Evidence of meeting #71 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was changes.
A video is available from Parliament.
5:25 p.m.
Associate Deputy Minister and G7/G20 and Financial Stability Board Deputy for Canada, Department of Finance
Premiums earned by CMHC are recognized in the annual public accounts of the Government of Canada.
5:25 p.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
Where does the money go? Is it kept separate?
5:25 p.m.
Associate Deputy Minister and G7/G20 and Financial Stability Board Deputy for Canada, Department of Finance
The money, for the moment, is invested by CMHC and is held as an investment, but the recognition from an accounting point of view is of annual income. If an event occurred and CMHC paid out on insurance, or any of the other two guaranteed insurers—
5:25 p.m.
Conservative
5:25 p.m.
Associate Deputy Minister and G7/G20 and Financial Stability Board Deputy for Canada, Department of Finance
—that would be recognized as a fiscal expense.
5:25 p.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
Is there a fund, or is it an accounting—
5:25 p.m.
Associate Deputy Minister and G7/G20 and Financial Stability Board Deputy for Canada, Department of Finance
It's only the accounting that matters.
5:25 p.m.
Liberal
The Chair Liberal Wayne Easter
Mr. Falcon Ouellette, you have time for one question, if you want one.
5:25 p.m.
Liberal
Robert-Falcon Ouellette Liberal Winnipeg Centre, MB
Thank you very much. I guess I'll try to make it a most worthwhile one.
We talked a lot about the middle class. I was just wondering what the impact of this change might be, for instance, on an inner-city housing market? I know it's a very specific question. I represent the doughnut or inner city of Winnipeg. I know there are a couple of other places like that in the country, perhaps in Saskatoon or Regina. How does that impact getting, for instance, newcomers and aboriginal peoples to get into home ownership, even though the housing stock itself might not be of the greatest quality? What do you think might be the impact?
I'm not looking for a specific answer, or you might not know the answer, but I'd just like to have some of your thoughts on that.
5:25 p.m.
Associate Deputy Minister and G7/G20 and Financial Stability Board Deputy for Canada, Department of Finance
The issue in urban markets is really the changing nature of those marketplaces over time and the need for a more diversified housing stock. This is recognized in the government's work on its national housing strategy and, indeed, in supporting people in getting access to homes. We have a very large policy set today that supports people in getting access to homes, against which we balance these concerns about stability.
There are segments of the population, particularly in urban markets where prices have risen, who would be inclined to stretch—and I believe the term we've used is “unhinged expectations”—and they might get themselves into a situation where they would be vulnerable. That was the concern that motivated these policy measures.
We think it's a transitional impact, so a borrower, an individual, or a household that really would like to own a home can save to own a home over time. It's a question of supply at the end of the day, and whether or not there are available homes. This is one of the main concerns when you look at markets like Toronto.
5:30 p.m.
Liberal
Robert-Falcon Ouellette Liberal Winnipeg Centre, MB
In Winnipeg, for example, where you can still get a home for about $150,000—in the suburbs they might be about $350,000, $400,000, $500,000, or $1 million—do you think this might push more of the middle class, younger people for instance, into that inner city and diversify the people living there? It's a difficult question, I know.
5:30 p.m.
Associate Deputy Minister and G7/G20 and Financial Stability Board Deputy for Canada, Department of Finance
I can't really answer that. I would say that, in the long run, protecting borrower vulnerability and preventing people from reaching for buying houses, and therefore, pushing up their prices is in the interests of the diverse population of people who want to buy houses.
5:30 p.m.
Liberal
The Chair Liberal Wayne Easter
We'll have to stop it there because we are at the end of our time frame.
Ms. Petitpas Taylor, you were going to check, and the clerk will as well, on whether there is a transcript from that conversation. Whether it's publicly available would be the other question.
With that, thank you all for your presentations.
We will see you all on Wednesday when we talk to the advisory council on economic growth.
The meeting is adjourned.