Wellesley Institute on Ontario budget 2007: Thanks for the thoughts, but where's the money?

    TORONTO, March 22 /CNW/ - Ontario's 2007 provincial budget has plenty of
strong language about poverty and affordable housing. But the dollars are
missing. Not a single new penny has been devoted to affordable housing, and
the dollars devoted to eradicating poverty are limited and stretch over a
number of years.
    "At a time when 600,000 Ontario households are in 'core housing need',
the Ontario budget merely recycles federal housing dollars that were
authorized in 2005. Two years later, the province has finally announced that
it will allow the federal dollars to be spent, but there is no new provincial
dollars," says Michael Shapcott, Senior Fellow at the Wellesley Institute.
    Two days ago, Ontario Premier Dalton McGuinty complained that Monday's
federal budget fell short of the dollars that Ontario was seeking. "Justice
delayed is justice denied," said the Premier of the Harper budget. The same
can be said of Premier McGuinty's own budget, which falls far short of
delivering the dollars that would lift Ontario children, and their families,
out of poverty.
    "After years of Ontario governments that put a priority on tax cuts
rather than an investment in people and programs, today's budget signals a
welcome change," says Shapcott. "But kind words are not enough. Budgets are
about choices, and they are about dollars and cents. Today's budget doesn't
deliver the dollars that are needed."
    For instance, today's provincial budget announces that some of the
recycled federal housing dollars will be devoted to a new housing allowance
program for 27,000 low-income working families, even though more than
1.6 million Ontarians are living in poverty. Each household will receive a
mere $100 per month, even though poor families face a housing poverty gap of
hundreds of dollars.
    Renter household incomes have been falling in recent years, even as
average market rents have increased. The "housing poverty gap" - the
difference between what landlords are charging and what tenants can afford to
pay - is wide and growing. Tenant households caught in the financial squeeze
are facing an all-time record number of evictions - almost 67,000 households
in 2006 (about 183 families facing eviction every day of the year).
    Budget 2007 does provide some more details on the previous announcement
by Premier Dalton McGuinty that the Ontario government will start to flow
$392 million in federal housing dollars that were authorized by Parliament in
2005. However, there will be at least one more round of announcements on this
funding before the money is finally allocated. Some details:

    -   $127 million will be divided among to municipalities to fund new
        housing or repair existing homes, with details to be announced later.
        The money will be allocated by the end of March and there will be few
        guidelines for municipalities. There is a danger that few of the
        dollars will actually go to desperately-needed new supply and will
        instead be diverted to fund much-needed repairs of existing rundown
    -   $80 million will go to off-reserve Aboriginal housing, following a
        consultation with Aboriginal housing and service providers.
    -   the remainder will go to a five-year housing allowance program for
        working families that will provide a bare $100 per month to help
        narrow the gap between household income and rents.

    Here are some specifics on income issues in the Ontario budget:

    -   a 2% increase in social assistance (welfare rates in all categories
        remain well below the poverty line).
    -   a new Ontario Child Benefit which, when it is fully phased in over
        five years, will amount to a maximum of $1,100 annually per child.
    -   an end to the provincial clawback of federal children's benefits.
    -   an increase of 75 cents per year in the minimum wage until it reaches
        $10.25 in the year 2010.

    One surprising development is the partial uploading of social services
and social housing spending in the "905" municipalities. Social services costs
were downloaded by the Harris government in the 1990s and the McGuinty
government had promised to reverse this policy. But today's budget only
uploaded the costs for York, Peel and Durham Regions, without uploading the
same set of costs borne by Toronto or municipalities in the rest of the
    "The people of Ontario have been demanding that the McGuinty government
honour its promises, going back to the 2003 election campaign, to reinvest in
the vital services that will help to rebuild the province," says Shapcott.
"Today's budget echoes those concerns, but fails to provide the dollars."
    The Wellesley Institute is completing a review of the growing "housing
poverty gap" in communities across the province. Working families, along with
low, moderate and even middle-income Ontarians are being caught in the squeeze
between rising housing costs and stagnant incomes. For more details, log onto

For further information:

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

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