The Disappearance of Affordable Housing in Regina.
by Della MacNeil and John W. Warnock
Prepared for the Council on Social Development Regina, Inc.
Regina, Saskatchewan, January 2000. 91 pp.
ISBN: 1-895975-15-8
The text is published as a pdf file on the website of the Social Policy Research Unit, School of Social Work, University of Regina, Regina, SK S4S 0A2:
http://cat.uregina.ca/spr/assets/documents/The Disappearance of Affordable Housing.pdf
Extract: Saskatchewan and the devolution of housing [by John W. Warnock]
The radical change in housing policy came in the early 1990s. In 1992 CMHC put a cap on money for new social housing. In February 1993 the federal government froze the CMHC budget; no new non-First Nations social housing would be financed by the federal government. By this time the federal, provincial and municipal programs had created 661,000 units of social housing , and around 50 percent of these were operated by the nonprofit and co-operative third sector. If any new social housing was to be created, it had to be through the public-private partnership route, usually led by local community development corporations or the provincial governments in co-operation with municipal governments. With the federal government getting out of social housing, it was inevitable that the target clientele for social housing would shrink from 15 to 20 percent of households to only five to 10 percent. (Prince, 1995; Skelton, 1998)
The 1990s also saw a number of provinces reduce the shelter allowance for certain categories of people on social assistance. Singles and couples deemed to be employable were the hardest hit. New Brunswick introduced a shelter subsidy to assist families, up to $90 per month. Quebec also introduced a shelter subsidy. These subsidies were designed to help low income families not on social assistance. (Prince, 1998)
One significant change was made in New Brunswick. Welfare rules were altered to encourage disabled clients to share accomodations; each client was allowed to receive the single-person rate. The Saskatchewan government has always refused this reform. When no-married people live together, the shelter allowance is reduced.
The Chretien government completed the devolution policy initiated by the Mulroney government. In 1996 Diane Marleau, the minister responsible for CMHC, announced that the administration of all social housing would be transferred to the provinces. In the 1996 federal budget Paul Martin revealed that the federal government would be phasing out its role in social housing and cap all existing expenditure at the 1995-6 level. The existing mortgages would be gradually retired over the next 40 years. Annual increases needed to maintain the existing housing stock would be shifted to the provincial governments and the institutions managing the housing. (Wolfe, 1998; Styles, 1997)
The Saskatchewan agreement
The first province to jump at the chance to take over responsibility for social housing was Saskatchewan. Negotiations were held behind closed doors. There was no public input. The co-operative and non-profit organizations were not informed of the proceedings or allowed to have any input into the process. The basic terms of the Canada-Saskatchewan agreement were released on February 27, 1997. The agreement, which was to set the precedent for any other provincial agreements, included six principles:
(1) Federal funds allocated under the new arrangements are strictly for housing purposes. They cannot be used to support other provincial priorities.
(2) Federal funds will be used to provide residential accommodation and related shelter
services through a portfolio of programs described in the new agreements. Related
shelter services exclude such areas as health, education, corrections and nutrition.
(3) CMHC will establish income limits, which reflect the maximum income for a
household to be eligible for targeted federal assistance.
(4) Federal funds currently directed to households with incomes insufficient to cover
the cost of appropriate accommodation will continue to be used for this purpose. If the
funding is not needed in the program where it is currently directed, provinces can use
this funding for another program, but it must nonetheless be directed to households with
incomes below established limits.
(5) Federal funding currently directed to moderate-income households can continue to
be used for this purpose until such time as the units are paid off. Should this funding
be freed-up at some point in the future, it is to be used for targeted assistance.
(6) Savings remain in the jurisdiction from which they originate. This means that
provinces can use federal funding savings achieved through cost reduction and efficient management of the portfolio to serve households in their respective jurisdictions.
