Human Resources Committee on Sept. 27th, 2023

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

Wow. If the minister thinks it's “cute” to ask questions on behalf of desperate Canadians who don't know how they're going to make their next mortgage payment or their next rent payment or 35-year-olds who have moved back into their parents' basement, if he thinks that's “cute”, he can look Canadians in the eye and tell them that.

This was a very simple question, and you have refused to answer it because the answer is, in fact, zero. That's a complete failure. If you want to talk about eight years ago, let's talk about eight years ago, when housing costs were half of what they are now, when the average—

[Sean Fraser, Liberal, Central Nova, NS]

When the rate of building was half of what it is now....

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

—mortgage payment was half of what it is now and the average rent payment was half of what it is now. I would be happy to compare the housing record of eight years ago with today's.

Now, in budget 2022, the finance minister promised that, “Over the next 10 years, we will double the number of [new] homes we build”. Since that time, have housing starts gone up or down?

[Sean Fraser, Liberal, Central Nova, NS]

It depends where you measure from or if you cherry-pick data, but if we compare it to the time that you were in government, housing construction is nearly twice what it was then.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

Minister, I'm not cherry-picking data. I'm picking the date on which your colleague, the Minister of Finance, made that promise. Since that time, have housing prices gone up or down?

[Sean Fraser, Liberal, Central Nova, NS]

Housing prices...?

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

I'm sorry. Housing starts, have they gone up or down? You can answer on prices, too, but have housing starts gone up or down since the minister promised to double the number in the next 10 years?

[Sean Fraser, Liberal, Central Nova, NS]

Before we get to your question, I don't think any member of this committee or any party in the House of Commons has a monopoly on caring about vulnerable people who have very real housing needs.

One of the things that I actually think is really healthy—

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

It's about doing something.

[Sean Fraser, Liberal, Central Nova, NS]

I agree, and I'm happy to talk about what I'm doing, but one of the things that I think is really important and actually very healthy in our democracy...and I credit all parties in the House. I think we're in agreement on what some of the problems are.

However, back to the housing accelerator fund that you pointed to—

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

The answer is supposed to be similar to the time for the question.

[Sean Fraser, Liberal, Central Nova, NS]

—it has a very specific purpose. It's not throwing anything at the wall. It's designed to change the way that cities build homes, and it's having that desired impact today.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Scheer.

[Peter Fragiskatos, Liberal, London North Centre, ON]

Mr. Chair, I have a point of order. It's a simple point.

When witnesses, regardless of whether or not they're ministers...and I understand that Mr. Scheer wants to make a political point here. However, when witnesses are given questions, we should allow them the time to offer an answer. It's basic decorum to maintain order at committee.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

On the same point, there is a well-established convention that the length of time for the answer should be commensurate with the length of time for the question. When the questions are simple yes or no—

[Peter Fragiskatos, Liberal, London North Centre, ON]

You didn't follow it.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

—or up or down, or just the number, it shouldn't take three or four minutes to answer that kind of question.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Scheer and Mr. Fragiskatos.

We will go to Mr. Coteau for five minutes.

[Michael Coteau, Liberal, Don Valley East, ON]

Thank you, Mr. Chair.

Thank you to the minister for being here.

I want to start by saying there's no question that this issue impacts all communities across this country. All members on this committee are concerned about this issue because it impacts our neighbourhoods and people who live in the ridings we represent.

I do think there's this narrative that the price of homes has increased just since 2015. It's a false narrative. I bought my house in 2007, which was basically a year after the Conservative government came to power. The average price in Ontario was just under $300,000. By the time 2015 hit, it was at $700,000. This has been an ongoing issue in Canada, and the trajectory has just gone.... It's increased so much. We all, as MPs, have to look for ways to find solutions.

I'm happy with the new initiative to remove GST from new developments. Minister, I think you made reference to the article that came out in Toronto last week: 5,000 new units are going to be built because of this new initiative. Can you speak specifically to this initiative? What do you think the impact is going to look like across the country?

