A.  Background

Governments at all three levels have invested significant funds to provide low-income housing. Since the 1940s, the federal government has played an important role in ensuring Canadians’ access to social and affordable housing. This background section explains the role of the federal government related to social and affordable housing, housing for Indigenous peoples, and homelessness, and outlines recent initiatives that provide important context for the witness testimony that follows.

Canada Mortgage and Housing Corporation (CMHC) considers housing to be “affordable” if shelter costs account for 30% or less of net household income. “Affordable housing” is a broad term that includes housing provided by the private, public, and not-for-profit sectors and forms of housing such as rental, cooperative ownership, and market home ownership. Affordable housing may be temporary or permanent housing. Social housing is one element of affordable housing and usually refers to government subsidized rental housing for low-income residents.[267]

According to a study released in April 2015 by CMHC,[268] approximately 30.8% of Canadian households lived in housing that was “unacceptable” in terms of adequacy, suitability, or affordability,[269] and 40.6% of these households would not have been able to find acceptable housing in their region had they looked for it. According to CMHC’s study, 12.5% of Canadian households were in core housing need in 2011, meaning that their current housing was unacceptable in terms of adequacy, suitability, or affordability, and their income did not enable them to access acceptable housing in their region’s rental market.[270] The study also showed that affordability, rather than suitability or adequacy, has long been the most critical factor for Canadian households.

By province, the incidence of core housing need in 2011 ranged from 9.2% in Prince Edward Island to 15.4% in British Columbia. Households in Nunavut were much more likely to be in core housing need (39.2%) than households in any other province or territory.[271]

1.   Role of the federal government

In terms of social housing, CMHC’s role has changed over time. In 1993, the federal government stopped investing directly in new social housing construction and transferred the management and administration of most of its social housing stock to the provinces and territories.[272] However, CMHC continues to fund existing social housing through long-term operating agreements, designed to cover the difference between the operating expenses of social housing units and the rents paid by low-income residents. As of 2010, 613,500 social housing units were supported by federal long-term operating agreements.[273] The federal government’s intention was that as federal funding ended with the expiry of these agreements, the property mortgages would be paid off, leaving housing providers with reduced operating costs.[274]

CMHC also offers programs to help create new and affordable housing, upgrade existing housing in need of renovations or accessibility modifications, address the housing needs of victims of family violence, and provide rent subsidies for individuals and families in need. In recent years, the federal government has allocated close to $2 billion annually through the Investments in Affordable Housing (IAH) program[275] to housing assistance through CMHC to improve the quality of life of low-income Canadians.[276] Provinces and territories provide matching contribution funds to IAH and are responsible for the design and delivery of the program, providing them with the ability to meet the unique needs within their jurisdictions. IAH funds may be used for construction, renovations and repair, rent supplements, shelter allowances, home ownership support and housing for victims of family violence.

CMHC, in partnership with Indigenous and Northern Affairs Canada (INAC), is responsible for providing housing to First Nations living on reserve. INAC’s First Nation On-Reserve Housing Program provides housing in First Nation communities in most of Canada. In British Columbia, INAC supports housing for First Nations through the Housing Subsidy program and the New Approach for Housing Support.[277] INAC’s annual funding of $146 million for on-reserve housing can be used by First Nations for construction, renovation, maintenance, debt servicing, insurance, and housing stock operational costs. INAC does not provide the full costs of housing and First Nation communities and residents must obtain funds from other sources.

Also in relation to on-reserve housing, CMHC, in partnership with INAC and First Nations, administers the On-Reserve Non-Profit Housing Program,[278] which assists First Nations in the construction, purchase and rehabilitation, and administration of affordable rental housing on reserve. CMHC also administers the First Nations Market Housing Fund,[279] designed to facilitate access to market loans and mortgages that can be difficult to obtain because of the unique land tenure system on reserve.

ESDC is the lead federal department responsible for homelessness and oversees the Homelessness Partnering Strategy[280] (HPS), a community-based program aimed at preventing and reducing homelessness across Canada. Budget 2013 allocated $600 million over five years (2014−2019) to the HPS, increasing support and direct funding to 61 designated communities and to agencies addressing homelessness among Indigenous peoples across the country, and promoting a Housing First model to reduce homelessness.

Focusing resources on Housing First redirected HPS funding from the more traditional methods of using shelters and shelter services to address homelessness. Housing First integrates housing with other supports and services often needed by homeless persons, such as mental health and addiction counselling services. It focuses on moving people as rapidly as possible from the streets or emergency shelters into permanent housing with supports that vary according to the client. Housing First targets individuals who have been homeless for six months or more in the past year as well as those who are currently homeless and have experienced three or more episodes of homelessness in the past year.

Under the HPS, ESDC also administers, in partnership with Public Services and Procurement Canada, the Surplus Federal Real Property for Homelessness Initiative,[281] which makes surplus federal real properties available to eligible recipients to invest in transitional, permanent supportive, or longer-term housing and related support and emergency services with the objective of preventing and reducing homelessness.

