CANADIAN HOUSING POLICIES

(1935-1980)

Albert Rose

University of Toronto.

1980

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Canadian Cataloguing in Publication Data

Rose, Albert, 1917- Canadian housing policies (1935-1980)

Includes index. ISBN 0-409-86315-7

1. Housing policy - Canada - History. I. Title.

HD7305.A3R67 363.5'8'0971 C80-094402-X

Preface

In Canada housing has been a major economic and social policy concern for more than fifty years. During the 1930s, attention was directed to the miserable living conditions of those who suffered most from world wide depression and failure within Canadian resource/ export industries. Canada’s population at that time was about evenly divided between rural and urban areas and the full impact of the housing problem in an urban society had yet to materialize.

In the thirty-five years following the close of the Second World War the urbanization of our country has matched that of the United States, Great Britain, France and West Germany; by the end of this century Canadians will be almost totally identified in our statistical records as urban dwellers. The photographs of the 1930s, which have recently been appearing in new books for the edification of those who have known nothing but Western industrial affluence, now seem like interest- ing pictures drawn from the prints of the eighteenth and early nineteenth centuries. In short, although we have by no means grappled successfully with the problem of poor rural housing, our attention has turned. since the beginning of the 1950s to the enormous problem of providing adequate housing for burgeoning urban populations; these have been swollen each year by most of the 150,000 to 250,000 newcomers from other nations, often far different in economic and cultural backgrounds.

It is not appropriate to continue the argument, so dear to politicians and social workers, that Canada is in the midst of a housing crisis. The truth is that throughout the twentieth century Canada has been in the midst of a continuous housing crisis. In his first book, Humphrey

iti

iv Canadian Housing Policies (1935-1980)

Carver* analyzed the facts of Canada’s housing production with respect to the best available data of the housing needs of Canadians from 1920 through 1945. It became perfectly clear that as a nation we had not, for a quarter of a century before the end of World War II, met the human and statistical criteria for decent and adequate housing accom- modation.

Nevertheless, the major political parties in Canada, whether federal or provincial, did not see the matter of housing as an issue of significant concern for the vast majority of Canadian voters. In this judgment they were probably correct but by the close of the 1950s, following fifteen years of expansion in population (through a combination of one of the highest birth rates in the world and extensive immigration), this political judgment began to change. Canada had changed from a nation of tenants during the 1930s and early 1940s to one of homeowners by the late 1950s as a consequence of federal and provincial housing policies, legislation and initiatives.

By the end of the 1950s most major Canadian urban centres had exhausted their available raw land, not to speak of the supply of serviced land ready for construction of housing. It was foreseeable that a small group of relatively large producers of apartment dwellings would arise. Within the next decade (1959-1968) they accounted for as much as one-half to two thirds of the total new housing starts, with variations from region to region and from metropolis to metropolis.

Canadians reverted to a nation of tenants — this time in high-rise apartment buildings rather than in smaller structures —- and the poli- tical climate changed as a direct result. There was tremendous concern among many groups about the very modest production of dwellings for low-income families during the years 1955-1964, These groups worked very hard to influence the Government of Canada and Central Mortgage and Housing Corporation to amend the National Housing Act towards the goal of substantially increasing the supply of housing for low-income individuals and families.

On the other hand, the provincial governments began to realize after 1964 how their political destinies were significantly tied to the quality of life in an urban environment. By 1967, John Robarts, the former premier of Ontario, cited as a strong argument for re-election his performance in the production of housing in general, and of public housing in particular, through the Ontario Housing Corporation. A year later, the new federal leader, Pierre Elliott Trudeau, had fulfilled one of his election promises by appointing Paul Hellyer, the man who placed second to him in the competition for leadership of the Liberal

*H. S. M. Carver, Houses for Canadians (Toronto: University of Toronto Press, 1948) p. 3-47.

Preface ¥

Party, to direct the Task Force on Housing and Urban Development, whose work covered the period September 1968 to April 1969.

In 1970 the Government of Canada created a Ministry of State for Urban Affairs, with responsibility for the formulation of housing policy being implemented through the Central Mortgage and Housing Corporation in conjunction with the provincial government housing corporations and other agencies. In short, housing policy had arrived as a political weapon in the hands of members of the two senior levels of government. It was another five years before regional and municipal governments began to assume — after a diminution of responsibility for nearly twenty years — the kind of role in policy formulation and implementation originally assigned to them during the early postwar period.

My concern here not being mainly statistical, is with a description of the role of governments and the changing shifts and currents in policy which are a consequence of political, economic and social forces. Much of the material covering the years 1940-1968 (Chapter 3 and Appendix A) was originally drafted for the Canadian Conference on Housing held in Toronto during November 1968. A great deal has happened during the ensuing years with respect to government inter- vention in the housing market at all levels.

Housing policy has not merely arrived as a political phenomenon in terms of appeals to the electorate for favour or rejection, but is an important component of intergovernmental relationships, and a signifi- cant aspect of economic, social and political considerations at a time in Canadian history when the central issues are said to be those of inflation and unemployment. There are few segments of the Canadian economy in which price inflation has been greater and there has been no aspect of the inflationary process which has hurt or may hurt Canadians more significantly than its impact upon the production and distribution of housing accommodation for Canadians. There are few segments of the Canadian economy in which the burden of unemploy- ment has been greater than in the construction industry, including the building of housing accommodation. There is a surplus of houses for sale in the early 1980s, yet many Canadian families are unable to afford accommodation.

From the outset, my objective has been to clarify the nature of Canadian housing policies, formulated by government and emerging from the struggle for hegemony between the various levels of govern- ment, primarily by tracing the history of legislation and its implementa- tion. Members of the private residential housebuilding industry make decisions concerning their annual and five-year plans for land purchase and ultimate housebuilding activity; by doing so they may affect materially the supply and cost of housing. However, all their plans are

vi Canadian Housing Policies (1935-1980)

very significantly influenced by the actions of government. That is not to deny that the lobbying or public information role of very large economic units in the housing industry may be considerable, or that their land acquisition policies have important economic and social consequences. It is rather to indicate the major emphasis of this work: government policies.

I cannot offer any simple or guaranteed solution to the dilemmas which face Canada, its provinces and municipalities, in the continuous efforts of providing adequate housing accommodation for various income groups in Canadian society. While I am all too conscious of our many deficiencies in this field, Canada also has much to be proud of in its record of accomplishment. The variety of regions and regional jurisdictions within the vast geographical area which is Canada and a whole gamut of international and national economic forces challenge our capacity to provide human and physical services for our people. To acknowledge that challenge is not to accept defeat.

In writing a book on a subject as complex as Canadian housing policies an author becomes obligated to a great many persons who offer advice, criticism and support. This book has been published with the help of a grant from the Social Science Federation of Canada, using funds provided by the Social Sciences and Humanities Research Council of Canada. Minor portions of chapter eight have been published elsewhere (Albert Rose, “The Impact of Recent Trends in Social Housing Policies,” in Urban Housing Markets: Recent Directions in Research and Policy, edited by Bourne and Hitchcock and published by the University of Toronto Press, 1978). I would like to acknowledge the pioneering work of Peter Spurr (published by James Lorimer & Company), Michael Dennis and Susan Fish. I extend thanks to all Canadians who, by joining efforts with their fellow citizens, and by exerting pressure on their elected representatives as well as their appointed officials, have caused the development of better housing policies.

Albert Rose

Il. Il. IV.

VI. VII. VII.

x.

Contents

Housing Policies in their Political, Economic and Social Contexts ..............

Essential Elements of a Canadian Housing Policy ............

Housing Policy in Canada 1940-1968 000

National Housing Policies for Urban Canada:

The 1970s and Thereafter 000.0000.

New Housing Policy Initiatives by Provincial and

Local Governments o0..00......000ccecue Eien nee

Housing Policies in Ontario: A Case Study

Constraints Upon Policies and Programs ............0.....000.

Housing for Low-Income Families: The Importance of Attitudes 2.00.0...

Canada’s Housing Problem: Insoluble Crisis or Intractable Dilemma? ..............

Appendix A: Provincial Legislation in Housing and Urban

‘Renewaltin the 1960s‘. ce ct 2h eo ea On or miarsbel ois tte!

vii

CHAPTER 1

Housing Policies in Their Political, Economic and Social Contexts

Throughout the more than eleven decades of Canada’s national existence, there have been few periods in which there were not expres- sions of concern about the housing and living conditions experienced by some Canadians. These concerns were expressed by elected repre- sentatives within local councils, by journalists, by church groups, by charitable organizations! and by individuals. In particular, the years prior to and after the First World War were marked by a great deal of interest in the orderly development of Canada’s newly emerging cities and smaller urban centres.?

The untoward explosion which occurred in Halifax harbour in 1917 may mark the beginning of concerted public intervention and assump- tion of responsibility in the field of housing. This explosion destroyed a significant proportion of the housing stock adjacent to the harbour. As a consequence, a number of dwellings were built to be inhabited by families who had lost their homes; these houses remain inhabited today. Moreover, the problems consequent upon the disaster and the need for government intervention to assist disadvantaged families led directly to the creation of the first provincial housing authority, the Nova Scotia Housing Commission.

Nevertheless, with the exception of some housing which was built for veterans returning from the First World War under the terms of legislation passed by the Government of Canada, and 334 dwelling

i

2 Canadian Housing Policies (1935-1980)

units built by the Toronto Housing Company,’ there was relatively little continuous governmental participation until the middle and late 1930s. During the 1920s, as Carver pointed out,* the Canadian economy was relatively buoyant and, in company with the United States, Canada enjoyed a period of unprecedented prosperity. Housing built during the 1920s was created by small builders (for purchase) within the private market. Insofar as Canadians thought very much about the housing conditions of those individuals and families in the lower half of the income scale, it was assumed that the “filtering-down” process worked satisfactorily. This assumption, long since discredited but widely held by more affluent members of the community to this day, involves the notion that when the well-to-do leave dwellings which they inhabit, presumably for more adequate housing, their previous dwellings are reduced in value and become available to those of lesser means. Those of moderate income who improve their accommodation by acquiring more space or elegance leave other houses which ultimately filter down to the very poor.

THE COMPLEXITIES OF HOUSING MARKET ANALYSIS

The field of housing is one of the most complicated aspects of modern industrial societies, if not the most complex. It may indeed be exceeded in scope and difficulty only by the field of health care. In western industrial societies, housing has become both a private activity in the market place and a public activity on behalf of those individuals and families who, due to insufficiency of resources, seem incapable of meeting their housing requirements. Such “resources” are usually considered to be financial, such as the proportion of income which can be devoted to housing without serious deterioration of the family’s standard of living, but they may embrace such intangibles as motivation, the degree of sacrifice which an individual or family is prepared to make, and many other emotional aspects. (The nature of the house inhabited by a family, the neighbourhood in which it lives, and the amenities in that neighbourhood, are all components of the social class to which the family is considered to belong and some measure of the regard in which the family is held by its friends, relatives and neighbours. )

In a capitalistic market economy the housing industry, by definition, must produce for those who have the resources to take its products off the market, otherwise its entrepreneurs would be forced out of business. This has meant, and can only mean, that adequate housing is not provided automatically in western industrial societies for those persons with modest or inadequate resources. Under these circumstances

Political, Economic and Social Contexts 3

governments have intervened and a variety of housing programs have been developed in Canada and in other countries to meet the needs of those who must be assisted by the resources of society as a whole.

The “government of housing”, as Donnison has pointed out,> proceeds on a variety of levels of conceptualization. Many persons believe the provision of housing to be quite different, in philosophical terms, than the provision of food, clothing, household facilities, and other necessities of life. There is a moral problem faced by an important segment of the population which holds the view that there is something unethical in process when housing must be provided with state assistance unless there is some disadvantage within the individual and family which requires such assistance. In short, a disability must be recognized, examined and carefully evaluated before such assistance can be rendered and especially if it is to be provided for an extended period. This is simply one example of the attitudes many people maintain with respect to persons who are poor in industrial societies where poverty is no longer the norm.®

THE POLITICAL CONTEXT

No government is likely to take the requisite action to provide housing for those who require societal intervention unless there appears to be a political advantage or unless the pressure for action on the government in power is so strong that it can no longer be resisted. In Canada, the intervention of government in the 1930s was fundamentally a response to economic problems which spawned very significant poli- tical problems. The Conservative government, which appeared to be threatened with the loss of power as an election approached in 1935, passed a series of legislative measures described colloquially as “Canada’s New Deal”, presumably because they appeared to be emula- tion of American measures of 1933 and thereafter. The only piece of legislation which survived the test of constitutionality in 1935 was the Dominion Housing Act.” The fact that the legislation was passed is a reflection of political and economic circumstances; it cannot by any means be considered to be indicative of a conviction on the part of the then federal government that state intervention in the housing market was either normal or desirable.

The passage of the first National Housing Act in 1938 can be attributed to similar inducements as unemployment persisted under the new Liberal government and a further economic recession occurred in 1937-38.8 The NHA was a political and economic act by a government hoping to stimulate employment by broadening the terms of the 1935 legislation. At no time prior to the Second World War did it appear

4 Canadian Housing Policies (1935-1980)

to the majority of Canadians that governmental intervention in the field of housing was likely to persist and expand.® Viewpoints have since changed but it is still a moot point whether the majority of our citizens in the late 1970s view public activity in the field of housing as desirable, permanent and inevitable.

The first series of decisions must be taken at the local level, within municipal councils. Not only in federal nations like Canada or the United States but in a nation like the United Kingdom where there are no States or provinces, the fact remains that housing accommodation is provided, and very often financed in part, administered and managed, within the physical boundaries and the planning jurisdiction of a local government. By definition, the land upon which the housing rests is within a municipality or regional government; those individuals or families who require governmental assistance in meeting their housing requirements are residents and taxpayers of a locality or a regional governmental area. Local governments in most Canadian provinces have a good deal of “negative capacity” to forestall the creation of housing accommodation under governmental auspices if they are dis- inclined to favour such activities. These capacities rest in their powers to zone land, to regulate the pace and the specifics of urban develop- ment, and to develop standards of maintenance and occupancy within the existing housing stock.

In Canada, the provincial governments, as well, have substantial power to facilitate or to oppose inter-governmental activity within the field of housing. They have exercised these powers when they so chose and the fundamental political question remains the one enunciated previously: to what degree is there advantage to the government in power in engaging in this important economic and social activity around which so much controversy swells?

The great mistake which so many Canadians have made in consider- ing the political context of housing policy consists in the naive view that once governments recognize a human need, they will move to take action as promptly as possible. The fact is that what is meant by “action” in the field of housing is a series of political and legislative decisions to devote a portion of scarce economic resources to this activity rather than to another. Sometimes this means diverting financial resources (to the housing activity) from the social services, from the health services, from the provision of educational facilities, and from basic municipal protective services; sometimes it means additional capital borrowing over and beyond the experience of previous years. It surely means the creation of administrative resources within government to handle the economic and technical questions which arise in the. development of housing for persons and families of modest or low income.

Political, Economic and Social Contexts 5

THE ECONOMIC CONTEXT

The provision of housing accommodation is a matter of substantial economic significance in Canada. Between the early 1950s and the late 1970s the total annual investment in residential construction rose from about $2 billion to more than $11 billion.1¢ Although the demand for new housing for purchase had not been strong in 1976 and throughout the first half of 1977, the number of housing starts in 1976 was at a record high (exceeding 273,000 units).1* Unemployment in Canada exceeded 7 per cent of the labour force in the late 1970s; instability in the residential construction industry has greatly contri- buted to such unemployment.

Although most Canadians realize that provision of housing is an important economic activity within private industry as a whole, they are not fully aware of all the economic ramifications of the house- building industry and that all of the factors of production, land, labour and materials are involved in the provision of housing.

Moreover, those industries which produce the furnishings new home buyers often require (plumbing fixtures, appliances, furniture, carpets, bedding, linens and so on) will be affected by the degree to which the market for new housing is buoyant or otherwise. The policies of governments and the decisions of private entrepreneurs with respect to land use affect the supply of housing, the kind of housing produced and the level of housing costs at any one time. The degree to which residential housing is expanding has a profound effect upon employment in a number of related industries which supply building. materials (lumber, cement, bricks, copper piping, oil burners, furnaces and the like). In short, the economic ramifications of the private and public provision of housing accommodation are widespread.

Under these circumstances I am always amazed at the naiveté displayed by many Canadians, including some politicians and social scientists, with respect to the economic position of housing in their analysis of housing programs and policies. Over the years [ can recall the plaintive demands of citizens’ groups, of social scientists, of elected and appointed officials and of voluntary organizations, that government not “use” housing as a stimulus or a deterrent to economic activity. Dennis and Fish have identified what they consider to be the first deliberate attempt by the Government of Canada in 1957 to use housing provision as an economic stimulant.??

The tragic aspect of this situation is the widely held belief that government can exercise its overall economic, monetary and social policies, without in any serious way affecting the provision of housing. It is not possible for the Government of Canada to exert its influence to vary interest rates or the money supply upward or downward without

6 Canadian Housing Policies (1935-1980)

affecting mortgage rates, and these in turn have a profound effect on the capacity or willingness of Canadians to purchase new homes. In the latter part of 1976 and into 1977, the rediscount rate of the Bank of Canada was reduced on several occasions; soon thereafter rates on first mortgages from most lending institutions dropped by a similar percentage; in 1978 and 1979 the “bank rate” was increased ten times and, invariably, mortgage rates rose correspondingly.

Critics of government housing policies have customarily not been upset when rates were dropping but when it was apparently in the economic interest of the nation to raise interest rates (and thus mort- gage rates) there were pleas by the aforementioned critics, to the federal government, to eliminate or ameliorate the influence of these changed economic policies in the field of housing. This cannot be done simply, although a number of assisted housing programs involving the subsidization of interest rates can be and have been undertaken to alleviate the impact of economic changes upon certain individuals or families within various housing markets.

There is a further dimension to the economics of housing which is more clearly understood than the interrelationships of monetary policy and housing activity, specifically the direct and indirect expenditures of government in housing provision. At the end of 1968 it was asserted in a formal report to the federal cabinet that

a total of more than $12 billion in National Housing Act loans, grants and subsidies has been extended to provide Canadians with more and better housing in a suitable urban environment. It is by most standards an impressive record.13

More than $8 billion was committed in direct federal expenditures and CMHC loans between the end of 1968 to the end of 1978.

Canadians understand that loans are repaid and that direct expen- ditures are a relatively minor part of the total. Subsidies are more difficult to comprehend and have been a cause for concern by govern- ments and resentment by the general public. Until 1973 the term “subsidy” generally referred to the difference between the rent-paying capacity of a tenant in public housing and the full economic cost of providing the accommodation, amortized over fifty years. Such sub- sidies were not substantial, in absolute current dollars, prior to the late 1960s. By the mid-1970s the annual dollar requirement in conventional assisted housing had approached $500 million, at least half of which was borne by the Government of Canada. At the same time, new programs had been developed requiring subsidies to home purchasers in the form of interest reduction loans and outright grants to purchasers to maintain monthly shelter payments at 30 per cent or less of gross

* family income.

Political, Economic and Social Contexts 7

There was in the late 1970s renewed concern about both per unit per month subsidy payments required by virtue of rapidly escalating housing costs, and total subsidy payments on an annual basis. I consider the subsidy question a serious policy constraint in Canadian housing for the next two decades at least.

THE SOCIAL CONTEXT

The determination of a national society, or a smaller community within it, to intervene in the housing market requires both implicit and explicit social commitments and underlying frameworks ranging from the philosophical to the quite specifically economic. Basically, the provision of affordable housing, adequate in quantity (space) and quality (physical and community, amenities), for every individual and family, must be enunciated as a major social goal.

Canada, unlike a number of western countries, rather than formally presenting the fundamental goals of its housing policies, has instead relied on a statement of objectives associated with each new or altered housing program. This important omission has been clearly expressed by Wolman in his analysis of “housing as a social service”.

One of the less visible, but nonetheless important differences between British and American housing policy ~ and one which itself greatly helps to account for many of the other differences ~ is the view each country holds with respect to the appropriate responsibility of govern- ment in meeting the shelter needs of its citizens. The concept of housing as a social service appears frequently in discussions of British housing policy, while it is not a common frame of reference for debate on American housing policy.15

The word “Canadian” may be substituted for the word “American” in the quotation with entire justification. Nevertheless, the development of Canadian housing legislation by the federal and provincial gov- ernments, particularly since 1954, constitutes an undeniable social commitment.

Once this commitment is affirmed, the social questions assume the form of explicit socio-economic decisions. The major social question may be phrased as follows: “Who are to be the direct beneficiaries of publicly initiated housing policies and programs?” The obvious response must be: “Those persons and families in the greatest need of adequate housing.” But how is need to be measured and priorities to be determined among those identified as “in need”? And how is such identification of those “in need” to be made in the first instance?

The first of the most logical techniques developed to answer these questions almost everywhere in the world consists of a careful observa-

8 Canadian Housing Policies (1935-1980)

tion and examination of the physical shelter and housing conditions of those who apply as tenants or purchasers of the new or rehabilitated housing to be provided. This assessment requires a staff of examiners or interviewers who must be trained to observe and rate the extent of physical deficiencies, to ask the proper questions of the residents and to seek relevant answers. This is particularly important when the impact of current living arrangements upon the physical and emotional health of family members is a part of the rating process in determining need.

The second technique in measurement of need and priorities among applicants (who, it is assumed, will generally exceed the number of available dwellings) is a determination of individual or family income or both. Information can be provided by the applicant or other members of the family, by the employer, if there is one, or by those agencies, usually governmental, which provide or supplement the basic income of the individual or family. The fundamental notion is, of course, that those in the poorest shelter and with the lowest income per household (sometimes considered per capita) should have the highest priority in the allocation of publicly provided housing, But to express this apparently fair and reasonable assumption without quali- fication is to gloss over a variety of social and administrative problems and issues.

What immediately comes to mind is the question of whether the alleged “need” should be expressed through a process of self-identifica- tion (application) or whether society should first identify those areas of clearly undesirable or “bad” housing in the community, develop a program to replace or rehabilitate such housing, if feasible, and allocate the new accommodation to the previous residents. The latter is the essence of the concepts of slum clearance and urban renewal. Those displaced by the clearance and rebuilding operations would naturally be the first to be rehoused. Such neat formulations soon run into the blocks which appear when criteria other than prior residence are taken into consideration. The most important of these is the income criterion. The assumption in Canada and the United States in the first postwar decade (1946-1955) that the residents of slum clearance or renewal areas would be “quite poor” was not borne out in practice. Some households were in poverty, some were not. Should all previous on-site residents have equal priority for rehousing?

