Mr. Speaker, I welcome the opportunity to comment on the amendments to this legislation, Bill C-66, dealing with the mortgage insurance function of the Canada Mortgage and Housing Corporation put forward by my hon. colleague from Kelowna.
As we debate the legislation, it is important to remember the original reason for CMHC's existence. It was at the height of the depression in 1935 that the federal government got involved in housing with the Dominion Housing Act. This involvement continued during the second world war with the Wartime Housing Corporation which was set up to address the housing needs of war workers. The CMHC was created in 1946 to address the housing needs of returning soldiers. The CMHC enabled thousands of Canadians to live in decent, safe, affordable housing by building housing or providing mortgage insurance.
Today, if one believes the government, CMHC's role in making housing affordable for Canadians is no longer required. The Conservatives got CMHC out of building new social housing in 1991. More recently, the Liberal government has tried to download its responsibilities for social housing to the provinces. Now, with this legislation, the role of CMHC in providing mortgage insurance for social housing or to people who may not otherwise be able to buy a house is under attack.
In the past, CMHC has been able to offer insurance on 100% of a mortgage loan for co-operative and non-profit housing. Without this support, there would have been very little co-op or non-profit housing for low and moderate income Canadians built in Canada, according to the Co-operative Housing Federation of Canada.
CMHC programs have also meant that many Canadians who could only dream of buying a house have become homeowners. It has played a particularly important role in areas which may be ignored by private insurers, remote and rural areas and first nations.
Now with this bill, which we in the New Democratic Party feel commercializes CMHC, the role it played in the past, financing the construction of social housing and opening up the possibility of homeownership to Canadians of modest means, may be lost.
In the past, when CMHC suffered a loss in underwriting a mortgage, the federal government absorbed that loss. Under this legislation, CMHC will have to absorb any losses from underwriting itself. Absorbing losses may force CMHC to deny mortgage insurance to high risk applicants such as people with limited means.
How can the government justify reducing the role of CMHC? If all Canadians had access to decent, safe and affordable housing I would see the sense in the bill. If the provinces had sufficient resources to meet the housing needs of Canadians I could accept that there were other governments or agencies that could fill the gap. However, that is not the case.
We have recently seen the government give the responsibility to the Minister of Labour to look into what we feel in the New Democratic Party is a national disaster; that is, homelessness in the country.
The generation entering the workforce today knows it is the first one in decades that will have lower real income than the generation that came before it.
Is the government trying to tell us that people in their twenties will not need the support their parents did? If members of the government are doing that, then I can assure them they will not be believed. Are they telling people trying to find a way to afford to buy their own home that there are agencies other than the CMHC which will offer service to higher risk customers? I would hope the government has more respect for the intelligence of Canadians than to try to suggest that.
The role of the CMHC as a bulwark against recession is also threatened. Currently, because it can underwrite mortgages in poor market conditions without risk, the CMHC can encourage housing development at a point in the market cycle when the market discourages it.
Commercializing CMHC's mortgage insurance will force it to weigh risk according to market cycles. Thus, it will no longer be able to play a valuable counter-recessionary role in the economy.
I realize, and this might explain the attitudes of some of my colleagues, that in relatively prosperous urban areas the loss of the service that the CMHC has been able to provide may not be noticed. However, in many of the communities I represent in Cape Breton, and thousands of similar communities across Canada, it would be a very serious blow. That is why I am disappointed to see the amendments put forward by the member for Kelowna. The amendments the member has moved do nothing to ensure that the CMHC is able to meet the housing needs of all Canadians. What they do is respond to the concerns of GE Capital, a large American owned multinational which is in competition with the CMHC.
When we vote on these amendments the decision we have to make is who comes first, a foreign owned multinational or Canadian families?
My party members know which side they are on. We will be voting against these amendments.
We should be ensuring that the CMHC is able to do what it was set up to do, that is, to work to improve the availability of decent, affordable accommodations for all Canadians. It is not only our responsibility, it is our duty to Canadian families.