Long way home: Blamed for affordability crisis, Liberals look to pivot on housing

2023/08/15 Leave a comment

But a real pivot has to include both immigration and housing….

Chris Burke and his fiancée have been less than a year away from buying their first home for the past three years.

Saving for a down payment was the first challenge. Now, rising interest rates have kicked home ownership down the road again, stalling the couple’s plans to get married and have children.

“Any gains we make towards purchasing a house, we’re watching the goalposts move further and further away,” the 31-year-old Ottawa resident said.

Feeling “stuck,” as Burke put it, is a sentiment shared by many young Canadians who are increasingly pessimistic about their home ownership prospects.

For the federal Liberals, the growing discontent with the state of the housing market is becoming a political threat.

“I’m a former Liberal voter,” Burke said. “I certainly wouldn’t be voting for them this time around.”

Experts say the housing crisis poses a great risk to the incumbent government in the next election if it doesn’t take drastic action soon.

“This has become probably the most important both economic and political problem facing the country right now,” said Tyler Meredith, a former head of economic strategy and planning for Finance Minister Chrystia Freeland.

“And especially given the significant emphasis the government has put on immigration and the relationship between immigration and the housing market, there is a need to do more.”

Conservative Leader Pierre Poilievre has taken direct aim at the Liberals for the state of the housing market, highlighting the dramatic increases in home prices, rents and even interest rates.

According to the Canadian Real Estate Association, the national average price of a home sold was $709,000 in June 2023, up from $455,000 in Oct. 2015, when the Liberals first came to power.

And the cost of getting a mortgage has soared, following a series of aggressive interest rate increases by the Bank of Canada in response to rising inflation following the COVID-19 pandemic.

Rent prices have also skyrocketed, with some cities seeing double-digit increases over the last year.

Trudeau has tried to deflect for the housing crisis, recently saying there are limits to what the federal government can do.

“I’ll be blunt as well: housing isn’t a primary federal responsibility,” Trudeau said during a housing announcement in Hamilton on July 31.

“It’s not something we have direct carriage of. But it is something that we can and must help with.”

His remarks were quickly blasted by Poilievre, who reminded people of earlier promises Trudeau had made on housing.

“(Trudeau) held a news conference … to tell you all he’s not responsible for housing. That’s funny, because eight years ago, he promised he was gonna lower housing costs,” Poilievre said in a news conference the next day.

Most experts agree that Ottawa isn’t solely responsible for the problem. But many say the federal government could still be doing more to alleviate the shortage of housing at the root of the affordability crunch.

The Canada Mortgage Housing Corp., the national housing agency, warned last year that the country needs to build 5.8 million homes by 2030 to restore affordability.

If the current pace of building continues, then only 2.3 million homes will have been added to the housing stock by then.

There are several things experts say the federal government could be doing, such as better calibrating its immigration policy with housing and reforming tax laws to incentivize rental developments. It could also push local governments to get housing built faster.

The federal government has been hearing from stakeholders and housing experts on these potential solutions, as rumblings grow about a focus on housing in the coming fall economic statement and next year’s budget.

A senior government official who spoke on the condition of anonymity so they could discuss matters not yet made public, says the Liberals plan to take steps over the next year to get other levels of government, the private sector and the not-for-profit sector to build more homes.

Trudeau’s recent cabinet shuffle might be an early sign that the federal government plans to prioritize housing. The prime minister appointed one of the stronger communicators and a rising star on the Liberal bench, Sean Fraser, to take on housing and infrastructure as one, amalgamated file.

“The prime minister said something to the effect of, ‘I’ve got a big job for you to do,'” Fraser said in an interview.

Fraser said he hopes to help restore a housing market closer to the one he grew up with in small-town Nova Scotia: one where having a job was enough to buy a home.

“It might take a bit of time for us to solve the housing challenges that are before us,” he said. “But man, is it a challenge we’re solving.”

That challenge includes overcoming jurisdictional issues. Many of the policy levers that could help spur more housing development are at the provincial and municipal levels of government.

Urban planning, zoning laws and red tape are the purview of local governments, which have decision-making powers that can help or hinder housing development.

