute.com

 

www.wellesleyinstitute.com

research. policy. innovation. action.

 

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