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The OTHER budget announcement

March 27, 2013

You don’t often get a chance to see affordable housing headline any budget. So it was welcome news to learn the Federal Government proposed to extend their Investment in Affordable Housing.

The budget promises $253 Million per year across Canada for the next five years – the same amount as the program expiring in 2014. To give a sense of scale, similar funding levels between 2011 – 2014 allowed Toronto to budget for 137 new rental apartments, 200 affordable ownership homes, renovations to 1200 privately-owned units and time-limited housing allowances for 3,850 households.

It’s a welcome contribution. But it won’t change Toronto’s housing landscape. And unless the rules change this time round, it won’t fix Toronto Community Housing’s buildings either.

What might? A bit of arcane provincial business that could make or break Toronto Community Housing.  I’m referring to the recommendations of the Social Assistance Review.

The hidden $80 Million  

In her February 19th Throne Speech, Premier Wynne said the Ontario Government would move forward on the ”recommendations of Francis Lankin and Munir Sheikh:” authors of this important and wide-ranging review.

I’m no expert on social assistance, but the promise seems like good news for people on social assistance. It’s also good news for social housing.

Tucked on page 97 of the Review is a recommendation to get rid of the rent-geared-to-income rent scale. Right now there is a two-tiered system for social assistance recipients. If you live in private rental housing, tenants can get a shelter allowance of up to $479 for a single person on ODSP,; $816 for a family of three. It’s rarely enough to cover the rent, of course, and tenants make up the difference between the shelter allowance and their real rents out of their own pockets.

Social housing tenants are different. They pay absurdly low rents – as low as $85 for a single person on OW —as set out in a provincially-set rent scale. But they don’t get to pocket the shelter allowance. Instead, their shelter allowance is reduced by an equal amount, the municipality picks up the shortfall through rent-geared-to-income subsidies, and the Province pockets the difference.

Getting rid of this rent scale won’t hurt social housing tenants. Their rents would go up, but so would their social assistance cheques. But for Ontario municipalities, it means the elimination of a hidden subsidy to the Ontario Government.

How big a subsidy? In Toronto alone, it is estimated to be worth $80 million per year and growing. Across Ontario, the rent scale has been funneling $200 million every year from municipal housing budgets to provincial coffers.

What could we do with $80 million per year?

If the money stayed in the City’s housing budget, money saved through the abolition of the rent scale could put $80 Million towards Toronto Community Housing’s $100 M per year backlog, without raising taxes or robbing other social programs.

It would be money the City could count on year after year – exactly the sort of stable funding base that a long-term investment such as housing needs. And of course it is far better approach than such band-aid notions as selling TCHC houses, that would tide City Council over until the next election but do nothing to fix TCHC’s structural deficit.

But don’t pull out the balloons and party hats yet.

On page 127 of the Review it also says that that “The Province will need to determine, within the context of provincial-municipal cost-sharing discussions, how these funds should be used—to reduce overall implementation costs [of social assistance reforms] or to reinvest in services.”

In other words, they expect the savings from the housing budget will be used to fund social assistance.

I am sure the review’s authors have no malicious intent to wrest money from housing. And you can certainly argue the Province’s plan to take the money for social assistance is far better than using it to pay for jets or jails, to name two federal government priorities.

But surely we can find a solution that fixes social assistance without abandoning the homes of the very people we hope to serve.

Time to connect the dots

A few weeks ago I attended a workshop on Community Land Trusts. The conversation shifted towards sources of cheap land for housing. Could it come from school boards? From the TTC? From Go Transit?

And then one participant said the obvious: “If GO Transit has some surplus land and is wondering what to do with it, is affordable housing at the top of their minds? Ya think?”

And yet it is exactly this sort of joined-up thinking that would make Toronto a stronger city.

If anyone knows about joined-up thinking, it’s Premier Kathleen Wynne. But it will be hard for her to act unless municipalities and housing activists raise their voice.

So Toronto. So TCHC. So housing activists. Don’t let this moment pass.

The message may not meet the definition of the classic 30-second “elevator speech.” But it is the message that could keep TCHC’s elevators in service for years to come.


3 Comments leave one →
  1. March 27, 2013 12:08 pm

    The Ontario Government would likely see those rent increases as a transfer of provincial funds to municipalities. Those artificially low rents have been there for years. The rent for a single was $85 thirty years ago.
    But if the government made these changes, they could also get rid of the absurd non-benefit thresholds that occupy the same tables as the low rents. We could then get rid of the “Linda Chamberlain” rule once and for all.

  2. March 30, 2013 9:05 am

    I agree, John. Eliminating these rent scales is good news for everyone. But I don’t know why the Ontario Government should see rent increases as a transfer to municipalities. Rent is rent — it goes to landlords. It’s municipally-funded rent-geared-to-income subsidies — really income supports with a different name — that have been helping out the province all these years.

  3. April 22, 2013 1:57 pm

    it doesn’t matter HOW much more money you give to people on social assistance in Ontario, small landlords will still not be able to afford to rent to them. The proposed housing benefit will not fix the problem, sorry.

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