(Wolfe, 1998)
Opposition to the new housing agreement
The devolution of social housing to the provinces and the new agreement was strongly attacked by the Co-operative Housing Federation of Canada. Alexandra Wilson remarked that "It's shocking that the federal and provincial politicians and bureaucrats would meet secretly for month after month to plan the transfer of those co-ops without even bothering to involve the thousands of people who live in those co-ops." Barbara Millsap, president of CHF, warned: "Far from meeting the housing needs of lower-income people, the Saskatchewan deal give an incentive to the province to shut down existing co-ops. Under this deal, Saskatchewan will continue to receive federal housing dollars for a co-op even if the project fails or is closed down by the province." (CHF Canada, 1997)
The National Aboriginal Housing Association denounced the federal government for giving control of social housing to the provinces without even consulting Native groups. They did not see how Aboriginal housing could survive in the long run if funding was limited to the 1995-6 level. Mel Buffalo, president of the organization, predicted that "you're going to see more people in to the ghetto areas, more people kicked out by unscrupulous landlords, more people homeless." (Chung, 1998)
There were many common criticisms of the Saskatchewan agreement. There is no commitment to future social housing. The agreements ratify the decision by the federal government to withdraw from social housing; this will make it very difficult in the future to pressure them to again fund social housing. The existing social housing corporations are forced to try to exist on a declining budget. Social housing will now be the responsibility of the provinces, who have had an indifferent commitment in the past. The provinces are permitted to dispose of housing and amend or alter existing agreements with non-profit groups without their consent. There are national "principles" but no national standards. The provinces will no longer be limited to charging a maximum of 30 percent of a tenant's income as rent. Provinces are not prohibited from shifting responsibility to municipalities. There is no commitment to keep the existing housing as social housing; they can be sold on the market when the mortgages expire. The province may not prepay existing mortgages to take advantage of lower interest rate. Saskatchewan received a "special allowance" of $11.7 million, but there was no indication it would be used for new social housing. (Dunphy, 1997; CHRA, 1997)
The Saskatchewan government proposed changes that were not acceptable to the co-ops. The co-ops were given a list of demands and only 30 days to make a decision. With the help of the Co-op Housing Federation of Canada, they fought back and won some concessions. But in order to continue receiving their subsidy for low-income tenants, they lost some of their traditional decision-making powers to the Saskatchewan Housing Corporation. One project, a senior citizen co-op in North Battleford, was shut down by the provincial government over the opposition of the co-operatives. (CHF Canada, 1998)
The Romanow government strongly supports the agreement. They argue that the federal government has agreed to continue the existing funding over a long period. The merging of all the different programs will allow efficiency savings. Decision-making power has been decentralized to the provinces. The government has decided to make rent scales, utility allowances, income definition, and maintenance standards uniform through the province. This, they believe, will bring savings. The addition of 9,809 federal social housing units brings the Saskatchewan total to 33,800. (Styles, 1997)
Housing policy in other provinces
Some provinces took a different approach to the Chretien government's decision to get out of social housing. Ontario had developed a considerable stock of social housing on its own, without federal support. In 1995 the Progressive Conservative government of Mike Harris canceled their non-profit housing program. Between 1989 and 1993 the provincial program had accounted for 17 percent of all housing starts in the province. In 1997 the provincial government announced that it was devolving the responsibility for social housing to the municipalities. Critics pointed out that municipal governments are forced to rely on the very regressive property tax and lack adequate borrowing authority. Social housing is a redistributive program, and only the senior governments have the necessary taxing authority. (Morris, 1997; ONHA, 1999)
In contrast to Saskatchewan, the provinces of British Columbia and Quebec have refused to sign the devolution agreements, strongly arguing that the federal government has a primary responsibility for helping to finance social housing. These two provinces have their own social housing programs. The B.C. Housing Management Commission is still promoting and partnershiping new social housing projects. Quebec's program, which is more modest, focuses on the revitalization of older neighbourhoods through the Residential Renovation Program, rescuing boarded up buildings, conversion of non-residential buildings, a safety improvement program, and grants to help stimulate new social housing. Municipalities are participating in these programs on a cost-sharing basis. (Carter, 1997)
The Saskatchewan government insists that it is still committed to providing adequate, affordable housing for all its citizens. Its policy paper Investing in People and Communities, released in September 1997, states that the first priority is to maximize "the efficiency and effectiveness of the existing social housing portfolio." There is no indication what-so-ever that the NDP government would be pushing for the federal government to get back into the area of social housing. The clear thrust of the policy paper is that housing is now a provincial responsibility.
Nevertheless, Investing in People and Communities recognizes that there are serious problems in the housing area: an aging population, increasing Aboriginal population, increasing urban population, more single parent families, and more one-person households. The government admits that there is a very serious housing problem in northern Saskatchewan, with a fast growing relatively young population with virtually no private housing market coupled with a high degree of poverty and unemployment.