The abovementioned experience raised sharply the whole question of the validity of the income criterion and also the question, “What is to be considered total family income for the purpose of determining eligibility and setting priorities for allocation of scarce accommoda- tion?” Most governmental organizations determined eligibility by the total annual income for both individuals and families or by marginal

Political, Economic and Social Contexts 9%

tax (percentage of income for rent). During the 1950s, the Central Mortgage and Housing Corporation issued quarterly estimates of the total family income for various communities (said to be the upper limit of the lowest third of the family income distribution) beyond which applications for publicly assisted housing could not be accepted and current tenants would be encouraged to move out and seek accommodation in the private market.

Beyond these over-arching questions there are many problems implicit in the definition of family income. Most authorities in Canada and the United States developed systems of rental payment whereby rents were geared-to-income. Rents would increase as income increased (sometimes to a maximum proportion of 25-30 per cent of gross family income) and decrease as income decreased. Thus emerged the so-called “rental scale”.

The first step in rent determination was thus income determination. The latter began usually with a recording of the total income of the head of the household, assumed to be the father of the family. But among low-income families, as the postwar decades passed, the prin- cipal income recipient was often the mother of the family - widowed, separated or deserted — and families headed by a woman became the norm among applicants for public housing. The question arose as to whether the principal source of income — a public social assist- ance payment — should be considered in toto for purposes of rent determination.

Among intact families headed by a male the question of secondary income recipients posed many difficulties. Should the part-time earnings of wives (mothers) be included in family income and if so, how much of their income? And what about the earnings of employed children, ranging all the way from the pin money of the child’s newspaper delivery route to the full-time incomes of older teen-aged or young adult children who normally paid nominal amounts to parents for room and board? If these earnings were not included, in whole or in part, why not? It was not difficult to emphasize that one goal of publicly assisted housing programs was to enable families to re-organize or re-order their spending patterns, to save money if possible, and to leave public housing for the private rental or purchase market. Strict regulations governing income calculation might well inhibit attainment of these socio-economic goals.

As difficult as these administrative and social decisions were, they were overshadowed by the major questions of social objectives implicit in a large-scale public housing program. As the effort to increase the supply of publicly assisted housing units intensified throughout Canada during 1965-1974, the matter of the form and shape of physical structures on the one hand, and of the neighbourhood or community

10 Canadian Housing Policies (1935-1980)

on the other, came to exercise paramount influence. The quickest way to acquire housing was to purchase buildings under construction by private entrepreneurs seeking liquidity in their investments. Moreover, rental units in high-rise multiple form offered hundreds of dwelling units rather than dozens usually available in low-rise, low or medium density developments.

Apartment buildings afforded housing described as bachelor accom- modation and one- and two-bedroom apartments, for the most part. The housing authorities were committed to the prevention of over- crowding and thus could often not meet the needs of families with more than two to four children. In any case, there was the emerging question of the suitability of apartment dwellings for families with children. In the late 1960s there was an increasing volume of literature attributing disturbed family relationships and behavioural problems among children to high-rise apartment living.1*

The question of “community” or “normalcy” within neighbourhoods dominated by public housing projects was equally important. Within some municipalities in Canada, school boards deplored the vastly increased number of children from low-income publicly-housed families, insisting that many children had fallen behind in the appropriate age~ grade progression and related to this fact was the frequence of problem behaviour in classrooms.

This situation was merely one aspect of community. More important was the fact that public housing accommodation was increasingly populated by families dependent on one form or another of public assistance payments, general welfare assistance, family benefits or mothers’ allowances, old age pensions and disability allowances. More- over, the fact that applications from single parent families reached levels exceeding 50 per cent of all applications in many Ontario cities by the mid-1970s promised no return to “normal” communities com- posed of an appropriate mixture of self-supporting employed intact families, dependent intact families and self-supporting and dependent one-parent families. The notion of general normalcy in communities in which significant proportations of socially assisted housing units are located, cannot be stretched to encompass the notion of “villages of the poor”.

A FUNCTIONAL APPROACH TO ANALYSIS

The complexities of housing policy analysis thus involve constitu- tional, political, economic, social and administrative considerations. In recent years a number of competent scholars and research organizations” have attempted through analyses of the “housing problem” or the

Political, Economic and Social Contexts 11

“housing crisis” (to cite the two most common phrases of concern in Canada) to devise housing policies they consider more appropriate in the light of changing circumstances.

At the beginning of the 1970s, as the federal government was contemplating the creation of a new ministry to be responsible for housing and urban affairs, the minister responsible for housing, Robert Andras, commissioned Harvey Lithwick, then Professor of Economics at Carleton University, to undertake a comprehensive examination of Canada’s urban situation, including the organization and administration of its housing program. By 1972, under the direction of Dr. Lithwick, six research monographs had been published as well as a major review of the problems and prospects facing an urban Canada.17 The second monograph in the research series was entitled “Housing in Canada”."* There can be no question that under Dr. Lithwick’s direction the empirical and theoretical framework essential to the development of a Ministry of State for Urban Affairs, which was ultimately created in 1971,!® was well provided.

As these studies were in the process of publication and dissemination, a major research project was commissioned by Central Mortgage and Housing Corporation under the direction of Michael Dennis, then a member of the Faculty of Osgoode Hall Law School and Susan Fish, then Director of the Bureau of Municipal Research in Toronto. Dennis and Fish ultimately published their own report when the sponsoring organization either refused or was dilatory in its consideration of publication and dissemination. The approach in this major contribution to the analysis of housing policies in Canada is implicit within its title, Programs in Search of a Policy: Low Income Housing in Canada.?° The major conclusions of the authors were that a great variety of housing programs had been initiated in Canada since the Second World War, that they had been ad hoc responses by the Government of Canada with or without the participation of the provincial governments, and that they failed to be based firmly on any clear policy direction by the federal government or the federal and provincial governments acting jointly.

In the view of one research organization, these major studies within the field of housing in Canada failed to recognize fully the basic characteristics of the housing sector. The most significant consideration is the fact that housing performs several significant functions.

Housing performs at least four quite different functions in our society. It is a consumer good, providing shelter; it is an investment good, the only major investment of most families; it is an industrial sector, providing jobs and incomes for many; and it is a social good, which governments attempt to provide for all income classes.21

12 Canadian Housing Policies (1935-1980)

All of these several approaches to the analysis of Canadian housing were important contributions to the study of the subject. Nevertheless, the complex problems inherent within the provision of housing in Canada continue and while we are undoubtedly one of the best housed nations in the world, the questions raised by these analysts concerning the inadequacies of housing provision for a substantial proportion of our population remain unanswered. It is not suggested that I will provide the answer but in the analysis which follows, I shall trace the evolution of housing policies within Canada, not merely from the vantage point of the federal government but from the point of view of all three (or even four levels of government where regional governments exist) particularly since the end of the Second World War. I cannot accept the view that we have had housing programs to the exclusion of housing policies; I cannot accept the view that governments have failed the Canadian population seriously; I cannot accept the view that we cannot do better. Perhaps my examination of the history will provide some clues to the evolution of more adequate housing policies and programs designed to implement them.

NOTES

1D. C. Masters, The Rise of Toronto, 1850-1890 (Toronto: University of Toronto Press, 1947) p. 127. An address by Miss Charity Cook, Tenth Canadian Conference of Charities and Correction, Proceedings (Toronto, October 1909) pp. 10-12. J. S. Woodsworth, My Neighbor (University of Toronto Press and Oxford University Press, 1911, reprinted 1972).

2Bureau of Municipal Research, Toronto: Bulletin 2, “Do You Care How the Other Fellow is Housed?”, March 13, 1914; Bulletin 7, “Is the Solution of the Housing Problem a Civic Duty”, April 1, 1914. D. W. Holdsworth, “House and Home in Vancouver: Images of West Coast Urbanism, 1886- 1929”, in G. Stelter and A. Artibise (Eds.) The Canadian City: Essays in Urban History (Toronto: McClelland & Stewart, 1977 — Carleton University Library).

3§. Spragge, “Early Housing Reform — A Confluence of Interests, 1900- 1920”, a paper delivered at the first Canadian Urban History Conference (University of Guelph, May 1977, mimeo) p. 12.

4H. S. M. Carver, Houses for Canadians (Toronto: University of Toronto Press, 1948) pp. 25-28.

5D. V. Donnison, The Government of Housing (London: Penguin Books Ltd., 1967) pp. 79-112.

8}. K. Galbraith, The Affluent Society (Boston: Houghton Mifflin Co., 1958) pp. 322-333.

TDominion Housing Act, 1935, 25-26 George V, Chap. 58.

Political, Economie and Social Contexts 13

8National Housing Act, 1938, 2 George VI, Chap. 49.

®The Research Committee of the League for Social Reconstruction, Social Planning for Canada (Toronto: Thomas Nelson & Sons Ltd., 1935), pp. 3-39, 451-463.

1°Central Mortgage and Housing Corporation, Canadian Housing Statis- tics, 1978 (Ottawa: CMHC, March 1979) Table 24, p. 21.

1Jbid., Table 1, p. 1. There were sharp reductions to 245,700 starts in 1977 and 227,600 in 1978.

12M. Dennis and S. Fish, Programs in Search of a Policy: Low Income Housing in Canada (Toronto: Hakkert, 1972), p. 130.

18Canada, Report of the Task Force on Housing and Urban Development (Ottawa: Queen’s Printer, 1969) p. 6.

44Central Mortgage and Housing Corporation, Canadian Housing Statis- tics, 1978 (Ottawa: CMHC, March 1979) Table 24, p. 21.

1H. L. Wolman, Housing and Housing Policy in the U.S. and the U.K. (Lexington, Toronto and London: Lexington Books, D. C. Heath and Company, 1975) p. 15.

16See M. Lipman, Social Effects of the Housing Environment, a back- ground paper prepared for the Canadian Conference on Housing, October 1968, pp. 4-17; and H. N. Colburn, Health and Housing, similarly prepared, pp. 33-34. These papers were collected and published under the title, The Right to Housing (Montreal: Harvest House, 1969).

“Central Mortgage and Housing Corporation, Urban Canada: Problems and Prospects, a report prepared by N. H. Lithwick for the Minister Responsible for Housing, Government of Canada (Ottawa: CMHC, December 1970) pp. 236.

181, B. Smith, “Housing in Canada,” Urban Canada: Problems and Prospects, (Ottawa: CMHC, January 1971) research monograph 2, pp. 99.

19Dr. Lithwick became the first director of research for the new Ministry of State and remained in that position for nearly two years.

20M. Dennis and S. Fish, op. cit.

*1R. Shaffner, “Housing Policy in Canada: Learning from Recent Prob- lems” HRI Observations (Montreal: C. D. Howe Research Institute) No. 9, August 1975, p. 2.

CHAPTER 2

Essential Elements of a Canadian Housing Policy

INTRODUCTION

In recent Canadian history there has been much confusion about housing policy. The most serious and the most frequent charge to be levelled, particularly against the federal government, is that “there is no national housing policy.” When the particular course of action adopted and pursued by one or more levels of government is unsuc- cessful in meeting the total problem under consideration, one suspects that the pronouncer of the dictum “there is no housing policy”, is simply finding another way of saying that many individual, family, or group housing problems have not been solved satisfactorily either in quantitative or qualitative terms.

It is nevertheless true that it is very difficult for the student of housing affairs to decide when a particular government proposal, or apparent course of action, really represents housing policy or is merely a temporary palliative or pronouncement behind which stands no particular government support and conviction. During the past thirty years it has been alleged by many social scientists, politicians, and other students of the problem that the most prevalent governmental reaction to Canada’s housing dilemmas may fairly be described as “housing by headline”. This is meant to imply that during this period there have been far more pronouncements, newspaper articles, press

15

16 Canadian Housing Policies (1935-1980)

releases, and other indications of concern and potential action than there have been specific governmental actions designed to meet our housing needs. In this welter of charge and countercharge, of proposal and counterproposal, of allegations of buck-passing from one level of government to another, the tremendous progress in Canada’s housing situation since 1938-1939 tends to become lost, or at best dimmed, and the limits and scope of a housing policy become obscured.

The most important background fact in the Canadian housing experience is that Canada is a federal state. In 1867 the authors of our constitution determined that there would be a federal government with certain specific functions and a second tier of provincial govern- ments with certain other specific functions. Unlike the situation in the United States, the residual powers were left with the federal govern- men. In fact, the Government of Canada can legislate in any national emergency “for the peace, order, and good government” of all Canadians.’ But, it must be emphasized that in a federal state the matter of housing policy is quite different from that in a unitary state like the United Kingdom. In Canada the first essential must be to determine where the constitutional responsibility lies, and once that legal interpretation is made clear and is accepted by the central govern- ment and the governments of the provinces, then, and only then, can the concept of policy begin to emerge. There can be no policy other- wise, unless what passes for policy is merely a course of action contemplated by one level of government in default of the rightful assumption of responsibility by another.

In this country the constitutional responsibility for the provision of housing to individuals and families has been assigned, by judicial inter- pretation, to the provinces under Section 92 of the British North America Act.2 The assignment does not necessarily result in the acceptance of responsibility by these governments. Therefore, when some persons have insisted in recent years that Canadian housing policy has changed drastically by virtue of the assumption of respon- sibility by the governments of the provinces, such an assertion must be strongly challenged. Housing policy has not changed, if we can, indeed, admit that such policy existed. What has changed has been the adoption and pursuit of a course of action by a particular level of government (provincial) which, during the previous thirty years, had participated in this endeavour only to a very limited extent.

This kind of analysis emphasizes that there are essentials in the determination of a Canadian housing policy, and these essentials must be carefully examined and explained before we can proceed to under- stand the response to the national housing problem. The major essen- tials in Canadian housing policy are legislation, financial resources,

Essential Elements of a Canadian Housing Policy 17

responsibility for initiating action, and appropriate administration arrangements.

LEGISLATION

The determination of a particular course of action with respect to the alleviation of some aspect of the overall housing problem cannot take the form merely of a pronouncement by one or more levels of government that action will be taken. Nor is it sufficient to suggest that the government in question favours a particular approach or a particular view of the problem. Housing policy, as one definition suggests, requires a course of action adopted and pursued by a govern- ment, and the terms “adoption” and “pursuit” require, at the very least, the passage of legislation that enunciates specifically what the particular government is prepared to do about the problem. In this respect it might be argued that there has been a national housing policy in Canada since at least 1935, when the Dominion Housing Act was passed,? Since that time there have been three major National Housing Acts passed in 1938, 1944 and 1954; and in 1964 and 1973 a further series of major amendments which transformed the legislation*

The essence of federal legislation in housing is not very different from that of other federal legislation concerned with matters of national interest in some field of economic and social affairs. In a federal country, a major piece of legislation must afford an opportunity for the governments of the provinces, if they have the constitutional responsibility, to participate actively in the implementation of the particular course of action planned by the central government. These incentives may be as simple as the provision of financial resources, provided the governments of the provinces pass “enabling legislation” permitting them to sign agreements with the federal government on the matter in question. It is more usual, however, for the federal government to pass legislation which enunciates the essence of the central government’s view of the problem and the nature of the potential solutions required to solve it. In addition, federal legislation customarily implies that certain standards of implementation and administration must be met if the provincial governments are to qualify for assistance — technical, administrative, accounting, financial — to be provided by the central government.

In a country like Canada, a major piece of federal legislation must provide the opportunity for every region to participate in the contem- plated program. It should be possible for each region to develop, within appropriate limits, its own approach to the solution of the

18 Canadian Housing Policies (1935-1980)

housing problem, an approach consistent with its history and traditions, its tastes and preferences, and its view of its own special needs.

It is conceivable that a course of action may be enunciated by government without the passage of specific legislation and that this declaration may be the expression of governmental policy. It is incon- ceivable, however, that policy can be implemented without the passage of legislation which makes it possible to pursue the prescribed action. Within the several National Housing Acts passed in Canada since 1938 it is possible to discern the philosophy underlying government housing policy. The legislation and the regulations written for such legislation really prescribe the beneficiaries for whom governmental action is intended and the conditions under which potential beneficiaries may, in fact, receive the support or assistance provided by the legis- lation. To this extent, legislation is not merely the legal execution of constitutional responsibility but can be conceived as both the social and economic dimensions of housing policy at the particular level of government responsible for its passage.

FINANCIAL RESOURCES

It is insufficient to pass laws without the provision of financial resources to implement the policies developed and proclaimed by the legislation. Moreover, the actual provision of government appropriations may be an indication of the intensity with which policy is meant to be implemented. Legislation is sometimes passed under pressure from citizens’ groups, from business or trade associations, even from the elected representatives of other levels of government; but it may be the intention of the body which passes the legislation that it shall be merely a token acknowledgement of the need for governmental action.

In Canada, unlike the United States, the passage of legislation is usually accompanied by some specific indication of the amount of money intended to achieve the objectives of the legislation. For example, in both Part I (Housing for Home Owners) and Part IT (Section 22 ~ later Part IH, Section 23) of the National Housing Act of 1944, specific amounts of money, namely, $300,000,000 (1949) and $250,000,000 (1953), were specified as available for these parti- cular portions, As time passed, these amounts were amended and when the National Housing Act of 1954 was passed, the amounts available were altered in response to changing legislation and increased demand. Therefore, there is no need in Canada for additional pressure to be brought, once the legislation is passed, to ensure that the appropriation is voted. Rather, the more serious concern is to ensure that the monies available and specified within the legislation are, in fact, spent. This

Essential Elements of a Canadian Housing Policy 19 :

assurance very often requires intense pressure upon one level of government to convince its officials and, indeed, to force them to develop programs for which the funds are apparently available through a higher level of government.

It would appear that the enunciation of a course of action by government has been accompanied by a specific appropriation of funds for the various programs possible within the new laws. This is not to suggest, however, that the amounts of money provided have been sufficient. In that aspect of Canadian federal housing legislation which is intended to encourage the assumption of home ownership through the provision of more generous mortgage terms than are available in the open market, governmental policy shifted during the post-war period from direct intervention (the provision of a portion of the mortgage loans themselves) to more indirect intervention (the guar- anteed repayment of such loans if potential owners should default). As simple as this may seem, housing policy in Canada has been more evident in the field of mortgage financing of home ownership than in any other respect.

In the years following the passage of the National Housing Act of 1944 and throughout most of the ensuing decade, Part I of the Act provided that the Government of Canada would provide 25 per cent of the capital amount of an approved NHA mortgage loan at relatively low interest, namely, 3 per cent. The effect of this specific action has had so many important ramifications in our post-war housing exper- ience that even today the full impact of the experience of the first post-war decade can scarcely be measured fully. Clearly, it was the policy of the central government to encourage the assumption of home ownership, in new construction only, through a programme which resulted in the lowest first-mortgage interest rates in our history. This was formed by not one but two forms of subsidy: direct lending of funds provided by the general taxpayer to several hundreds of thousands of privileged families, and the provision of such funds at an artificially reduced rate of interest.

Although it occupied only one short part of the federal legislation, a-consequence of this set of policies was clearly the expansion of vast suburban areas adjacent to every medium-sized and large urban centre. The problems that have ensued, both for the governments and residents of suburban areas and the governments and residents of central cities which did not directly benefit from this encouragement to home owner- ship, are immeasurable. An adequate assessment of the pros and cons of this aspect of policy has not been published, and one must refrain from ascribing all forms of urban distress and all negative aspects of urban living to one specific set of policies. On the other hand, it is not sufficient for those who have defended such policies to argue that, in

20 Canadian Housing Policies (1935-1980)

the long run, a vast growth of urban population resulted in an expan- sion of metropolitan economic development inconceivable in the years immediately after the end of World War Two. It can surely be argued that this is a case where housing policy in effect took over the respon- sibility of urban planning (in this case suburban planning) which has been the source of so much distress to social, economic and planning analysts.

At this point in the argument, the key aspect of the situation in the first postwar decade is that the financial resources were, indeed, made available. As total Canadian population expanded and urbanization progressed rapidly, it became apparent early in the 1950s that the policy of stimulating home ownership — in itself the advancement of a group of values which represented the collective judgment of elected and appointed officials — could no longer be supported with available governmental revenues. In re-writing the National Housing Act in 1953-1954, the government’s decision to discontinue direct participation in mortgage lending at a subsidized rate of interest was no surprise to students of the subject at that time. The new legislation permitted the chartered banks to enter the mortgage field in so far as National Housing Act operations were concerned. In fact, the banks were formally advised that they must share in the provision of required financial resources. In order to enable a conservative banking system to participate in the pursuit of a course of action prescribed by govern- ment, a system of mortgage loan guarantees was instituted and, as is often the case, the ultimate consumer (in this case the home buyer) would provide the insurance premiums, in the form of a fee amounting to 2 per cent of the purchase price.

APPROPRIATE INITIATIVES IN THE FIELD OF HOUSING

The pursuit of a course of action (the implementation of policy) must begin somewhere. A statement of housing policy backed up by legislative and financial guarantees is by no means equivalent to the implementation of a policy unless someone, somewhere, takes the initiative. It has been stated many times that housing legislation in Canada is as good as that existing in any other western nation. There is no reason to challenge this contention because such an argument would be fruitless. The real test of housing policy is its translation into the provision of adequate physical and social space occupied by indi- viduals or families who are in need of such accommodation. The failure of such housing policy, when and if it could be judged that a particular course of action had failed, is more properly attributed to lack of initiative than to lack of resources.

Essential Elements of a Canadian Housing Policy 24

It was therefore fitting that in discussing the proposed 1949 amend- ments to the National Housing Act, which were to introduce Canada for the first time to the field of public housing for low-income families, the then minister of Resources and Development, Robert H. Winters, should stress that the new legislation could only be implemented by virtue of local initiatives. The federal minister made it perfectly clear that those forms of government which were allegedly closest to the tangible needs of people must take steps to meet those needs. The relationships emphasized by federal officials were, of course, federal- provincial relations.

Despite the triteness of the phrase, the municipalities are in fact the creatures of the provincial governments. Barring the extraordinary powers available during periods of war-time emergency, the federal government has no constitutional right to negotiate directly with local government. It was made clear, therefore, when Section 35 was before Parliament in November 1944,> that the federal-provincial agreements envisaged in this amendment to the Act depended upon local initiative. The amount of financial responsibility placed upon local governments was a matter for the provincial governments, after they chose to participate in the newly conceived federal-provincial partnership. Some provinces (Alberta, Quebec, and Prince Edward Island) did not choose to participate for nearly fifteen years.