2.   Recent federal actions

The federal government announced its plans to develop a national housing strategy, following consultations, as part of Budget 2016, which also announced the plans to expand current investments with regards to affordable housing. Speaking on this subject, the Honourable Jean-Yves Duclos, Minister of Families, Children and Social Development indicated “[t]hese investments are a transitional measure to bridge the gap for the next two years while consultations are undertaken [with provinces, territories and stakeholders] leading to a new approach under a national housing strategy.”[282]

Budget 2016[283] also announced the allocation of $3.4 billion over five years for social infrastructure. Of this amount, $1.48 billion would be provided over 2016–2017 and 2017–2018 to include: $504.4 million to double current federal funding provided to provinces and territories under the Investment in Affordable Housing Initiative (with funding to be matched by provinces and territories); $200.7 million to increase affordable housing for seniors; $573.9 million for supporting retrofits and renovations for existing social housing; $89.9 million to support shelters for victims of violence; and $111.8 million to address homelessness. These funds will go to various communities for initiatives to prevent and reduce homelessness, “including Housing First activities, better emergency response services, and supports for youth, women fleeing violence, and veterans.”[284]

Budget 2016 announced the allocation of $208.3 million in 2016–2017 to support the construction, repair, and adaptation of affordable housing for seniors, with the goal of allowing seniors to stay in their homes as long as possible. The funding will not require provinces or territories to cost-match these investments.

To support Indigenous peoples and northern communities, Budget 2016 announced the allocation of up to $177 million over two years beginning in 2016–2017 for northern and Inuit housing through CMHC’s Investment in Affordable Housing Initiative, including: $8 million to Yukon; $12 million to the Northwest Territories; $76.7 million to Nunavut; $50 million to Nunavik; $15 million to Nunatsiavut; and $15 million to the Inuvialuit Settlement Region. Funding was announced for the federal government to provide $554.3 million in 2016–2017 to 2017–2018 towards First Nations housing on reserve. Of this amount, $137.7 million would be allocated to CMHC to support renovation and retrofit of existing housing on reserve and $416.6 million would be allocated to INAC to address immediate housing needs on reserve.

B.  What the Committee Heard

The Committee heard from a number of witnesses about the gaps, challenges and possible ways forward to address the housing needs of low-income Canadians. In particular, witnesses provided considerable information and insight into many of the underlying causes of the current social and affordable housing situation and described how certain populations, such as Indigenous peoples and seniors, have been affected. Many witnesses provided the Committee with views on homelessness and the Housing First model and how it could be improved. For example, several witnesses advocated that the affordability criteria for housing be changed, as the current definition of 80% of average market rent is beyond the means of many low-income families.[285]

Many of the witnesses who contributed to this study had recently provided their input and recommendations to the government as part of its housing strategy consultation process. It is not the intention of the Committee to provide recommendations on an overall national housing strategy, as, observed by the Canadian Home Builders’ Association, the housing market is a continuum, of which social and affordable housing is only one part:

... addressing the entire housing continuum right up into market rate, rental, and home ownership is critical to both the housing strategy and the poverty reduction strategy. The ripple effects of deteriorating market-rate affordability and barriers to home ownership cascade right down to those in housing need and impede progress and poverty reduction if not addressed....

Overall, we need to keep Canadians moving across the housing continuum towards market-rate housing. People need to keep moving along the continuum to make space available for those less fortunate. Even more important, we need to ensure people are not sliding back in the wrong direction. If affordability problems and market-rate housing push those who would otherwise be self-sufficient into a requirement for public support, our system has truly failed.[286]

There is a foundational relationship between housing and poverty and a number of witnesses stressed that the national housing strategy that the federal government is currently developing must be part of an overall national poverty reduction strategy. As Robin Miiller, Chief Administrative Officer of the Medicine Hat Community Housing Society, stated, “poverty reduction is homelessness prevention. Access to appropriate housing should, therefore, be seen first from a perspective of a preventive response to homelessness.”[287]

Another witness stressed that access to safe and affordable housing is so critical to the health and well-being of individuals that it is a basic human right and a “cornerstone for ensuring that other rights are respected.”[288]

1. Underlying causes of housing need

Witnesses identified a range of policies and events that have contributed to the shortage of affordable housing in Canada. They pointed to factors such as the federal departure from social housing, the escalating cost of market housing in major municipalities, particularly in Toronto and Vancouver, the decline of rental housing construction, the expiry of CMHC’s long-term operating agreements, and the impacts of municipal policies, taxes and regulations.

The Committee heard that the federal government’s decision in 1992 to withdraw from the development of social housing was the starting point of an affordable housing crisis in communities. The Committee also heard that the current structure of CMHC’s affordable housing program does not lead to a sustainable long-term affordable housing sector, because of the provision that enables landlords to withdraw from the affordable housing market after 20 years in the program, causing affordable housing stock to diminish over time in the absence of new construction.[289] Witnesses also stressed that as long-term operating agreements for social housing expired, low-income tenants were losing or at risk of losing their housing as many housing providers were unable to offer low rents without subsidies.[290]

While many witnesses called on the federal government to increase funding to affordable housing initiatives across Canada, the Committee’s attention was drawn to the fact that the populations that would be served by affordable housing and those served by social housing were significantly different. As Mary Todorow of the Advocacy Centre for Tenants Ontario explained, CMHC’s Investment in Affordable Housing program does not help those in the lowest income brackets:

The affordable housing that's being built under the Investment in Affordable Housing program is not affordable to the people on the waiting list who are homeless unless an additional rental subsidy is available. We're talking about the most vulnerable people in our communities here. People who are eligible for those investments in affordable housing rents have to make about $40,000 a year. As an example, half of the tenants in TCHC [Toronto Community Housing Corporation] have incomes of less than $15,000 a year. The majority of the tenants in TCHC are recipients of social assistance. Do you know what's really scary? The majority of people who are on Ontario Works are living in the private rental sector. Their shelter allowance component of social assistance is not enough to pay for average rents in virtually every community across Ontario.[291]