Ben Dachis, associate vice-president of public affairs at the C.D. Howe Institute, says the predicament the Liberals find themselves in speaks to the “insidious nature of consistent federal overreach.”

“The cautionary tale is that the federal government needs to stick with jurisdiction,” Dachis said.

But housing expert Carolyn Whitzman has a different take. The University of Ottawa adjunct professor says the federal government can’t turn its back on Canadians in the middle a crisis.

“The federal government: it’s where the buck stops,” Whitzman said.

“If housing and climate change are the crises that they’re certainly treated (as), the federal government is going to have to put on its big kid pants and actually deal with it.”

Source: Long way home: Blamed for affordability crisis, Liberals look to pivot on housing

Related article: Canada ‘absolutely’ can’t build more houses without more immigrants, minister says

Canada’s housing crisis “absolutely cannot” be solved without the aid of new immigrants who bring their skills here, Immigration Minister Marc Miller told reporters on Friday

“The federal government is making housing more affordable and bringing in the skilled workers required to build more homes,” Miller said in Montreal.

“Without those skilled workers coming from outside Canada, we absolutely cannot build the homes and meet the demand that exists currently today.”

Miller was asked by reporters if he was considering slashing Canada’s immigration targets, which are currently at historic highs, in response to a recent Bank of Canada report that new immigrants are adding to housing demand.

The minister said he was not.

“People coming to this country are resourceful. When they bring capital, they are able to acquire houses,” he said.

“If people are asking us to slash, what does that mean? Does that mean slashing the skilled workers that we need to actually build those houses? Slash family reunification, which can be devastating for the mental health and well-being of the families that are already here?”

Canada aims to welcome 451,000 new immigrants in 2024.

By 2025, the number is expected to go up to 500,000 new immigrants in one year.

Miller said around 60 per cent of new immigrants to Canada are economic migrants, many of whom are the kind of skilled workers needed to build more housing. Family reunification visas account for around 20 per cent of those migrating. The rest, he said, are refugees and asylum seekers.

“We have a humanitarian duty towards people that are fleeing war and persecution,” Miller said.

Last week, a spokesperson from Miller’s office told Global News that fulfilling Canada’s labour shortages is one of his key priorities, and a key goal of the government’s immigration targets.

“Strategies like Express Entry, and the historic Immigration Levels Plan, which is largely made up of economic migrants, are a great asset to our nation as they will directly help combat the ongoing labour shortage. This is especially true when it comes to the housing sector,” Bahoz Dara Aziz, press secretary to the immigration minister, told Global News.

“With provinces like Ontario needing 100,000 workers to meet their housing demands, it is clear that immigration will play a strong role in creating more homes for Canadians.”

The federal government increased its immigration targets in November 2022, and Miller has suggested those targets may need to keep rising.

The construction industry is short tens of thousands of workers, and experts say a coming wave of retirements could make the problem worse.

Meanwhile, Canada is millions of homes behind what’s needed to reach housing affordability this decade.

The job vacancy rate in construction is at a record high with around 80,000 vacancies in the industry,  CIBC deputy chief economist Benjamin Tal said in a recent note.

Those vacancies, which push up building costs and impede productivity, come at a time when the residential construction industry is under pressure to meet the demands of a growing population.

Canada Mortgage and Housing Corp. forecasts a need for 3.5 million more homes by 2030 than the country is currently on track to build.

The number of new homes built, however, has been in decline, from just over 271,000 in 2021 to 260,000 in 2022. And in May this year, the annual pace of housing starts dropped 23 per cent month over month, leading the CMHC’s chief economist to predict that just 210,000 to 220,000 new homes will be built by the end of the year.

Last week, the federal government launched a separate stream of entry for newcomers with work experience in skilled trades.

“It’s absolutely critical to address the shortage of skilled trades workers in our country, and part of the solution is helping the construction sector find and maintain the workers it needs,” Miller said in a statement, making his first major announcement as Canada’s new immigration minister.

“This round of category-based selection recognizes these skilled trades workers as essential, and I look forward to welcoming more of these talented individuals to Canada.”