Canada’s housing history during the 1950s, as far as direct public intervention is concerned, can be described in terms of the existence or non-existence of local initiatives pressing for public participation in the available legislation and financial programs. Local initiative, subject to many and varied interpretations, is sometimes regarded as a purely voluntary effort on the part of private citizens and organizations directed towards influencing one or more levels of government to take appro- priate action. This conception of local initiative is far too narrow. For example, in Halifax, where a substantial public housing program was mounted during the 1950s, the most important initiators were the mayor and the elected councillors of the city (these officials were advised by a competent city manager).

Perhaps this form of local government provides a structure in which the city manager, convinced of the need for urban renewal and an appropriate housing program, can draw more clearly to the attention of elected officials the needs of the community. Initiation in Toronto, however, has been less evident among elected and appointed officials but has, to a substantial degree, been the product of pressure mounted by voluntary community organizations such as: the Citizens Housing and Planning Association, from 1944 to 1949; the Metropolitan Toronto Branch of the Community Planning Association of Canada, from 1948 to the present; the Association of Women Electors; and

22 Canadian Housing Policies (1935-1980)

other groups. In the late 1970s, with the creation of the City of Toronto Non-Profit Housing Corporation (City Home), this lack of “official” initiative was no longer a reality.

Each of these experiences (Halifax, Toronto, Vancouver,* et al) can be justifiably described as local initiatives. The legislative arrange- ments require that the local community has a clear recognition of need and a clear indication of the desire for the public assumption of responsibility to provide housing accommodation for low-income groups. This would seem to be an appropriate line of initiatives ~ a line running from the local manifestation of human need to those levels of government where the legislative and financial resources have been provided. The alternative approach, a line of action which would run from governmental bodies down towards the neighbourhood or the local community, is surely a paternalistic approach and moreover, one that could fail to recognize the differential quality of housing require- ments from community to community and from region to region.

It must be recognized, of course, that what is called local initiative, whether citizen-based or council-based, can only flourish under certain favourable conditions. In a situation where a provincial government has decided, for whatever reason, that it does not consider housing to be of relatively high priority among ail of its competing responsibilities, the atmosphere in which local initiative can develop is most restricted. In Nova Scotia, Ontario and British Columbia it was obvious that there was at least some recognition of the potentialities of the federal- provincial partnership. Although the line from local initiative to pro- vincial acceptance of need, to the development of a federal-provincial agreement with respect to the construction of “housing projects for sale or for rent” in any Ontario community’? was not smooth and uninter- rupted, the general climate was favourable. In general it can be argued that this was also the case in Newfoundland, and to some extent in New Brunswick. In certain other provinces such as Alberta, Manitoba, and especially Quebec, the situation was quite different.

In certain provinces the required enabling legislation following the 1949 amendments, was not even enacted. In other provinces where enabling legislation was passed, unusually difficult financial requirements were prescribed, which effectively curtailed the nurturing of local initiatives in the development of housing programs. In those provinces where all or most of the 25 per cent provincial share of capital require- ments and operating subsidies was passed on to the local municipality, such arrangements could hardly be regarded as “the pursuit of a course of action.” A detailed assessment of the experience in the 1950s from province to province is not available, but it can be stated fairly: that whatever progress occurred, in both physical and social terms, was very closely related to the climate in which voluntary and public

Essential Elements of a Canadian Housing Policy 23

initiatives at the local community level were fostered in some provinces or hampered to the point of discouragement in others.

EFFECTIVE ADMINISTRATIVE ARRANGEMENTS

Even where it can be assumed that all of the previously considered essentials of a national housing policy — legislation, financial resources, local initiative — were present and flowed smoothly towards the an- nounced objectives, there was always the danger of long and frustrating delays and even the abandonment of specific programs because of the Jack of administrative arrangements, both in the structural and personnel sense.

In the early years after World War Two, most provinces were ill- equipped to deal with the problems of urbanization which included housing, community planning, urban renewal, and the like. Most provinces did not have appropriate community planning legislation; most did not have appropriate legislation with respect to housing development; and, most did not have any clearly defined locus of responsibility within the provincial departmental structure where new programs could be lodged. In Ontario the entire field was the respon- sibility of two branches of the then Department of Planning and Development, first created in 1946. The Housing Branch was respon- sible for the administration of provincial legislation, such as the Housing Development Act of 1948,§ and was soon assigned the role of provincial agent in the emerging federal-provincial partnership after 1949. The responsibilities of local government in the field of community planning were administered through the Community Planning Branch of the same department. Both of these branches were relatively new, modestly staffed and modestly financed; they were groping their way to an understanding and appreciation of the problems for which they were responsible, and were trying to devise administrative techniques for meeting them. Most other Canadian provinces were by no means as well equipped as Ontario to deal with the rapid expansion of urban areas after 1945.

The development of effective administrative arrangements cannot be conceived merely as a problem of governmental administration in the sense of allocation of responsibilities on organizational charts. There has been naive assumption on the part of the protagonists of public intervention, as well as by certain government officials, that the admin- istration of housing programs is fairly straightforward. The fact is that in the first decade following the end of the Second World War there were very few people in Canada who had any experience in the administration of public housing programs; in the general field of

26 Canadian Housing Policies (1935-1980)

3Dominion Housing Act, 1935, 25-26, George V, c. 58.

4National Housing Act, 8 George VI, 1944-45, c. 46, R.S.C. 1952, c. 188. An Act to Promote the Construction of new Houses, the Repair and Modernization of existing Houses, the Improvement of Housing and Living Conditions, and the Expansion of Employment in the Postwar Period.

513 George VI, c. 30. An Act to Amend the National Housing Act 1944 (assented to 10th December, 1949) S. 35.

®6The Vancouver Housing Association, founded before the Second World War, was perhaps the strongest and certainly the most durable citizens’ housing organization in Canada.

72-3 Elizabeth II, c. 23, National Housing Act 1954. An Act to Promote the Construction of new Houses, the Repair and Modernization of existing Houses, and the Improvement of Housing and Living Conditions, S$. 36(1).

8Housing Development Act, Revised Statutes of Ontario, 1950, c. 174, Sec, 13(1) and 14.

®*The Ontario Housing Corporation Act 1964, R.S.O., 1970, c. 317, 8. 3(4).

Oscar Lewis, The Children of Sanchez (New York: Random House, 1961) pp. xi-xxxi and 1-14.

14John R. Seeley, “The Slum: Its Nature, Use and Users,” Journal of the American Institute of Planners, xxv, 1959.

12An Institute of Housing Management, with members drawn from both public and private housing management organizations, was created in Ontario in the mid-1970s and held its first annual meeting in November 1976.

CHAPTER 3

Housing Policy in Canada 1940-1968

A HISTORICAL PERSPECTIVE

Canadian public housing policies, in any coherent sense of the word, emerged as a consequence of the depressed economic activity of the late 1930s and the onset of the Second World War. (The official reaction to the disaster in Halifax harbour during World War One must be seen as a fortuitous incident.) There is, of course, some difference of opinion concerning the most appropriate date from which to build an analysis. The year 1929 is a favourite choice of many writers, for obvious reasons. In my view, however, the year 1941 is the date from which most of the mid-twentieth century programs of Canada and the United States can be appropriately measured. As the war effort accelerated Canada approached full employment. In the fall of 194] prices of all goods and services, including rentals of housing accommodation, had advanced to the point where the federal govern- ment felt it necessary to impose controls under its war-time emergency legislation — controls over prices, wages, rents, and the allocation of materials.

By 1941 the federal government had also taken several significant steps which heralded the assumption of governmental responsibility in the housing field. Although the first National Housing Act had been passed in 1938, the opportunities for homebuilding were cut off by the onset of the Second World War. In 1941 a Crown corporation,

27

28 Canadian Housing Policies (1935-1980)

Wartime Housing Limited, was created by Order-in-Council to under- take the task of providing housing urgently required in many urban centres to accommodate workers attracted by governmental exhortation to work in wartime industries. Wartime Housing Limited can be seen now as a rudimentary federal housing agency, one of whose major tasks was direct negotiation with the elected and appointed officials of municipal governments. These negotiations produced a total of 45,930 dwelling units with an investment of $253,689,000 during the next nine years.1 Nearly forty years later, most of the housing developed by this corporation remains in use in or adjacent to our cities.

Whatever its strengths and deficiencies, rent control as a facet of housing policy did represent an important federal intervention not previously experienced in the Canadian housing market. Its main significance was a recognition that the demand for scarce housing accommodation would continue to exceed the available supply during the war and probably thereafter. All the evidence in other countries pointed to the depressing effect that rent control would have upon the possible expansion of the supply of housing, but during the war the probability of any real expansion in the housing stock seemed quite remote. Rent control did continue into the post-war years and in some municipalities was retained, in whole or in part, until the late 1940s.

The Government of Canada passed the second National Housing Act in 1944, a much expanded and relatively comprehensive piece of legislation in contrast with the legislation of the immediate pre-war period. In retrospect, the Act appears like a declaration of faith in the nation’s future in which housing policies would play a large role in post-war readjustment. In fact, the legislation did follow a major report of a special committee on post-war reconstruction known, after Professor Clifford Curtis of Queen’s University, its chairman, as the Curtis Committee.’ The Curtis Report, published in 1944, called for a recognition of the role of government, primarily that of the federal government, in the housing field, particularly with respect to the provision of housing for low-income families.

This report, which followed Canada’s charter for post-war social security (the Marsh Report of 1943),* was a milestone in the enuncia- tion of social responsibility by government. It must be reiterated that in the early months of 1944 the war was far from won, and it seems remarkable that the Parliament of Canada would enact legislation which, on the face of it, might appear premature. The very preamble of the National Housing Act of 1944, however, pinpoints the rationale for the legislation. The Act is described as “An Act to Promote the Construction of New Houses, the Repair and Modernization of Existing Houses, the Improvement of Housing and Living Conditions, and the Expansion of Employment in the Postwar Period”. The emphasis on

Housing Policy in Canada, 1940-1968 29

the expansion of employment in the post-war period makes it clear that the fundamental intention of the legislation was more economic — in terms of the avoidance of a post-war depression akin to that of 1919-21 — than a social concern with the well-being of all Canadians in terms of their housing requirements.

In the spring of 1945 the final link in this chain of future govern- mental organization for housing development was forged with the passage of the Central Mortgage and Housing Corporation Act.* This act created a federal housing agency in the form of a wholly-owned Crown corporation which was to administer the National Housing Act and thus the housing policy and program of the Government of Canada. The federal machinery for post-war housing expansion was complete.

Within the next five or six years Central Mortgage and Housing Corporation was to absorb or supersede all of the lesser agencies created during the wartime emergency, including Wartime Housing Limited.® The new agency, headed by a president and a vice-president and supported by a board of directors appointed by the Government of Canada, had all the attributes of a well-run business corporation and was designed to hide the potential iron fist of governmental inter- vention with a velvet glove of respectability or even financial profit. On this latter score the corporation has never disappointed the financial community.

INTERGOVERNMENTAL RELATIONS

Several important factors combined during the six years following the end of the war to make it possible for a strong federal role to emerge. The first of these was associated with the creation of a Crown corporation (CMHC) to administer the National Housing Act. Equally significant were the emergency powers granted to the Government of Canada in wartime and continued in substantial measure throughout the early post-war years. A shortage of consumer durable goods, build- ing materials, steel, rubber, petroleum and other products vital to the growth of the national economy made it essential to continue certain wartime emergency powers and specific intergovernmental agencies.* In the early 1940s, Wartime Housing Limited negotiated directly with many municipalities and a pattern of relationships was established which continued, almost without question, during the early post-war years.

As the housing industry developed momentum by the second half of 1946, and the incomes and preferences of families began to reflect a higher level of expectations, Wartime Housing Limited was taken over by Central Mortgage and Housing Corporation and a new pro-

30 Canadian Housing Policies (1935-1980)

gram was developed to take effect during the years 1947-1949, The intention of this new program, entitled Veterans’ Rental Housing,’ was to develop 10,000 dwelling units per annum of a more durable quality than that provided by Wartime Housing Limited (from an exterior point of view the main difference was the substitution of aluminum siding for frame construction, and full basements were deliberately provided). A serious attempt was made to provide permanent housing and once more, the federal government negotiated more or less directly with the municipalities concerned with little or no apparent objection from the respective provincial governments.

A third factor of considerable importance in the expansion of the federal role in the early post-war years was the obvious weakness of the provincial governments in these new fields of urban development. It has already been pointed out that the governments of the provinces were by no means prepared to assume their constitutional responsi- bilities in those areas of growth and development comprised by the term “urbanization”. This must explain in part the lack of interference by provincial officials, elected and appointed, in the major federal- municipal housing programs of the 1940s. Moreover, these programs appeared to be the only way in which housing accommodation could be provided in Canada at that stage of political and economic develop- ment. Not only were the provincial governments unprepared, in the political and administrative sense, to play much of a role in housing policy, but their financial resources were quite inadequate to meet the new challenges they were forced to face within two or three years after the war.

Finally, the federal role was fostered by outright and fairly strong hostility to public housing programs, a hostility far more evident within the councils of local government and the legislatures of provincial governments than anywhere else in Canada. At the federal level, there was, by the late 1940s, at least a decade of major housing legislation, intervention in the housing market, direct negotiation with local govern- ments for the construction of many thousands of dwellings, experience with certain social and community programs provided within Wartime Housing developments, and the operation of a substantial mortgage lending program supported out of tax revenues. The Marsh Report and the Curtis Report were further influences at the federal level that helped to weaken whatever antagonism existed towards public inter- vention in the nation’s economy to achieve social goals through social service programs. There was never in Ottawa the strong anti-public housing lobbies which were evident in Washington from 1933 onwards.

In the Canadian cities and in the provincial legislatures, however, the situation was by no means so favourable. In many towns and cities there had been serious suffering by many thousands of families and

Housing Policy in Canada, 1940-1968 31

individuals during the 1930s and not infrequent criticism of the manner in which financial assistance and work-relief programs had been handled. There was much dissatisfaction on the part of the unemployed and the needy as well as the staff members of the social and health services who had tried, under the most adverse circumstances, to help these people with the support of appropriate federal and provincial welfare legislation, At the same time, the four-fifths of the labour force who remained employed during those disastrous years found it difficult to accept the pleas of the disadvantaged. Rather, they were critical of what they considered to be wasteful measures of assistance to many persons whom they considered to be lazy and indolent,

Such attitudes towards the poor expressed themselves as opposition to the developing pressure for slum clearance and public housing programs during the last two years of the war and in the early post- war period. It was somewhat of a surprise to many people that the ratepayers of Toronto should endorse an estimated expenditure of nearly $6,000,000 on January Ist, 1947, for the Regent Park North low-income housing project.’ Despite the favourable vote, there was fairly strong opposition to the assumption of responsibility by the City Council of Toronto in the absence of supporting provincial legis- lation and financial assistance. In other parts of Canada the situation was much the same. Although the opposition to public housing was never as vociferous, hard-hitting and vicious as it was in many urban areas in the United States, it nevertheless existed and discouraged local initiative, not only in the late 1940s but throughout the 1950s even after the passage of enabling federal legislation.®

In the two years following the war, then, intergovernmental relations in the field of housing were quite perfunctory. There was a clear, evident and strong federal role and assumption of responsibility enunciated in legislation and in administrative arrangements designed and enforced through Central Mortgage and Housing Corporation. There was a minor, weak, much less evident provincial role, even after the passage of Section 35 of the National Housing Act in November 1949, which depended on similar “enabling legislation” being passed in the provinces. Some provinces quickly took advantage of the new opportunities and developed appropriate machinery. Others did not and for some years operated under legislation and administrative arrangements which were at best makeshift or stunted in their growth and development.

At the local level there was confusion and consternation at the requirement that clear and definite local initiative must precede the utilization of the federal-provincial partnership within specific com- munities. The major cities and towns faced the same difficulties as the governments of the provinces, but, in addition, suffered from a series

32 Canadian Housing Policies (1935-1980)

of disadvantages which they were less well prepared to overcome than their respective provincial hosts. At the local level there was opposition to public activity in the housing market, whether it be called slum clearance, urban redevelopment, public housing, or urban renewal. The residents of most neighbourhoods that were judged to be blighted or seriously deteriorating fought strongly against the expropriation and clearance of their homes, neighbourhood stores, and social and recrea- tional facilities. They bitterly denounced official and press statements that they lived in a slum or a blighted area. At the same time, the residents of other neighbourhoods, both in the central city and the newly developing suburban areas, strongly opposed the location of public housing projects in their midst. They argued that they would be taxed not only in general but specifically for the welfare and educational requirements of downtown slum dwellers who had been foisted upon them for the general betterment of some other municipal organization.

In addition to this discontent and opposition from within, local governments faced very serious financial problems from the late 1940s through the late 1960s, and they continue to face significant financial dilemmas. Under the terms of the federal-provincial housing partner- ship, a municipality was required to bring “city services” (usually water and sewage facilities, street lighting and educational facilities) to the boundaries of a new public housing project and, in the case of schools, often within the large project site itself. These costs were burdensome enough to many municipalities but since in many provinces the local government was required to pay from 7% per cent (Ontario) to, at most, 25 per cent of project costs (Alberta, Manitoba, and Nova Scotia) they were not the whole picture. During the 1950s, in return for these expenditures on capital and a similar share of operating deficits (rental subsidies) local governments might expect in lieu of taxes a payment which, they argued, was woefully short of meeting the real costs of local participation in an intergovernmental partnership.

Although it is true that despite these obstacles much progress was evident by the mid-1950s in Saint John’s, Halifax, Toronto, Hamilton, Windsor and Vancouver — this list represents merely a handful of urban centres — in the great majority of municipalities little or no progress was evident before the mid-1960s.

In the light of the foregoing, it might be argued that it would be easy to identify a series of practical steps which could be described as “federal housing policies”, “provincial housing policies”, and “municipal housing policies”. Unfortunately such an enterprise would be extremely difficult and unrewarding because none of the various governments in Canada ever really came forward with a clear statement of their goals

Housing Policy in Canada, 1940-1968 33

and courses of action, or programs designed to attain given objectives over some period of years. There was no clear statement of what might be termed “federal housing policy’, but a series of statements and pronouncements each year with respect to the overall housing situation and, in particular, with respect to the total number of dwelling units likely to be constructed, under construction, and completed during that year. Under the circumstances, the analyst can do no better than infer the most important elements of national housing policy from the enactment or amendment of legislation, and the encouragement or discouragement of various aspects of the total national housing program.

SIGNIFICANCE OF THE FEDERAL ROLE

Late in 1949, very soon after enactment of the federal-provincial partnership legislation, it became entirely clear that the federal government, through its agency, Central Mortgage and Housing Cor- poration, intended to play a strong and controlling role in the develop- ment of publicly-provided housing accommodation initiated anywhere in Canada, as seemed to befit its senior role in the provision of capital and operating subsidies. As the 1950s opened, a number of munici- palities moved forward in their role as initiators of public housing programs. Evidence that the process of federal-provincial-municipal negotiation towards the creation of public housing would be a long and tedious affair, in which the dominant roles would be played by officials of the federal agency, began to accumulate. In an address to the Committee on Housing of the City of Kingston, Ontario, in 1954, I predicted that if the council of that city were to agree at that very moment to proceed with a request for the development of a substantial housing project intended to replace a deteriorated shack town which had recently become the responsibility of the city through annexation of part of an adjacent municipality, it would take five years before the assembled councillors would see a family occupy a dwelling unit. This prediction was borne out almost to the very letter, and is indicative of the length of time required to complete housing projects which accounts for much of the failure in Canadian public housing in the 1950s.

The federal role was based upon a clear and commendable objective of excellence for Canada’s public housing program. By that time we had had the good fortune to observe nearly a half-century of British experience and more than a decade of American experience. Wherever a Canadian official might travel in these two countries, there were evident errors of omission and commission that it would be essential

34 Canadian Housing Policies (1935-1980)

to avoid. A desire for excellence impelled the officials of Central Mortgage and Housing Corporation to develop a set of administrative procedures in which a local initiative might very soon bog down completely. It became an interesting exercise to list the number of steps and approvals through which a public housing project had to pass from the initial proposal at the local level to actual construction and occupation of the project by low-income families. The number of steps listed by the Metropolitan Toronto Housing Authority in 1961- 1962, from local to provincial to federal to provincial to local ap- provals, back and forth a number of times, exceeded fifty. Under these conditions it was indeed remarkable that any public housing accom- modation was built at all.

In retrospect, the main difficulty appears to have been the desire of highly trained and specialized officials of the federal agency to achieve excellence in the Canadian public housing program. This is by no means an undesirable objective, nor one to be discounted. The fact was, however, that excellence could only be obtained at the expense of quantity. Although this was not the only reason for Canada’s modest quantitative attainment in public housing, it was an important con- sideration. The federal agency insisted on planning every step of the way, from the original municipal-provincial request to the ultimate appointment of a local housing authority to administer and manage the completed dwellings. The Architectural Division of Central Mort- gage and Housing Corporation produced plans in the finest detail for such huge public housing projects in Canada as Lawrence Heights and Warden Woods in Toronto, Skeena Terrace and MacLean Park in Vancouver, Mulgrave Park in Halifax, and Jeanne Mance in Montreal. The results of the division’s activity were noteworthy. Public housing projects were praised by architectural bodies, by visitors from other countries, and by local officials. Such praise and various architectural awards were won at the expense of a mass attack on the need for housing accommodation for the most disadvantaged individuals and families in Canadian urban centres.

Perhaps the techniques of the 1950s were fully justified on two counts: firstly, the absence of any appropriate provincial and local machinery to plan and design public housing programs or to implement such programs through the letting of contracts and the supervision of construction; and secondly, because the federal government was in fact paying the lion’s share of the cost of such provision. It is clear that the first deficiency was in process of amelioration as the provinces attempted, in the late 1960s, to develop appropriate and adequate machinery through the device of the provincial housing corporation. At the same time, the federal government continued to put up a far gteater percentage (90 per cent) of the required capital without any

Housing Policy in Canada, 1940-1968 35

suggestion that it must seriously control the process of housing develop- ment because of this financial contribution.

In light of the substantial and powerful federal role in public housing, it might be thought that the Government of Canada was strongly in favour of a vast program of publicly provided housing for the lowest third of individuals and families in the national income distribution. As indicated previously, one can only infer the essentials of national housing policy, but it is safe to argue that the federal public housing policy was not consistent with the scope of the federal public housing role.