The Committee heard that not only has there been a decline of rental housing construction for a number of years, but that there was also a shortage of rental units sufficiently large to meet the needs of certain vulnerable populations such as recent immigrants and urban Indigenous peoples. The Committee learned that in Vancouver and Winnipeg, refugee families from Syria and other locations have arrived with large families but are being housed in two-bedroom apartments. As well, Indigenous peoples seeking affordable housing often have larger families that include extended family members. As recently as October 2015, the Social Planning Council of Winnipeg, using CMHC data, calculated that there were only four affordable three-bedroom rental units in the city of Winnipeg. During this same timeframe, the Social Planning Council also determined that there were only approximately 27 affordable bachelor units in Winnipeg, at a time when there were 1,400 homeless individuals in the city.[292]

Aside from the impact of the federal government’s departure from social housing in recent decades, the Committee also heard that building and zoning restrictions were barriers to construction of affordable housing. Several witnesses pointed to the effect of government (particularly municipal) red tape and taxation practices and their dampening effect on housing stock supply. In discussing his report on housing in the Greater Golden Horseshoe area, Kenneth Green, Senior Director, Natural Resources Studies, Fraser Institute, explained how the cost of obtaining building permits, the delays due to re-zoning and waiting for permits, and the challenges from municipal councils and community groups have suppressed housing construction and helped fuel the increase in rents and housing prices.[293] Housing supply has also been restricted by community opposition to higher density, mixed-income housing developments, which one witness stated was a more significant impediment than municipal regulations.[294]

The Committee learned of research on the effects of municipal regulations and land use restrictions and their impacts on housing prices. It heard of research done on the richest American cities and the economic distortions caused in local, regional, and national labour markets. Extreme housing prices serve to deter labour mobility as the lack of affordable housing prevents less-educated workers from better opportunities in locations that offer higher paid jobs, either because they cannot afford to move to richer cities because of the higher housing costs or they are pushed out of these areas as housing becomes unaffordable. This results in increased regional income inequality and prevents poorer regions from closing the economic gap with more wealthy regions. This trend has been growing as a result of the increasing use of regulations and land use restrictions introduced in wealthier cities, which has hampered housing development.[295] However, CMHC officials told the Committee that they lack the data to calculate how much land restrictions contribute to the cost of housing in Canada.[296]

The Committee heard that applying the Goods and Services Tax (GST) to rental construction also had negative effects on the affordability of housing and that it was a burden for those constructing cooperatives.[297] Witnesses explained that builders of rental accommodation pay GST on the goods and services used during construction and build these costs into the price of rent, making rents more expensive and deterring developers from building rental accommodation.[298]

Several witnesses reminded the Committee that the core housing need of many low- and moderate-income Canadians should be viewed in the context of the rapidly rising housing prices in several major municipalities, such as Vancouver and Toronto. Thom Armstrong, Executive Director, Co-operative Housing Federation of British Columbia, spoke of the disconnect between housing markets and household income. In Vancouver, he indicated, between 2001 and 2014, home values went up by 211% while wages increased only by 36%. Further, in the last three years, while rents went up by 11%, the median wages of renters only increased by 6.5%.

Finally, the cost of land was identified as one of the larger drivers of higher housing prices in many communities. One witness noted that the transfer of federal surplus land for affordable housing development, if placed in a community land trust, would reduce the cost of such housing by as much as 20% to 40%.[299]

2.   Impacts: Current housing needs

The Committee heard repeatedly about the pressing need for both affordable and social housing across Canada and about the negative impacts for individuals, families, and the economic and social well-being of communities as a result of the current gaps and distortions in the housing sector. For individuals and families, the Committee learned that those in deepest poverty, and at greatest risk of homelessness, live in rental accommodation. In Canada, 1.6 million households spend more than 30% of their income on rental housing, of which 850,000 households spend more than 50% of their income.[300] In British Columbia almost one quarter of renters spend more than half of their income on housing.[301] Across the country, as many as 1 in 10 tenants spend 80% of their income on housing.[302]

The shortage of affordable housing was a concern for many of the witnesses, who informed the Committee of lengthy waiting lists in most major municipalities. In Ontario alone, approximately 10,000 new rental units annually are needed to meet demand, but the annual construction rate of rental units has averaged only 3,200 over the last 20 years.[303] The supply of cooperative housing has also decelerated significantly, with no new projects opening in Toronto in the past 10 years.[304]

The Committee was reminded that the consequences of the lack of affordable housing extend beyond individuals and families but affect the overall economic health of the community. Pamela McConnell, Deputy Mayor for the City of Toronto, stated that the lack of affordable rental and ownership housing in the city is negatively impacting Toronto’s economy and its capacity to attract new businesses and new business investment.[305] The Committee heard that this was also an issue for smaller municipalities, such as Fort St. John, British Columbia, whose prosperity is fuelling higher costs of living, including housing, and deterring needed workers and businesses from moving to the community.[306]

a.   Indigenous housing needs

There are significant and numerous challenges in addressing the housing needs of Indigenous and northern communities. Witnesses explained that Indigenous peoples are also a vulnerable population in urban centres, more likely to experience higher rates of homelessness, core housing need and substandard housing. One in 15 urban Indigenous peoples will experience homelessness compared to approximately 1 in 128 non-Indigenous Canadians. The Committee also learned that in 2011, 22% of non-reserve Indigenous households were living in substandard housing.[307]

The high cost of housing has multiple impacts on Indigenous peoples. The Committee was told that not only do they suffer from the consequences of high housing costs that increase food insecurity and overcrowding, the population growth rate far exceeds that of non-Indigenous Canadians, further contributing to overcrowding.