Immigration, Refugees and Citizenship Canada (IRCC) said that by welcoming people in skilled trades such as carpentry, plumbing and welding, Canada can help its construction sector attract skilled workers.

But there remain questions about how the government can ensure those bringing the skill set to work in construction actually end up working in the sector and are able to navigate the certifications processes across the country.

Source: Canada ‘absolutely’ can’t build more houses without more immigrants, minister says

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Griffith: Canada badly needs an immigration reset 

2023/08/10 Leave a comment

My latest, hoping to provoke a more concrete discussion on what a reset needs and what it would mean:

The government has largely ignored the impact of high levels of immigration on housing availability and affordability, health care and infrastructure. Belated recognition that current policies are not working to the benefit of all Canadians may be the reason behind the appointment of a new minister of Immigration, Marc Miller, and the reassignment of  the former minister of Immigration, Sean Fraser, to housing and infrastructure.

Minister Fraser arguably will have to deal with some of the mess he and the government created with the large increases in both permanent and temporary residents, pushing up housing costs and burdening existing infrastructure. Minister Miller will likely be more attuned to concerns about immigration given that he is from Quebec and thus more familiar with immigration critiques regarding the demographic impact on Quebec.

Moreover, the nature of conversations has changed. When, some two years ago I wrote an article for Policy Options entitled Increasing immigration to boost population? Not so fast, there were few voices questioning the government’s planned expansion of immigration. Now, there are almost weekly commentaries and reports, ranging from the banks to economists, the International Monetary Fund and others, noting deteriorating productivity, housing availability and affordability, stress on health care and infrastructure. Even the major boosters of increased immigration have shifted their messaging to “growing well” or even calling for a pause in increases.

While immigration is not solely responsible for the increase in housing costs, the link is being seen and could lead to newcomers being the scapegoats for poor policy decisions. The significant drop in support for the Liberal government may reflect this very personal issue to Canadians.

While at Immigration, Fraser was able to increase levels easily, whereas as housing and infrastructure minister, he will be confronted with the real time lags, making it impossible to show concrete results before the 2025 election. So it’s not a matter of “better communications” but rather of complex delivery with a wide range of government and private sector actors.

Miller, depending on his mandate letter, has an opportunity to reset or at least adjust  immigration policies and programs to take account of recent commentary and realities. He will not be able to ignore these issues even if his initial comments confirm planned increases. The annual plan on the number of immigrants this fall provides an opportunity for a reset should the government choose to do so.

Given that a complete pivot to a more evidence-based approach is unlikely, here are some modest suggestions that make sense from an immigration and economic perspective that may be politically sellable.

To start with, the plan should be broadened to include plans for temporary residents levels rather than just permanent residents levels, given that some 60 per cent of all new residents are temporary workers and students, many of whom transition to permanent residency.

Given time lags in building housing, increasing the capacity of the health-care system and addressing infrastructure gaps, the government should freeze 2023 levels of 465,000 for the next few years. More ambitiously, the government could reduce future levels to the lower 2024 range of 410,000.

The current open-ended levels on temporary residents (students and workers) should be replaced by hard ranges based on 2023 levels for similar reasons. Furthermore, the government needs to consider seriously the introduction of a cap-and-trade system for temporary residents to reduce the numbers over time to address weak productivity, as the University of Waterloo’s Mikal Skuterud has suggested.

Lastly, the government needs to take steps to further broaden the plan to include the impacts of immigration on housing, health care and infrastructure, including measures to address these impacts, rather than as a discrete program.

Miller’s mandate letter will indicate the extent to which this is possible. But these changes would not necessarily be perceived as divisive or xenophobic given that the impacts on housing, health care and infrastructure affect everyone, immigrants and Canadian-born alike. Failure to pivot to a more comprehensive approach that incorporates these considerations into immigration programs will not only worsen the quality of lives of Canadians but may prove politically damaging to a government long-in-the-tooth and losing popular support.