The best conclusion we can arrive at concerning national housing policy from 1945 through 1964 is that the Government of Canada was strongly in favour of the attainment of home ownership by every family. This goal was enunciated from time to time in Parliament and in the speeches of federal ministers, particularly those responsible for the operation of Central Mortgage and Housing Corporation, More~- over, the government and the officials of the corporation devoted much of their formal speechmaking and laudatory pronouncements to the encouragement of the house-building industry in its efforts to provide hundreds of thousands. of homes for sale during the years 1946-1959. Every effort was made to provide adequate supplies of mortgage money, to manipulate the interest rate, and to set forth appropriate terms to encourage individual home ownership. Not only — was mortgage money made available through the National Housing Act at rates lower than those prevailing in the money markets, but down- payments were successively reduced as loan amounts were increased. The period of amortization increased from fifteen years in 1946 to twenty, then twenty-five, and then to its present length of 35 years or more to enable lower-income families to acquire a home of their own. If anything, this was the heart of our housing policy during the past thirty years,

In the implementation of this course of action, Canada was trans- formed from a nation of tenants to a nation of homeowners, with the exception of Quebec. This was a fundamental revolution in our living patterns and a tremendous stimulus to the development of our national economy. Most of our population growth between 1951 and 1961 was located in old or new municipalities which developed on the fringes of existing towns and cities. During the decade in question population increased by 30.2 per cent, but in 17 metropolitan census areas it increased by more than 54 per cent. The population of the central city, as in the case of Toronto, declined, but the adjacent suburban areas increased prodigiously as houses became available.

The house-building industry came to represent a sizeable part of Canada’s annual capital investment, absorbing 2 billion dollars per

36 Canadian Housing Policies (1935-1980)

annum by 1965. Fluctuations in this industry affected, or were affected by, national economic and monetary policies. At least half-a-million jobs were directly involved with, and two or three times as many were dependent upon, the house-building industry, an industry devoted until the late 1950s to the production of one main product: the single family detached house on vacant land, the only type eligible for National Housing Act financing.

A national housing policy dedicated to a single objective neglected public intervention in rental accommodation for families in the lowest third of the income distribution. When a substantial degree of national resources and effort is devoted towards making every Canadian family a house owner, then there is a special kind of label, a special taint or blight to be placed upon those families who, despite all the favourable manipulations in the basic policy, cannot afford a house of their own. In such circumstances, the only possible conclusion to be drawn by many right-thinking men is that those who cannot benefit from these policies must be, in Galbraith’s words, the victims of “case poverty”.!°

Case poverty is commonly and properly related to some characteristics of the individuals so afflicted. Nearly everyone else has mastered his environment; this proves that it is not intractable. But some quality peculiar to the individual or family involved — mental deficiency, bad health, inability to adapt to the discipline of modern economic life, excessive procreation, alcohol, insufficient education, or perhaps a combination of several of these handicaps — have kept these individuals from participating in the general well-being.

These pervasive influences have taken a long time to overcome in the Canadian housing picture and it was only with the assumption of a stronger role by several provincial governments in the 1960s that the tide began to turn. Even so, progress can only be described as moderate in a nation in which, in the late 1960s, not more than 5 per cent of its annual housing starts of some 175,000 were devoted to public housing; and this proportion was attained only in 1967 after years of less adequate provision.

THE FIRST DECADE OF PUBLIC HOUSING: A SUMMING UP

Fifteen years of meetings and discussion, of speech-making and brief-writing, of presentations to provincial ministers, federal officials, local municipal councils, and groups of businessmen and service clubs, had resulted, by 1960, in the construction of not more than 10,000 to 12,000 public housing units, depending upon how the count was made. Some estimates of total public housing production included dwellings

Housing Policy in Canada, 1940-1968 37

constructed for occupancy by elderly persons or so-called “limited- dividend” housing, other counts did not. It would be safe to insist that no matter how the estimate was derived, the total number of such dwelling units available for rent to low-income families did not exceed 15,000 in 1960.

Not only was there great discouragement at this meagre quantitative achievement of the years 1949-1959, but by this time Canada was in the midst of a severe economic recession which lasted well into 1963. Both the federal government and those provincial governments who had participated in the federal-provincial housing partnership during the 1950s discontinued their encouragement of additional programs and stood pat with those programs already under way and in the process of construction. The result was even greater discouragement for those voluntary associations and professionals who had hoped that a vast program of public housing activity would have been mounted by this time in many metropolitan areas. On the contrary, only thirty- eight dwelling units (the last to be completed in the Lawrence Heights project) were actually completed for occupancy by low-income families in the metropolitan area of Toronto during the years 1958-1963. Waiting lists grew only at a moderate rate because eligible families realized that it was futile to make application for accommodation that did not exist and for which there was no hope of attainment.

By 1961 it was clear to all interested parties that the federal- provincial partnership had collapsed. It was not only that its total accomplishment was grossly insufficient, but very little had been ap- proved and no future programs were evident after the downturn in Canadian economic activity during the winter of 1957-1958. Under the circumstances, some persons concluded that the answer to the stalemate lay in an entirely different approach through an elevation of the role of the local housing authority. It was pointed out that such authorities in the United States had a great deal more power than similar bodies in Canada, that they raised their own funds at relatively low interest rates through the issuance of tax-exempt bonds, that they produced their own programs and plans for several years ahead (sub- ject to the approval of federal and state authorities), that they acquired land, hired architects, developed plans, let contracts and, in general, acted as Central Mortgage and Housing Corporation was attempting to act on behalf of an entire nation.

In Metropolitan Toronto the drive towards a rejuvenated local housing authority was shaped by a number of lay and professional persons in the voluntary services and by elected and appointed officials at the political level. The chairman of the Metropolitan Toronto Council lent additional support to the creation of a new regional or metropolitan-wide Housing Authority which would absorb all existing

38 Canadian Housing Policies (1935-1980)

authorities in the area: two organizations involved in public housing for families and two in the form of Limited-Dividend Housing Corpora- tions devoted primarily to the production of housing for the elderly. In 1962 the view spread and gained credence that the federal govern- ment was prepared to amend the National Housing Act to encourage the growth and development of such comprehensive regional author- ities by permitting direct access to federal funds available under certain sections of the Act such as: Section 16 (Limited-Dividend), Section 23 (Urban Redevelopment), and Section 36 (Federal-Provin- cial Projects). Hopes were high at this time but they were dashed by a series of disasters, including the deaths of the federal minister responsible for housing affairs, the president of Central Mortgage and Housing Corporation, and the director of the Housing Branch of the Department of Economics and Development in Ontario.

In 1964 the Government of Ontario, aware that the National Housing Act would in fact soon be amended to encourage the assump- tion of significant responsibilities by local or provincial authorities, developed the concept of a provincial housing corporation and created this agency with the passage of the Ontario Housing Corporation Act in June 1964. In the same month, amendments to the National Housing Act revolutionalized the approach to public participation in the pro- vision of accommodation to low-income persons.!?

THE 1964 AMENDMENTS: A TURNING POINT IN CANADIAN HOUSING POLICY

The 1964 amendments, which virtually re-wrote most of the social provisions of the National Housing Act, included the following signi- ficant changes.

1. A new Section 16A was added to authorize loans to non-profit corporations owned by. a province, municipality or any agency thereof, or by a charitable corporation for the construction or purchase of a housing project or housing accommodation of the hostel or dormitory type for use as a low-rental housing project. This amendment may be considered to be a substantial expansion of the former Section 16, the so-called “limited dividend section”, but of most significance is the implication that the governments of the provinces would enter into this specific activity.

2. Part III of the National Housing Act was re-titled “Urban Renewal” as distinct from its previous designation of “Urban Redevelopment”. This part of the Act which had, from 1954, been comprised entirely of Section 23 was substantially re- written. This was the first time the phrase “urban renewal” was

Housing Policy in Canada, 1940-1968 39

written into the National Housing Act and Section 23 was broadened considerably to encompass a broad-gauge approach to the prevention and treatment of blighted and slum areas in urban municipalities.

Specifically, Section 23 was expanded by the addition of new

Sections numbered 23A to 23F. These sub-sections were designed to cover, respectively, contributions for preparation of an urban- renewal scheme, contributions for implementing an urban- renewal scheme, loans for an urban-renewal scheme, insured loans for housing projects in urban-renewal areas, authorization for expenditures from the Consolidated Revenue Fund, and regulations, As far as the governments of the provinces were concerned, Sections 2A, B, and C were most important. Not only were the provinces clearly recognized as the authority which must approve local urban-renewal plans, but the federal govern- ment agreed to pay one-half of the costs of preparing and implementing such schemes. In addition, Central Mortgage and Housing Corporation recognized for the first time that imple- mentation would require the employment of persons to assist in the re-location of individuals and families dispossessed of housing accommodation by urban-renewal programs. Section 36 of the 1954 Act, which was the first portion of Part VI, entitled “Federal-Provincial Projects,” was re-numbered as Section 35A and Part VI was re-titled “Public Housing”. Although the federal-provincial partnership had been in force since the end of 1949, this was the first time that the phrase “public housing” had appeared in the National Housing Act.

Section 35A was, in fact, a re-statement of the earlier federal- provincial partnership, with the addition of the possible inclusion of hostel or dormitory type housing accommodation in federal- provincial housing projects. The 75-25 division of financial responsibility in both capital costs and Iosses (subsidies) between the federal and provincial governments was continued unchanged. The entire field of public housing operations was broadened substantially with the enactment of new portions of Section 35 numbered 35B to E. In Section 35B the term “public housing agency” was defined to include a corporation “wholly owned by the government of a province or any agency thereof”, or “one or more municipalities in a province”. This revised definition, along with the new financial provisions in Sections 35 C to E, brought the Canadian provinces directly into the field of public housing for the first time in our housing history.

In Section 35C, Central Mortgage and Housing Corporation was permitted to make loans to assist a province, municipality

40 Canadian Housing Policies (1935-1980)

or public-housing agency to acquire lands for public-housing projects. The maximum loan that might be made for this purpose was 90 per cent of the cost of acquiring and servicing the land. Since it was anticipated that a land-acquisition program would soon be followed by the construction of a public-housing project, loans under this section were expected to be for relatively short terms and in no case for more than 15 years.

This new Section was followed by another, Section 35D, which permitted the federal agency to make loans to provinces, municipalities and public housing agencies “to construct, acquire, and operate public housing projects”. Loans made under this Section were to be subject to conditions similar to those applying to limited dividend housing companies and to non-profit corpora- tions. In short, these loans could not exceed 90 per cent of the cost of the project as determined by the Corporation and would be for a term not exceeding fifty years from the date of completion or acquisition of the project. Finally, in the third new section, Section 35E, the federal Corporation was authorized to make contributions towards the operating losses of subsidized public- housing projects owned and operated by a provincial, municipal and public-housing agency for the benefit of persons of low income. The maximum federal contribution was set at 50 per cent for a period not in excess of fifty years.

In these new sections the National Housing Act was slanted in the direction of new forms of initiative by local or provincial governments. Clearly, the terms available in the completely revised Section 35 under the rubric “public housing” were far more favourable than the terms provided in the familiar federal- provincial partnership (although these provisions were retained as an alternative if desired by any provincial jurisdiction). The increase in the proportion of capital contributions was, of course, accompanied by a decrease in the proportion of subsidies which the federal government would pay; the amount of the subsidies however had rarely appeared to be a major consideration affecting the decisions on public housing of municipalities and provinces. The capital contribution, however, had been an important deter- rent to local initiatives in most municipalities.

Although it may not have been apparent in June 1964, the amend- ments passed that month proved to be a turning point in Canadian housing history. From that time on the whole question of whether slum or blighted areas were to be cleared, the social questions accompanying the processes of re-housing and relocation, the whole question of whether low-income persons and families were to be offered decent and adequate housing at a price they could afford — these and numerous

Housing Policy in Canada, 1940-1968 41

related social questions were put squarely in the laps of the provincial governments. Their response during the ensuing years has been a clear indication of their motivation, or lack of it, in the face of the most opportune circumstances ever put before the network of intergovern- mental organizations in this country. The roles of these governments have become much clearer and, in the light of recent experience, it is now possible to speculate upon the respective roles of the three levels of government for the next decade or two.

NOTES

10, J. Firestone, Residential Real Estate in Canada (Toronto: University of Toronto Press, 1951) Table 109, p. 488.

2Canada, Advisory Committee on Reconstruction, Housing and Com- munity Planning, Sub-Committee Report, No. 4 (Ottawa: King’s Printer, 1944).

’Canada, Advisory Committee on Reconstruction, Report on Social Security for Canada, prepared by L. C. Marsh, (Ottawa: King’s Printer, 1943).

4Central Mortgage and Housing Corporation Act, 9-10 George VI, c. 15, 1945. The corporation began its operations on January 1, 1946.

S“Housing in Canada, 1946-1970,” A supplement to the 25th annual Report of Central Mortgage and Housing Corporation (Ottawa: 1970) pp. 10-11.

®[bid., pp. 11-13. Ubid., p. 12.

SAlbert Rose, Regent Park: A Study in Slum Clearance (Toronto: University of Toronto Press, 1958) pp. 63-68.

®1bid., pp. 100-102.

10. K. Galbraith, The Affluent Society (Boston: Houghton, Mifflin & Co., 1958) pp. 325-331.

11M. Dennis and S. Fish, Programs in Search of a Policy: Low Income Housing in Canada (Toronto: Hakkert, 1972) pp. 145-146.

12An Act to Amend the National Housing Act (1954). 13 Elizabeth II, c. 15, §. 8. June 1964.

CHAPTER 4

National Housing Policy for an Urban Canada: The 1970s and Thereafter

The development of housing policies for Canada, appropriate for the last three decades of the twentieth century, really began with the election of the first Trudeau government in 1968. Pierre Elliot Trudeau is an urbane man; he is also an urbanite, a native of the largest metro- politan area in Canada, whose thinking has been deeply influenced by the urbanization of this country since his birth in 1919. In the election campaign of 1968 the new leader of the Liberal Party promised very significant attention to the problems of Canadian cities. In August of that year, shortly after his election, Trudeau asked one of his best known cabinet ministers, Paul Hellyer, who had been given respon- sibility for housing, to lead a Task Force on Housing and Urban Development.

THE TASK FORCE ON HOUSING AND URBAN DEVELOPMENT 1968-1969

The chairman of the Task Force asserted that his approach would not be that of a Royal Commission which might take two or three years to investigate every facet of its terms of reference and produce a massive report. He emphasized speed and set as his goal the com- pletion of a study within three to four months, and the production of a

43

44 Canadian Housing Policies (1935-1980)

teport within six months. The chairman was himself a housebuilder and land developer who had become independently wealthy: he had been first elected to the House of Commons at the age of twenty-five. He was known to be strong, energetic, impatient in some of his approaches; and many journalists suspected that his mind was already made up about solutions to Canada’s housing problems. A seven- member task force was quickly assembled and set to work with a relatively small staff. In addition to Paul Hellyer, the members of the task force were Dr. Doris Boyle, Dr. Pierre Dansereau, W. Peter Carter, Robert Campeau, Dr. James Gillies, and C. E. Pratt.

Throughout the fall of 1968 it travelled from coast to coast and held hearings in a great many large and small urban centres as well as in certain rural areas. True to its chairman’s word, the members of the task force swept into town like a whirlwind, occupied the local schoolhouse auditorium for several hours on one or more evenings, toured and visited housing projects, heard briefs which had been submitted in advance and the special arguments of voluntary organiza- tions, and quickly swept out of town. In the course of its sessions the task force resorted to such unscientific strategies as asking for a show of hands to determine whether those in attendance wished to own their own homes rather than continue as tenants, roomers or boarders. In addition, the chairman commissioned certain studies from consulting firms who were provided with scarcely sufficient time to undertake acceptable research investigations. These methods were part of the reason for the debacle which ensued when the task force report was ultimately tabled in Parliament on January 22, 1969.1

The essential responsibility of the task force was to establish the requirements for and the limits of a federal role in the rapidly expanding urban society. It is entirely clear that both the prime minister and the chairman were convinced that the future of the Liberal Party lay in its response to the needs of an urban society. In 1961 the Census of Canada had reported that Canadians were 69.7 per cent urban dwellers; by 1971 this proportion had increased to 76.1 per cent.? Even without the benefit of the latter data, all parties in the House had the advantage of the projections of the Gordon Commission, which reported, in 1959- 1960, that Canada would be almost entirely urbanized by 1990, if not some years before,*

In the 1960s the federal-provincial arrangements in the fields of housing and urban development had been oriented towards the provinces assumption of their constitutional roles. The federal government’s responsibility was to provide financial resources within a series of programs which also required provincial and perhaps municipal con- tributions, to set standards that would create more or less similar patterns of inter-governmental relationships and of public housing

National Housing Policies for an Urban Canada 45

throughout the nation, and to ensure that the requirements of the Naional Housing Act were met in both substance and spirit.

Within four years of the passage of the major 1964 Amendments to the Act, it was clear that these federal roles would consign the Government of Canada, and the party in power, to a minor position in a nation of thirty million or more urban dwellers. Urban development in Canada was bound to accelerate during the 1970s and 1980s if the nation’s economic potential was realized, if the level of net immigration was maintained at some moderate level (say 150,000 to 170,000 per annum), and if Canada was to maintain its position as a nation with one of the highest living standards in the world, a major partner in the United Nations and NATO.

These were no longer the most significant agendas. The members of the task force received a substantial number of briefs from across the country, insisting that it was illogical and clearly irresponsible for the federal government to maintain Ministries of Agriculture, Fisheries, and Regional Economic Expansion without creating a ministry charged with the responsibility of providing adequate housing accommodation as well as the related urban infrastructure and services. I presented a brief to the task force on September 30, 1968 in which I argued the case for the creation of a federal Department of Housing.*

It is incredible that in our Western industrial urban society housing and urban development continue to be one of the several (or part- time) responsibilities of a minister of the Crown ... It must be admitted at once that the question of the locus of ministerial respon- sibility is by no means the major reason that Canada has failed to meet all the emerging requirements of housing and urban development during the past quarter-century. Nevertheless, the failure of the Government of Canada to create a department and to name a minister solely responsible for these developments seems indicative of an absence of urgency at the highest levels.

It was clear from the manner in which the task force questioned those who presented or responded to briefs that it was concerned with a number of quite specific concerns:

1. the failure of the Canadian housebuilding industry, Canadian financial institutions and the various levels of government to build adequate supplies of housing at prices that a substantial majority of families could afford to pay;

2. the failure of these institutions to meet the qualitative require- ments of families; to build accommodation for very large families as well as for elderly couples; to build rental housing, particularly in apartment buildings, for families with more than two children;

3. the failure of intergovernmental programs to build more than a

46 Canadian Housing Policies (1935-1980)

token amount of housing leased on rent-geared-to-income scales for low-income families;

4, the failure of Central Mortgage and Housing Corporation to adapt quickly to changing requirements for housing accommoda- tion and other aspects of urban development within a rapidly changing Canadian society; and,

5. the failure of the major urban planning organization within government, in conjunction with architects, private housing and development organizations, and those in the visual arts, to create more interesting, varied and pleasing designs for housing, new towns, and “satellite” communities.

The task force presented its report to Parliament right on schedule. Major recommendations covered financing, land costs and utilization, construction costs and techniques, social housing and special programs, urban development, administrative structure, and research, including the specific proposal that, “the federal government should establish a federal Department of Housing and Urban Affairs.”>

The recommendations can be grouped under four main concerns: to facilitate and expand home ownership; to reduce the cost of housing; to de-emphasize the nature and role of public housing; to suggest the most appropriate forms of urban development during the last quarter of the twentieth century.

The recommendations designed to facilitate and expend home owner- ship included these proposals:

— that the maximum NHA mortgage be increased from $18,000 to

$30,000;

~ that the amortization period of an NHA loan be expanded from

thirty-five to forty years;

~ that a reduction in down payments lead eventually to the prospect

of a nominal $100 down payment or no down payment;

— that the full benefits of NHA legislation with respect to mortgages

on new homes be extended to the purchase of existing homes; ~ that the insurance premium required on NHA mortgages, which amounted to 2 per cent of the purchase price, be reduced to I per cent; and,

— that private lending institutions be consulted once or twice a year by federal officials to insure that they made every effort to channel a sufficient proportion of their investment funds into residential housing.®

The task force proposed a series of measures which, over several years it argued, would cut the high cost of the main components of home ownership: land, building materials, fees, and the cost of mort- gages. It proposed:

— that a capital gains tax be imposed on the speculative profits of

National Housing Policies for an Urban Canada 47

all land sales, including the possibility of a special tax where land transfers occurred without evidence of improvement;

— that the federal and provincial governments should remove all sales tax on building materials for residential construction, with the possibility that this change might begin with the introduction of rebates on materials used in “low-cost housing”;

— that municipalities buy large quantities of land required for urban development within their boundaries and that the federal govern- ment make direct loans to them for this purpose;

— that an investigation be launched into restraint of prices in the building industry and unfair labour practices; and,

— that fees in real-estate transactions paid to brokers, salesmen and lawyers be reduced by some form of voluntary restraint.”

The report devoted ten of its eighty-five pages to a discussion of the inadequacies of some of the older and larger public housing projects in Canada and the social and economic evils that had developed among tenant families. It had been anticipated that, in the wake of the task force’s visit to Toronto’s Regent Park and Trefann Court, the report would blast large concentrations of publicly-housed families. Yet the recommendation that no more large projects be built had already been implemented by the Ontario Housing Corporation and was part of the philosophy of the other seven provincial housing corporations and two housing commissions in Canada.

In an analysis published within two weeks of the tabling of the report in Parliament, I argued that,

The task force has clearly put forward a number of recommendations and proposals that can only be termed political, By any form of analysis they constitute an intrusion into the rights and responsibilities of provincial and local governments who, without doubt, are responsible for housing and physical planning within their geographical jurisdiction. The recommendation for forward purchase of land, the recommenda- tion that local governments should be relieved by the provincial governments of at least 80 per cent of the cost of education, the recommendation that local governments (if they have not already done so) should adopt the National Building Code by 1970, the recommendation that regional governments should be set up through- out the nation and that these governments should assume the respon- sibility for purchasing and servicing land for urban development, the recommendation that municipalities should examine and alter their assessment procedures to ensure that speculation in land is no longer fostered by inadequate assessment procedures — all of these are the kind of proposals that Ottawa would choke upon if some provincial commission of inquiry were to recommend a closer examination and alteration of certain areas of federal jurisdiction to assist the meeting of a specific problem.