Indigenous social housing units are mostly rent-geared-to income models, such that as operating agreements expire in the coming years, indigenous housing providers will be more negatively affected than other housing providers.[308]

Much of the dependence on rental housing is a result of the barriers to home ownership faced by northern communities, including a lack of banking services in many communities in the north and a lack of credit among low-income Inuit.[309] The Committee also listened to witnesses describe how restrictions on land ownership are further barriers to a functioning housing system for First Nations on reserve, as the Indian Act does not provide the type of land tenure conducive to individual home ownership or business development.[310]

There are unique challenges facing Inuit peoples in accessing adequate housing. One witness reminded the Committee that data from Statistics Canada shows that Quebec’s Nunavik region suffers from the worst overcrowding situation in Canada.[311] The Kativik Municipal Housing Bureau, which administers housing in Nunavik, told the Committee that it has a backlog of those waiting for housing that ranges from three to eight years. The situation is worsening due to the population’s high birth rate, which has risen by 11.8% between 2006 and 2011, more than double that of the rest of the province.[312]

The serious housing shortage has consequences for individuals, families, Elders and the economic life of the region’s communities. Overcrowded housing has serious health consequences. The Committee heard that since 2000, the steadily rising incidence of tuberculosis in the region has overwhelmed its health care system. More than half of children in Nunavik are living in overcrowded homes, with the result that the region has some of the highest rates of infectious disease hospitalization rates in the province of Quebec for children under the age of two. As well, witnesses informed the Committee that there are consequences for mental health, ranging from depression, sleep deprivation and the effects of family conflict.[313]

There are economic and social consequences for these communities that are also of concern. The Committee learned that when Inuit youth move south to study or work, they have challenges trying to return to their communities because there is no housing available. This has negative consequences for workplaces in the region that cannot reap the benefits of the education and experience gained by this cohort.[314]

Nunavik’s adults who move south to escape from these pressures, but who lack supports or employment opportunities, contribute to “growing the itinerant population of Montreal homeless.”[315] This problem was echoed by other witnesses in describing the situation facing Indigenous Manitobans, who move from the poor housing in remote reserves to Winnipeg, only to find that affordable adequate housing is equally unavailable. Many of them become homeless, unfamiliar with how to navigate the support networks in urban centres.[316]

Witnesses told the Committee that the poor housing situation has consequences for the Elders in the region, who share their homes with generations of family members and are often pressured by family members to use their revenue to support the extended household, a situation that may lead to abuse.[317]

The Committee also heard that the housing provided is often not culturally appropriate, as decision making has not rested within Indigenous communities. One witness concluded that the multiple unique and critical housing needs of Indigenous peoples required a separate housing strategy:

We think it is essential to learn from the mistakes of the past, where the development of community housing, social housing and housing in general was not well-thought-out, well-designed or understood by the people in the community. We mustn't make these mistakes anymore. The people of the communities themselves must control the process....

There has to be a separate strategy because there is a distinct situation in terms of national rights, and statistics show that. We have a two-tier regime, and it is important that aboriginal communities, including Inuit communities, have the means to catch up and get what the general population had before.[318]

The Committee heard that housing constructed for Inuit in the north currently does not consider the cultural and lifestyle needs of community members. In order to reduce costs to municipalities, construction to date has placed houses close together, creating denser neighbourhoods. Residents have complained that this has increased their sense of distance from the land and their disconnection from nature.[319] Current housing lacks both areas to process food harvested from hunting and fishing and places to store the weapons needed to hunt.

The Committee learned that how governments provide housing to northern communities has not been adapted to address the consequences of climate change. One witness explained how the housing construction methods used to date have been affected:

The permafrost layer is supposed to be frozen permanently, but the ground moves. It seems that this melting is being caused by climate change. Because of that, the houses, which are built on pilings, are much more unstable. We build a pad that is made up of several layers of various substances such as sand and rock, and the homes are built on those pads. Before now homes did not move very much, but we now see that some new houses have already moved. The structure of homes that are only two years old has already moved. You can see that on the inside.[320]

Witnesses explained to the Committee that in Nunavik the federal government provided funding for housing construction and the provincial government funded the management, maintenance and renovations of the housing. They called for both levels of government to develop longer-term agreements, which would enable communities to plan more efficiently and to reduce costs related to renovations, construction and the purchase of materials.[321] Witnesses told the Committee that the region has one-year agreements with governments and the short funding cycles do not accommodate the unique construction challenges in the north:

That's part of the problem because we cannot buy all the material to build a house years before, and we have to wait for the ice levels to go down for the sealift.

Materials are delivered by boat, but the ice has to melt for that to happen. Only then can construction begin.

If we were able to plan longer-term agreements, savings could be made. We could actually buy the materials in advance and start building earlier, without having to wait for the materials to arrive in late June or in July. That would also make it possible to start building.

