Canada’s housing crisis was decades in the making

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A problem that took 30 years to develop will take another 10 to fix.

By Sheila Copps
First published in The Hill Times on August 28, 2023.

OTTAWA—Canada’s housing dilemma is not just a national crisis. It is a stark example of what happens when the federal government vacates an area of responsibility in the name of good government.

For decades, provincial governments have lobbied to receive more responsibility and funding for housing, claiming their proximity to residents gives them a better understanding of the challenges. Starting back in the 1980s, the national government signed agreements turning over housing responsibility to provincial governments.

It wasn’t until 2017 that the federal government joined together with most provincial governments in launching a National Housing Strategy (NHS). It included a 10-year, $40-billion plan to house 530,000 families and reduce chronic homelessness by 50 per cent.

Not surprisingly, the province of Quebec has refused to participate in the national strategy, claiming it “intends to fully exercise its own responsibilities and control over the planning, organization and management of housing on its territory.”

Prime Minister Justin Trudeau was criticized when he claimed recently that “housing isn’t a primary federal responsibility. It’s not something that we have direct carriage of. But it is something that we can and must help with.”

As usual, Conservative Leader Pierre Poilievre has a simple solution. He promises to withhold transfer payments to local governments who do not fast-track housing.

The latest scapegoat for the hike in housing costs is immigration.

But an in-depth review of the demise of housing availability in Canada should start with a document released by Bill McKnight in his authority as minister responsible for the Canada Mortgage and Housing Corporation (CMHC) back in 1986, entitled, “A National Direction For Housing Solutions.”

At that time the CMHC was also known as “Canada’s housing agency,” but this report was the first step in dismantling a national housing policy in favour of multiple provincial policies.

Back in 1984, the federal government spent $1.4-billion annually on housing. But the McKnight document relegated the federal role in housing to solely one of funder, with provincial governments responsible for building housing and developing sound policy.

The only areas that remained in federal hands, largely because of active lobbying, included co-operative housing developments, urban Indigenous housing, and some housing rehabilitation programs. The rest was transferred to provinces, and it took more than 30 years for the federal government to re-insert itself into the conversation in 2017.

Thirty years of stagnation in social housing construction has certainly come with huge consequences. Now, when a national push for housing comes, the focus is on reducing the number of people who need houses, not decreasing the size of our housing footprint.

The relative house size in Canada is more than double that of the United Kingdom. In the UK, people inhabit an average 818-square-foot home, compared with 1,948 square feet in Canada. China’s average urban house size is 646 square feet.

At the same time, fewer people are living in increasingly bigger homes. So, when we are looking at housing policy, we have to consider that size matters. Simply cutting back on immigration is not the solution to this problem.

If we really want to tackle the housing problem, we need to look at a national housing strategy that does not encourage people to live in overhoused, underutilized structures.

Most older Canadians remember the time when a 500-square-foot house provided habitation for eight to 10 members of a family. Now we have mega homes that often house only two or three people.

The current focus is on building new homes, but renovations should also be included in the discussion. Urban planners are trying to figure out what to do with vacant office buildings and shopping destinations. Landfill sites across the country are also filled with building materials from houses that have been torn down because their inferior building quality was designed for obsolescence after 30 years.

These questions are complex. A single government is not going to fix them. But removing the federal government from responsibility for housing policy in 1986 was a huge mistake that we are paying for today.

It has taken us 30 years to move forward with a fix. Trudeau actually had the courage to reinsert an active role for the federal government in tackling the housing crisis.

That decision happened in 2017. The feds have been back working on housing for the past five years.

A problem that took 30 years to develop will take another 10 to fix.

Sheila Copps is a former Jean Chrétien-era cabinet minister and a former deputy prime minister. Follow her on Twitter at @Sheila_Copps.