Source: Griffith: Canada badly needs an immigration reset

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‘Need too great’: Canada could raise immigration targets despite housing crunch

2023/08/05 Leave a comment

Change in Minister doesn’t mean a change in policy or understanding as government continues to ignore the linkage between housing, healthcare and infrastructure with immigration. Disappointing, as a change in minister provided an opportunity to signal recognition of this linkage and the negative impacts:

Prime Minister Justin Trudeau’s government won’t lower its immigration targets despite growing criticism that drastic population growth worsens existing housing shortages.

In one of his first interviews a week into his new cabinet role, Immigration Minister Marc Miller said the government will have to either keep — or raise — its annual targets for permanent residents of about half a million. That’s because of the diminishing number of working-age people relative to the number of retirees and the risk it poses to public service funding, he said.
“I don’t see a world in which we lower it, the need is too great,” said Miller, who’s expected to announce new targets on Nov. 1. “Whether we revise them upwards or not is something that I have to look at. But certainly I don’t think we’re in any position of wanting to lower them by any stretch of the imagination.”Globally, advanced economies are confronting similar challenges from decreasing birthrates and aging workforces, and many are competing for skilled workers. But while immigration for some countries is a divisive issue that can polarize voters and even topple a government, Canada has comfortably relied on public support to open its doors more widely for working-age newcomers.Miller’s comments suggest the government is still counting on that backing to grow its population rapidly to stave off long-term economic decline. Trudeau’s government has consistently raised its target for permanent residents. Last year, foreign students, temporary workers and refugees made up another group that’s even larger, bringing total arrivals to a record one million.

Source: ‘Need too great’: Canada could raise immigration targets despite housing crunch

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Sun Editorial: How to create a crisis in housing

2023/07/31 Leave a comment

Sun nails it more directly but avoids the option of freezing or reducing levels:

Hello, newly minted Housing Minister Sean Fraser and congratulations on your promotion. Ditto Marc Miller, also recently arrived in the Immigration portfolio after Prime Minister Justin Trudeau’s seismic shuffle this week.

The left hand of Immigration seems to be unaware of what the right hand of Housing is doing. So shake hands and start working together.

The Trudeau government has what it calls an “ambitious” target of bringing in 465,000 new permanent residents in 2023, 485,000 in 2024 and 500,000 in 2025.

According to its National Housing Strategy, the federal government is committed to building, “up to 160,000 new affordable homes” over the next 10 years.

You don’t have to be a math genius to see the problem. The government is committed to bringing in 1.4 million people over the next three years and has a plan to build only 160,000 new homes. That leaves approximately 1.2 million newcomers looking for homes. Certainly, the private sector will fill many gaps – if they’re allowed to.

We already have a housing crisis, with people under-housed or homeless and those who can’t afford a mortgage in this over-inflated economy the government has created.

No one is arguing that this country shouldn’t bring in newcomers. Canada was built on immigration. It’s our economic lifeblood. But the numbers have to add up. And these don’t.

Fraser said recently he would, “urge caution to anyone who believes the answer to our housing challenges is to close the door on newcomers.”

Fair enough. Now show us your logical and practical plan to house them.

Finance Minister Chrystia Freeland recently turned down Toronto Mayor Olivia Chow’s reasonable request for more federal funding to help deal with a massive influx of asylum seekers who were living on the streets.

Freeland set an adversarial tone for every big city. The federal government will bring in hundreds of thousands of newcomers to this country, dump them on cities, shortchange those communities and tell them to deal with it.

It’s not just housing. Where’s the funding for new schools, community centres and healthcare? The government is creating a crisis.

Trudeau needs to put his money where his mouth is – and fund those newcomers before they, too, are living on the streets.

Source: EDITORIAL: How to create a crisis in housing

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Yakabuski: The renewal theme rings hollow even as Justin Trudeau names seven new faces to cabinet

2023/07/28 Leave a comment

Pointed comments on Ministers Fraser and Miller, likely understate the challenges. And of course, turning up the dial on the number of permanent and temporary residents much easier than new housing:

Conveying renewal and stability at the same time is a neat trick, if you can manage it.

Prime Minister Justin Trudeau tried to do both with a cabinet shufflethat featured a slew of new faces on Wednesday, all while relying even more heavily on a quartet of tested ministers – and likely future leadership contenders – to carry the load of a government living on borrowed time.

