Human Resources Committee on Sept. 27th, 2023

[Sean Fraser, Liberal, Central Nova, NS]

One of the things I find difficult to accept—particularly since Mr. Poilievre, over the course of the summer, has been touting himself as some working-class hero with all the solutions for housing and shooting videos for Twitter—is that he seems to communicate effectively that he understands the anxiety that people are going through. I think we all need to better reflect the very real anxiety that people are going through. However, when we came back to Ottawa after the summer and they put forward a plan, it's unimaginably weak. There is no funding for housing for low-income families. There is no plan to address homelessness. He says that he's building homes and not bureaucracy, and introduced the most bureaucratically possible form of the GST. He wants to hire public servants to run a snitch line for purposes I can't possibly imagine. He wants to cut the housing accelerator fund, which is worth $4 billion, to put on the table $100 million that will only apply in 22 cities.

I go up and down the plan, and I just see that people within the Conservative caucus seemingly don't understand the scale of the problem we're dealing with, despite the rhetoric. I find it hard to accept that someone would criticize our record on homelessness...which is something that I will be the first to acknowledge we need to do more on because there are vulnerable people out there. When I hear the rhetoric and it's matched with a voting record that opposed doubling the funding for homelessness, a voting record where the entire Conservative Party voted against the national housing strategy, which puts money in place for affordable housing, it makes no sense.

Let's not just focus on the things that people could have done over the past 20 or 30 years—that's important to acknowledge—but compare one plan to the other and figure out who's actually going to do more. Seven days a week, I know that the measures we're advancing, even in the last few weeks, will dwarf the proposed plan that Mr. Poilievre has put forward.

[Chad Collins, Liberal, Hamilton East—Stoney Creek, ON]

Thank you.

I want to stick with the housing accelerator fund because it seems to be the topic of discussion today.

You talked about working with municipalities. I've had to sit in the House and listen to the nonsensical tag lines, the bumper sticker solutions, in terms of “Get rid of the gatekeepers” and nonsense like that.

Having come from the municipal sector, I'll tell you that municipalities across the country have been building a record number of houses up until the time of the pandemic. They were breaking municipal records. They were in Hamilton. I know that in Ontario, the area that I come from, they were doing much the same in different areas. To say that municipalities aren't doing enough and then to demonize mayors and councillors for not doing their fair shares when, for the last 30 years, they were the only ones, by and large, across the country who were doing their fair share on the affordable housing scene.... They were cash poor and land rich and had to find unique ways, then, to build affordable housing units and housing supply.

Like you, I find it difficult to listen to some of the comments in terms of “they had their opportunity”. The FCM and municipalities across Canada begged and pleaded for support. It didn't come, and hence came the national housing strategy.

I want you to, if you could, reference how important it is...instead of demonizing municipalities and blaming them for the situation that we're in. This is very much where we were with former premier Harris when he demonized municipalities for not doing enough, and then he talked about amalgamation and all of those other things and how it was the “common sense revolution”.

Mr. Chair, we heard this week the common sense plan—very much like what we heard from a former Conservative premier in Ontario—demonizing municipalities for not doing their parts.

I'm just hoping, Minister, that you could talk very briefly about why it's important to work with our partners and work with municipalities, who've done their fair share, and illustrate what contrasts we have in terms of our approach to dealing with our partners in that space.

[Sean Fraser, Liberal, Central Nova, NS]

Sure.

Mr. Chair, how much time do I have before time expires?

[The Chair, Liberal, Bobby Morrissey]

You have two minutes.

[Sean Fraser, Liberal, Central Nova, NS]

It's really important to work with partners at different levels of government. Some of the greatest leaders in terms of reforming the way Canada is going to build homes are municipal government leaders—their mayors, their councillors. There are others who do need to be pushed, but we still need to partner with them, and there are others still who've never dealt with a housing crunch like they're facing now and don't have the muscle memory to know how to respond but very much want to and maybe need a partner from a funding perspective to help share best practices. Depending on the community you're dealing with, the circumstances are different.

The housing accelerator fund is a great example. It's not the only one, but it's a great example of how we can leverage municipal co-operation and partnership by putting real money on the table that's going to incentivize change. Municipal councillors know what it's like to have a little extra cash to invest in the infrastructure they need to have livable communities and communities that can actually have the capacity to accommodate more housing developments.

