Former Deputy PM Points to Policy Failures as Root of Canada’s Housing Crisis

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The ongoing housing crisis in Canada is a long-standing issue, deeply rooted in decades of inadequate policies, according to Sheila Copps, former deputy prime minister. She attributed the crisis to the decision made in the 1980s by the federal government to transfer housing responsibilities to the provinces.

Copps recalled a time when the Canada Mortgage and Housing Corporation (CMHC) actively participated in housing construction projects, resulting in robust national investments in housing and driving comprehensive housing strategies. With the government’s withdrawal from the housing sector in 1987, Canada has grappled with an underproduction of housing and a lack of sound, data-driven public housing policies— an issue she identifies as substantial.

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Copps, who served as the Liberal deputy prime minister in the 90s, further detailed the dramatic policy shifts in the 1970s. During that time, the national government was directly involved in diverse housing projects, including developments designed for senior citizens and Indigenous populations. The shift to provincial control, she stated, led to mixed outcomes: while some provinces, like Quebec, dutifully allotted funds to social housing, others failed to do so.

With the federal government largely disassociated from housing from the late 80s till 2017, the crisis only worsened, according to Copps. Only then did Justin Trudeau’s Liberal government “re-enter the housing game”, signaling the inaugural chapter of a collaborative effort. However, addressing the prevailing housing shortage and lack of affordability now endemic in Canadian cities, she posits, will inevitably require time and careful planning.

“As we stand now, five years into this effort, we’re contending with problems that have been brewing since the federal government’s hands-off approach dating back to 1987,” Copps stressed. Noting the complexities and the many players involved, she suggested, “there are times when a central government needs to actively participate in resolving issues. Leaving it to ten provinces and three territories doesn’t always prove to be the best course of action.”

Copps further recommended that the federal housing strategy extend beyond creating new homes to easing the concentration in highly populated areas. She suggested incentives to encourage migration from bustling urban centers to quieter, rural areas.

“Consider the price disparity I housing between rural or remote communities and urban regions. We can promote relocation by providing additional benefits for a registered homeownership investment plan,” she proposed.

Highlighting the role of a national government, she went on to say, “There are ample opportunities to persuade people to consider relocating. But to ensure this, it’s crucial to have a national government that isn’t solely focused on building houses, but that pursues a broader, more multipronged housing strategy.”