Ottawa threatens to cancel $350M in housing money from Ontario over lack of affordable units
Province says proposal is unfair and doesn't recognize realities
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OTTAWA — The federal Liberals are threatening to cancel $357 million in promised housing cash for the Ontario government because it said the province has an insufficient plan for building affordable units.
In a letter federal Housing Minister Sean Fraser sent to his Ontario counterpart, Paul Calandra, Fraser said that if the Ontario government didn’t come up with a better plan for housing in the next three years he would hold back promised funding.
“Should Ontario fail to provide a revised plan demonstrating how it intends to meet its housing targets under the agreement, the Province will not receive $357 million dollars intended for affordable housing from the federal government,” he said.
The money comes from a program called the National Housing Strategy that matches funds with provinces in order to build and repair social housing units and create more affordable homes.
Ontario and the federal government entered into a 10-year agreement in 2018 that included $5.8 billion in cost-shared investments. Under the plan, Ontario provides regular updates on what the province intends to do with the money.
Fraser’s letter said the latest update isn’t living up to the housing challenge the province faces.
“Ontario’s draft 2022-25 Action Plan fails to meet these commitments and seemingly does not recognize the scale of the crisis playing out in the province. Speaking frankly, the proposed Action Plan is a disappointment,” he wrote in his letter.
Ontario pledged to build nearly 20,000 units of social housing under the proposal, but is failing to meet that target Fraser argued and the new plan just pushes the problem down the road.
“It shows almost no progress toward reaching the affordable housing expansion target and proposes to achieve only 1,184 units of the 19,660 required by the end of 2024-2025,” he said “This leaves 94 per cent of the target to be achieved during the last three years of the agreement, which is not realistic.”
Calandra countered in a letter of his own that threatening to withhold funding will make no one better off.
“Ontario respectfully expects to be treated by the federal government as the true and equal partner. Withholding funding would simply be a punitive measure that will benefit no one,” he said.
Calandra confirmed in an interview that the province has submitted a revised housing plan. He said Ontario has a unique model for delivering social housing that partners with municipalities, a model it doesn’t intend to change. He said when units built alongside municipalities are added into the mix, Ontario has already reached 60 per cent of the 20,000 unit target.
“We are meeting our targets, working with our municipal partners who actually deliver the programs with the funding that they received from us and the federal government,” he said.
Calandra said the Ontario government and municipalities have focused on keeping the existing social housing stock in good repair, because Ontario has the oldest social housing in the country and because high interest rates makes repairs more cost effective than new builds.
“There’s more bang for our buck. We can keep more people in homes if we renovate the old stock, keep people in those homes,” he said.
Calandra said he was surprised by Fraser’s letter and believes there is room for the two sides to come together.
“We’re still at the table. They have chosen to walk away from the table; they’ve chosen to make the unilateral cuts. Our municipal partners are in agreement with us on this,” he said. “I remain committed. The Ontario government will not change its funding. We will still live up to our end of the agreement whether the federal government does or not.”
Late Monday, Fraser’s office confirmed Ontario had submitted a revised housing plan, but said it was still being reviewed.
National Post
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