Permafrost thaw is a problem.... When the budget is confirmed only one year in advance, we don't have enough time to build the pads, solidify them during the winter and then begin construction. As a result, after being built on pads, homes shift around. The inside structure of the home gets a bit broken down, and that requires renovations and necessarily implies costs.[322]

Witnesses called for measures to develop the capacity of communities to assume control over housing issues, in terms of planning, design, decision-making and management and also for the federal government to provide training in the construction and maintenance of homes. Nunavik communities are currently participating in a study with Laval University to develop a housing concept that is consistent with the lifestyle in the region. Some model homes have been built and several existing homes are beginning to be adapted. They noted that these features would not necessarily add to construction costs, but would provide more usable and appropriate housing for the needs of community members.[323]

b.   Housing needs of seniors

The Committee heard that many of the risk factors associated with poverty among seniors are related to the lack of affordable housing, an issue that is particularly acute in major Canadian municipalities. The challenges of poverty among seniors related to the lack of affordable housing will become more prevalent with the aging population. The Committee was reminded that currently five million individuals are over the age of 65 and by 2036 this number will double. John Brown of the University of Calgary drew the Committee’s attention to a 2015 report of the Federation of Canadian Municipalities which stated that 23.4% of Canadian households led by seniors currently face housing affordability challenges and that 48.1% of senior renters live in unaffordable housing.[324]

Witnesses explained that the housing needs of seniors differ from those of other vulnerable groups. Seniors who wish to age in place often have to modify their homes to make them more accessible, the cost of which decreases their affordability and may undermine the long-term resale value of the property.[325] Such modifications are often not possible in rental accommodation. Those who cannot alter their homes often move to long-term care facilities or hospitals, with resulting cost pressures for themselves and governments. With the added risks of isolation, dementia, depression, and anxiety experienced by many seniors, shelters have significant numbers of senior clients, as much as 10% of their overall clientele in some cases.[326]

The Committee heard that Inuit Elders in Nunavut are increasingly moving to Ottawa and other southern communities because of lack of assisted living and long-term care facilities. This presents other challenges, as Elders are removed from family and community ties and southern care facilities do not provide care in the Inuktitut language or serve “country food.”[327]

3.   Homelessness and Housing First

a.   Housing First

The Committee heard consistent testimony that the Housing First model, providing housing for chronically homeless individuals with wraparound services to support those with mental illness and addiction, benefited communities and was a sound model. Among the features that were strongly supported by witnesses was the federal government decision to change from a three year to a five year funding cycle, which now allows communities to do longer-term planning.[328]

The success of the Housing First model is best demonstrated in the City of Medicine Hat. Indeed, the city has earned the moniker “the city that solved homelessness,” and Medicine Hat’s Mayor, Ted Clugston, explained to the Committee how their municipal leaders had applied the Housing First model to eliminate homelessness in their community. He indicated that some of this success is a result of adapting the Housing First model to include a wide range of community support services based on individual needs, not only services related to mental illness and addiction. As well, the municipality owns a property development company with extensive land holdings and has provided the Medicine Hat Community Housing Society with free land to build affordable housing units.

However, as the Mayor cautioned the Committee, there are circumstances unique to Medicine Hat that may limit the possibility of replicating this model and its success in other communities. For instance, the municipality owns its own utilities, including an oil company, a gas distribution company, and an electric generation company, and is able to provide its residents and businesses with some of the lowest utility rates in Canada. He also told the Committee that, unlike other communities, his municipal government has not faced the issue of NIMBYism (not in my backyard). He attributed this to the physical appearance of the affordable housing that has been constructed, which looks the same as regular rental stock. The lack of NIMBYism in Medicine Hat has also meant that development projects have not been delayed by appeals.[329]

b.   Gaps in Housing First and shelter services

Several witnesses drew the Committee’s attention to what they felt were gaps in the Housing First model. Despite the positive testimony of many witnesses in support of the Housing First model, the Committee also heard concerns that it lacked flexibility and had served to channel funding away from other needs, such as shelters, youth homelessness, and homeless women. It was estimated that as many as 20% of the homeless population do not benefit from Housing First.[330]

The shelters visited by and described to the Committee operate at capacity on a nightly basis, often providing meals to larger numbers of low-income individuals and families during the day and are largely run by volunteers. While shelters receive some provincial funding, they receive no funding from the HPS and have to devote significant resources to regularly fundraise in the community in order to maintain their core services.[331]

Some witnesses felt that the federal government should allow for greater flexibility in its definition of “shelter,” to allow funding for shelters that serve as longer-term residences for those who cannot successfully move into, or are ineligible for, transitional housing or where transitional housing is not available in the community.[332]

The Committee also learned that Lesbian, Gay, Bisexual, Trans and Queer (LGBTQ) individuals had unique challenges in dealing with poverty and homelessness. Many trans women have been refused entry to women’s shelters and trans youth are also at risk of being turned away from shelters because of their gender identity.[333]

As Housing First prioritizes the chronically homeless population, several witnesses indicated that those who experience homelessness episodically have been neglected. The Committee heard that Housing First has destabilized the women’s homelessness system in Hamilton Ontario, as many homeless women do not meet the program’s criteria for “chronically or episodically homeless.”[334] The reduced funding resulting from the emphasis on the Housing First model has created pressure, in Hamilton, forcing the closure of a transitional housing program with 20 beds for single women and 24 beds for women with children.[335]

The Committee heard that the model fails to provide adequate ongoing supports to those with needs beyond the mental health/addiction spectrum. For example, one witness noted that as many as 18% of individuals using an adult male shelter in Toronto were developmentally disabled and therefore did not fall under the Housing First criteria.[336]

The Committee learned that the Housing First model does not provide the means to address youth homelessness. Following the decision in 2014 to focus the resources of the HPS on the Housing First model, the Committee heard that funding for youth shelters ended. In the Lower Mainland of B.C, with a population of two to three million people, there are only 20 “low barrier” shelter beds for youth. The few youth shelters that do exist in British Columbia are licensed to house only five youth at one time, with one emergency bed.[337] Moreover, the Committee learned that these youth shelters allow youth to stay for only seven nights, at which point they return to often abusive homes or the streets.

