What to look for in the Ontario 2012 budget: Improving housing affordability

Although a good, affordable home is one of the most important social determinants of health and investing in housing not only takes pressure off of the health care system but is good for the economy, federal and provincial housing funding continues to be insufficient to meet the province’s need for new affordable housing and the maintenance of existing affordable homes.

Ontario Budget 2012 – What to look for: Affordable housing,” provides an overview of the current fiscal landscape for affordable housing in the province, details the recommendations for increased housing investments included in the recently released Drummond Report on provincial spending, and sets out what we should be seeing both in the provincial budget and in the year ahead if the province really is committed to taking the health and well-being of Ontarians and the Ontario economy seriously.

The recently released Drummond Report on provincial spending urges increased investment in new affordable homes and urgent attention to aging existing housing and calls on the federal and provincial governments to negotiate a new, long-term housing deal that would provide funding both for much-needed new affordable homes and also for repairs of existing, substandard housing. The federal government promised in June of 2009 that it would work more closely with the provinces and territories to meet the housing needs of Canadians, and the Report serves as an important reminder that this collaboration is long overdue.

In completing work on Ontario’s 2012/13 budget, the provincial finance minister should be taking up the Drummond recommendations that the provincial and federal governments negotiate a long-term affordable housing plan with adequate funding; and that the province ensure that municipalities have access to a range of funding programs and policies to properly maintain housing infrastructure.

Given that such negotiations can take months (or even years), in the meantime, the province needs to make specific investments in affordable housing in the upcoming provincial budget. These include:

  • Doubling the allocation for affordable housing in the Infrastructure Ontario affordable housing loan fund to $1 billion, to be financed by the sale of government bonds; and
  • Reversing the cuts in both operating and capital dollars for affordable housing in the past year, and restoring the approximately $600 million that is required to build new homes, repair run-down housing and support housing-related services.

In addition to much-needed financial investments, there are important steps that Ontario can take that won’t cost the treasury a penny. These include:

  • Amend the Planning Act to allow municipalities to develop mandatory inclusionary housing plans, similar to initiatives in hundreds of US cities where a fixed percentage of affordable homes is required in every new development.6 Each municipality would be responsible for setting its own inclusionary housing rules, but the province needs to give municipalities the legal right to create inclusionary housing plans through an amendment to the Planning Act.
  • Protecting the province’s existing stock of social housing from sell-off. Under provincial legislation, the Ontario government must give its approval for the sale by municipalities of designated affordable homes. Affordable housing wait lists are growing in most parts of the province. The Ontario government has a vital role to play in preserving the existing supply.

Read Ontario Budget 2012 – What to look for: Affordable housing.