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Ontario’s Housing Allowance Plan Violates Federal Operating Principles

by NationTalk on April 8, 2007567 Views

TORONTO, April 5 – Ontario’s $185 million housing allowance plan, announced in the 2007 provincial budget on March 22 and funded entirely with federal affordable housing trust fund dollars, violates the operating principles tabled by federal finance minister Jim Flaherty in the House of Commons in May of 2006. The federal housing dollars were authorized by Parliament in Bill C-48 in June of 2005. The money was intended to increase the supply of affordable housing, including off-reserve Aboriginal housing. On May 2, 2006, the federal budget allocated $1.4 billion to a series of affordable housing trust funds for the provinces and territories, plus a series of trust funds for off-reserve Aboriginal housing. Two weeks later, Minister Flaherty tabled the operating principles for the trust funds in the House of Commons.

Ontario’s share of the affordable housing trust fund dollars is $312 million (plus $80 million for off-reserve Aboriginal housing), but the money was delayed by a federal-provincial squabble. In February of 2007, Ontario Premier Dalton McGuinty announced that the housing dollars would start flowing, saying: “I believe that it would be unfair to allow people in need of adequate housing to have their needs go unmet because two governments are engaged in an argument.” The Ontario plan for the federal dollars was set out in the March 22 provincial budget. About 60% ($185 million) was allocated to a $100 per month housing subsidy for working families. The McGuinty government has been criticized for failing to meet its 2003 election promise to provide 35,000 housing allowances. Housing advocates have noted that the scheme falls short of the gap between household income and housing costs. For instance, the gap between the average income of a labourer in Ottawa ($21,268) and the income needed for a two-bedroom apartment ($36,800) is $15,532 annually – or almost $1,300 per month (Source: Where’s Home? 2006).

In addition to concerns about the adequacy of the Ontario program, the provincial plan contradicts federal operating principles. “The Government of Canada recognizes the significant role that provincial and territorial governments play in the design and delivery of housing policies and programs within their respective jurisdictions,” according to the federal operating principles. “The Affordable Housing Trust Fund is not intended to support ongoing operational funding for existing housing stock, rent subsidies, or to replace provincial and territorial investment in affordable housing.” The full federal operating principles are posted on the Wellesley Institute web site at http://wellesleyinstitute.com/files/flahertyhtf2006.pdf .

Ontario’s housing subsidy will target families on social housing waiting lists (who are either in rental housing, or would like to be in rental housing). Federal officials say that it is up to the Ontario government to honour the trust fund operating principles, and Ontario officials say that they intend to continue with the rent subsidy scheme.

For further information: Michael Shapcott, Wellesley Institute – (416) 972-1010, x231, mobile – (416) 605-8316

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