John Harvey of Covenant House Vancouver described the extent of the challenges. He explained that Covenant House serves approximately 1,300 youth annually from the ages of 16 to 24, with a continuum of services from outreach and drop-in services to short-term crisis beds and transitional housing. It also provides case management services for mental health and addiction, clinical assessments and referrals, life skills, education, and housing and employment readiness supports. Of the homeless youth they serve, 30% have acute mental health issues and 60% of the female clients have diagnosed mental health problems. It is estimated that over 40% of homeless youth have been involved with child welfare services and over 50% of homeless youth do not complete high school. However, over 90% of Covenant House’s funding is from private sources and with a limited number of beds they were forced to turn away 314 youth the previous year.[338] The Committee heard that in addition to the urgent need for shelter spaces for youth was the equally critical need for longer-term supportive housing to meet their needs for educational support, counseling, and life skills as they transition into adulthood.[339]

Other witnesses noted that Housing First does not address the challenge of the “hidden homeless,” the estimated 50,000 individuals in Canada who are not in shelters or on the streets but who nevertheless lack safe, permanent, stable homes.[340] Other supports, such as health care services, are not funded under the Housing First model and are left to Housing First clients to arrange themselves, something that is beyond many of them.[341] The Committee was also told that Housing First was too inflexible in the length of time that individuals received support. While the program extends services for a maximum of two years, often those with mental illness and addiction problems experience set-backs during their recovery and are not fully prepared for increased independence within this timeframe.[342]

One witness observed that the rationale for Housing First as a cost saving measure, reducing costs that would have been incurred by health, social and judicial services, has also reduced the urgency with which governments address homelessness among other vulnerable groups:

As awesome as Housing First has been and as great as it is that our cost-savings argument has leveraged those initiatives—we say that this guy's costing $100,000 and now he's costing $10,000—a youth who hasn't been going to emergency care, has been living on the street, and is engaging in the sex trade for survival is not costing us, so that extremely vulnerable youth is not a priority now because of our Housing First focus, so I would say that you need to consider the unintended consequences in all of this. In my research, I've talked to so many youth who say—pardon me—“I'm not effed up enough to get help.”[343]

Witnesses drew the Committee’s attention to the reporting burden involved with the HPS. They applauded the governance model of channeling funding directly to community advisory boards, supported by a community entity that administers the funds. However, they noted that while these entities included federal representation, they were still required to provide additional reporting to departmental officials in Ottawa.[344] The Committee also heard that Housing First’s funding needed to be more flexible to allow communities to roll over unused funding from one year to another.[345]

Finally, the Committee heard from several witnesses who described the lack of consistent indicators and the need for the federal government to lead further research related to housing and homelessness[346] as well as help facilitate the sharing of innovative models and pilot projects planned or underway in various provinces, territories and communities across the country.

C.  Options the Committee Heard

1.   General

a.   Housing supplements and rent-geared-to-income

Witnesses explained to the Committee that the government should consider different measures to address the various and complex needs of the social and affordable housing sector. The Canadian Home Builders’ Association noted that most families in core housing need are currently properly housed but lack sufficient income to pay both rent and the essentials of maintaining their families. They advocated a portable housing benefit providing rent supplements directly to individuals, first targeted to those most in need and then scaled up if necessary. According to their analysis, this measure would move 800,000 people out of core housing need. The Canadian Home Builders’ Association observed that in this manner the government could efficiently move people into or keep them in market-rate rental housing, freeing up social housing for those most in need. They told the Committee that this would have the advantages of providing autonomy and choice for individuals, improving labour market mobility, and supporting the growth of mixed-income neighbourhoods.[347]

Portable housing benefits are currently being used by several provinces, however, one witness observed that many low-income individuals and couples do not qualify for them. Such programs are targeted to specific groups, including persons with disabilities, victims of domestic violence, seniors, and families with children, and often exclude unattached persons and couples living in deep poverty who are both ineligible for the housing benefit but also unable to access social housing because of long waiting lists.[348]

Other witnesses pointed to evidence showing that, when properly designed, portable housing benefits do not inflate rents and are cost effective.[349] The Committee also learned that Ontario is conducting a two-year pilot housing benefit for victims of domestic violence and heard that housing benefits could be particularly appropriate in situations where assistance is needed quickly and financial hardship is short term.[350] The Committee was cautioned that any housing benefit policy should be developed in a manner that would prevent tenants in social housing from paying more for their housing if the benefit replaced other income subsidies, such as rent-geared-to-income.[351] The Committee heard that housing benefits can be one measure, although not the only one, to address homelessness prevention.[352]

Witnesses noted that rent subsidies, payments which are attached to specific housing units, may be another partial means to address affordable housing needs in the face of volatile housing markets. Rent subsidies were perceived as an effective measure, but difficult to maintain in areas with rapidly rising housing costs. Alan Whittle, Director of Community Relations and Planning at Good Shepherd, told the Committee that after years of working with Toronto and Hamilton area private sector landlords who provided 435 affordable housing units to clients with rent subsidies, some landlords are now withdrawing from these agreements and moving to more expensive rent arrangements to earn higher revenue, thus reducing an already limited supply of rent-subsidized housing in the region.[353]

