Good morning.
I would like to preface my remarks by saying we recognize the need for fiscal prudence in the coming budget. We would also, along with others, though, caution the Minister of Finance to show some flexibility and keep a fiscal open mind, given the international economic uncertainty we face.
In that context, I want to address very quickly the three elements of our brief.
The first is the need, in our view, to continue to invest in Canada's cities. We have an opportunity here in Budget 2012 to renew the federal government's good track record on investment in infrastructure and housing. This is an opportunity for Canada right now in the face of global uncertainty to ready its cities and its urban infrastructure to be economically competitive in the future, to create what we would like to call “joined up cities”, where transportation, housing, and jobs all come together to create an environment that is conducive to economic productivity.
Part of that, of course, is housing. The government has a good record in investing in housing. Close to $400 million a year is going in through the affordable housing framework, which runs between now and 2014. But we would argue, given the housing need in this country, that more is needed.
A number of witnesses, both before and after my appearance, will argue for tax-side incentives to create affordable housing. We would agree with that, with one caveat: that the housing that is created retain long-term affordability. We have seen tax-incentive housing developed in the past, which has lost its affordability. We would argue that if the government is going to invest on the tax side to create opportunities for affordable housing, it needs some sort of guarantee of continued affordability for the long term.
One possible way to do that is to look at the low-income housing tax credit system in the United States. This was actually a Conservative platform in the 2007 federal election. We would argue that you should revisit that and consider carefully whether that might be a scheme that could work in Canada to create more affordable housing.
Our second thing today actually is not one that is going to cost you any money. I'm sure the Canadian Taxpayers Federation will be happy to hear that. The federal government is in the process of completing agreements with the provinces in the affordable housing framework. Part of those agreements is an accountability clause, which we actually argued strongly for leading up to the renewal of the affordable housing framework.
The accountability framework requires the provinces and territories to actually account for the money they are spending on housing to demonstrate how they are creating affordability on the one hand and reduction in housing need on the other. What we are asking the federal government to do is to hold the provinces' and territories' feet to the fire here to make sure that the accountability framework is robust and that the provinces and territories really do account for the housing reduction that is caused through spending federal housing money.
I'd like to dwell now on the third point, which I think is perhaps the most pressing for us. Over the next five or six years an enormous number of funding agreements for existing what we might call legacy social housing are going to come to an end. That housing is facing a very uncertain future. The question is going to be the affordability of that housing for the low-income residents. What is going to happen is that subsidy streams will expire at the same time as the mortgage commitments those housing projects have. The question is, will those two things cancel each other out, or will they face an uncertain future in terms of the affordability of this housing for the low-income households?
What we argue is that there is not enough going on, not enough being talked about, not enough being discussed around the future of this housing. Last week the president of the CMHC, Karen Kinsley, was in front of the HUMA committee and said broadly that much of this housing is going to be okay.
We take issue with that. We don't believe it's going to be okay. The requirement to reinvest in this housing, coupled with very high ongoing maintenance costs, means that the affordability of this housing for low-income families is very much in doubt, very much at risk. We are looking at up to 200,000 units of affordable housing in this country that may no longer be affordable to seniors, to other people with fixed incomes, and to people with disabilities, going forward.
Part of the legacy of our affordable housing program in this country is security of tenure for low-income households. That security of tenure is in danger of being lost unless the federal government takes a leadership role to address the shortfall that's going to occur once the subsidy streams come to an end.
We are urging the finance minister to press CMHC to release a long-awaited report on the future of this stock and to address the financial shortfall that's going to occur.
One thing we don't want to see in the face of a real scarcity of affordable housing is the loss of housing that is already on the ground and is currently affordable, but that affordability is no longer guaranteed in the future. So we're urging you to address that in a meaningful and organized way with your provincial and territorial partners.
Thank you.