Human Resources Committee on Oct. 30th, 2023

[The Chair (Mr. Robert Morrissey (Egmont, Lib.)), Liberal, Bobby Morrissey]

I call this meeting to order.

The clerk has advised me that we have quorum. Those members who are appearing virtually have been sound tested.

Welcome to meeting number 85 of the House of the Commons Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities.

Pursuant to Standing Order 108(2), the committee will be receiving a briefing from the Canada Mortgage and Housing Corporation and the Office of Infrastructure of Canada.

Today's meeting is taking place in a hybrid format, pursuant to House of Commons rules that were adopted earlier. For those attending in the room and virtually, you can choose to participate in the official language of your choice. Use the interpretation headset that is in the room by selecting the language you wish to participate in.

Those appearing virtually can use the translation icon at the bottom of your Surface device and click. If there is an interruption in translation, please get my attention. To those in the room, raise your hand; to those appearing virtually, use the “raise hand” function. I will suspend while the issue is being corrected.

I will ask members to speak slowly. For the benefit of our translators, please keep your earpiece away from the mike to avoid popping of the sound system. Speak as slowly as you can so that your comments can be translated correctly.

Appearing today is Romy Bowers, president and chief executive officer of CMHC. Welcome, Ms. Bowers.

From the Office of Infrastructure of Canada, we have Kelly Gillis, deputy minister, and Kris Johnson, director general, homelessness policy directorate. Welcome, Ms. Gillis and Mr. Johnson.

Ms. Bowers, I believe you want to make a brief opening statement.

[Romy Bowers, President and Chief Executive Officer, Canada Mortgage and Housing Corporation]

Yes. Thank you very much, Chair.

I would like to thank you very much for having me here today to talk about the housing challenges Canada is facing, what CMHC is doing to help today and what we see as the path forward.

We at CMHC are seeing two distinct but connected housing crises.

There’s a crisis for the most vulnerable—people who are struggling to have even their basic housing needs met because of a lack of affordable, or social, housing, and insufficient income supports.

Meanwhile, there’s also an affordability crisis for middle‑income people, who are finding it increasingly difficult to afford market housing. The separate crises are connected by the fact that housing exists on a continuum.

People who can’t afford to buy a home will stay in the rental space longer. That makes renting more expensive for those trying to transition out of social housing and into the market. That, in turn, makes the social-housing wait list longer, which has an impact on homelessness.

If we're going to achieve housing affordability in this country, we will need an across-the-board increase in housing supply. We will need more market housing, particularly purpose-built rental homes, as well as more social and affordable housing.

We need much more housing, in fact. Our research at CMHC has found that to reach affordability by the year 2030, Canada will need to build an additional 3.5 million homes, which is beyond what the country's already on track to produce.

Reaching affordability will take a whole-of-government approach. CMHC, as Canada's national housing agency, plays a very important role, of course. Our work complements that of Infrastructure Canada, which is the department responsible for leading housing policy. The strengthened partnership with Infrastructure Canada will ensure that investments in housing leverage existing infrastructure. In addition, the recently announced GST exemptions for rental construction and the increase in the Canada mortgage bond limits are under the purview of Finance Canada. These two measures will also support the expansion of our housing stock.

That said, the federal government does not have access to all of the levers that control housing affordability. Many of them are in the jurisdiction of provincial, territorial and municipal governments, which are responsible for things like land use policies, permitting and tenant-landlord relations. The main approaches available to the federal government are to encourage and incentivize the other orders of government to make housing a priority.

The biggest player, in our view, is really the private sector. The private sector provides the vast majority of housing in Canada. We need private sector capital, so governments need to create the conditions necessary to attract that investment in housing.

However, the private sector won't be able to just buy Canada out of this situation. Skilled labour shortages in the construction sector mean that Canada does not have the human capacity to close the supply gap. Canada needs to boost productivity in the construction sector, partly by encouraging innovation and fixing supply chain issues. We can't keep building houses the way we have for decades.

In conclusion, I'd like to state that what's really important in this space is partnerships with the private sector, other orders of government, the non-profit sector and indigenous communities. We truly need all hands on deck.

Fortunately, the national housing strategy was designed very much with this in mind. Collaboration is built into many of its initiatives, but we need to do more and we need to go further. The national housing strategy has made significant progress since it was launched in 2017, but it was not, even at that time, intended to be the sole solution to our housing challenges.

I'm pleased to be here today to work very closely with this committee on how we can go further as a country to address our housing affordability challenges.

On one last note, as members of this committee may already be aware, I will be leaving CMHC in December this year to pursue an opportunity at the International Monetary Fund. It has been the privilege of my life to serve as the CEO of CMHC and to work with a very dedicated and committed group of employees.

I would also like to acknowledge the dedication of the people on this committee and to thank you for your attention to housing in Canada.

Thank you.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Ms. Bowers.

Congratulations on your new position. As with all positions, I'm sure the challenges will be different and you will have an opportunity to contribute at a different level worldwide. We wish you all the best as you move into a new role.