If I look back in the spirit of comparing what's actually being put on the table, the housing accelerator fund is $4 billion across Canada. That's going to help. We now have in excess of 500 applications that have come in. Compare that to the difference that would be made under the Conservative plan, with a $100-million contribution that's going to be split between only 22 or so communities and is also going to require.... It ignores the fact that sometimes communities need the investments in infrastructure they're threatening to cut if they're going to meet the targets they're now setting. It makes no sense.

If we actually work with municipalities, find the good leaders out there and incentivize the changes that they're already pushing, but then find the ones who are laggards and push them to do more, I think we can actually squeeze more productivity out of every federal dollar and create an ecosystem not just for the next couple of years but for the next couple of generations. We'll have a different way that people build homes, because it will be legal to build the kinds of homes that are required to solve the crisis. It will be faster to permit the kinds of homes that will be built and that will help solve the crisis.

If we work with municipalities, push ones to go further where they need a push and work with the leaders who are already there by incentivizing change, we can make a major difference.

[Chad Collins, Liberal, Hamilton East—Stoney Creek, ON]

Thank you, Mr. Chair.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Collins.

Mr. Trudel, you have six minutes.

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

Thank you, Mr. Chair.

I’m trying to understand, from what you’re saying, how we’ll be able to build affordable housing, housing that people will be able to afford.

Earlier, you spoke about a GST exemption. How many housing units do you think that measure will help build between now and 2030? Have you done the math?

[Sean Fraser, Liberal, Central Nova, NS]

The estimates I've seen range between 200,000 and 300,000 over the next decade or so, but it depends on other factors that are within the control of other levels of government as well. That number could increase if provincial governments come on board with similar measures. It will increase further if we grow the productive capacity of the Canadian workforce. It's hard to look at it in isolation, but the estimates I've seen tend to range between 200,000 and 300,000 homes.

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

How many of these units will be affordable housing and how many will be social housing?

What I want to know is how you’re going to go about it. You’ve told me that you don’t want to establish the affordability requirement, but private builders want to make money. That’s the way it works. One of our concerns is that a large portion of the funds from the National Housing Strategy will go to private builders who will erect so‑called affordable housing at $2,000 a month in Montreal. That doesn’t help the most disadvantaged people in society, like single mothers and victims of domestic violence who need housing.

How do we go about building housing for them?

[Sean Fraser, Liberal, Central Nova, NS]

I completely agree, it is essential to continue to build housing for the most vulnerable among us. However, it’s important to understand the rationale behind each policy.

With the GST measure that we have put in place, it's addressed at building more supply. There are other programs that are tackling the measures you're dealing with and that offer a parallel track for people to build more affordable—

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

What programs are you referring to, Minister?

From what I understand, this GST exemption will not support the construction of affordable housing. Earlier, you talked about a bottleneck for builders. I completely understand that. It’s a pharaonic undertaking. Of course, we have to find a way of calling on the private sector to help us.

However, it’s your responsibility to house everyone in society, not just those who can afford a $2,000-a-month home in Montreal. You must also take care of people who only have $600, $700 or $800 to spend on rent.

What program are you going to use to build housing for them?

[Sean Fraser, Liberal, Central Nova, NS]

There are programs specifically targeted to the issues you're dealing with, like the national housing co-investment fund, the rapid housing initiative and the rental construction financing initiative, but to a different degree.

I don't want to ignore the importance of increasing supply and reducing the cost for everyone, including low-income families. By moving forward with the GST, we're going to reduce the cost of building, making it more reasonable for people to build the kinds of buildings that ordinary people can afford to pay for. When you complement that measure with the other programs I've mentioned, you're going to see additional incentives to build homes below market value and, in some instances, geared to people's incomes so that they can afford it regardless of their ability to pay.

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

Minister, one of the federal programs that’s working well, I’ll tell you, is the Rapid Housing Initiative, or RHI. Everyone on the ground talked to me about it. The program works well, and people understand it. In fact, it almost moves too quickly for non-profit housing organizations to apply.

In my opinion, you could simply scrap the national strategy, which isn’t working, and put all the funds into this program. We’re in the third phase of the RHI, and $1 billion or $1.5 billion isn’t going to do it. We could invest billions of dollars in this program and really build social housing and affordable housing. Have you considered that approach?

[Sean Fraser, Liberal, Central Nova, NS]

Yes, but it’s not possible to solve the national crisis with this program alone. We must also create opportunities to attract private sector investment.

When we're dealing with the need to build millions of homes, and the per unit cost through a program that's designed specifically for affordable housing can be hundreds of thousands of dollars, we have to realize that, if we're going to spend our way out of this, we will be waiting a very long time.