It is my conclusion that one of the reasons for the formation of the task force was to take away from the new provincial housing corpora-

48 Canadian Housing Policies (1935-1980)

tions, particularly the successful Ontario Housing Corporation, some of the attention and kudos that have been gained through increasingly active provincial initiatives since 1965... . Ottawa has provided 90 per cent of the money but has had little of the credit. On the other hand, the complaints and criticisms about.the chronic housing crisis through- out Canada have been focused on the federal government.®

Within a day or two of the tabling of the report there was major opposition to the recommendations from the general public, the pro- vincial governments, the federal government and thus from within the Liberal Party of Canada. It was not immediately apparent that the Liberal caucus would take serious exception to the report, but within a week there was considerable division of opinion. Although the prime minister never stated publicly his opposition, it became obvious that he and his cabinet had rejected the recommendations of the task force. Within a few weeks Paul Hellyer resigned from the cabinet and within a year left the Liberal Party and crossed the floor of the House.

This outcome of the work of the task force is extremely curious, because the Hellyer Report laid the groundwork and developed the parameters of what became federal housing policy in the first half of the 1970s. Whatever the immediate political climate may have been following the presentation of the report, its salient recommendations have in fact been implemented. Moreover, they were implemented quickly, commencing with the creation of a Ministry of State for Urban Affairs in the 1970-1971 session of the twenty-eighth Parliament of Canada.

A MINISTRY OF STATE FOR URBAN AFFAIRS

A clear recommendation of the task force, that a federal Ministry of Housing and Urban Affairs be created, was implemented within eighteen months. Prime Minister Trudeau had initiated and authorized Ministries of State for a variety of purposes, including Science and Technology, Environment, and Urban Affairs, by a Proclamation of June 30, 1971. Robert K. Andras, was in fact, appointed early in 1970, but his first title was “Minister Responsible for Housing”.

The minister’s first major speech in the House delivered on April 21, 1970 set the tone for a variety of programs in the field of housing which, several years later, are still in the process of development. He proposed the following:?

1. A revised rent-to-income scale for public housing, including specific provisions that: (a) family size would be taken into account in arriving at rents through a reduction of $2 per month for each child after the second; (b) working wives would be

National Housing Policies for an Urban Canada 49

allowed to earn up to $900 per annum (up from the previous limit of $250) before such earnings would be considered income for the purpose of calculating rent; (c) incomes of one-parent families, for the purpose of calculating rents, would be reduced by up to $900 per annum to compensate for the fact that sole- supporting parents do not have the opportunities for additional earnings; and, (d) the maximum proportion of income required as rent in the higher income range would be reduced from 30 to 25 per cent. 2. Social and recreational facilities in both new and existing public housing projects would be eligible for federal assistance. 3. Duly constituted public housing tenant associations would be assisted with grants. 4. A model lease would be developed and incorporated within a revised manual of procedures for housing authorities. 5. Formal training programs in public housing management would be initiated in co-operation with the provinces. The minister also placed a great deal of emphasis on housing design, location and density. On the question of tenant organization and involvement in the management of public housing, he stated,

I am convinced that giving tenants some voice in the administration of their project is a matter of social justice and would help to encourage a new and healthier outlook all around and remove a major cause of many of the difficulties we have experienced to this time.1°

It was established by Parliament that the new ministry, which was not a full-fledged department of the Government of Canada, would be responsible for housing policy. The Central Mortgage and Housing Corporation would be responsible for reporting through the new minister and he in turn would be responsible to Parliament. It was not considered sufficient, obviously, to establish a Ministry of Housing or even a Ministry of Housing and Urban Development; the designation “urban affairs” was surely a far broader-concept than any of the other titles suggested." It is clear why the prime minister chose such word- ing, because no level of government was possessed of the constitutional responsibility in a field as conceptually vague and as boundless as “urban affairs”; though for forty years the major constitutional respon- sibility in the field of housing lay with the provincial governments. It is also clear that the term “urban development” was reprehensible. Perhaps the Liberal Party, conscious of the significance of rural affairs, was determined not to alienate its relatively modest support in rural areas and in the Western provinces by appearing to espouse urban development. Urban affairs surely encompassed more than simply development of our cities.

50 Canadian Housing Policies (1935-1980)

In its first decade the Ministry of State for Urban Affairs was in a process of evolution of role, responsibility and programs.’* Although there had been no formal admission of conflict it was clear that the Central Mortgage and Housing Corporation came under strong attack by the new ministry. The corporation was placed on the defensive, and important staff positions were created by the minister and literally imposed upon the administrative structure of CMHC. The result was confusion, irritation, and conflict between the corporation and the ministry. In the minds of many parliamentarians and interested ob- servers beyond the national capital, the creation of this ministry was an unproductive act.t®

In his two years as minister, Robert Andras truly exercised super- vision over a tooling-up process. The ministry was organized to assist him in policy formulation for the cabinet; a research division was created with sufficient funds to engage a substantial staff and a number of capable social scientists and urban affairs researchers; and, whether it wanted to be or not, the CMHC was reorganized. From the point of view of the critics of the corporation, it was dragged reluctantly into the second half of the twentieth century; to its devoted supporters, it was being emasculated by those forces within government which either opposed its role of the previous quarter-century or felt it should be replaced by some new structure developed within the ministry. There are many persons, within and without government, who sincerely deplore the allocation of socio-economic functions to Crown corpora- tions as they are structures beyond the direct control of Parliament. From this point of view, the creation of a ministry that would exercise some control over the corporation, which had had a relatively free hand in policy formulation and implementation for a very long time, was a step in the right direction.

The first Minister of State for Urban Affairs implemented many of the proposals of the Task Force on Housing and Urban Development, but none was more important than the continued ban on urban renewal activities. In 1968 a substantial number of urban renewal schemes (probably more than thirty in all) were awaiting continued approval and funding in their respective municipalities. Mr. Hellyer, however, imposed a ban on further development of already approved projects pending completion of the study to be undertaken by his task force. It had been hoped that the new minister, following rejection of the Hellyer report, would restore the status quo in the urban renewal process or, at the very least, would enable those projects already under- way to be completed. The government seemed to have accepted the view of the Hellyer task force that urban renewal was a damaging process, a process in which many low-income families were removed from traditional neighbourhoods, relocated elsewhere — sometimes in

National Housing Policies for an Urban Canada 51

public housing but often in older, less desirable and sub-standard accommodation ~ and that better solutions needed to be found for the rehabilitation of the central core.4* Be that as it may, the task force found no new evidence on the subject, nor did it present any solution to the problem of rebuilding the downtown areas of our major urban centres.

It was the ministry’s view, apparently, that the positions adopted by the government during the period September 1968 to March 1969 should be continued pending further intensive studies of urbanization and housing policies. The principal study to emerge!® was a serious condemnation of Canadian housing, planning and urban development policies over the previous three decades. Lithwick, in fact, rejected all the work of the previous quarter century ~ beginning with the amend- ments to the NHA setting up the federal-provincial partnership in November 1949 — as futile gestures which were at best anti-social. He had, of course, the advantage of hindsight, because as a relatively young academic (he had been an elementary school pupil in the post-war years) he could scarcely have appreciated the problems of passing new legislation and persuading the Canadian public in 1948-1949 that government should intervene in the housing market on behalf of low- income or disadvantaged families and individuals.

Lithwick’s study was and remains the most comprehensive analysis of the process of urbanization ever undertaken in Canada. It was both highly conceptual and thoroughly empirical. The conceptual analysis was bolstered not only by the available data up to and including the censuses of 1961 and 1966 but also by detailed forecasts of such major components of urban development as housing demand and transporta- tion requirements.

It is significant that the final section of this document, which became known as “The Lithwick Report”, emphasized the. notion of “policy” under the general rubric of “Urban Prospects and Policy”. The section dealing with “housing in the urban future” forecast housing demand in eleven major metropolitan areas from Halifax to Vancouver to the year 2001. Total demand, moreover, was broken down between family and non-family.

The grim picture which emerged from the forecast visualized required additions to the housing stock for major metropolitan areas alone of more than 800,000 dwelling units in the 1970s, nearly 900,000 in the 1980s, more than 950,000 in the last decade of the century — a total of 2,651,000 between 1971 and 2001. This forecast, disregarding the requirements for the balance of the population residing outside the major metropolitan areas studied in 1970, meant a two-thirds addition to the total existent Canadian housing stock at that time.

Publication of the Lithwick Report and six significant research

52 Canadian Housing Policies (1935-1980)

monographs created somewhat of a sensation in 1970-71 as Robert Andras began to interpret the federal role for urban affairs. Lithwick and some of his colleagues, as well as the minister, were in great demand to speak at universities, to participate in seminars, and to address annual meetings of major trade associations in the housing and building industry, until the awful truth emerged in late spring of 1971: neither Lithwick nor Andras had any real solution to the problems of urbanization and the enormous housing requirements of the last third of the twentieth century. In a seminar sponsored by the Centre for Urban and Community Studies at the University of Toronto, Professor Lithwick not only decried the value of most urban research in Canada (a good deal of which had been undertaken by members of his audi- ence), but offered as a solution to the problem of urban growth federal restriction on immigration to Canada. His audience found this a very weak answer to the problem.’*

Within a few months it seemed apparent that the impact of Lith- wick’s major analyses of urban prospects and policies had not been enthusiastically received by the cabinet (insofar as Robert Andras had presented the material to his senior colleagues). In a strongly worded statement issued to the press in early summer 1971, Professor Lithwick ceremoniously resigned from his post as Assistant Secretary (equivalent to senior Assistant Deputy Minister) in the Ministry of State for Urban Affairs. In his explanation he emphasized his frustration at the painfully slow evolution of federal housing policies and went so far as to indicate that he saw very little prospect of a strong federal initiative in con- trolling and directing the course of Canadian urban development during the balance of the century.

The second significant research venture by the Ministry was a contractual arrangement with Michael Dennis and Susan Fish. They embarked upon a major study of housing policies in Canada which apparently so disturbed the government in confidential draft form that the ministry was reluctant to publish it. A short time thereafter a full copy was leaked to one of the opposition parties in the House of Commons and a great many allegations based on it were made by the leaders of the two opposition parties. The government was firmly criticized for refusing to publish the document, and soon thereafter Dennis and Fish enlisted the services of a Toronto publishing house and issued their report.17

There is no question that the Dennis and Fish Report, as it became known, is the most comprehensive analysis of the housing problem in Canada since the publication of the Curtis Report in 1944.18 The tone which permeates the entire report is one of frustration, anger and belligerence. The authors delve into several facets of the housing problem, including interest rates, the shortage of serviced land, and,

National Housing Policies for an Urban Canada 53

inevitably, poverty and low-income among that substantial segment of Canadians whose housing accommodation is grossly inadequate.

Lithwick, as an economist, had berated not only politicians but his academic colleagues and predecessors for their gross neglect of the economics of urbanization. Dennis and Fish continued this onslaught on a wider front involving all social scientists and the entire society for its neglect of the requirements of low-income Canadians, presumably through an undying faith in the “filtering down” process whereby the better housing occupied by middie and upper-middle income groups eventually deteriorated and is made available to the lower-income groups. The authors were, however, fifteen years late in denying the validity of that ancient argument.

The greatest difficulty in accepting the analysis stemming from angry outbursts at the general stupidity and callousness of Canadians rests in the fact that with Dennis and Fish there is no middle ground. In their view, all Canadians have neglected the needs of the poor for decent and adequate housing accommodation; all politicians are primarily interested in rebuilding the core of our urban centres without regard for the impact on those residents who are most likely to be poor, elderly or members of families with many children; and all legislation has been grossly deficient because it is not intended to interfere with traditional housing market operations. In short, all politicians are hand-in-glove with all housebuilders, land developers and subcontrac- tors, for the benefit of the few to the detriment of the needy. Perhaps the authors assumed that there was a significant need for a strong radical posture in describing, dissecting and re-assembling the compon- ents of our critical housing problem. They were not the first to make this assumption .but in the late 1970s they retain the distinction of being the most strident of the critics. It is not difficult to understand that, if indeed he had initiated their study, Robert Andras was under no compulsion to engage in a masochistic exercise by distributing it widely under the government imprint.

In my view, Dennis and Fish ended up in exactly the same position as Lithwick in seeking new fundamental solutions to some of the most complicated problems in Canadian social and economic development. The concluding chapters of their report dealt with a so-called “com- prehensive housing policy” and its administration. They insisted that there must first of all be a statement of national housing goals: providing equal access to decent housing for all Canadians, controlling housing price inflation, improving the environmental quality of all housing, conserving and upgrading the existing housing stock, maximiz- ing the dignity and freedom of choice of the individual user of housing, and creating a decision-making process that is open to user input and whose centre of authority is as close to the user as possible.!®

54 Canadian Housing Policies (1935-1980)

It is difficult for any student of the subject whose acquaintance pre- dates 1968 to find anything new in these motherhood statements. Moreover, they imply on the one hand conditions which do not exist anywhere in the world (for example, “equal access to decent housing’’), and a national economy which has full control of its development (for example, “controlling house price inflation”).

There is no doubt that Dennis and Fish had an important impact upon new federal housing legislation passed in 1973 and upon the general posture of federal spokesmen in housing and urban affairs. Their report drew sharp attention to the socio-economic inequities in the provision of housing in Canada. It emphasized and documented the gross disadvantages of Canadian individuals and families in the lower half of the income scale. It pointed to conflicts between national policy statements on the one hand and national housing programs on the other; and between several departments of the Government of Canada whose policies affect housing and urban affairs, and Central Mortgage and Housing Corporation. In short, Programs in Search of a Policy provided a sufficiently long and difficult agenda for the new Ministry of State for Urban Affairs that the latter could well have occupied itself in a decade of policy responses; but time and events do not stand still and new situations in the housing market were soon to push the report into the background.

THE 1973 AMENDMENTS TO THE NATIONAL HOUSING ACT

The sequence of dramatic events since the election of the first Trudeau government in 1968 — the appointment of the Task Force on Housing and Urban Development and rejection of its report; the appointment of Professor Lithwick, the publication of several major research monographs and rejection of Lithwick’s recommendations; the appointment of Michael Dennis, publication of the Dennis and Fish monograph and rejection of its policy recommendations ~ led to a clear expectation of major changes in federal legislation. In 1972 the second Minister of State for Urban Affairs, Ron Basford, introduced into the House a draft bill containing a series of important new initia- tives, all of which died on the order paper when the prime minister called an election for early fall. The fact that the Trudeau government was returned with only a two-seat advantage over the Conservative Party and was forced to rely on the New Democratic Party to maintain its position as the Government of Canada had two important conse- quences for prospective housing legislation. On the one hand, wide- spread political confusion made it inevitable that amendments to the NHA would not be among the highest priority legislation; on the other

National Housing Policies for an Urban Canada 55

hand, the enormous interest of the NDP (which held the balance of power) in all forms of social legislation ensured that new housing legislation could not be long delayed.

Early in 1973 Parliament passed a substantial series of amendments to the NHA (which continues to be cited as the National Housing Act, 1953-54, c. 23, S. 1). A detailed examination of the 1973 consolidation reveals 36 amendments.*° Many of the changes are in the nature of legislative housekeeping and require no further explanation. Let us turn to the minister’s exposition of what he termed “New National Housing Act Programs”.** In a strong effort to make the most of the 1973 amendments, ten new programs were identified. These will be described in the order in which they appeared in the minister’s publicity kit distributed widely throughout the country.

(1) Assisted Home Ownership (new Sections 34.15 and 34.16)

These sections were introduced into the Act under Part IV.2 as “Loans to Facilitate Home-Ownership”. In a real sense, such changes derived from Central Mortgage and Housing Corporation’s traditional responsibilities in the field of direct lending whereby loans could be made to individuals living in geographical areas where conventional mortgages were not available. The major change, however, is simply that the AHOP was directed towards lower-income families with one or more dependent children. The minister’s explanation of objectives and methods was as follows.

Assistance is provided in accordance with a graduated scale of adjusted family incomes. As family income decreases in the income scale, assistance increases progressively. Following interest rate adjustments down to CMHC’s lowest rate, a maximum grant of $300 per annum is available to make further reductions in monthly charges.

The objective is to enable families to own a house without spending more than 25 per cent of their gross income in meeting the monthly costs of mortgage loan repayments and municipal taxes. Regular home- owner housing, housing built on leased land or condominium forms of housing all qualify under the program.??

AHOP was considered by both federal and provincial officials to have been a substantial success and a significant legislative innovation. There are, in fact, two parts to the “assistance” available under the scheme: firstly, an interest reduction loan (literally a second mortgage) designed to reduce the effective rate of interest from current levels to 8 per cent. The intent was to reduce the amount of total family income required to meet debt service charges within a 25-30 per cent ratio of

56 Canadian Housing Policies (1935-1980)

shelter costs to gross income, depending upon the specified maximum sale prices in difficult localities. The loan is repayable after six years.

The second form of assistance to the purchaser was a direct grant (originally $300 per annum) to a maximum $750 per annum to further reduce the burden of shelter costs on moderate-income families. This grant could bring families with incomes of $800-$900 per month into the market. Success of these concepts is attested to by the action of the governments of Nova Scotia (1974-1975) and Ontario (1976- 1977) to add an additional grant to the subsidy. In Ontario’s case a further $750 per annum was possible in the first year, one implication being the potential entry into home ownership of families with $7,000 — $8,500 per annum.

CMHC attributed an important part of the successful 1976 home- building program to AHOP in its assessment of that year’s activity:

Housing starts in 1976 totalled 273,203 units, up from 231,456 in 1975 and above the previous record of 268,529 in 1973 . . . Private insti- tutional lending for new residential construction increased from $4.7 billion in 1975 to $6.5 billion in 1976, or by 38 per cent. This increase was almost entirely attributable to increased NHA activity, and parti- cularly to the AHOP and ARP (Assisted Rental) Programs .. . The demand for mortgage funds for new residential construction was strong throughout 1976 . . . The strength in the second half of the year was due in large part to the AHOP and ARP Programs.?4

The danger in AHOP rests in its fundamental reliance on continued price inflation in the Canadian economy. For the low or moderate-income purchaser of an AHOP-financed home there are two important require- ments which come into sharp focus six years after purchase. First of all, repayment of the interest reduction loan must commence in the seventh year, and at the rate of interest then prevailing. This rate could be 3 to 5 percentage points higher than the 8 per cent rate for the first five years. Clearly, the purchaser needs a substantially higher income than the one prevailing at the time home ownership commenced. Inflation will likely be a prerequisite to the attainment of such income. The second requirement is a sufficient rise in all prices and thus allowable or attainable incomes, to permit the purchaser to maintain a reasonable debt service ratio,

The future did not bode well for AHOP participants. If the prospects for new growth and development and thus the prospects for expanded employment were encouraging, the assumptions governing the program might be reasonable. All the forecasts of the late 1970s, however, appear to indicate that economic growth for the early to mid-1980s will be relatively modest and that unemployment will remain at a level of 8 per cent. Taking this into consideration, it is doubtful that appro-

National Housing Policies for an Urban Canada 57

priate housing policies can be devised to meet the needs of all income groups given statistical projections of an additional 150,000 families and/or 220,000 households being formed per annum.?>

(2) Non-Profit Housing Assistance (new Section 15.1)

The purpose of this amendment is “to make it easier for non-profit housing organizations to develop housing projects.” Loans may be made to non-profit corporations of three types: those constituted exclusively for charitable purposes, co-operative associations whose members will make up the majority of those who will occupy the housing, and housing co-operatives owned entirely by a municipality or an agency of a municipality. In all cases the loan may be in an amount equal to the total lending value of the project.?® Moreover, CMHC is enabled to make an additional contribution not exceeding 10 per cent of the capital cost of projects developed by any of these three types of non-profit co-operatives.

(3) Co-operative Housing Assistance

The act was amended in several sections to extend the provisions for co-operative housing and various forms of assistance were added to make it easier for low-income families and persons to obtain housing through co-operative associations. In the past only recognized formal co-operative associations were enabled to secure loans. The 1973 amendments encouraged groups of individuals to organize themselves in co-operatives not only to build new housing but to purchase existing housing and to rehabilitate it.

(4) Neighbourhood Improvement Program (new Part HI.1, S. 27)

In the 1973 act NIP follows immediately upon part III, “Urban Renewal”. This new program is thus a broadened and more deliberate extension of the traditional concepts of clearance and renewal. The new section begins,

For the purpose of improving the amenities of neighbourhoods and the housing and living conditions of the residents of such neighbourhoods, the corporation may make contributions and loans pursuant to this Part to or for the benefit of municipalities in a province.

In the first instance, however, CMHC is required to enter into an agreement with a province for the purposes just described. This require-

58 Canadian Housing Policies (1935-1980)

ment has become known loosely as “the master agreement” which, the legislation states, sets out the criteria governing the selection of neigh- bourhoods and, in general, prescribes the procedures under which applications are made.

Under the heading “Neighbourhood Eligibility”, the 1973 kit states:

The criteria whereby municipalities and neighbourhoods may participate in this program are set out in agreements between the federal govern- ment and each of the provincial governments.

In general, however, it is expected that participating neighbourhoods

will have the following characteristics:

1. They will be predominantly residential although they may contain local stores, schools, banks, churches, small businesses and perhaps some non-conforming uses of land;

2. A significant proportion of the existing housing stock is in need of improvement and repair in order for it to comply with minimum standards of health and safety;

3. Most of the housing in the neighbourhood is occupied by people of low to moderate income;

4. The available social and recreational amenities are considered to be inadequate.

In the minister’s presentation to Parliament and in a variety of speeches and background papers released by the ministry, NIP is fundamentally the logical expansion of legislation which dates from 1944 in the Canadian housing annals. Some of the very language of Section 12 of the National Housing Act, 1944 and Section 23 of the National Housing Act, 1954, appears almost intact in the 1973 Amend- ments which offered two apparently new programs described as a “neighbourhood improvement programme” and a “residential rehabili- tation programme”.?”

The federal contribution through CMHC is identical with the 50 per cent available thirty years ago for “acquisition and clearance of sub-standard neighbourhoods”. The major difference is that NIP does not contemplate clearance (except as indicated below) but obviously, from its very title, is intended to emphasize “improvement”. The federal contribution is made with respect to the costs of selecting appropriate neighbourhoods, acquiring parcels of land for low-income family dwellings of low density, the acquisition and clearance of land for social or recreational facilities, the construction of such facilities, and so on. The contribution is also intended to assist in the relocation of persons whose accommodation is lost through neighbourhood improve- ment and, finally, the municipal staffing of the entire process. These forms of encouragement and financial assistance encompassed within NIP had been available for some time.