Ms. Gillis, do you have some comments?

[Kelly Gillis, Deputy Minister, Office of Infrastructure of Canada]

I just have some brief comments, Mr. Chair.

[The Chair, Liberal, Bobby Morrissey]

That's fine.

[Kelly Gillis]

Thank you, Mr. Chair, for welcoming me here today.

I'd like begin by acknowledging that we are here on the traditional unceded territory of the Algonquin Anishinabe people.

Infrastructure Canada began supporting the Government of Canada's housing and homelessness agenda in November 2021.

Infrastructure Canada is taking a key role in federal housing policy, in partnership with CMHC. This strengthened partnership reflects a whole-of-government approach that the federal government is taking to address housing and homelessness.

We understand that investments in housing, public transit, water infrastructure, community centres and other public infrastructure are all interconnected and that they are essential to building communities that are livable and affordable, communities where people can not only afford their homes and lead comfortable lives but also enjoy easy access to essential programs and services and effective public transit to take them places for work and school.

But, we also recognize that the housing environment has changed drastically in recent years. A severe housing shortage, inflation, and rising interest rates have created a situation where middle-class Canadians are struggling with affordability.

We are already working very closely with CMHC as we take on additional actions to help address this crisis. We're grateful to have their expertise by our side as we continue to take an increased role in the federal housing policy and to strengthen this government's capacity to deliver on a housing and homelessness agenda that can benefit everyone in Canada.

Furthermore, Infrastructure Canada leads on supporting the most vulnerable Canadians through Reaching Home, Canada's homelessness strategy. This program, as part of the national housing strategy, is helping those who are homeless or at risk of becoming homeless to accept support services and safe and stable housing.

Reaching Home is investing almost $4 billion to address this challenge. Through the strategy, we’re working with our partners to reduce chronic homelessness in Canada and ultimately eliminate it, helping our most vulnerable neighbours access the safe and affordable homes they deserve.

When we take an approach that considers housing and infrastructure needs together, we can better address local needs while achieving shared results.

Tackling housing and affordability will take a whole-of-government approach and more investment from all levels of government and the private sector.

To catalyze this change, the federal government is taking action by offering programs and financing solutions that make housing and life more affordable for Canadians. While we invest in housing and community infrastructure, we're creating stronger communities and investing for the well-being of Canadians today and for generations to come.

I had the privilege of coming here a few weeks ago with Minister Fraser when he talked about a six-point plan and needing to do more and was seeking the committee's advice, and I look forward to the discussion here today.

Thank you very much.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Ms. Gillis.

As the committee is aware, this is one two-hour session, so we'll follow the rotation to the end.

Welcome, Mr. Chambers, to the committee this morning.

We will begin with Mr. Aitchison for six minutes, please.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

Thanks, Mr. Chair.

Ms. Bowers, I want to talk about the housing accelerator fund. I understand it is now closed for applications.

How much was that fund overall, the total amount?

[Romy Bowers]

It was $1 billion.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

Okay, and if it's closed, does it mean that the money has now been distributed completely?

[Romy Bowers]

No, it means that we've received over 600 applications.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

Okay. How many applications have been approved to date, and how much money has actually gone out the door?

[Romy Bowers]

The application window closed at the end of August, and we have announced agreements with seven municipalities to date.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

How much money does that encompass of the fund?

[Romy Bowers]

I don't have that exact number, but I can certainly provide that after the fact.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

Please do.

Could you tell us how many homes have been constructed so far as a result of this stimulating money?

[Romy Bowers]

The purpose of the fund, Chair, is to provide incentives for municipalities to reform their municipal processes, things like land use planning. It doesn't provide direct funding for the construction of homes.

The idea behind the fund and the policy intent is to commit municipalities for transformational reforms, and once certain milestones are hit and housing starts are accelerated, they receive payment.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

Can you tell us, then, how many units have been started as a result of the program?

[Romy Bowers]

When the applications are approved, our target is 100,000 incremental new starts in the first three years.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

Do you know if any have actually been started yet? Have you had reports on that?

[Romy Bowers]

We've just approved seven of 606 applications that have been received. It's in the very early stages of the program, so I can't comment on the starts at this point.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

Will you be tracking the results, then? If the goal is to have the number of units you just mentioned, will you be tracking the results, based on each of the municipal submissions?

[Romy Bowers]

Yes. We'll be tracking two things: We'll be tracking the incremental increase in starts the municipalities have committed to, and in addition to that, we'll be tracking the transformational reforms in the municipal processes.

Each municipality is required to submit a detailed plan of the reforms they undertake, with milestones provided by year. We're providing check-ins with each municipality on a six-month basis.

[Scott Aitchison, Conservative, Parry Sound—Muskoka, ON]

As part of the adjudication process of each of the applications from each of these municipalities, I understand an action plan is required as part of the submission. Every municipality has to submit an action plan for how they'll carry out these various different objectives. Is that correct?

[Romy Bowers]

That's correct.