At the same time, the government is aware of the fact that there is a declining supply of affordable housing, a shrinking rental market, and rising rents and prices of homes. The conversion of rental units to condominiums and the demolition of older houses has reduced the supply of rental properties. (Sakatchewan, September 1997)
The lack of affordable housing is a crisis for many
But what has the province done to meet this growing crisis? In 1992 it lifted all rent controls. It sat back and watched as Boardwalk Equities subsequently moved into the province, bought up thousands of affordable rental housing, and raised the rents. It did nothing when Boardwalk Equities took over Gladmer Park in Regina, did some renovations, and doubled the rents. This represented the loss of one of the most important social housing projects in the city. These policies, or lack of them, have resulted in a major loss of affordable housing in Regina.
On the other side of the ledger, some new programs have been introduced. Three community development projects have been sponsored, one each in Regina, Saskatoon and Prince Albert, under the Neighbourhood Home Ownership Program. These developments, which required a tremendous amount of time and energy to bring forth, provide 34 low income families with the opportunity to buy their own home.
The Homes Now program provides for the renovation of 80 urban houses for conversion to social housing. The Home Adaptations for Senior's Independence provided grants to 84 senior citizens. The Community Home Incentive Program provided funds to non-profit groups to develop 180 affordable rental units in rural areas over a three year period.
The Remote Housing Program, announced in 1997, provided assistance to individuals to build their own homes. Over a three year period it will help 70 familes in the north. The Rental Market Assistance Program provides an initiative to build 75 rental units in the north, again over a three year period. An additional 70 housing units in the north received grants for repair.
On an administrative level, the province has been promoting the development of regional housing authorities. As of March 1997, there were eight regional housing authorities in the north managing 874 of 1,315 social housing units. (Young, 1998; Saskatchewan, September 1997)
These programs are all very commendable. The only problem is that the funding for them is very limited, and they don't begin to meet the need. For the NDP government, affordable housing for low income people has been a very low priority.
Conclusion
In response to the report of the Mayor's Homelessness Action Task Force in Toronto, public pressure from advocacy groups, and demonstrations by the poor and homeless, the Chretien government named Claudette Bradshaw, Minister of Labour, to be the Federal Co-ordinator on Homelessness. On December 17, 1999 the Minister announced a three-year program totalling $753 million to help "alleviate and prevent homelessness across Canada."
Of the total, $305 million was to go to communities to help eliminate homelessness, $57 million to expand services, $268 million to expand the RRAP program, and $10 million to make surplus federal property available for housing. But the federal government was careful that none of these programs actually got them back into the business of social housing.
The iniative was welcomed by a number of politicians as a good "first step." In contrast, the National Housing and Homeless Network called it a "patchwork reponse to Canada's national homelessness disaster and housing crisis." They strongly objected to the "partnership approach" to social housing, which requires multiple funding and creates additional barriers. "Groups will have to spend months or years fundraising instead of building housing and providing services." They argued that "unless there is a massive federal reinvestment in a national housing program, it cannot be called a step in the right direction."
John Clarke of the Ontario Coalition Against Poverty, which has been mobilizing homeless people in political actions, called Ottawa's announcement "an empty gesture" and suggested that they were "misrepresenting the crisis." (Dunphy, 1999; McHardie, 1999)
The new programs are designed to get the homeless off the streets. The question of whether or not the federal government would be getting back into the housing business was left for discussions with provincial and municipal governments in the year 2000.
The central problem of the devolution of the responsibility for social housing from the federal government to the provincial governments is put forth by Tom Carter, Professor of Geography at the University of Winnipeg and former director of their Institute of Urban Studies.
The federal and provincial governments have ceased to provide any significant number of new housing units. The result is "the level of new affordable units provided each year is less than five percent of the level provided in the late 1970s or early 1980s. Most governments are also avoiding programs that build in ongoing subsidy responsibilities."
As a result, the trend everywhere is to local self-help partnerships between governments, the private sector and community groups. Nevertheless, without federal government subsidy programs, "it may be impossible to accommodate the very low income households that are unable to access adequate affordable housing in the private sector." Many of the new housing projects implemented with local development corporations focus on moderate income families. This "may result in a growing number of households living in poor housing as well as in poverty." (Carter, 1997)
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A few copies still available from the Council on Social Development Regina, 445 Winnipeg St., Regina, Saskatchewan, S4R 8P2. (306) 949-5375