Since 1964 the federal government had also contributed to the costs of improved municipal and public utility services in designated urban

National Housing Policies for an Urban Canada 59

renewal neighbourhoods. This contribution is continued at the rate of 25 per cent but was expanded to include the acquisition and clearance of land “where the existing housing is not consistent with the planned general character of the neighbourhood”. Central Mortgage and Hous- ing Corporation may make further loans of up to 75 per cent of the costs incurred by municipalities which participate in a Neighbourhood Improvement Program.?8

(5) Residential Rehabilitation Assistance Program (Part IV.1)

Rehabilitation as a concept has been a part of the National Housing Act since 1944 and has been one of the least successful aspects of federal housing legislation. The intent in 1972-1973 was to provide a fillip to this aspect of traditional legislation by encouraging the main- tenance and improvement of existing housing stock. It has always been recognized that the vast majority of housing accommodation in Canada has been in the form of existing housing, much of which is forty to fifty years old or even older.?®

In 1973 RRAP was described as a new program. It is difficult to comprehend the newness of the program because it did little more than specify more clearly the nature of eligibility for federal assistance and a new approach in the form of “forgivable loans”. In the previous three decades the major problem with the rehabilitation section of the Act was that those persons who most required financial assistance for repair and improvement of owner-occupied accommodation were the least likely to borrow money, even under relatively generous terms, because they tended to be in families of low income or elderly persons or both. Moreover, those dwellings owned by absentee landlords were not likely to be repaired, since the cost of improvements would mean that rents would need to be raised; in most cases, the landlord could not see this prospect in the neighbourhoods in which he owned such accommodation.

The minister’s program of 1973 specified that eligible homeowners could not earn more than $11,000 per year. Up to $5,000 per dwelling unit could be borrowed at a less than the normal rate of interest (this represented an increase in the maximum lending value of $1,000 per dwelling unit, whereas for nearly two decades $10,000 per dwelling unit had been available under the United States legislation) .®° If the Canadian homeowner earned less than $6,000 per annum, a portion of the loan did not have to be repaid provided that the owner continued to occupy and maintain the accommodation. In the range $6,000 to $11,000 per annum the forgiveness portion was progressively reduced as income increased.*

60 Canadian Housing Policies (1935-1980)

Landlords who agreed to accept rent controls were also eligible for assistance under RRAP, together with non-profit corporations and co-operatives. There was, however, a very important restriction: the dwellings to be rehabilitated, whether owner-occupied or owned by absentee landlords, had to be located in Neighbourhood Improvement Program Areas; if they were in other areas they could be included only by special agreement with the province concerned. Non-profit corporations and co-operatives, however, could purchase older accom- modation, renovate it, and make it available regardless of its location.®* A good deal of the additional funds allocated in recent years are, in fact, accounted for by the activity of non-profit housing corporations.

In 1973 the NHA was amended by the addition of the important Section 34.1(3), which stated that no loan would be made under RRAP unless the province of the municipality “has adopted occupancy and building maintenance standards satisfactory to the Corporation”.

(6) Land Assembly Assistance

The minister announced as his “sixth programme”, assistance avail- able under Sections 40 and 42 of the NHA to provinces and munici- palities wishing to assemble and develop land for residential and associated purposes, or “to establish land banks for future development of a predominantly residential nature”. The language of Section 40(1) is almost word for word the language incorporated in Section 35 of the NHA in the significant amendments of November 1949. What, then, is new about land assembly when in the Metropolitan Toronto area, for example, such vast land acquisitions as Malvern, Bathurst- Lawrence, Keele and Steeles (now accommodating both York Uni- versity and a major public housing development known as Edgeley Village) were undertaken between 1950 and 1952?

Since 1964 there has been a great deal more emphasis on the concept of “land banking”, which appeared so beneficial in its potential that it could scarcely be opposed by politicians, public servants, and members of voluntary organizations. The objectives of land assembly assistance included an improvement in the supply of land, a reduction in the rate of interest with respect to the cost of serviced land, and a program which would be scaled and timed “to assist the implementation of municipal, regional and provincial growth policies”. What is involved in attaining these objectives is simply the forward purchase of land, since the price of land in a rapidly urbanizing society is bound to increase. The costs to government in the acquisition and clearance, and the ultimate subsidies required to provide housing accommodation to needy families, will also increase considerably. The great difficulty was

National Housing Policies for an Urban Canada 61

that by 1973 relatively little land was available for land banking. Spurr has demonstrated that all the major housing development organizations operating in the Montreal, Toronto and Vancouver metropolitan areas either owned or had under option vast acreages of undeveloped or serviced land.** Despite the assistance of the land assembly provisions of Section 42, land banking opportunities were severely limited.

(7) New Communities Program (Part VI.1)

This relatively new legislation expanded the concept of federal- provincial agreements which had been originally introduced in Novem- ber 1949 for the purpose of providing housing for rental to low-income families. The scope of federal-provincial agreements had been broadly expanded in 1954 and again in 1964, but in 1973 the legislation included for the first time the acquisition of land “for a new community, including land to be used for transportation corridors, linking the community to other communities, or for public open space in or around a new community or separating it from any other community.” Such agreements could include assistance in undertaking the planning of a new community and the design and installation of utilities, and other services required for its development.

It must be clear that a “New Communities Program” is an obvious and significant federal thrust in the emerging picture of Canada as an urbanized nation. The Task Force on Housing and Urban Development was quite aware of British and American experiments in the develop- ment of new communities, and Paul Hellyer in particular made a number of public addresses on this subject. Long before the report of the task force was tabled, its chairman was on record as an advocate of “satellite communities” and his report of January 1969 included recommendations on the subject. In that sense the inclusion of a New Communities Program in the 1973 amendments is a further example of the government’s implementation of the recommendations of the task force, despite the formal rejection and ignominy suffered by its chairman.**

(8) Developmental Program

In Part V of the act, “Housing Research and Community Planning”, an amendment to Section 37 was introduced to enable the federal government to play a more significant role in the development of new and innovative solutions to Canadian housing problems. This read,

62 Canadian Housing Policies (1935-1980)

The corporation may undertake or cause to be undertaken projects of an experimental or developmental nature that may assist the corpora- tion in the formulation and implementation of a housing policy designed to meet the needs of the various communities in Canada.

The ministerial statement defined the developmental project as one in which new forms of housing, new community designs, new methods of providing services, and new social relationships “are put into prac- tice, so that their efforts can be seen and tested.” The fact is that financial assistance for research in these areas has been available since the introduction of Part V in the act. The particular specification of the notion of a developmental program was not included but there is certainly a good deal of evidence that many innovations in community planning have been delineated in social research funded by CMHC.*®

(9) Housing for Indians on Reserves

The Government of Canada has a specific responsibility for Canadian status Indians who live on reserves, and this responsibility has included the provision of new housing within the programs of both the Depart- ment of Northern Development & Indian Affairs and the Central Mortgage and Housing Corporation. Section 59 of the NHA was amended in 1973 to authorize the corporation to “make loans to Indians, as defined in the Indian Act, for the purpose of assisting in the purchase, improvement, or construction of housing projects on Indian reserves.” The objective of this change was to extend to Indians access to housing by the provision of a mini-program of residential rehabilitation on the reserves.

(10) Purchaser Protection

Finally, the minister indicated that it was the policy of his government “that home buyers should benefit from the same kind of protection available to purchasers of other goods in today’s economy.” In short, the government was examining the possibility of developing a national warranty system and to this end amended Section 8.1 of the NHA.

Section 8 had previously made it possible for the corporation to make a contribution to a purchaser from the Mortgage Insurance Fund when the builder had failed to complete the construction of a house which was insured through the provisions of the National Housing Act. The purpose of the contribution had been restricted to enable the purchaser to complete construction of the house. In 1973 the legisla-

National Housing Policies for an Urban Canada 63

tion was amended to include bankruptcy of the builder prior to com- pletion of a unit. Central Mortgage and Housing Corporation could make available to the prospective purchaser sufficient funds to discharge any liability which he had incurred with respect to liens or “privileged claims affecting the house.” This change was a major step in the direction of a home warranty system but the minister expected that further efforts would be required, and he indicated that the government intended to proceed with a “home protection development plan”.

In 1976 the Government of Ontario passed legislation to enable the Housing and Urban Development Association of Canada (HUDAC) to establish a warranty program.** Builders were required to join the scheme and to pay a fee for participation, or forfeit certain opportun- ities within the building programs of the Ministry of Housing and the Ontario Housing Corporation. The legislation protects the purchaser of homes built by members of the plan by guaranteeing that certain deficiencies attributable to the work of the construction company will be rectified. There is no similar legislation in other Canadian provinces but there are warranty plans and programs in which HUDAC and other organizations play important roles and assume significant responsibilities.

A BRIEF ASSESSMENT

In 1973, there was clearly an intention on the part of the ministry and its senior agency, CMHC, to pursue certain traditional initiatives with more vigour and flexibility. For the most part, the programs themselves are more flexible interpretations of legislation dating back to the National Housing Act of 1944. For example, the Neighbourhood Improvement Program is a modern version of slum clearance and urban renewal and the Residential Rehabilitation Assistance Program is the modern version of the home improvement loan program which first became available with the inclusion of Part IV, Home Improvement and Home Extension loans, in the 1944 act.37

The recent additions to the program raise a further caveat which may be more significant than an assessment that could be interpreted by federal officials as mere quibbling over words. The fact is that all these programs are administered by the Central Mortgage and Housing Corporation. It is never clear to either the casual or the professional observer of such federal-provincial programs whether federal officials, for whatever reason, are fully or only partially in support of programs introduced by the ministries concerned. It was not at all clear that the Ministry of State for Urban Affairs and the CMHC were at one which each other as policy agency and implementation agency respectively.

64 Canadian Housing Policies (1935-1980)

Nor was it clear that the regulations in such fields as neighbourhood improvement and residential rehabilitation would be interpreted any more flexibly than legislation that had been on the books for at least a quarter of a century.*6

Such municipalities as Vancouver, Edmonton, Winnipeg, Windsor, Toronto, Ottawa, Montreal, Saint John, Halifax, and St. John’s have all been deeply involved in the processes described first as “Slum Clearance” (Section 12 of the NHA 1944), then as “Urban Redevelop- ment” (Section 23, NHA 1954), and later as “Urban Renewal” (Section 23, NHA 1954, as amended 1964). They did not approach NIP in the mid-1970s with the great enthusiasm of an explorer coming across a new diamond field or a new gold mine. Many forms of encouragement and financial assistance encompassed within NIP had been available for some time. Many approaches had been made during the past twenty years by municipalities through their respective provin- cial governments to the federal government through its agency, CMHC.

Some approaches had been fruitful, some had been abortive or frustrated, and some had been facilitated and proved to be disastrous programs. The general impression of provincial and local governmental reception of Ron Basford’s announcements in 1972-1973 was that they were not greeted with enthusiasm or open arms by elected and appointed provincial and municipal officials. Nevertheless, NIP is here and apparently has a thrust that is different; in particular, it is more concerned with social consequences than with the urban renewal schemes developed in accordance with the stipulations of Part II of the NHA 1954, as amended. :

Despite the early skepticism with which the 1973 amendments were greeted, there has been, as the statistical data attest, a substantial upsurge in municipal and provincial activity within the two major programs customarily referred to as NIP and RRAP.*® It is not a question of further legislative changes.*® Rather, it is clear that modi- fications of the regulations and a “selling job” by the minister and his associates stimulated increasing interest, particularly within local gov- ernments in every province and on the part of citizen-initiated housing co-operatives.

NOTES

1Canada, Report of the Task Force on Housing and Urban Development (Ottawa: Queen’s Printer, 1969) pp. 85.

?Science Council of Canada, Perceptions 1: Study on Population and Technology (Ottawa: Information Canada, 1975) Table 1, p. 13; Table 3, p. 15.

National Housing Policies for an Urban Canada 65

8Canada, Report of the Royal Commission on Canada’s Economic Prospects (Ottawa: Queen’s Printer, November 1957) pp. 97-122.

4Albert Rose, A Brief to the Task Force on Housing and Urban Develop- ment (Toronto: mimeo., September 30, 1968) p. 1-2.

5Canada, Report of the Task Force on Housing and Urban Development, p. 72.

8Ibid., pp. 26-37. Udem., pp. 37-45.

8Albert Rose, “Paul Hellyer on Housing: Fact or Fiction?” (The Globe and Mail, February 5, 1969) p. 7.

*Robert K. Andras, “Statement on Public Housing Program”, House of Commons, April 21, 1970, pp. 10.

10[bid., p. 9. The matter of grants and the matter of a voice in the management of public housing were closely related. Tenant associations required funds to develop programs of interest to tenant families and to convince provincial housing corporations or local housing authorities of their representativesness and their capacity to share in a variety of managerial tasks.

“The report of the Hellyer task force recommended a “Department of Housing and Urban Affairs”. The prime minister and the cabinet rejected both the notion of such a department and inclusion of “Housing” in the title of the new ministry.

Late in 1978 Prime Minister Trudeau announced its abolition, pre- sumably in deference to the wishes of the provinces and re-named the corporation, Canada Mortgage and Housing Corporation.

13In 1976, for the first time one person, William Teron, was appointed to the senior position in both the Ministry (as secretary, equivalent to deputy minister) and the Central Mortgage and Housing Corporation (as president). The latter post Mr. Teron had already held for some three years, This dual appointment was clearly intended “to heal wounds” and to tie the corporation more closely to government policy in urban affairs.

14M. Lipman, “Relocation and Family Life’ (Toronto: University of Toronto, unpublished doctoral dissertation, 1968). In a study of the Alexandra Park Urban Redevelopment Project in west-central Toronto, Lipman found that displaced home-owners were forced to add substantially higher amounts to their mortgage debt after expropriation and purchase of another house in a different neighbourhood.

15N. H. Lithwick, Urban Canada: Problems and Prospects (Ottawa: Central Mortgage and Housing Corporation, December 1970).

16Lithwick spoke at the University of Toronto on February 10, 1971.

17Michael Dennis and Susan Fish, Programs in Search of a Policy: Low Income Housing in Canada (Toronto: Hakkert, 1972).

18Canada, Report of the Advisory Committee on Reconstruction (Ottawa: 1944), Vol. IV.

66 Canadian Housing Policies (1935-1980)

19Dennis and Fish, op. cit., p. 349. 20RS. c. N-10, 2. 2-59; 1973. c. 18, S. 1-21.

21Government of Canada, Central Mortgage and Housing Corporation, New National Housing Act Programs, 1973, not paged.

*2First program description, August 1973. 28To about $11,000-$12,000, per annum.

24Central Mortgage and Housing Corporation, Canadian Housing Statis- tics, 1976 (Ottawa: CMHC, 1977) pp. viii-x.

*5Central Mortgage and Housing Corporation, Canadian Housing Statis- tics, 1975 (Ottawa: CMHC, 1976) Table 110, p. 88.

26Total lending value” is a concept utilized by mortgage appraisors to indicate the maximum amount upon which a loan may be based. It is usually less than market values.

27Albert Rose, “Relevance of NIP to Inner-City Areas”, Presentation to the Centre for Urban and Community Studies, (Toronto: University of Toronto, mimeo., September 1973) pp. 27.

28Nevertheless, between 1973 and 1976 grants under NIP (NHA, Sec. 27.2) exceeded $143 million and loans to the provinces under Sec. 27.5 approached $32 million. See Canadian Housing Statistics, 1976, Table 70, p. 62.

29Albert Rose and Donald F. Bellamy, Rehabilitation of Housing in Central Toronto. A report submitted to the City of Toronto Planning Board, September 1966, pp. 1-10.

80The maximum amount which could be borrowed under RRAP was increased to $10,000 in October 1976. The rate of interest was 8 per cent.

81[n 1973 one-half of the maximum loan, that is, $2,500 was forgivable. When the loan maximum was increased to $10,000, the forgivable portion was increased to $3,750, The borrower literally earns a forgivable portion at the rate of $750 per annum and thus reaches the maximum in five years.

®2Home improvement activity increased greatly in dollar volume under RRAP between 1973 and 1978; $319 million were committed in loans by the latter year. See Canadian Housing Statistics, 1978, Table 72, p. 64.

38Peter Spurr, Land and Urban Development (Toronto: James Lorimer and Co., 1976) pp. 111-113; table A-7, p. 411; and table A-8, p. 412. Spurr’s report, described as “a preliminary study”, was commissioned by CMHC in part during 1972-73. The author offered the completed study to the corporation in August 1974 and was hired to develop it for publication. In 1976 CMHC decided not to publish it and James Lorimer and Co. made it available to the public.

34Report of the Task Force on Housing and Urban Development, op. cit. p. 75. In effect, the amount committed between 1973 and 1978 for the program now described as Community Resources Organization (Sec. 36G) was less than 1.9 million. See Canadian Housing Statistics, 1978, Table 72, p. 64.

National Housing Policies for an Urban Canada 67

35A particularly significant example would be the study by A. J. Diamond, “Density, Distribution and Costs” (University of Toronto Centre for Urban and Community Studies, April 1970, mimeographed) pp. 289.

38QOntario New Homes Warranties Plan Act, 1976, proclaimed by Order- in-Council 3365-76, in effect from December 31, 1976.

8TAlthough there has been much greater dollar activity under RRAP since the 1973 amendments, the restriction that borrowers must be residents of NIP areas was a serious deterrent. In 1976 fewer than forty individual homes in the City of Toronto were improved with RRAP assistance. (Inter- view with Director of Community Development, City of Toronto, May 27, 1977).

88Canadian Council on Social Development, Housing Rehabilitation. Proceedings of a conference held November 1973 (Ottawa: CCSD, Decem- ber 1974) pp. 27-29, 106-108.

39Between 1973 and 1978, NIP Grants (Section 72.2) amounted to nearly $202 million and loans (Section 27.5) to more than $64 million. Canadian Housing Statistics, 1978, Table 72, p. 64.

40"There were no legislative changes to the National Housing Act during 1976.” Canadian Housing Statistics, 1976, Housing Legislation and Policy, p. xiv.

CHAPTER 5

New Housing Policy Initiatives by Provincial and Local Governments

The report of the federal Task Force on Housing and Urban Development and the implementation of some of its important recom- mendations cast a serious chill over the development of provincial housing policies at the close of the 1960s. There had been feverish activity within a number of provinces, particularly in Ontario during the years 1967-69. I felt that the report of the task force was, in substantial measure, aimed at the Ontario Housing Corporation and its rapidly increasing program of governmental housing activity within Canada’s largest province.! This allegation was not denied by Paul Hellyer or by officials of CMHC. Rather, the Government of Canada proceeded to initiate a new Ministry of State for Urban Affairs while continuing the freeze (originated by Mr. Hellyer) on more than thirty urban renewal projects across Canada, most of them located within Ontario.

During the years 1970-72, provincial housing programs were thus virtually at a standstill as provincial officials attempted to ascertain and measure the significance of new federal initiatives. On the one hand, Robert Andras (the first minister) began to release modest funds to complete work already underway in urban renewal projects; on the other hand, in the conventional public housing field, the OHC alone was absorbing nearly 98 per cent of all available federal funds by 1969-70. It was certain that the new provincial housing corporations

69

76 Canadian Housing Policies (1935-1980)

elsewhere in Canada would have a claim on these funds and, unless the total allocation by the federal government was increased (through CMHC), the Ontario program would be bound to suffer. At approxi- mately this time the first initiatives from the Quebec Housing Corpora- tion were ready and the President of CMHC announced that $150 million would be made available per annum to the QHC without the necessity of formal approval of each specific program.

This agreement seriously upset the relationships that had been established between the Ontario Minister of Economics and Develop- ment (Stanley Randall), the president of CMHC (Herbert Hignett), and the Minister of State for Urban Affairs (Robert Andras). Ontario felt that, at the very least, it had undertaken its responsibilities since 1964 in strict accordance with federal housing legislation. It had accepted the necessity to seek approval by the CMHC for every housing project in the province in which work was undertaken or was to be undertaken. Within Metro Toronto this involved dozens of approvals following a multitude of inspections: first, of proposals, plans and prices; second, of construction; and finally, of the condition of the particular building or grouping of houses prior to formal take-over by the OHC. These intergovernmental arrangements were well understood in Ontario, since they had been initiated in part during the days of the federal-provincial program at the beginning of the 1950's.

At the very most, what Ontario wanted was the same treatment as that accorded to Quebec through its agency, the Quebec Housing Corporation. This meant that the Government of Ontario would seek a commitment by the CMHC for a block of funds for public housing purposes (whether for rental by families or senior citizens, or for land assembly and servicing of land); and block funding not for only one fiscal year but for three to five years in advance, as was the hope of the new Minister of Economics and Development, Allan Grossman, who had been designated by the Premier of Ontario as Minister responsible for Housing.

This was the climate early in the 1970s as the new amendments to the NHA began to take shape and as the full impact of major federal initiatives in housing policy formulation began to be felt. Although there was considerable irritation, tension and a serious retardation in the rate of progress towards meeting the needs of low-income families and elderly persons throughout the country, the major positive effect was the examination and re-examination of provincial housing policies.

New Initatives by Provincial and Local Governments 71

Table I Statutes for Housing and Planning

FEDERAL National Housing Act, R.S.C. 1970, c. N-10

as amended by 1973-74, c. 18, 1974-75-76, cc. 38, 82. ALBERTA

The Alberta Housing Act, R.S.A. 1970, c. 175 amended 1971, c. 46; 1972, c. 51; 1973, c. 54; 1974, c. 34; 1975, Bill 13.

The Municipal Government Act, R.S.A. 1970, c. 246 amended 1971, c. 74.

The Planning Act, R.S.A. 1970, c. 276 amended 1971, c. 84.

BRITISH COLUMBIA

The Housing Act, R.S.B.C. 1960, c. 183.

Department of Housing Act, 1973, ¢. 110.

The Municipal Act, R.S.B.C. 1960, c. 255 amended 1961, cc. 43, 59; 1962, cc. 36, 41; 1963, c. 42; 1964, c. 33; 1965, c. 28; 1966, c. 31; 1967, c. 28; 1968, c. 33; 1969, c. 21; 1970, c. 29; 1971, c. 38; 1972, c. 36.