…

Source: The renewal theme rings hollow even as Justin Trudeau names seven new faces to cabinet

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Airport, passport and immigration problems ‘should never have happened,’ minister admits

2022/08/31 Leave a comment

Refreshing admission by Minister Miller (he consistently one of the few ministers who is more candid with respect to government weaknesses and failures). And yes, the task force is more communications than substance as the main issues involve Service Canada and IRCC, which did not need a task force to address. (Airport issues are more complex given the different players involved):

The delays plaguing Canada’s airports, passport services and immigration processes “should never have happened in the first place,” the federal minister charged with co-leading Ottawa’s task force on slashing wait times admitted Monday.

Crown-Indigenous Relations Minister Marc Miller, providing an update on the government’s efforts to tackle pandemic-induced delays across a swath of operations and services, said that despite some improvements, officials were still working to prevent such issues from occurring again.

“I do want to say that nobody should be congratulating themselves for having done their jobs. We are by no stretch of the imagination out of the woods yet. The focus will continue to be on Canadians and the results they expect and deserve from this or any other government,” Miller said at a joint news conference with other ministers.

Prime Minister Justin Trudeau struck a committee involving 13 cabinet members in late June to get started on reducing wait times at major airports and clear out backlogs that led to sluggish processing times for passport and immigration applications.

As COVID-19 restrictions eased, air passengers passing through Canadian travel hubs have contended with hours-long delays in security screening lines, delayed or cancelled flights, hiccups with the ArriveCAN app and the chaos of lost baggage.

Transport Minister Omar Alghabra said Monday that between January and August, the number of air travellers jumped by more than 250 per cent just as the travel industry faced staffing shortages.

He pointed to the hiring of more than 1,800 new screening officers and weekly meetings with airlines, airports and travel-related government departments as evidence that delays were improving. According to the federal government, between Aug. 18 and Aug. 21, 85 per cent of passengers were screened within 15 minutes. The number of aircraft held at Toronto’s Pearson International Airport also dropped to 47 by the third week of August, down from 370 in May.

Monette Pasher, the interim president of the Canadian Airports Council, said there has been “marked progress” in reducing wait times and cancellations in the past few weeks.

But she told the Star in a statement that other measures, like modernizing screening procedures and reopening Nexus assessment centres amid a backlog of applications for the trusted traveller program, would improve the situation more.

The staffing increases don’t change the fact that airport screeners are “worn out,” said Catherine Cosgrove, the director of communications and public affairs for Teamsters Canada, which represents over 1,000 screeners across the country.

“We can expect to continue seeing difficulties in hiring and retaining screeners and delays throughout the fall,” she told the Star, adding that there still aren’t enough trainers to get new hires working at full capacity.

Addressing frustrations experienced by Canadians trying to renew or apply for passports, Families, Children and Social Development Minister Karina Gould acknowledged “the recent demand for passports far exceeded the government’s expectations.”

That was despite unions representing federal workers warning the government in 2021 that passport requests would rise, without the necessary staffing to take on the increased load.

Gould said Ottawa has boosted the number of staff handling the country’s passport program and that workers have implemented a “triage system” to better process applications. Passport services have also been expanded in a number of offices and Service Canada centres.

Immigration Minister Sean Fraser also discussed application backlogs within his department, which have left international students and others hoping to immigrate to Canada in limbo.

“Though we have a welcoming nature towards newcomers, our immigration system has faced unprecedented challenges and obstacles that have become larger and have compounded on one another over the past few years,” Fraser said.

He said that owing in part to staffing changes, his department had returned to a “pre-pandemic service standard” in some areas and was on track to reaching its permanent residency and study permit goals.

“We could have sat here and blamed others. We could have blamed airlines, we could blame this, that and the other. But we realized quite quickly that a lot of responsibility did lie on our shoulders,” Miller told reporters.

“To some extent, we were slow in responding to a number of unprecedented … things that Canadians expect to see from their governments.”

