The Liberal government plans to withhold $547 million in funding for affordable housing from Ontario, choosing instead to send the money to city service managers dealing with the issue.
“I owe it to Canadians to ensure that their money, which Parliament has authorized for investments in new affordable housing, is actually spent on building more affordable housing,” Housing Minister Sean Fraser wrote to his Ontario counterpart, according to The Globe and Mail.
Mr. Fraser said Ottawa would instead send the funds to Ontario’s 47 service managers, which include both regional governments and administrative boards that operate social housing and homelessness plans. Ottawa has already been signing agreements directly with municipalities through its Housing Accelerator Fund, a $4 billion plan to grow Canada’s housing supply at a time of rising rental costs.
Ontario’s disagreement with the federal government has revolved around how the province will meet its goal of creating 19,660 new rent-assisted social housing units by 2028 as part of a $5.8 billion transfer agreement with Ottawa. While the federal and provincial governments are meant to agree on housing targets, and Ontario must submit an action plan every three years, Mr. Fraser said the province had failed to do this.
Ontario, however, has argued Ottawa has not counted the units it has built and the tens of thousands it has refurbished.
Trudeau Says He Will ‘Go Around’ Provinces
This move comes as Prime Minister Justin Trudeau has indicated he will go around provinces and work directly with municipalities to get housing built, which has become a top priority for the federal government.
“I’m going to work where I can in partnership with provinces that want to, like B.C. and others have. And places where they want to block the kinds of investments that are going to help Canadians, I’m just going to try and figure out ways to help Canadians directly,” Mr. Trudeau said during a press conference in Victoria on April 19.
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Mr. Trudeau added that while his preference is to work directly with the provinces, “if we have to, I will go around them and be there for Canadians.”
The prime minister was responding to an April 19 letter from the Council of the Federation, made up of all 13 provincial and territorial premiers. In the letter, the premiers said the cost of new federal programs in the last budget will be passed onto the provinces and territories, and there was not enough consultation with premiers before its release.
The new federal budget put forward $52.9 billion in new spending over the next five years, including $8.5 billion in new spending on housing.
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