We need to continue to directly invest in affordable housing projects through initiatives such as the rapid housing initiative, but we also need to create the framework and conditions for home builders to build based on the economics of the project, not just the scale of the subsidy. We need to pursue both tracks to grow the supply by changing the system, but we also need to continue to make the investments necessary to build dedicated non-market housing.

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

Thank you, Minister.

I’d now like to turn to homelessness.

People tell me that homelessness has doubled in Quebec, and that’s the major problem. What has changed a lot, however, is the regionalization of homelessness. The Reaching Home homelessness strategy sends money to designated communities. Roughly speaking, those are the major cities in Quebec. However, at the moment, we’re seeing homelessness in smaller municipalities, such as Lebel-sur-Quévillon or Saint-Jean-de-Dieu, in Témiscouata, among others. These small municipalities have no resources, because they’re not accustomed to seeing homelessness in their areas.

It’s absolutely vital to review the program and increase the funding. Will you commit to studying this and trying to improve the Reaching Home program?

[Sean Fraser, Liberal, Central Nova, NS]

I agree. I think it's something we need to constantly reassess. I have seen in my own community a change that we did not experience.

As I mentioned during my opening, we're used to having many homes available because so many families moved away. The circumstances have changed. Housing is not available. Homelessness is a real problem, even in small-town Nova Scotia, to the extent that we need to change our programs to reflect the changes to the environment we're living in.

I'm not somebody who is dogmatic and will dig in and say the first way is the only way we're going to do it. I hope that was reflected as we advanced policies during the pandemic, when we heard from Canadians that we needed to make changes. I got more compliments from my constituents about our willingness to change than I did about any one program.

We're now looking for ways to change the course to respond to the current dynamics that exist so that we can address very real problems, including for very vulnerable Canadians.

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

I would like to add that this is urgent.

[The Chair, Liberal, Bobby Morrissey]

Do we have Madam Zarrillo or Ms. Kwan?

Madam Zarrillo, you have six minutes.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you, Mr. Chair.

Minister, I'm hoping we'll be able to have that meeting soon that we had to cancel recently.

I wanted to talk about systemic problems in getting affordable housing built. I was looking forward to seeing you here today, because I wanted to hear from you your value proposition and your mentality for addressing this crisis, because we know that the crisis cannot be fixed with the same market-focus mentality of governments current and past.

Here is an example. I wanted to share with you, and perhaps you know this.... I guess I'll ask you.

Did you know that the Canada Infrastructure Bank is investing in REITS, retrofits that result in renovictions and rent hikes? The Canada Infrastructure Bank is doing that. Avenue Living Asset Management, an owner and operator of properties, primarily out in the Prairies, has received commitments from the CIB for retrofits.

Is your plan to continue to use the Canada Infrastructure Bank for REITS and renovictions?

[Sean Fraser, Liberal, Central Nova, NS]

One thing that I think is important when we deal with the Canada Infrastructure Bank is that the investment decisions it makes will be independent of me.

I would encourage the Canada Infrastructure Bank to consider how it can be investing in projects that will grow the housing supply. That would typically be more along the lines of housing-enabling infrastructure, but I can't dictate the specific investments it would make in individual projects.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you, Minister.

I'll just bring to your attention that this is a continuation of the systemic problem around this government and past governments having a really market-based lens, even though we knew that no federal investment for 40 years in social housing, no plan for expiring operating agreements for not-for-profits, no investments in the maintenance of co-ops and no appetite for risk.... This is the other thing I wanted to talk about as we talk about risk.

Minister, were you aware that the CMHC pension plan holds real estate—16%—and that, of that real estate, a percentage of it is residential real estate? Do you think that's a conflict of interest, Minister?

[Sean Fraser, Liberal, Central Nova, NS]

I don't want to be interfering with the independent decisions of pension investments. Protecting the ability of pension boards to make independent decisions to protect the pensions of workers is something that's extremely important to me. I think it's possible for a pension board to make investment decisions that don't necessarily interfere with the ability of an organization to still continue to support housing.

On your broader focus, on the market focus versus non-market focus, my view is that we need to do both. I think some market measures can address affordable housing, though it's more targeting increasing supply, but in parallel, we need to advance measures that support non-market housing as well, including co-ops, as per the comments I made earlier in this conversation.

[Bonita Zarrillo, NDP, Port Moody—Coquitlam, BC]

Thank you, Minister. I encourage you to continue to work very closely with MP Jenny Kwan, then, because I know that she has many solutions that we need to take under advisement.

[Sean Fraser, Liberal, Central Nova, NS]

I agree.