Ontario Loses Out on $357 Million in Housing Funding as Ottawa Directs Money to Service Managers
The Liberal government has decided to withhold $547 million in funding for affordable housing from Ontario. Instead, they will allocate the money to city service managers addressing the issue.
Federal Housing Minister Sean Fraser sent a letter to his Ontario counterpart stating, “I owe it to Canadians to ensure that their money, which Parliament has approved for investments in new affordable housing, is actually used for building more affordable housing,” as reported by The Globe and Mail.
Mr. Fraser announced that the funds would be redirected to Ontario’s 47 service managers, which include regional governments and administrative boards handling social housing and homelessness plans. The federal government has been entering agreements directly with municipalities through its $4 billion Housing Accelerator Fund to increase Canada’s housing supply amidst rising rental costs.
The disagreement between Ontario and the federal government revolves around how the province will achieve its target of developing 19,660 new rent-assisted social housing units by 2028 under a $5.8 billion transfer deal with Ottawa. While both levels of government are supposed to agree on housing goals and Ontario must submit an action plan every three years, Mr. Fraser noted that the province has not complied.
Trudeau Says He Will ‘Go Around’ Provinces
The decision by Ottawa follows Prime Minister Justin Trudeau’s indication that he will bypass provinces and collaborate directly with municipalities to facilitate housing construction, which is a major focus for the federal government.
During a press conference in Victoria on April 19, Mr. Trudeau stated, “I will collaborate with provinces like B.C. and others that are willing to do so. In places where they obstruct investments that benefit Canadians, I will find ways to help Canadians directly.”
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Mr. Trudeau mentioned that while he prefers to collaborate with provinces, he will “go around them and support Canadians directly” if necessary.
The prime minister’s statement came in response to a letter from the Council of the Federation, comprising all 13 provincial and territorial premiers. The premiers expressed concerns that the costs of new federal programs in the recent budget would be transferred to the provinces and territories without sufficient consultation beforehand.
The new federal budget includes $52.9 billion in additional spending over the next five years, with $8.5 billion allocated for housing.
