Thank you very much, Mr. Chair.
My name is Michael Shapcott. I'm the director of affordable housing and social innovation at the Wellesley Institute. With me is my colleague Nimira Lalani, who is a research associate.
The Wellesley Institute is an independent research and policy institute dedicated to advancing urban health. In our written submission we made several specific recommendations in terms of the next federal budget. Today we want to focus on affordable housing and community innovation.
Mr. Chair, even before the current recession, hundreds of thousands of Canadians were experiencing homelessness and millions more were precariously housed. Our research shows that the toxic combination of insecure housing and inadequate incomes is causing increased illness and premature death.
Just recently we prepared a paper for the federal government's consultation on housing and homelessness in which we totalled up federal government spending on housing and homelessness. We found that the federal government is actually spending a substantial amount of money. In fact, the figures from the federal government show that it'll spend $17.5 billion this year on housing-related expenditures. That doesn't include the $64 billion that's been committed to the banks through the insured mortgage purchase program.
The problem isn't the level of spending, it's the fact that only a small fraction of those dollars are going to reach the households with the most urgent need. I'll give you two examples.
The federal government estimates that the home renovation tax credit will cost about $2 billion this year. Yet most of the 3.2 million households—and that's about nine million women, men, and children—who are living in substandard housing, according to Statistics Canada, won't be able to qualify for the home renovation tax credit. What's offered to them is another federal program called the residential rehabilitation assistance program, which is funded at $128 million annually--$128 million...$2 billion. What $128 million buys is assistance for about 20,000 homes a year for ownership and rental homes. If you do the math--20,000 homes, with 3.2 million households in need of repair--it'll take about 160 years at the current level of spending to meet the repair needs of those households.
Another issue we are concerned about is new supply. We continue to have new households that need new affordable housing, yet we're not generating enough new households. Only about 15% of the $3.5 billion the federal government spends on affordable housing will be devoted to new supply.
Members of the committee will remember that about two weeks ago you voted on Bill C-304, which is an act to ensure adequate accessible and affordable housing. That bill passed second reading and is going to another committee for review. We believe that Canada urgently needs a comprehensive national housing plan, and we commend that legislation.
However, in the meantime we'd like to urge this committee to make a recommendation for a substantial down payment towards a national housing plan. In particular, we want to offer three recommendations: first, an additional $700 million for new affordable housing supply; second, double the funding for the homeless partnering strategies with an additional $135 million; third, $128 million to double funding for the residential rehabilitation assistance program.
I know there's a concern in recommending new spending at this time. I want to say that it doesn't necessarily mean that you have to commit new revenues. The federal government should be starting to re-profile some of its existing housing investments to make sure it goes to the households that need it the most.
In addition, we want to recommend to this committee that the federal government should be reinvesting the estimated $1.353 billion surplus from Canada Mortgage and Housing Corporation this year. Some of that can be reinvested in affordable housing and homelessness initiatives.