Ontario's housing allowance plan violates federal operating principles

    TORONTO, April 5 /CNW/ - Ontario's $185 million housing allowance plan,
announced in the 2007 provincial budget on March 22 and funded entirely with
federal affordable housing trust fund dollars, violates the operating
principles tabled by federal finance minister Jim Flaherty in the House of
Commons in May of 2006. The federal housing dollars were authorized by
Parliament in Bill C-48 in June of 2005. The money was intended to increase
the supply of affordable housing, including off-reserve Aboriginal housing. On
May 2, 2006, the federal budget allocated $1.4 billion to a series of
affordable housing trust funds for the provinces and territories, plus a
series of trust funds for off-reserve Aboriginal housing. Two weeks later,
Minister Flaherty tabled the operating principles for the trust funds in the
House of Commons.
    Ontario's share of the affordable housing trust fund dollars is
$312 million (plus $80 million for off-reserve Aboriginal housing), but the
money was delayed by a federal-provincial squabble. In February of 2007,
Ontario Premier Dalton McGuinty announced that the housing dollars would start
flowing, saying: "I believe that it would be unfair to allow people in need of
adequate housing to have their needs go unmet because two governments are
engaged in an argument."
    The Ontario plan for the federal dollars was set out in the March 22
provincial budget. About 60% ($185 million) was allocated to a $100 per month
housing subsidy for working families. The McGuinty government has been
criticized for failing to meet its 2003 election promise to provide 35,000
housing allowances. Housing advocates have noted that the scheme falls short
of the gap between household income and housing costs. For instance, the gap
between the average income of a labourer in Ottawa ($21,268) and the income
needed for a two-bedroom apartment ($36,800) is $15,532 annually - or almost
$1,300 per month (Source: Where's Home? 2006).
    In addition to concerns about the adequacy of the Ontario program, the
provincial plan contradicts federal operating principles. "The Government of
Canada recognizes the significant role that provincial and territorial
governments play in the design and delivery of housing policies and programs
within their respective jurisdictions," according to the federal operating
principles. "The Affordable Housing Trust Fund is not intended to support
ongoing operational funding for existing housing stock, rent subsidies, or to
replace provincial and territorial investment in affordable housing." The full
federal operating principles are posted on the Wellesley Institute web site at
http://wellesleyinstitute.com/files/flahertyhtf2006.pdf .
    Ontario's housing subsidy will target families on social housing waiting
lists (who are either in rental housing, or would like to be in rental
housing). Federal officials say that it is up to the Ontario government to
honour the trust fund operating principles, and Ontario officials say that
they intend to continue with the rent subsidy scheme.

For further information:

For further information: Michael Shapcott, Wellesley Institute - (416)
972-1010, x231, mobile - (416) 605-8316

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