Other witnesses told the Committee that the federal government should consider a program to subsidize the supply of rent-geared-to-income housing units across the country.[354] It was also suggested that this could be funded through the revenues earned by CMHC and in partnership with provinces and territories.[355] While such a program could take several forms, such as traditional rent-geared-to-income, rent subsidies to individuals, rent subsidies to certain units within mixed housing or in cooperative buildings, the Committee was encouraged to recommend a “rent geared to family income” approach.[356]

Several witnesses supported the approach of providing a form of rent supplement which could be attached to affordable housing units such as cooperatives in order to preserve existing affordable housing stock. This has been done in Saint John where the provincial government has provided rent supplement agreements for 10 units per year for a two-year period, and which has been found to be successful in helping the community.[357] The need for rent supplements was also raised in other communities with high housing costs. The Mayor of Maple Ridge pointed to the need for a rent supplement system that is adequately funded and long term in order to address the challenges of the current rental market in B.C.’s lower mainland.[358]

b.   Need for social and affordable housing

Many witnesses urged the government to quickly build on commitments to affordable housing measures contained in Budget 2016 and provide long-term funding to social and affordable housing. Witnesses also urged that adequate funding be included for the repair and maintenance of existing social and affordable housing. The Committee also heard consistently that as plans and policies are developed to increase social and affordable housing, representatives with lived experience must be consulted.[359]

Within social and affordable housing, several witnesses called for specific types of such housing to be protected and expanded. In particular, the Committee heard that there is a need to reinvest in renewable existing co-op housing as well as to finance new co-op housing for municipalities such as Vancouver and Toronto which are undergoing critical affordability crises.[360] Several financing options were proposed. For example, the federal government could establish an equity fund, in partnership with communities and the private sector, to invest in the development of affordable housing.[361] It was also suggested that the federal government could create a distinct and separate long-term housing financing authority that would be scalable so that smaller housing providers would be eligible for financing, with loans guaranteed by the federal government.

The Committee heard that the government must focus not only on the housing needs of those with the lowest income, but also the pressing needs of the working poor.[362] Committee members saw an example of this when visiting the Christie Ossington Neighbourhood Centre, a shelter in Toronto which was structured to include accommodation for clients who were regularly employed but unable to afford housing in the community.

The Committee heard that, in addition to the urgent need for an expansion of social and affordable housing stock, there is the need for land on which to build. Several witnesses pointed to examples of municipalities increasing access to or donating land to non-profit housing corporations.[363] Some witnesses urged the federal government to expand the amount of surplus federal real property provided under ESDC’s Surplus Federal Real Property for Homelessness Initiative program[364] and to remove the GST from capital costs for social and affordable rental housing.[365] Other witnesses proposed that federal lands also be made available for community land trusts to develop new housing.[366]

Finally, witnesses proposed options related to the role of key stakeholders in supporting affordable housing. Several witnesses proposed that CMHC assume a more active operational role, supporting rural and remote communities, including Indigenous communities, to build and repair affordable housing, thus supporting job creation, independence, and sustainability of housing stock within communities.[367] One witness proposed that the federal, provincial and territorial governments work with municipalities and non-profit organizations to create a self-sustaining not-for-profit housing sector in Canada, a sector not dependent on governmental construction subsidies. This would not replace other mechanisms to increase the stock of affordable housing, but it could enable not-for-profit organizations under long-term operating agreements, that have equity in their asset holdings, to leverage that equity to develop more housing.[368]

The Committee was reminded that no single measure would effectively address the short- and long-term needs for social and affordable housing, including the repair and retention of existing rental stock and co-ops, and across the range of municipalities with different housing markets and community profiles. As one witness summarized the issue and the need to begin a series of measures:

Yes, we need new builds, but those will take time. Yes, we need repairs, but that doesn't give you any new supply. Housing benefits are the most efficient, broad way to start helping Canadians now….[369]

2.   Innovative concepts in housing

In the course of this study, witnesses identified new approaches to the challenges facing individuals and communities related to affordable housing. Some are models under development that bear monitoring and others are pilot projects that communities could modify or expand upon, if successful.