Indeed, ministers said Monday that Ottawa has been “scrambling” to contend with a series of challenges outside its control, from the havoc the pandemic wrought on Canada’s travel sector to continuous humanitarian crises that hampered which immigration applications were prioritized.

“We’ve thrown bodies at the problem, which is not the most effective way of doing things. It’s important because it got people their passports in time so they could finally travel after sitting in their houses for two years,” Miller said. “That is not the most effective way … of doing things.”

Source: Airport, passport and immigration problems ‘should never have happened,’ minister admits

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Should statues of Sir John A. Macdonald be taken down? Canada’s minister of Indigenous services says no

2021/06/04 Leave a comment

Of note and right approach:

As shock waves continue to reverberate following the discovery of a gravesite of 215 Indigenous children, Indigenous Services Minister Marc Miller spoke out Wednesday against taking down the statues of the prime minister responsible for creating the residential schools that led to their deaths.

Miller said removing statues of Sir John A Macdonald from public display would amount to Canadians taking their eyes off the brutal history and legacy of the schools.

“Knocking things down, breaking things is not my preferred option. Turning my eyes away from things is not my preferred option,” Miller said during a news conference in a government building named after Macdonald.

“Looking at things as painful as they are, explaining why they are, is my preferred option.”

Across the country, institutions and local governments are resuming efforts to remove statues of Canada’s first prime minister, and to rename streets and schools whose namesakes have a direct connection to Canada’s residential school program.

Similar such movements have become flashpoints over the last several years, including last summer in the wake of global Black Lives Matter protests, when Miller and Prime Minister Justin Trudeau spoke out against taking down the monuments.

But the outpouring of anger now is more directly targeted at the heart of one of Macdonald’s legacies: the residential school system.

The revelation last week that 215 children were buried in unmarked graves on the site of a former residential school in Kamloops, B.C. is leading to fresh rounds of soul-searching about whether and how Canada must come to grips with the deadly effect of those schools, which were initiated by Macdonald’s government in 1883.

During the century that followed — the last school closed in 1996 — about 150,000 Indigenous children were removed from their homes and forced to attend what Miller called “labour camps” that were built for the express purpose of eradicating their culture.

At least 4,000 children are known to have died while attending residential schools. Following the discovery of the graves in Kamloops last week, those estimates have begun to climb, with some now speculating the number could be as high as 25,000.

“We know there are lots of sites similar to Kamloops that are going to come to light in the future. We need to begin to prepare ourselves for that,” former senator Murray Sinclair said in a written statement late Tuesday.

“Those that are survivors and intergenerational survivors need to understand that this information is important for all of Canada to understand the magnitude of the truth of this experience.”

What must be done with that information is a debate taking many forms, be it the removal of Macdonald statues or the demands for the federal government to move much faster to implement the calls to action on missing children and burial information contained in the Truth and Reconciliation Commission’s report on residential schools.

In 2019, some $27 million was set aside to respond to those calls, but the funds were redirected to address the impacts of the pandemic and to finish off virtual engagement sessions on the response to the TRC, Crown-Indigenous Relations Minister Carolyn Bennett’s office said Wednesday.

Some money began to flow last year. On Wednesday, Bennett announced communities that want to begin the work of documenting, locating and memorializing missing children could apply anew and the money would flow on an “urgent” basis.

How that work is done must be determined in consultation with communities, Bennett and Miller have insisted.

The ministers said on Tuesday it is also important to listen to those who speak out against Macdonald.

However, Miller said the debate over renaming buildings or taking down statues has become too partisan, and misses the point.

“I respect the meaning and the expression of people saying we need to take this down, rip it down,” he said.

“It’s an expression of pain. I understand. I’m not a proponent of it. I think we have to keep explaining. We have to keep explaining so that we don’t repeat those errors.”

Conservative politicians have also spoken out against the need to tear down statues, though for different reasons, arguing doing so amounts to so-called “cancel culture.”

Conservatives including Alberta Premier Jason Kenney and federal Leader Erin O’Toole have also said removing statues of people like Macdonald would also erase all acknowledgment of the benefits they provided to Canada.

Source: Should statues of Sir John A. Macdonald be taken down? Canada’s minister of Indigenous services says no

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