Public Accounts Committee on April 30th, 2019

[Evan Siddall]

Yes.

[The Chair, Conservative, Kevin Sorenson]

We have to leave it there.

We'll go to Ms. Mendès and then back to Mr. Kelly and Mr. Kmiec, however they want to work it.

Ms. Mendès.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

Thank you very much, Mr. Chair.

Thank you all for being here today and for sharing your comments with us.

I don't know if my colleagues have already addressed this issue—and I'm sorry for my absence—but I would like to talk about the national housing strategy. Your primary purpose may still be to support national policy initiatives that are consistent with what you call your bold aspiration to ensure that, by 2030, everyone in Canada can afford housing that meets their needs.

Could you please tell us what steps you think you are taking to ensure that this happens by 2030? I would also like to know—and in this case, it really is ignorance on my part—whether this includes housing for indigenous people. Of course, I am talking about people living off reserve.

[Derek Ballantyne]

I'll answer first and then give the floor to Mr. Siddall.

I believe there are two parts to the answer regarding this bold ambition. First, it is about achieving, as part of the national housing strategy, fairly significant targets and activities that will largely address housing affordability issues for Canadians.

For the second component, we are working to find innovative ways to deliver our current programs or create new ones. We are also looking for other ways to do this, such as establishing partnerships with the private sector or partnerships with non-profit organizations or cooperatives. There is already a housing stock and efforts are being made by these two partners. It will be about acting as a lever when opportunities to expand the affordable housing stock arise and it can meet our ambition. These two components are in progress, but for part of the second component, we have not yet specified the measures that will be taken in the coming years.

With respect to housing for indigenous people, the national housing strategy provides housing for indigenous communities, but there is also a First Nations strategy that is the responsibility of another department, not CMHC.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

I'm talking about indigenous people who live off reserve.

[Derek Ballantyne]

Off reserve?

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

Yes. There are needs in this regard.

[Derek Ballantyne]

There is a need, which isn't really identified by the national strategy. Mr. Siddall, do you want to add anything?

[Evan Siddall]

Yes.

I'll say this, if I may, in English.

It is possible that we will not achieve our ambitious goal. You want to achieve ambitious things without being ambitious. Just saying that we will deliver the national housing strategy to us.... You know, we're not just a delivery mechanism. We can innovate and find new ways to deliver housing and new ways to help Canadians.

The analogy we use is that, just as John F. Kennedy encouraged Americans to get to the moon within a decade by saying so, if we don't say we're trying to achieve something big—it's our moon shot—then we won't get even partway there.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

I get the point, and I absolutely endorse it. I'm just trying to see how we can look at it in terms of actions that would be more, perhaps, explainable to Canadians.

How are you, as an organization, going to propose to achieve this objective?

[Evan Siddall]

I'll give you one single example.

Through the chair, our corporate plan details this in some—I won't read you our corporate plan—but we've reorganized our company to have an innovation function to try to think of new ideas with respect to housing. The budget also includes something called the housing supply challenge, for some $300 million, which CMHC will administer. It's kind of a crowdsourcing platform to think of new ideas.

In addition, we've set for ourselves the goal of sourcing $100 million of new money from the private sector this year, which we would add to the government's fiscal commitment to the national housing strategy in order to make use of the capabilities, the convening powers and the insights we have at CMHC to grow beyond the national housing strategy and fund more than the government has committed to funding through its own resources.

[The Chair, Conservative, Kevin Sorenson]

Thank you.

[Alexandra Mendes, Liberal, Brossard—Saint-Lambert, QC]

Do I have...?

[The Chair, Conservative, Kevin Sorenson]

No, your time is up.

Mr. Kmiec, please.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Just to continue partially on what I was asking about before, will the board going forward be informed of the shared equity mortgages, given an update on the financial status of that program every quarter?

[Evan Siddall]

Yes.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Will there be a premium surcharge on shared equity mortgages? If there is a premium surcharge, what will you do with that money? Will you add it to your reserve or feed it back to the general revenue fund?

[Evan Siddall]

Let me answer hypothetically. If there were a premium surcharge, that money would return to the CRF, the consolidated revenue fund. But we're just operating as the agent for the Government of Canada. The terms and conditions associated with the first-time homebuyers incentive are within the domain of the Minister of Finance in connection with the budget, and those have not been finalized yet. Whether or not there's a premium and any other terms and conditions has not yet been determined.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Shared equity mortgages will have a substantial impact, because you'll have mortgages to have a shared equity stake held by the Government of Canada, and then potentially you'll also be providing CMHC insurance on some of those.

You've said you've done some internal assessment of this. Just as a general policy matter, how do you feel about shared equity mortgages?

[Evan Siddall]

I think the shared equity mortgage, as a policy solution, was a surgical response to a particular aggravation on the part of some young Canadian families who, as a result of very high house prices, were unable to get into the marketplace. We've learned from the example of some other jurisdictions, in particular the U.K., and improved upon that here.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

British Columbia introduced a similar program called the B.C. home ownership plan. What are your thoughts on that program? It doesn't exist anymore. It lived for a very short period of time.

[Evan Siddall]

The B.C. home ownership plan, as I recall, was a down payment assistance plan. It was very different in the sense that it supported additional borrowing on the part of homeowners, whereas the shared equity mortgage program does not involve a financial burden. It doesn't involve monthly interest payments or periodic interest payments or a requirement to repay that's not within the homeowner's control.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Pardon me, Mr. Siddall, but how do you know so many details about this program? They're not in the budget and they're not in the public sphere. Do you have details on how these shared equity mortgages will work?

[Evan Siddall]

We've done extensive—

I'm sorry. I interrupted you.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

No, I'm just wondering how. We don't know. I sit on the finance committee regularly. I'm asked to pass the budget, but I don't know any of these details that you know. Would you be able to share these with the public accounts committee?