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Federal Program Spending on Housing Affordability.pdf

Summary

Canada’s 2017 National Housing Strategy (NHS) provided new funding for housing affordability programs over its ten-year term from 2018-19 to 2027-28. Taking into account existing and subsequent commitments, Canada Mortgage and Housing Corporation (CMHC) plans to spend an average of $2.8 billion/year on assisted housing programs over the ten-year term of the NHS. This represents a $0.4 billion/year (15%) increase in nominal spending over the 10-year historical average. Employment and Social Development Canada (ESDC) plans to spend $225 million/year on homelessness programs, which represents a $86 million/year (62%) increase in nominal spending over the five-year historical average.

In the overall allocation of funding between CMHC’s core responsibilities, there is a $325 million/year (14%) reduction in funding for Assistance for Housing Needs programs intended to help low-income households compared with the 10-year historical average. Within the Assistance for Housing Need portfolio, there is a $167 million/year (12%) reduction in funding for transfers to the provinces and territories and a $175 million/year (30%) reduction in funding for federal community housing. These reductions are partially offset by $200 million/year in new spending on rent subsidies. The decline in funding for Assistance for Housing Needs programs is offset, in terms of aggregate spending, by a $664 million/year increase in funding for Financing for Housing programs which are not necessarily targeted to low-income households.

It is not clear that the National Housing Strategy will reduce the prevalence of housing need relative to 2017 levels. Overall, Canada’s National Housing Strategy largely maintains current funding levels for current activities and slightly reduces targeted funding for households in core housing need. CMHC’s assumptions regarding the impact of NHS outputs on housing need do not reflect the likely impact of those programs on the prevalence of housing need.