Human Resources Committee on May 16th, 2019

[The Chair, Liberal, Bryan May]

Thank you.

That brings us to the end of the round. We will start another round.

Up first we have Mr. Kmiec.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

All my questions are for the CMHC and to the president again. Vote 1 and vote 10 are why I'm asking these questions, because you're going to be managing a $1.25 billion program for the government.

I've been told by multiple members on the government caucus side at the finance committee that this program is transformational. On BNN, on May 8, in an interview, sir, you said that it was “marginal”; you were saying this was marginal. Which is it? Is this a transformational change or is this marginal?

[Evan Siddall]

When I made the reference to it having a marginal impact, what I meant was that it was directed to the particular people who were affected by being excluded from the home ownership market. One can call that transformational for that group. It is, in market terms, a program that works at the margin, and it directed surgical attention to that particular issue.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Can we walk through the numbers, then, together because the government has used 100,000? The Department of Finance has used it, and we've had a conversation about this at the public accounts committee. I have asked multiple groups how they got to 100,000.

This is the back of the napkin math I have used in doing it. There are 100,000 people who are supposed to be helped by this program, but the average home price in Canada is $455,000. If we just assume past builds and nothing new, at 5% it would help about 54,945, and that's assuming a home price at $230,000. The average price in Canada is $455,000. The average in Ontario is $594,000, and in B.C. it's $686,000. I don't think $1.25 billion is enough money to help 100,000 people. Do you know where that number comes from?

[Evan Siddall]

It comes from some math that was done of the universe of people who could be affected.

One of the things that's important is that we don't use average prices. In fact, the average price in Canada, for example, is $470,000. The average insured price is $284,000. For starter homes it's even less than that.

It's different in certain markets, certainly, but using average house prices to do this calculation is not the right basis.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Those calculations that you just mentioned, are they internal to CMHC?

[Evan Siddall]

The numbers that I just gave you are not internal to CMHC. Those are average house prices for the country.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

But in terms of the calculation to get to the 100,000 estimate, have you done any of that work already on behalf of the government?

[Evan Siddall]

I think, sir, those calculations were done by the Department of Finance.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Actually, they said the opposite. They said CMHC did them.

I'm sorry, this is the situation now. They said it was you, and you said it was them. We'll try to figure out who it was.

[Evan Siddall]

I can attempt to explain it to you.

I'm trying to get a chart that I was looking at earlier in order to talk you through it. Here it is. Splendid.

This is eligible first-time homebuyers in the country, using 2018 data. I should say that this does not include the effect of the program, which could introduce new potential homebuyers. This is based on the old restrictions. At that time, the total number of insured people in the country was 184,000. Of those, 118,500 were first-time homebuyers. The eligible number of those—those who would have qualified under the program, sir—was 75,600. Over two and a half years, that would be 189,000. The percentage of those who might be eligible for the program was around 64%—this is some math that was done. The maximum recipient number was 39,000. Over two and a half years, that's approximately 100,000.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Is the document you just read from publicly available?

[Evan Siddall]

What I just read to you is now publicly available. The document itself is not.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

The document isn't. Would you be able to provide it to this committee?

[Evan Siddall]

I'll investigate whether I can.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Okay. That happened at the public accounts committee, and CMHC didn't want to follow up with some of the information you had committed to provide. I'm just a little concerned that I may not get it in the lead-up to the vote on the budget.

[Evan Siddall]

If it's not otherwise protected, we'd be pleased to send it to you.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

What kind of protection would it have?

[Evan Siddall]

It could be confidential advice to ministers.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Okay.

You mentioned that you were going to be giving advice to the finance minister on this. Is CMHC charged with determining all the terms and conditions for this program prior to its release in September?

[Evan Siddall]

No, we are not.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Will some of it come from the Department of Finance, or from the Minister of Finance, or the minister that you are responsible to?

[Evan Siddall]

I think that's a question for them.

I will tell you that we will be giving advice.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Policy advice, or administrative advice on the terms of the program?

[Evan Siddall]

Policy advice on the terms, and administrative advice on the operationalization of the program—both.