Federal Housing Budget 2017 2 2

These calculations assume that BC receives 13% of the federal budget based on its population size, and that Vancouver receives 13% of the Provincial budget based on its population size and that a social housing unit costs $200,000 on government owned land.

 

Federal government’s message to homeless people:
get a good tarp and sleeping bag and prepare to die young

On March 22nd, the Federal government released the 2017 budget. The budget commits $11.2 billion on housing over 11 years. Mainstream media has celebrated the housing budget. Huffington Post’s headline was “Liberals Dedicate Billions For Affordable Housing” and Global News called it a “Big investment in affordable housing.“ Mayor Gregor Robertson says he is “particularly pleased to see a commitment of $11.2 billion earmarked for housing nationally.”

However, none of these articles actually analyze what the $11.2 billions investment (over 11 years) means in terms of actually addressing the housing crisis and meeting the needs of the tens of thousands of people in desperate need of housing. Is it really a “big investment” in affordable housing? Will it even be enough to house the people who are currently homeless?

Breaking down the housing budget

To most people, $11.2 billion sounds like a lot of money, but when you consider that it is divided over 11 years, that it has to spread across the whole country and has to cover everything from homeless shelters, housing on and off reserves, maintaining and repairing existing social housing as well as the construction of new social housing – it suddenly becomes a whole lot less.

For example, if you divide the $11.2 billion over 11 years, it boils down to only $1 billion a year to be spent across the whole country. If the $1 billion was all spent on building new social housing, it would be enough to build about 5,000 social housing units across the country, or about 650 social housing units in BC. But this is only if it is all used towards the construction of new social housing, which is very unlikely given the state of disrepair of the existing housing stock. Canadian Centre for Policy Alternatives (CCPA) estimates that $1 billion is barely enough to maintain and repair the existing social housing stock across the country, let alone build new social housing.

While most of this funding was announced in the fall plan, the 2017 budget provides more detail on the specifics of the spending. For example, it sets aside approximately $3.2 billion over the next 11 years to provinces and territories to support key priorities for affordable housing. According to the budget, these priorities may include the construction of new affordable housing units; the renovation and repair of existing housing; rent subsidies and other measures to make housing more affordable. This investment amounts to $290 million / year for the whole country or $38 million / year for BC. This would in turn boil down to about $5 million for Vancouver, or about 25 social housing units if it was all spent on building new social housing.

Out of the $11.2 billion, only $2.1 billion over 11 years is earmarked for tackling homelessness. This boils down to $190 million per year for the whole country, $25 million a year for BC and only $3 million for Vancouver which would only be enough to house about 15 homeless people, or about 0.8% of the 1847 people counted as homeless in Vancouver in 2016.

Housing for Indigenous people

Budget 2017 proposes to invest $225 million over the next 11 years to provide financial support to housing providers serving Indigenous Peoples not living on-reserve. According to the budget, his funding will provide assistance for needed capital repairs, help ensure the continued affordability of units previously supported by the former Urban Native Housing Program and encourage development of new housing. This boils down to about 20.4 million per year across the whole country or a mere 102 new social housing units per year across the whole country. To put this number into perspective: 102 housing units would only house about a fourth of the Indigenous people who were counted as homeless in the 2016 homeless count in the City of Vancouver.

Budget 2017 also earmarks $300 million over the next 11 years to provide targeted support for northern housing: $24 million will be provided to Yukon, $36 million to the Northwest Territories, and $240 million to Nunavut. This translates to $2.2 million / year for Yukon, $3.3 million / year for Northwest Territories and $21.8 million / year for Nunavut.

This funding will barely scratch the surface of the housing crisis in Northern communities. Consider Nunavut where half of the population lives in social housing, where more than 3,000 households are estimated to be homeless and waiting for government-assisted housing and 4,000 of the existing housing units are deemed to be below housing standards, meaning they were either crowded or in need of major repairs or a combination of both. With an average $400,000 cost of a housing unit, $21.8 million a year could only build 54 housing units a year if it it was all used towards the construction of new housing. 

What we really need

What the federal government needs to do is to first calculate what the housing need is across the country. How many people are homeless? How many people are paying over half of their income on rent and or living inadequate or overcrowded housing conditions at the brink of homeless? How many people are in the social housing wait lists? The housing budget should be calculated based on these numbers, i.e. how many housing units are needed and how much would it cost?

In BC, over 4,000 people are homeless in Metro Vancouver, but this is a gross underestimate which does not include hidden homeless, and the thousands of people at brink of homelessness: paying more than half of their income on rent, or living in inadequate or overcrowded housing conditions. There is not a province wide homelessness count, but Social  Housing Alliance estimated in 2014 that there are 10,000 people at the brink of homelessness across the Province.

We also need to make up for the huge backlog in building social housing. In the early 1990s, with the onset of neoliberalism, the federal government almost withdrew completely from building and funding social housing. The responsibility for social housing was downloaded to the Provincial government, who has hardly built any housing at all since. As a result, over 10,000 people are currently on the BC Housing Waitlist in BC.

This means we need about 10,000 social housing units per year in BC, to house all homeless people, and to build away the social housing waitlist. Across the country, this means we need about 77,000 housing units / year. This would cost about $15 billion / year.

Most of these funds could be raised by closing tax loopholes which favour the 10% and 1% richest people in Canada. For example, taxing income from capital gains and investments at the same rate as employment income could bring in $10 billion a year. Over 90% of the benefit of this loophole on the personal income tax side goes to the richest 10% of income earners and 87% goes to the top 1%. The IMF has also estimated Canada could generate $12 billion annually from a single tax of just 1% on the net wealth of the top 10% of households.

Taken together this budget is an $11.2 billion dollar, decade-long recipe for escalating homelessness and housing insecurity.

 

 

About

The Carnegie Community Action Project (CCAP) is a project of the board of the Carnegie Community Centre Association. CCAP works mostly on housing, income, and land use issues in the Downtown Eastside (DTES) of Vancouver so that the area can remain a low income friendly community.

 

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