MANITOBA

The Housing and Renewal Corporation Act, R.S.M. 1970, c. H160 amended 1970, c. 86; 1971, c. 14.

The Municipal Act, 1970 (Man.), c. 100 amended 1971, cc. 27, 81, 82; 1972, cc. 22, 41, 42.

The Municipal Board Act, R.S.M. 1970, c. M240 amended 1970, c. 92; 1972, c. 81.

The Pianning Act, R.S.M. 1970, c. P80.

The Real Property Act, R.S.M. 1970, c. R30 amended 1970, c. 90; 1971, c. 82; 1972, cc. 37, 82.

NEW BRUNSWICK

The New Brunswick Housing Act, 1967.

The Community Planning Act, 1960-61 (N.B.), c. 6 amended 1963 (2nd Sess.), c. 13; 1964, c. 18; 1965, c. 12; 1966, c. 152; 1968, c. 21; superseded by 1972, c. 7.

The Municipalities Act, 1966 (N.B.), c. 20 amended 1967, c. 56; 1968, c. 41; 1969, c. 58; 1970, c. 37; 1971, c. 50; 1972, c. 49.

72 Canadian Housing Policies (1935-1980) Table I (continued)

NEWFOUNDLAND

The Housing Act, 1966, S.N., c. 87. An Act to incorporate the Newfound- land and Labrador Housing Corporation, April 25, 1967, cited as the Newfoundland and Labrador Housing Corporation Act, R.S.N., 1970, c. 249.

The Local Government Act 1966 (Nfid.), c. 31 amended 1966-67, c. 15; 1968, c. 19; 1969, c. 37; 1970, c. 33; 1971, c. 56.

The Urban and Rural Planning Act, 1965 (Nfid.), c. 28 amended 1969, c. 55. NOVA SCOTIA

The Housing Development Act, R.S.N.S. 1967, c. 129 amended 1969, c. 52; 1970-71, c. 45.

The Home Owner’s Incentive Act, R.S.N.S. 1970-71, ¢. 1.

The Municipal Act, R.S.N.S. 1967, c. 192 amended 1968, c. 41; 1969, cc. 60, 61; 1970, c. 54; 1970-71, c. 52; 1972, c. 46,

The Planning Act, 1969 (N.S.), c. 16 amended 1970, c. 87; 1970-71, c. 71.

The Towns Act, R.S.N.S. 1967, c. 309 amended 1968, c. 58; 1969, cc. 77, 78; 1970, c. 72; 1970-71, c..59; 1972 ¢. 55.

ONTARIO

The Housing Development Act, R.S.O. 1970, c. 213; as amended by 1972, c. 129; 1974, c. 31; 1976, Bill 64.

The Ontario Housing Corporation Act 1964, c. 76; RS.O., c. 317.

The Ministry of Housing Act, 1973, c. 100; as amended by 1974, c. 14.

The Municipal Act, R.S.O. 1970, c. 284 amended 1971, c. 81 and c. 98, s. 4 Sched. para. 23; 1972, cc. 121, 124, 169.

The Planning Act, R.S.O. 1970, c. 349 amended 1971, c. 2; 1972, c. 118.

New Initatives by Provincial and Local Governments 73 Table I (continued)

PRINCE EDWARD ISLAND

The Prince Edward Island Housing Authority Act, 1966; R.S.P.E. 1974, c. 33; repealed by the Housing Corporation Act, 24 Eliz. II, 1975, ¢. 14.

The Planning Act, 1968 (P-E.I.), c. 40 amended 1969, c. 35; 1970, c. 38; 1971, c. 30.

The Town Act, R.S.P.E.I. 1951, c. 162 amended 1952, c. 45; 1953, c. 46; 1959, c. 26; 1960, c. 42; 1961, c. 39; 1963, c. 31; 1964, c. 32; 1966, c. 41; 1968, c. 55; 1970, c. 51; 1971, c. 56.

The Village Service Act, 1954 (P.E.1.), c. 39 amended 1956, c. 45; 1957, c. 37; 1959, c. 31; 1960, c. 46; 1961, c. 43; 1962, c. 39; 1963, c. 35; 1964, c. 36; 1965, c. 28; 1966, c. 45; 1968, c. 60; 1969, c. 51; 1971, ¢. 56,

QUEBEC

The Quebec Housing Corporation Act, (Loi de la Société d'habitation du Québec) 1966-1967, ¢. 55; as amended by 1971, c. 56; 1971, c. 57; 1974, c. 49.

The Cities and Towns Act, R.S.Q. 1964, c. 193 amended 1966-67, c. 54; 1968, cc. 17, 53, 54, 55; 1969, cc. 55, 56; 1970, cc. 46, 47; 1971, c. 55.

The Municipal Code amended 1963, c. 65, s. 5. SASKATCHEWAN

The Housing and Urban Renewal Act, 1966, repealed by the Saskatchewan Housing Corporation Act, 1973, R.S.S. c. 93.

The Senior Citizens’ Home Repair Assistance Act, 1973, R.S.S., c. 103.

The House Building Assistance Act, 1974, c. 45 repealing the Acts of 1970 and 1972.

The Community Planning Act, R.S.S. 1965, c. 172 amended 1967, c. 92; 1968, c. 12, 1970, c. 9.

The Housing and Urban Renewal Act, 1966 (Sask.), c. 53 amended 1967, c. 30; 1968, c. 31.

The Urban Municipalities Act, 1970 (Sask.), c. 78 amended 1971, c. 63.

Source: I. M. Rogers, Canadian Law of Planning and Zoning (Toronto: Carswell 1973). Amended by the author to include certain additional Housing Statutes and updated to 1975-76.

74 Canadian Housing Policies (1935-1980)

A PERIOD OF PROVINCIAL RE-EXAMINATION: LEGISLATION AND SOUL-SEARCHING

The provinces were forced to examine the adequacy of their legis- lation as quickly as possible after 1970 and, if necessary, to amend it to meet the new conditions occasioned by the policies which Paul Hellyer had initiated and which the first Minister of State for Urban Affairs had begun to translate into federal and federal-provincial programs. A tabulation of governing legislation is presented in Table I to indicate, first of all, the activity which transpired to bring order out of near chaos.

A quick glance at this compilation of legislative enactments will indicate that there were a great many amendments to existing legisla- tion throughout the country in 1971 and 1972. In the western prov- inces — with the exception of Saskatchewan which passed legislation in 1973 — the basic legislation received important changes in those years. In three of the Maritime Provinces there was an entirely new Com- munity Planning Act, and in Nova Scotia all the basic legislation governing housing development was amended between 1970 and 1972. This was also the case in Ontario, and in Quebec with the exception of its basic municipal code. It is clear that the provinces were attempting to fit their legislative structure within the new formulations put forward by a federal government which proposed to play a substantial role in the future urbanization of a very wealthy, very diverse and thinly populated nation.

The second major element in this picture of housing policy formula- tion which took the form of a process of soul-searching, is perhaps best illustrated by the detailed exposition that follows on the course of events in Ontario. In defence of this approach it is argued that Ontario is virtually a major state within the Canadian nation. So much attention has been paid to the cultural differences and aspirations of the people of Quebec that the concept of two nations — Canada on the one hand and Quebec on the other — has restricted the thinking of most people. Ontario’s place in the nation has tended to be based more on the fact that most of its population is English-speaking rather than a recognition of its own special significance.

Ontario had a population of more than eight million persons in the late 1970s, approximately equal to that of Sweden and close to the total combined populations of Norway and Denmark. This province is by far the wealthiest in the country in terms of total physical product and the gross provincial product measured in dollars. Per capita income is above that of any other province;? the rate of unemployment until recent years has been below that in any other province; and, while the labour force has expanded substantially as a result of natural growth

New Initatives by Provincial and Local Governments 75

and immigration, total employment has expanded more or less in the same proportion. In short, Ontario is a nation-state with vast resources and with far less dependence on one type of resource than any other province in Canada. The reference to the Scandinavian countries was deliberate to indicate that the standard of living in Ontario is of the same order as that of major Scandinavian countries purporting to maintain the highest living standards in the world and which have developed tremendously imaginative and effective housing policies.

The situation that developed in Ontario from 1971 through 1974 constitutes one model of progression towards the evolution of appro- priate housing policies. It is not so clear that the same route was followed formally in any other province, but it would appear from legislative changes and from the statistical data available that, at least in certain formal and informal ways, the same set of procedures was followed in what I have called the process of “soul-searching”. In Ontario this process occurred in the following apparent sequential progression.

1. In November 1972 the Premier of Ontario, William Davis, appointed an Advisory Task Force on Housing Policy chaired by Professor Eli Comay, Faculty of Environmental Studies at York University (formerly the Commissioner of Planning for the Municipality of Metropolitan Toronto). The task force sub- mitted its report and several supporting monographs, as well as a variety of commissioned studies, on July 27, 1973.

2. The Government of Ontario created a Ministry of Housing through the passage of the Ministry of Housing Act on October 25, 1973. Premier Davis appointed Robert Welch, formerly the Policy Minister for Social Development, as the first Minister of Housing in Ontario.

3. The Ministry of Housing issued Housing Ontario ’74 described as “an initial statement of policies, programs, and partnerships.”

The report of the Advisory Task Force on Housing Policy proposed not only the creation of a Ministry of Housing but, further, that the Government of Ontario should de-centralize the administration and management of housing programs whenever a municipality felt capable of undertaking these responsibilities. The major documentation required to demonstrate such capacity was the development of a local, municipal, or regional housing policy. Early in 1974 the City of Toronto issued a study entitled, Living Room,* which purported to be the city’s statement of housing policies and capabilities to undertake its respon- sibilities, not only in the management but in the development of a housing program. The Ministry of Housing apparently recognized the city’s capability; in late spring, 1974 the City of Toronto created its first Department of Housing and appointed a Commissioner of Housing

716 Canadian Housing Policies (1935-1980)

with the same status as that of other major departmental heads.

In May 1974 the Municipality of Metropolitan Toronto issued an Interim Metro Housing Policy in draft form and described it in two parts as a housing policy suitable for the entire metropolitan area of Toronto with its two-and-a-half million inhabitants. The potential con- flict in housing policies between the constituent municipalities in the lower tier of the two-tier regional government and the upper tier, as represented by the Metropolitan Council in Toronto, had not yet been resolved in the late 1970s.

An examination of the major documents produced in Ontario during the years 1973-1977 constitutes one appropriate way of presenting the evolution of provincial and local housing policies.» The wealth of documentation is not available for any other province, yet the manner in which the progression has occurred is likely to be repeated in many other jurisdictions in our country.

PROVINCIAL INITIATIVES OUTSIDE ONTARIO

Since 1968, when the Canadian Conference on Housing included representatives from eight housing corporations, the two provinces which were lacking such administrative devices have developed new or stronger administrative organizations. The Saskatchewan Housing Corporation was created in March 1973 and the British Columbia Housing Management Commission in December 1967; but the latter was relatively inactive until amendments were made to the British Columbia Housing Act 1960. These amendments took effect in June 1970 and made it possible to undertake a variety of new programs in the mid-1970s.

All ten provinces are now identical, at least in terms of the apparent superstructure governing the development of housing policies and the implementation of housing programs within the respective provinces. This is not surprising in view of the fact that all must perforce operate within the umbrella of the National Housing Act and must seek the substantial financial resources available through the federal legislation, particularly since the amendments of 1973 and 1975.

Nevertheless, the essential data released by the CMHC indicate that there has been a substantial reduction in the activity of most provincial governments as far as housing for low-income groups is concerned. Table II indicates first of all that 1970 was the banner year for financial assistance to low-income groups from the federal agency through the provincial organizations during the decade 1965-1974. This tabulation, drawn from data in Canadian Housing Statistics, previously entitled, “Aids to Low Income Groups”, was retitled in the 1976 edition. The

New Initatives by Provincial and Local Governments 77

Table I Housing Assistance Programmes (by type of dwelling) 1969-78 Canada Single- Multiple- Detached Dwelling Period Dwellings Structures Total 1969 1,348 27,450 28,798 1970 1,803 52,533 54,336 1971 5,354 41,212 46,566 1972 5,701 29,819 35,520 1973 5,366 24,484 29,850 1974 9,008 25,004 34,012 1975 17,643 61,857 79,500 1976 22,192 68,428 90,620 1977 17,414 85,899 103,313 1978 9,048 38,728 47,776

substantial increase in the figures commencing 1975 is due to the inclusion of activity under Section 6 of the NHA whereby approved lenders may make insured loans. This recent substantial statistical change is primarily a reflection of increased activity in condominium apartment structures. In my opinion, inclusion of the data for Section 6 seriously weakens the phrase “housing assistance programs”.

Similarly, the data for Table III are not entirely comparable because of the aforementioned inclusion of Section 6 data in 1974 and there- after. It would appear that there was a substantial recovery in every province and for the nation as a whole after 1973. Most of the new dwelling units, however, were not for rent to low-income groups in traditional public housing programs; rather they were for sale to families in the lower half of the middle income group (“families of modest or moderate income”). It is important not to be deceived by statistical tables which indicate a three-fold increase in the number of dwelling units produced in Canada under “Housing Assistance Programs”,

This table indicates that the major reason for the downturn in the production of public housing for low-income groups prior to 1974 lay in the trend away from multiple dwellings, particularly in the provinces of Quebec and Ontario. There had been an important increase in the production of single detached homes, but a fourfold increase from 1969 to 1973 did not compensate for a more than 60 per cent drop-off in multiple dwellings from 1970 through 1973. For Canada as a whole, housing for low-income groups dropped by about 50 per cent during these four years. This is significant evidence of the critical problems which faced those individuals and families who fell in the lowest third of the income distribution.

Table TI

CMHC aids to Low-Income Groups’ (number of dwelling units by provinces and types of dwellings)

Single- Multiple- Single- Multiple- Single- Multiple-

Detached Dwelling Detached Dwelling Detached Dwelling Province Dwellings Structures Total Dwellings Structures Total Dwellings Structures Total

: 1971 1972 1973

Nfid. 142 345 487 109 106 215 199 450 649 PEL. 91 352 143 158 118 276 96 49 145 NSS. 1,083 1,761 2,844 761 1,753 2,514 610 1,266 1,876 N.B. 396 509 905 273 710 983 188 273 461 Que. 1,694 14,110 15,804 1,927 5,602 7,529 2,802 2,049 4,851 Ont. 60 15,208 15,268 169 12,187 12,356 366 11,105 11,471 Man. 380 4,252 4,632 398 2,451 2,849 344 876 1,220 Sask. 1,116 343 1,459 1,550 753 2,303 1,068 499 1,567 Alta. 420 2,663 3,083 441 1,952 2,393 358 1,671 2,029 B.C. 102 2,567 2,669 225 2,414 2,639 551 2,896 3,447 CANADA* 5,524 41,846 47,370 6,102 28,102 34,204 6,638 21,293 27,931

*Includes Yukon and Northwest Territories.

Source: CMHC, Canadian Housing Statistics, 1973 (Ottawa, March 1974) Table 51, p. 44.

(O86I-S§61) Sa1oyeg Suisnoy upippudd SL

Table III (continued)

Single- Multiple- Single- Multiple- Single- Multiple-

Detached Dwelling Detached Dwelling Detached Dwelling Province Dwellings Structures Total Dwellings Structures Total Dwellings Structures Total

1974 1975 1976

Nfld. 921 831 1,752 480 1,333 1,813 764 1,536 2,300 PEL 166 232 398 283 109 392 223 11 234 N.S. 1,307 988 2,295 1,616 1,941 3,557 1,131 954 2,085 N.B. 608 1,226 1,834 1,020 1,494 2,514 1,520 849 2,369 Que. 5,378 4,321 9,699 9,132 15,346 24,478 10,924 14,782 25,706 Ont. 2,744 11,366 14,110 1,374 24,513 25,887 1,841 27,542 29,383 Man. 747 1,229 1,976 651 4,807 5,458 534 3,756 4,290 Sask. 1,271 1,230 2,501 1,453 2,256 3,709 1,687 4,199 5,886 Alta. 369 1,579 1,948 204 3,026 3,230 169 3,874 4,043 B.C. 1,618 4,896 6,514 1,371 6,606 7,977 3,239 9,255 12,494 CANADA* = 15,180 28,015 43,195 17,933 61,623 79,556 22,304 67,009 89,313

*Includes Yukon and Northwest Territories.

Source: CMHC, Canadian Housing Statistics, 1978 (Ottawa, March 1977) Table 52, p. 46.

SUBUUULAAOD 1090] puv jo1duidosg Kq SaANoUy MaN

6L

Province

Nfld. PEL N.S. N.B. Que. Ont. Man. Sask. Alta. B.C. CANADA*

Single- Detached Dwellings

678 171 1,127 874 5,976 1,724 546 2,467 545 3,254 17,636

Multiple- Dwelling Structures

1977

1,185 192 3,322 633 16,366 35,289 5,711 3,531 9,225 11,693 87,420

*Includes Yukon and Northwest Territories.

Source: CMHC, Canadian Housing Statistics, 1978 (Ottawa: March 1979) Table 57, p. 51.

Table III (continued)

Total

1,863 363 4,449 1,507 22,342 37,013 6,257 5,998 9,770 14,947 105,056

Single- Detached Dwellings

447 119 786 683

2,678

1,445 424

1,224 219

1,481

9,621

Mutltiple- Dwelling Structures

1978

456 301 1,048 564 7,142 21,099 3,046 1,635 2,696 1,741 40,117

Total

903 420 1,834 1,247 9,820 22,544 3,470 2,859 3,188 3,222 49,738

(O86I-SE6T) Sa12NOg Buisnoy uvipouvd = 98

New Initatives by Provincial and Local Governments 81

Table IH presents a more detailed breakdown revealing that between 1972 and 1973 total dwelling units declined in all provinces except Newfoundland and British Columbia. It may be concluded that the new corporation in British Columbia and the allocation of substantial resources by a new government elected in 1972 made the difference. In most provinces the decline was substantial. In Quebec it was more than one-third; in Ontario it was approximately 7 to 8 per cent.

In almost every respect the years 1971-73 revealed a substantial decline by comparison with 1969 and 1970. The reasons for this downturn at a time when total housing production throughout Canada rose dramatically were provided earlier. The confusion after 1969 - the creation of the Ministry of State for Urban Affairs and the indecision of the successive ministers and their senior officials after 1970-71, the use of housing as a factor in curtailing the progress of inflation in the years 1969-71 — combined to worsen drastically the housing situation of low-income groups in our country.

The data for the years 1974-77 indicate a substantial increase in governmental activity. The title of the relevant Table was changed, however, from “CMHC Aids to Low-Income Groups” to “NHA Activity for New and Existing Housing”. These statistical manipulations seem to be based upon the notion that the federal government desired full statistical recognition for all its interventions in the housing market. If this is an accurate presumption it must have been embarrassing to discover that the number of units assisted dropped from more than 105,000 in 1977 to less than 50,000 in 1978 (a decline of 52.6 per cent). These facts presaged a crisis which deepened in 1979 and has become intolerable in the early 1980s.

A reading of the annual reports and other material published by the various provinces in recent years does, nevertheless, support the view that they were concerned with the plight of low-income families and individuals, and particularly with the needs of older people. The following description of activity within the several provinces is pre- sented in geographical order by province, from west to east.

British Columbia

Governmental housing activity in British Columbia took a form unique among the provinces. Although a B.C. Housing Management Commission had been created at the end of 1967, its only responsibility was to operate and administer existing federal-provincial public housing projects. The two local housing authorities, the Vancouver Housing Authority and the Prince Rupert Housing Authority, were disbanded. The government of Premier W. A. C. Bennett was cautious in its

82 Canadian Housing Policies (1935-1980)

expansion of the public housing stock and clearly was opposed to the concepts underlying public intervention in the housing market. With the election of a new government in 1972, a number of significant changes occurred.

A Department of Housing (rather than a ministry) was created on November 15th, 1973. On January 10th, 1974 the Department acquired a private housing construction company, known as Dunhill Develop- ment Corporation Limited, “to expedite matters.”® Dunhill was described as “a British Columbia company with an excellent reputation in the building development and construction field.”® The B.C. Housing Management Commission was reconstituted with “a fresh mandate”.

Thus, for the first time in the history of British Columbia, the pro- vincial government assumed a meaningful responsibility for the provision of adequate and reasonably-priced housing for residents of the province.!?

The Housing Management Commission planned an entirely new approach to its responsibilities in January 1975. It dispatched a letter to all public housing tenants, indicating that a new rent-to-income scale had been created for the purpose of changing the image of public housing. On January 13th, 1975 it introduced a rent supplement pro- gram which, it stated, had among its basic objectives the integration of persons and families in different income ranges, “normalization” of public housing programs in the community, housing alternatives for low-income groups and, hopefully, public acceptance of governmental activity. In the late months of 1974 there was considerable correspond- ence on this subject between the “Minister of Housing” in Victoria and the Minister of State for Urban Affairs in Ottawa. On August 9th of that year, Lorne Nicolson declared in a letter to Barnett Danson,

The program is designed to cover a much broader social mix,. per- mitting projects to become better integrated (without stigma) into the surrounding community. It will replace the existing public housing rent scale in British Columbia and will also be applicable by agreement with CMHC to co-operative and non-profit housing developments.11

Senior citizen housing had not previously been covered in British Coumbia by a rent-geared-to-income scale so the rents of single elderly persons were to be reduced and the rents for elderly couples were to be increased, although a number of allowable income exemptions were reported.

The federal minister responded with approval and indicated that provincial governments may deviate from the “federal rent-to-income scale” so that local conditions and needs can be better met. He

New Initatives by Provincial and Local Governments 83

stipulated, however, that the federal share of subsidies shall be based on the lesser amount resulting from the application of the “federal and provincial rental scales”.!2 Mr. Danson wrote again on June 30th, 1975 to indicate that agreement had been reached between the Govern- ment of Canada and the Government of British Columbia concerning the social and income mix for public housing in the province. His statement is an important affirmation of policy which presumably applied to all provinces.

Within a Section 43 NHA project, 95 per cent of the units would be reserved for low income families as defined in the National Housing Act (50 per cent of those in greatest need from the lower third of incomes within a market area and 35 per cent of those in greatest need from an income range above the lowest third to a level where 25 per cent of the income equates with current market rents for new comparable accommodation).

An allocation of 5 per cent may be made to families of higher income, at market rents.1?

