The severe housing crisis Canada now faces can be traced back to policy decisions made decades ago when federal responsibility for housing was transferred to provincial governments, according to former Deputy Prime Minister Sheila Copps. In conversation with BNN Bloomberg, Copps traced the predicament the country finds itself in, to 1987 when Canada Mortgage and Housing Corporation (CMHC) withdrew from the arena of house construction, marking the exit of significant national investment in this sphere.
Copps stated, “The handover in 1987 at federal level, resulted in 30 years of under-built housing, during which period, we also failed to engage in meaningful examination of sound public policy related to housing. This is at the root of the current crisis.” She illustrated how, prior to the shift of strategies in the 1980s, the national government had a more proactive role in housing construction, including significant initiatives being undertaken for seniors and Indigenous housing.
The 1980s, however, witnessed a change in this approach when the onus of housing policy was placed in the hands of the provincial governments. While some, like Quebec, responded by earmarking funds for social housing, several others did not prioritize this issue. Copps stated, “When provincial governments assumed the control over funds meant for housing, many did not invest it for the intended purpose.” She added that the federal government remained removed from housing matters until as recently as 2017 when the Trudeau led Liberal government took the initiative to re-enter the sector.
According to Copps, this move marked the commencement of an ongoing process to rectify a shortage and affordability issues that are currently having a pervasive impact on Canadian cities. “Five years on and we are in the throes of a crisis that has been brewing since the federal government washed their hands off housing back in 1987,” Copps noted. She underscored the role of the national government in providing solutions and emphasized that the strategy cannot be effectively handled by provinces and territories alone.
In conjunction with constructing more homes to meet the increasing demand, Copps opined, the federal housing initiative should also involve strategies to incentivize migration away from Canada’s most densely populated regions. “We need to consider disparities in housing prices in rural and remote locations as compared to urban areas, and find ways to entice relocation. The pandemic has taught us that living in downtown Toronto is not an absolute necessity,” she added. She further suggested the inclusion of schemes such as extra points for registered homeownership investment plans to encourage migration out of densely populated areas.