[Sean Fraser, Liberal, Central Nova, NS]

Thank you for this.

I think it's important to go back to the point that I led with in my opening remarks. The measures that we introduce have to be designed to solve very specific problems. When I looked at the decision to remove GST on the construction of apartments in Canada, it was designed to address the supply challenges that the housing sector is facing, which is driving up the price of homes across this country.

Going back over not only the time we've been in government but also during the government before, we've seen a steady increase in the price of homes. It's accelerated more recently, particularly during the pandemic when more people bought properties and dealt with historically low interest rates, but since then, the financial landscape has changed. The cost of labour has gone up. The cost of supplies and materials have gone up. The cost of land has gone up, and interest rates have gone up.

If we're dealing with builders who have, by the way, hundreds of thousands of units that are already approved across Canada, we need to get them to a place where the equation they're looking at takes a project off the shelf and puts shovels in the ground.

By removing the GST, I've seen estimates as high as 200,000 to 300,000 new homes for Canadians over the next 10 years. The 5,000 you mentioned are one storey. Many of the units, by the way, from that developer are going to be affordable, but that's one example I've heard of.

I read an article today that cited that example, but it pointed to two other developers who now say they're moving ahead with 3,000-unit projects and 1,000-unit projects directly in response to this measure.

This is going to cause an awful lot of home builders to take that project that has been yellow-lit, green-light it and start building right away. This is going to have a major impact. It's one of the most important things we could do, and housing advocates, not just developers but also those looking to build more low-income housing as well, are big advocates of this specific measure. That's why we've done it.

[Michael Coteau, Liberal, Don Valley East, ON]

You did recognize the importance of partnerships with provinces. I think, regardless of political differences, and that politicians of all stripes should be working together to look for solutions.

What's that relationship look like in regard to other provinces? Is there any appetite to remove provincial taxes from these initiatives?

[Sean Fraser, Liberal, Central Nova, NS]

One of the things that are important to understand is that the federal government has an important role to play, but we need everybody at the table. I am so optimistic about the opportunity to make a difference because of the response I've seen from different levels of government.

With respect to the GST, this is actually an excellent example. We've seen other provinces follow suit or advance similar measures in British Columbia, Ontario, Newfoundland and Labrador, and more recently in my home province of Nova Scotia. Just to put that into perspective, when you're dealing with a removal of a 15% value-added tax at the end of a project and you're dealing with a project worth hundreds of millions of dollars, this is millions of dollars in difference. It's going to change that equation. Therefore, when provinces get on board, it's going to further accelerate the rate of building as a result of the federal government's decision to step out and make that change.

[Michael Coteau, Liberal, Don Valley East, ON]

You also mentioned modular homes. I'm a big fan of alternative housing options, from prefabricated to tiny homes. There are so many different.... You talked about 3-D-printing homes. Where do these alternative housing solutions fit into your strategy?

[Sean Fraser, Liberal, Central Nova, NS]

They're complementary to the different challenges we need to overcome, because if we get the financial equation right, if we change the permitting process, if we invest in non-market housing, if we coordinate our programs perfectly, if we do everything perfectly, we're going to hit a bottleneck, and it's going to be the productive capacity of the Canadian workforce to produce the homes that Canadians need.

If we don't change the way we build homes and we continue to have people put up stick-built homes one house at a time, we're never going to escape the challenge that we're currently wrestling with. However, if we make the kinds of investments that will increase the productive capacity of the Canadian workforce and we can significantly improve the number of homes that we build, per the person that's working on those homes and per the hour that's spent building those homes, I think we can solve this challenge. If we aim to do something short of that, I think it would be a moral failure, but by investing in innovation that will actually grow the capacity of Canadians to build more homes, we can actually then leverage the difference that we're making with the financial changes, with the regulatory changes and with the investments in specific kinds of projects.

[Michael Coteau, Liberal, Don Valley East, ON]

Thank you very much.