• Adapting the Housing First Model: Medicine Hat has adapted the Housing First model beyond wraparound services related to mental health and addiction. They use access to affordable housing as a portal for other services beyond those associated with the Housing First model and have used this approach for other programs, such as their food bank, providing them with supplementary services needed based on the circumstances of the individuals and families:
• We have expanded our approach to not just the provision of affordable housing but also provision of connectivity to the community resources that are necessary to ensure that people have stability in their lives in all areas. We've included the development of outreach programs within our organization that work directly with people to address other issues in their lives besides housing.[370]
• ... We've evolved from strictly a housing organization into one that collaborates with necessary services to serve the people whom we're housing—so less focus on the housing, more focus on the people—is that unless we start doing that, we are not addressing the real issues around poverty....
• ... We have achieved an end to homelessness as we define it, and built a system that responds rapidly to people who become homeless. Now we need to shift to a prevention focus. We need to make sure that we maintain that model and look upstream ... to keep people from entering into this whole realm to begin with.[371]
• Housing for seniors: Another concept was the idea of developing portable housing for seniors. The Committee heard from John Brown, Associate Dean, Faculty of Environmental Design, University of Calgary, about the “age-in-place housing project” that is being developed by this academic institution. Mr. Brown explained that, for seniors, housing challenges extend beyond the cost or the supply of housing, as most homes are not designed to meet the mobility and other health-related needs of seniors. He told the Committee that barriers to home modifications include cost, impact on resale value of property, and the length of time for which modifications are needed. Modifications are therefore rare within the rental housing market, impacting seniors in more precarious financial situations. The result is an increase in formal care costs for family members as well as for society as a whole.
• According to Mr. Brown, the prototype being developed in connection with the “age-in-place housing project” has a modular interior that can be adapted to the medical and mobility needs of each resident, is designed to be portable and therefore can be temporarily placed in almost any backyard, and can be mass-produced. The business case for this project could make these homes more affordable for seniors through, for example, the establishment of public-private partnerships that would centrally own the homes and lease them to individuals for a period of time. The first-generation test in the community is expected to take place during the fall of 2017.
• Municipal Government Measures: The City of New Westminster has developed a strategy to deal with poverty, which includes several measures related to housing. They have created an affordable housing reserve fund and two sites for affordable housing projects. They have also developed a secure market rental housing policy to prevent people from changing rental units into condos. They have a tenant relocation policy and a rent eviction action plan.
• As well, they have created a rent bank program in collaboration with local credit unions, to provide access to funds needed to pay rent or utilities and thereby prevent eviction.[372] The rent bank also provides clients with financial literacy supports. Similar rent banks have been established in Vancouver, Fraser Valley, Surrey, and Kamloops. Rent banks are designed for short-term crisis situations, such as temporary unemployment or an unanticipated expense, and are not designed as a means of long-term rent supplement. The City of Westminster reviewed a study of the Kamloops Rent Bank which found that people who had access to a rent bank program were still housed one year later. The study also determined that because of their impact on preventing homelessness, rent banks reduced expenditures for landlords and homeless shelters.[373]
• Community Land Trusts: The City of Vancouver has a Community Land Trust Foundation that currently has 358 homes under construction on land that has been leased for 99 years. As the homes become available, the average rent will be affordable to those with income equivalent to 70% of median income and 1 in 5 homes will be available to the lowest-income quintile of community residents. The units will be affordable in perpetuity due to the non-profit structure of the foundation and, once it is fully occupied, there will be no ongoing subsidy cost to governments. Similar projects are being considered in Surrey, North Cowichan, and Vancouver. The government could consider using this model for lands transferred to communities under the federal surplus land transfer for homelessness initiative, which, if such lands were transferred to a community land trust, would keep housing constructed on the land affordable in perpetuity.[374]
• Equity Funds for Community Groups: The Cooperative Housing Federation of British Columbia suggested that CMHC use its funds and, in partnership with communities and the private sector, create a short- and long-term equity fund and a financing fund that could be made available to community-based groups that demonstrate the capacity to deliver housing projects and have lands they can contribute. This would remove the risk for private equity partners.[375] This is similar to the recommendation of the Canadian Housing and Renewal Association that the federal government create a housing financing authority that is scalable so that smaller providers are eligible. The financing authority would be long term to lower risk and loans would have better terms than those offered by commercial banks. The loans would be guaranteed by the federal government, likely by CMHC.[376]
• Land Banks: The Committee learned about research into the use of land banks in struggling municipalities in the United States and how this model could be of interest to certain communities. Land banks are not-for-profit organizations that acquire land through purchases or donation, and in some cases have the authority to expropriate land in cases of unpaid property taxes. One witness, Jody Kliffer, described his research in the area of land banking, outlining how it can be used to restore integrity and community pride to declining neighbourhoods and its purpose. Using the examples of Detroit and Flint, Michigan, he explained that the land bank is typically a quasi-governmental not-for-profit organization that examines neglected or abandoned real estate properties in the community and attempts to assign them a value. Often these organizations acquire land through purchase, donation or expropriation. Land banks also maintain land through the creation of green lots, created by the demolition of buildings beyond repair. They also repurpose the land and properties they acquire, which could go to affordable housing.
• One of the barriers for others to acquire properties in poor repair is that they often have taxes accumulated over a number of years and can involve unclear land title. However, in several American States land banks have the power to clear property taxes as well as to establish the title on land. American land banks can also expedite the foreclosure process, often shortening the time frame so that buildings do not reach a critical state of decline. The benefits from land banks have been the stabilization of community decline, creation of new tax revenues for communities, safer neighbourhoods, preservation of old buildings, more affordable housing stock, and increased green space and community gardens.
• Social Procurement: While the concept of social enterprises and social procurement is not unknown, the Committee was interested in how one social enterprise developed its business model on working with the provincial social housing authority, thus supporting employment for low-income residents while also helping to keep social housing costs down. BUILD Inc. (Building Urban Industries for Local Development) incorporated as a non-profit organization with the goal of insulating low-income housing and reducing poverty in Winnipeg. In 2008, it applied a social enterprise model, applying a business model to achieve social objectives. It hired employees from within the city’s low-income community and provides energy retrofit services to Manitoba Hydro. It now also provides energy retrofit, apartment maintenance, and renovation services to Manitoba Housing, the province’s social housing provider. Manitoba Housing recently begin including social benefit clauses in their public tender document for capital construction, requiring winners of contract bids to engage social enterprise for a percentage of the contracted work. This is done either by subcontracting defined pieces of the project to social enterprise or requiring their sub-trades to hire from BUILD’s pool of graduates. BUILD has modified and replicated their model, through mentoring and partnerships with other social enterprises in Winnipeg, Toronto, and St. John’s NL. As well, BUILD has, with the Assembly of Manitoba Chiefs and Green Communities Canada, co-founded Aki Energy to conduct geothermal work on First Nations reserves.[377]