The first annual report of the Department of Housing and the 1974 Dunhill Corporation annual report were equally optimistic. The department stated that “by the end of 1974 the provincial housing ministry, with all its housing and mortgage programs, was involved in financing over two-thirds of the housing starts in British Columbia, in one way or another.”!+ Dunhill reported that by the end of 1974 the total number of dwelling units completed, in progress or planned was 2,984.

A residential land lease program was promised under a new Lease- hold and Conversion Mortgage Loan Act. British Columbia was involved in a reduced interest rate program (which preceded the federal AHOP Program) whereby interest could be reduced to as little as 5 per cent by way of a so-called free loan.1® During its first year of operation the Department of Housing was involved in 258 projects of varying types and sizes.1* The public housing rental stock showed a substantial increase with about 1,400 new units for a total of 6,200 under management in mid-1975. The expectation was a stock of 10,000 units by mid-1976.

With the defeat of Premier David Barrett and the New Democratic Party late in 1975, a good deal of the apparent staff enthusiasm dis- appeared. A major study of housing problems in the province prepared by Karl Jaffary for the previous government was shelved.!* The senior staff person of the B.C. Housing Management Commission was dis- missed. Responsibility was assigned to the new Minister of Housing and Municipal Affairs. Reports for 1976 from the Department and from Dunhill were not available late in 1977. Thus it can be con-

84 Canadian Housing Policies (1935-1980)

jectured that British Columbia, like other provinces had dampened its enthusiasm for direct public housing activity and turned its attention to new programs designed to facilitate home ownership for moderate income families. This conjecture is strengthened by the data presented earlier in Table III.

Alberta

Amendments to the Alberta Housing Act at the beginning of the 1970s affirmed continuation of the Alberta Housing and Urban Renewal Corporation as a corporation with the name, Alberta Housing Corporation. In the 1973 annual report of the AHC three aspects of the overall situation were emphasized. Alberta was the first province to sign an agreement with the federal government for implementation of the Neighbourhood Improvement Program. Housing for senior citizens received emphasis with almost 1,000 self-contained units approved for construction in 1973. The corporation was also respon- sible for elderly persons’ housing in “lodges”, which have character- istics of both homes for the aged and nursing homes. In the year-end review 392 beds were approved. Finally, the report emphasized that 340 public housing units (family housing) were already under con- struction or planned for 1974.1°

An examination of housing programs in Alberta reveals the full galaxy of such programs available through federal-provincial co- operation, with two unique additions to such a list. The customary array was described as: Public Housing, Federal NIP, Staff Housing Program, Rural and Native Housing Program, Land Assembly and Development, Direct Lending Program, Senior Citizens Housing, Federal Assisted Home-Ownership Program, and Métis Housing Pro- gram. Housing for certain staff members of government who must live in remote areas and a Self-Help Métis Housing Program appear to be unique, although it is not clear whether the latter falls within the Rural and Native Housing Program (National Housing Act, Section 40.1).

The results of this apparent activity were described in a review entitled, a “Fifteen Month Review and Financial Statement” which covered the period January 1974 to March 31, 1975. By the time this report was made public early in 1976 the Alberta Housing Corporation had been reorganized, following a study by management consultants, whereby AHC was decentralized into separate north and south regions, each headed by a vice-president. The chief operating officer of the corporation is termed the President, responsible to the Minister of Municipal Affairs who is Chairman of the Board of Directors of the corporation.

New Initatives by Provincial and Local Governments 85

In the fifteen month period, 1,078 self-contained units and 856 beds in lodge accommodation were approved under the Senior Citizens Housing Program. An additional 209 public housing units were ap- proved and assistance was granted for 146 homes for Métis. Under the Direct Lending Program 2,470 loans were approved for the con- struction of 2,646 dwelling units. Within the Corporation’s Land Assembly and Development Program, eighteen land banks and/or land development projects had been devised to assist municipalities. More- over, the new NIP Program was underway in six cities and three districts.19

It is interesting to note that within this province, subsidiaries are divided on the following basis: federal 50 per cent, provincial 40 per cent and municipal 10 per cent. In Ontario the division is on a 50 ~ 421% - 7% basis.

Saskatchewan

Administration and control of all property acquired under the Housing and Urban Renewal Act, 1966, were transferred to the new Saskatchewan Housing Corporation in 1973. In its first annual report covering the period March 16 to December 31, 1973, the SHC care- fully separated its powers to assist low-income families and individuals from its powers to help social assistance recipients.*°

During its initial year the corporation placed priority upon public rental housing for low-income families and senior citizens, “with parti- cular emphasis on the housing needs of the latter”.?! Construction of an additional 1,100 public housing units was approved during 1973. The total stock under administration at December 31, 1973 was 2,048 units composed of 1,457 for families and 591 for senior citizens. The report stated that five new programs had been developed in that first year: Senior Citizens Housing Repair Assistance Program, Residential Rehabilitation Program, Direct Lending Program, Non-Profit Program, and Subsidy and Self-Help Program.

A year later the corporation reported that its internal administration had become departmentalized as follows: Loans and Grants, Finance and Administration, Municipal Programs, and Research and Informa- tion. The first annual agreement under NIP had been signed and participation of twelve municipalities had been approved.?? A great increase in public housing and housing activity generally, was claimed. In 1974 construction began on 519 units, with 570 dwellings actually completed. The total inventory in public housing was 2,578 dwelling units at December 31, 1974.28

86 Canadian Housing Policies (1935-1980)

In Saskatchewan both capital funding and subsidies were distributed on the following basis: federal 75 per cent, provincial 20 per cent and municipal 5 per cent. This distribution implies that the corporation was utilizing Section 40.2 of the National Housing Act rather than Section 43 which was normally favoured by the provincial corporations.

It is evident that in the mid-1970s the SHC emphasized promotion of the federal AHOP Program. In a special publication describing the program in June 1975, it emphasized that the province had agreed to

’ offer subsidies over the then CMHC maximum of $600 per purchaser. The SHC noted that it would increase these subsidies by up to $628 per year, thus reducing the annual income requirement to $6,787 if families were willing to pay up to 27 per cent of gross income for a home, the price of which did not exceed $31,000 in Regina ($30,000 in Saskatoon).

Manitoba

In February 1976 the Manitoba Housing and Renewal Corporation issued its eighth annual report since its incorporation in 1967.%4 It emphasized that new programs introduced in 1974 included NIP and the Rural and Native Housing Program. In addition, assistance was made available to first-time home buyers in the form of both grant and mortgage subsidies.”

Six main avenues of operation were recorded by the MHRC: Land Assembly, Rental Programs, Purchase Programs, Renewal Programs, Research, and New Towns. By the end of 1975 the corporation had land banked 4,717 acres including 3,554 in the Winnipeg area.?* Under the Elderly and Infirm Persons Housing Act, capital grants had made low rents possible; the current inventory at December 31, 1975 was 2,666 dwelling units. It is noteworthy that, in its annual report, the corporation admitted that it had entered rent supplement programs in both Winnipeg and northern Manitoba because of waiting lists of one to two years’ duration for public housing accommodation.

The Manitoba corporation appeared from its reports to be active in all facets of its “main avenues of operation.” It had purchased housing in the Rural and Native Housing Program; it had assisted Continuing Housing Co-operatives on leased land; it had been involved in AHOP since January 1974; and, with the first NIP agreement signed in 1974 it was involved in that program as well as RRAP.?"

The statistical results of this substantial activity are impressive. At the close of 1975 the number of dwelling units committed were: in Family Public Housing, 4,945, including 2,037 in Winnipeg; in Elderly Persons Public Housing, 5,687, including 3,857 in Winnipeg; in Rural

New Initatives by Provincial and Local Governments 87

and Native Housing, 922; and, in Elderly and Infirm Persons Housing 2,666, including 1,578 in Winnipeg. Manitoba’s record in a variety of housing assistance programs, with particular emphasis upon public housing, is all the more impressive when its population of just over 1 million persons is considered.2? Moreover, the province initiated two unique experimental structures designed to accommodate handicapped persons. The public housing project named Ten Ten Sinclair in Winnipeg is designed to accommodate people confined to wheelchairs. It was opened in October 1975 and contained 75 one-bedroom suites. The Manitoba Housing-Kiwanis Centre of the Deaf is a six-storey, 200 unit building opened in January 1976.

Prior to 1969, funding of public housing for both capital and subsidies was on the basis of the following distribution: federal 75 per cent, provincial 12% per cent, and municipal 12% per cent. This was changed in that year to 90 per cent federally funded and 10 per cent provincially funded (NHA, S. 43), with the municipalities making no contribution to either capital or operating costs. There were, however, ninety local housing authorities with municipal representation at the close of 1975.

Quebec

The Quebec Housing Corporation Act 1967/67 was amended in both 1971 and 1974. An annual report covering the years 1972-73 was issued by the QHC in April 1974. Although Quebec was by that time involved in many facets of governmental intervention in the housing market, the statistical results were not impressive.

In the previously presented tables?®? of NHA activity for new and existing housing, it was clear that the number of units listed under the heading “Aids to Low-Income Groups” declined significantly in the province from 15,804 in 1971 to 6,888 in 1973 before a statistical recovery occurred in the ensuing years by virtue of the inclusion of the activity under the NHA, Section 6.

In a more detailed breakdown of housing assistance programs under the National Housing Act covering the entire post-war period, 1946- 1976, the most salient data revealed that Quebec was second to Ontario in every aspect of social housing activity. As the second most populous province this should perhaps have been the case but in terms of activity per thousand of population, Quebec did not keep pace. Table TV presents some of the significant statistics.

The Quebec government was clearly not pleased with this record and commissioned a Task Force which submitted a report in January 1976.39 Report on Housing in Quebec consisted of an analysis of the

88 Canadian Housing Policies (1935-1980)

Table IV

Housing Assistance Programs Under the National Housing Act, Canada Quebec and Ontario (1946-1976)

Total Housing Activity*

New Housing Number of Loans Number of Units Hostel Beds

Existing Housing Number of Loans Number of Units Hostel Beds

Entrepreneurial Activity Under Section 15 (Limited Dividend)

New Housing Number of Loans Number of Units Hostel Beds

Existing Housing Number of Loans Number of Units Hostel Beds

Loans and Contributions to Non-Profit Corporations and Continuing Co-operatives

Loans for New Housing Number of Loans Number of Units Hostel Beds

Loans for Existing Housing Number of Loans Number of Units Hostel Beds

Federal-Provincial Rental Housing Projects Under Section 40 (75% to 25% Basis) New Housing

Number of Projects

Number of Units

Existing Housing Number of Projects Number of Units

Quebec

40,417

119,483

32,366

2,154 4,912 2,833

239 27,941 47

163 1,747 18

247 6,692 16,268

37 380 2,438

796

Ontario

32,661 179,157 35,231

3,646 11,287 2,815

371 40,754 527

165

144 7,875 5,538

466 1,768 1,530

82 6,599

436

New Initatives by Provincial and Local Governments 89 Table IV (continued)

Loans for Public Housing Projects Under Section 43

(90% to 10% Basis) Quebec Ontario New Housing Number of Loans 397 1,077 Number of Units 23,852 77,906 Hostel Beds 174 732 Existing Housing Number of Loans 12 54 Number of Units 380 5,215 Hostel Beds ~ -

Loans by CMHC Under Assisted Home Ownership and Rental Programs, NHA, 1973-1976

Assisted Home Ownership Program (AHOP) Number of Loans 434 85 Number of Units 434 85

Assisted Rental Program Number of Loans 1 Number of Units 8 17

he

*Includes activities under the following Sections of the National Housing Act: Loans to Entrepreneurs and Non-Profit Corporations (Sections 15 and 15.1), Public Housing (Section 43), Student Housing (Section 47), Assisted Home- Ownership Programmes (Sections 34.15, 58 and 59), Co-operative Housing (Section 34.18), Federal-Provincial Rental and Sales Housing Projects (Section 40), and Loans by Approved Lenders (Section 6). All sub-sections in Table TV are included within the grand total of housing activity.

Source: CMHC, Canadian Housing Statistics 1976, Tables 53-58, pp. 47-51.

housing situation in general and offered a proposal to the government for a general housing policy. It proposed that 300,000 homes be con- structed in five years, that an additional 360,000 homes be restored and repaired within ten years and that 30,000 acres of land “be made suitable” (serviced) within five years.**

The report concluded that the market mechanisms as well as the existing governmental programs function well in the case of single- family dwellings (presumably for sale), but the operation had suffered from a shortage of tenement homes at low prices (rentals) throughout the entire province. The Task Force attributed this shortage to several factors: increase of needs, deterioration of existing housing and the slowing down of construction. It emphasized that the gap is widening between the ability to pay for a reasonable standard of living and the

90 Canadian Housing Policies (1935-1980)

rising cost of new houses. Construction costs increased 100 per cent between 1972 and 1975 while the rate of interest rose from 9 to 12 per cent.

The task force stated that in 1975-76 the Government of Quebec was spending about $32 million for programs of the Quebec Housing Corporation and $28 million for industrial development, water and sewerage. It affirmed that a realistic budget would include, approxi- mately, $42 million for new programs and $38 million for renovation (rehabilitation) 3?

New Brunswick

The New Brunswick Housing Corporation issued an annual report in mid-1975 covering the fiscal year 1974. By March 31, 1975, 2,920 dwelling units were under administration and 532 were at varying stages of construction in 35 municipalities. It should be noted that the population of the province was 675,000 in that year. The development program of the corporation was concentrated on the housing needs of the elderly and emphasized the completion and occupation of the first senior citizens’ developments in Bathurst and Fredericton and the first senior citizens’ hostel project. Within the previous two years the corporation had designated 356 senior citizen units for low-income residents who required supplementation by virtue of their inability to obtain “decent housing in the private sector.”

Particular emphasis was placed upon the renovation of older pro- jects. In this connection, New Brunswick had embarked upon a unique activity in which social assistance recipients participated in a work activity program to upgrade public properties. While interesting, this development has roots within the original poor law philosophy which has dominated social development in the Atlantic provinces since the 18th century. The report made clear the linkage between the needs of persons in poverty for a variety of social services and their requirements for decent housing.

While social development has been traditionally relegated to a sub- ordinate role, the Corporation recognizes a need for an expanding social delivery service and negotiations are continuing with other governmental and private service agencies.34

In none of the recent annual reports of other provincial corporations is the linkage between social services and housing accommodation so clearly delineated. In most provinces the housing authorities are careful to separate these two fundamental requirements.

New Initatives by Provincial and Local Governments 91

In New Brunswick the corporation’s development division described a “very active land banking program” as a major function. It emphasized that public housing units fell in the fiscal year 1974 to 176 starts compared to 387 in the fiscal year 1973 “due to tendered construction costs of public housing units extending to inaccessible levels” (sic)*> On March 31, 1975, the New Brunswick Housing Corporation was administrating 2,108 completed and occupied units (1,235 for families and 873 for senior citizens), together with 127 rental supplement units (81 for families and 46 for senior citizens), plus the original federal- provincial family units in St. John and Moncton, numbering 685 — a total of 2,920. At that time, only ten additional family units were under construction, whereas 212 senior citizen units and 310 rent supplement units for senior citizens were under construction.** As in several other provinces, the emphasis has shifted from accommodation for families to housing for senior citizens.

The province issued a mimeographed, undated document (probably in 1975) entitled, Housing Programs in New Brunswick. This document was designed to distinguish newly emerging provincial programs, includ- ing assistance to individuals for home improvements and mortgage assistance for new construction, from new federal-provincial programs, including AHOP, the Rural and Native Housing Program, and the Co-operative Housing Program. In the AHOP Program New Brunswick was prepared to supplement the federal grant by $300 per annum and in certain special cases, by as much as $500. Seventy units of new construction were planned for 1975. Under the Rural and Native Housing Program the province had approved 400 grants in 1975, either for rehabilitation or for new construction. Co-operative housing activity was underway in four cities with 400 dwellings planned in 1975.

Nova Scotia

The Nova Scotia Housing Commission in the annual report for the 1973 fiscal year emphasized that it had introduced an interim form of Assisted Home Ownership under the NHA amendments of 1972 and 1973. The province was prepared to add a provincial grant to the federal assistance to reduce the required family income to as little as $5,000 per annum.?"

Construction had been started during the period under review on an additional 533 dwellings for senior citizens in 25 communities. By contrast, a mere 158 houses for families were commenced in six communities. At the end of fiscal 1973 the local housing authorities in the province had approximately 3,800 dwelling units under manage-

92 Canadian Housing Policies (1935-1980)

ment.?8 The commission revealed that it would embark upon a survey of the external conditions of all residential buildings in communities with a population of 2,000 persons or more.*?

A year later the annual report for fiscal 1974 highlighted five major events. It reported a new enabling agreement had been reached with CMHC io enable co-operative housing companies to operate with increasing mortgage amounts and subsidies. At the same time the province signed its first agreement under the Neighbourhood Improve- ment Program.*® By the end of the fiscal year the cities of Halifax, Dartmouth and Sydney had renewal programs for implementation under NIP.*#

In the public housing field 572 starts were recorded for senior citizens’ housing in 21 communities, nine of which were embarking upon their first such construction, but the Low Rental Family Housing Program was in serious difficulties.

The government moratorium on this program continued in effect with the result that only 216 starts were made during the year on projects approved prior to the imposition of the moratorium.

The government’s decision to suspend the development of public rental housing for families was based upon substantial increases in the cost of construction. The provincial government felt that the subsidies con- sequent upon such costs over the fifty-year mortgage term would be significant. At the same time, the demand for such housing continued to increase because of rising costs in the private housing market.**

The commission had signed a new agreement with the federal government under the AHOP Program. At that time the federal sub- sidy was $300 per annum (later increased to $600 and in 1976 to $750 per annum). Thus, the provincial subsidy was then set at an additional $300 per annum. Higher maximum mortgage limits were set for co-operative builders and 795 units of co-operative housing were approved in fiscal 1974.

Nova Scotia continued to place emphasis upon its Land Development Program. In the year under review, 553 lots were released with an additional 179 anticipated later in 1975. The commission reported considerable land assembly activity.**

Prince Edward Island

Canada’s smallest province (1976 population: 120,000) reported enthusiastically that fiscal 1973 had been a year of housing activity with starts at a record pace. The Prince Edward Island Housing

New Initatives by Provincial and Local Governments 93

Authority emphasized substantial activity for senior citizens’ housing, home improvement, social housing and home ownership - yet it cautioned that the year under review was one in which the cost of building or repairing homes increased dramatically. Moreover, it was a year in which the amount of inexpensive serviced land grew even more scarce. *5

The province’s own Home Ownership Assistance Program had a direct input into 40 per cent of the housing starts during fiscal 1973.46 During the year the new federal AHOP Program was accepted and applicants were directed to available federal assistance wherever ap- propriate. The Authority reported that in fiscal 1974 it expected to sign agreements respecting NIP and RRAP.

P.EI. maintained a Home Improvement Assistance Program which was associated closely with a social rehabilitation housing program undertaken in co-operation with the Department of Social Services of the province. This unique program made available up to $4,000 assistance per dwelling for the rehabilitation of residences belonging to welfare recipients.‘”

The annual report of the P.E.I. Authority is far more detailed than those of most other provinces and clearly reflects the pride of a small province in its extensive involvement in federal-provincial housing programs. The roster of program areas included eight distinct sections reflecting a considerable effort on the part of a small population with few resources but with significant housing problems.**

At the close of fiscal 1973 Prince Edward Island had completed 409 senior citizens’ units in 26 locations. The annual report stated that “the 409 units gave P.E.I. 32.3 senior citizens’ dwelling units per thousand persons 65 years of age or over. This figure compares favourably with the 1971 Canadian average of 13.7.”

In the field of public family housing the figures are not nearly so impressive. Rent-to-income housing operated by voluntary local hous- ing authorities was originally created under the NHA, Section 40, on the basis (for both capital and subsidies) of the following distribution: federal 75 per cent, provincial 124 per cent, and municipal 1214 per cent. For fiscal 1973 the province took over the municipal share. Nevertheless, just 16 family dwellings were completed that year and at March 31, 1974 only 90 family housing units were under administration in the entire province. In mid-1975 a mimeographed report was issued by the re-named Prince Edward Island Housing Corporation.®° The annual report of the authority for fiscal 1974 was issued about the same time.

The new document of mid-1975 was a comprehensive review of all programs within the province under four major headings: Home Ownership and Home Construction, describing the Co-Operative

94 Canadian Housing Policies (1935-1980)

Housing Program, the Social Housing Program, and the Rural Poor and Native Housing Program.>1 The second major heading entitled, Home Rehabilitation, described the social rehabilitation program and tural home rehabilitation program. The third category was rental accommodation, including senior citizens’ housing, homes for special care and family or public housing. Finally, the document contained a description of municipal and land programs, including the Neighbour- hood Improvement Program and a land assembly and development program.

The difficulty with the provision of rental housing for families was further re-inforced when it became clear that no new dwellings were constructed in fiscal 1974. The report stated,

As with all our deep subsidy programs, the Housing Authority is giving careful consideration to the financial costs of the Family Housing Program. Rapidly rising construction and maintenance costs, together with other demands being placed on provincial funds, make a re- assessment of the program a necessity. In many cases, home ownership programs such as AHOP and Co-operatives, may provide a more effective and acceptable housing alternative to low-income families.52

Newfoundland

The Newfoundland and Labrador Housing Corporation carries out its responsibilities for the operation and management of subsidized rental housing through the St. John’s Housing Authority, Corner Brook Housing Corporation and three direct management offices. The cor- poration designs and builds the housing with loans through the appropriate Sections of the National Housing Act, but operating losses are shared equally with the federal government; there is no municipal contribution.

In documents issued in the early-1970s, the corporation listed nine separate programs, the first of which is the aforementioned Subsidized Rental Housing. In addition, a program, entitled, “Housing for Needy Individuals”, is under direct management in cooperation with the provincial Department of Social Services. This latter program is akin to others in the Atlantic provinces but is not found in the programs operated from British Columbia to Ontario.

A program, entitled, “Rental Housing — General” is akin to the staff housing program in the province of Alberta. In Newfoundland, the corporation builds or acquires housing for rental to support indus- trial development and to house government employees, particularly members of essential professions such as doctors, dentists and welfare officers.53

New Initatives by Provincial and Local Governments 95

Land banking and land assembly are emphasized by the corporation which, with the assistance of the relevant Sections of the NHA, will make loans to municipalities for land development, repayable over three to five years. The corporation is also involved in the development of so-called industrial parks, using both provincial funding and assist- ance from the federal Department of Regional