Multilateral agreements are functionally contracts between different levels of government which tie funding to action. They ensure that everyone commits their fair share of resources and follows through on the predetermined goals. They’re also an invaluable tool for each level of government to hold each other accountable instead of pointing fingers when something doesn’t get done. When it comes to housing, multilateral agreements are fundamental to easing the affordability crisis, as no single level of government has the power and to do it on their own.
A New Generation of Multilateral Agreements
After three decades of abandonment of housing policy by the federal government, the 2017 National Housing Strategy (NHS) set two high level targets for the period 2018-2028:
- Remove 530,000 households from “housing need” (only 31% of 1.7 million households in housing need, according to the 2016 census)
- Eradicating chronic homelessness.
If these goals are to be achieved, it will require three levels of government working together using multilateral agreements. There are two main types of agreements: (1) federal agreements with provinces and territories, and (2) federal agreements with municipalities and regions.
To build effective multilateral agreements, policymakers must use:
- Clear definitions: The federal government must clearly define affordable housing as housing which costs no more than 30% of pre-tax household income, and “whose income levels are such that they could not afford alternative suitable and adequate housing in their community”. This is the definition used by the CMHC and the census to derive NHS targets, and should be the definition used in any government program.
- Evidence-based targets: The federal government has already committed itself to the progressive realization of the right to adequate housing. It should refresh the NHS using 2021 census data, to provide short and long-term targets towards that goal, which may take 30 years to realize.
- Interdependent policy mechanisms: Achieving the goals of the NHS requires all three levels of government working together on what each scale does best. Progress requires:
- Federal infrastructure spending that is adequate to solve the problem, and focused on meeting the needs of those who are most marginalized
- Provincial and territorial spending on adequate incomes (welfare and minimum wage) and social/health supports, as well as provincially mandated mechanisms such as rent control, security of tenure, planning and zoning regulation
- Local and regional policy leadership in planning approvals, eviction prevention, rent retention, and supporting the scaling of social housing.
Current Problems with Multilateral Agreements
There is a general consensus that while the NHS was an important moment signaling re-entry of the federal government into the housing policy space, it must be substantially revised to bring it in line with the 2019 National Housing Strategy Act (NHSA).
Canada signed both the Universal Declaration of Human Rights and the International Covenant on Economic, Social and Cultural Rights (ICESCR) in 1948 and 1976 respectively. As a result, according to a National Right to Housing Network report for the CMHC, “all levels of government, not simply the executive branch… must do their utmost to uphold obligations, including the duty to progressively realize the right to adequate housing”. The report indicates that the “maximum of available resources [including] budgeting, programming, taxation measures, goals, and targets” should be used at each level, and the federal government should make “compliance a condition of the receipt of transfer payments” to achieve the right to housing in the shortest possible time. The phrase ‘maximum available resources’ is UN language, meant to provide a loophole to very low-income countries. In a country like Canada, with the ninth largest GDP in the world, $1.832 trillion, there is no excuse for only 0.002% of the GDP, $3.6 billion, spent annually on federal funding for housing. As the Parliamentary Budget Office pointed out in 2021, the federal government is subsidizing 42% fewer low-income homes under operating agreements than before the National Housing Strategy.
At present, the federal government does not prioritize the right to housing in its agreements. Current federal/provincial agreements state that their purpose is to: “achieve Targets and Outcomes, increase access to Housing, reduce Housing Need and achieve better housing solutions across the spectrum.” The current agreements do not address affordability for the lowest income households, accessibility, location, security of tenure, availability of services or cultural adequacy, all elements required to achieve the right to housing.
Furthermore, the agreement focus is on demand-side subsidies such as the Canada Housing Benefit (matched with provincial benefits), rather than supply-side construction. This assumes an existing supply of available, accessible, well located, adequately sized rental units in good repair which the CMHC (and numerous other organizations) have shown does not exist. The benefit is not enough to lift any households into adequate and secure homes, let alone the most vulnerable. Benefits should be linked to the creation of affordable housing supply, as was the case in operating agreements before 1992.
Finally, the expectation of 50/50 federal-provincial cost-matching for social housing construction is not compatible with the federal government’s much greater tax revenues than provinces and territories. When social housing was strongest in Canada, in the 1960s to 1980s, cost sharing ranged between 75% and 90% federal commitment. Successive Parliamentary Budget Office reports show that there is no significant new funding for affordable housing supply in the NHS, and certainly nowhere near the effort that a rich country like Canada can and should take in relation to adequate housing.
Building Better Multilateral Agreements
All federal agreements should tie funding to achieving targets:
- Using definitions and frameworks from the National Housing Strategy Act
- Minimizing loss of affordable homes due to housing speculation and financialization, using mechanisms ranging from ending tax exemptions of Real Estate Investment Trusts to taxation on capital gains
- Prioritizing ending homelessness, both visible and hidden, through scaling up non-profit development
- Reporting and implementing specific 10-year housing targets by income category, household size and priority population
- Free leasing of all suitable and well-located government land for non-profit housing, including (at the federal level) surplus defence bases, post offices, and land above VIA Rail stations
Agreements with provinces should link funding for housing subsidies and social/health transfer payments to:
- Raising welfare and minimum wage rates to levels that reflect current rents (shelter allowances starting at $600/mo for a single person, $750/mo for a couple, and $900/mo for a single mother with one child; minimum wages starting at $20/hour)
- Requiring provinces to develop and enforce strong rent controls with vacancy control, and protecting the rights of tenants not be to displaced; licensing all landlords in order to obtain better information on current rents and adequate repair
- Free leasing of all suitable well-located provincial/territorial government land for non-profit housing, including provincial/territorial housing above transit stations, schools, health centres, and other ‘lazy land’
- Annual public assessments that allow better capture of windfall gains through increased home and land costs
- Annual reporting required on outcomes in relation to targets, including net loss of affordable housing, and housing completions
Agreements with municipalities should link housing infrastructure funding to:
- A designated affordable housing office to expedite affordable housing applications (it is still rare for there to be more than one affordable housing officer in many large municipalities)
- Eradication of exclusionary zoning, with as-of-right zoning and bonuses for deeply affordable and non-profit homes, within existing well-located areas
- Measures to suppress short-term rentals
- Preventing evictions into homelessness through a municipal short-term loan fund and dedicated officers to assist those at risk, as well as policy in place preventing encampment evictions without providing permanent housing options
- Free leased use of all suitable municipal land for non-market housing as well as exemptions from development charges, property taxes and application fees for non-profits
- Access to justice and independent monitoring through a Housing Ombudsman.
The Housing Assessment Resource Tools (HART) project, funded by the Canada Mortgage and Housing Corporation (CMHC) through the data driven round of the Housing Supply Challenge, can help. The project is developing three evidence-based, simple, comparable, replicable, and equity focused tools:
- A housing need assessment tool that allows housing deficit to be calculated by income category, household size, and priority population; and also includes projections of net change in affordable housing and in population growth and change over 10 years. This allows targets to be set towards the progressive realization of the right to housing.
- A land assessment mapping tool that identifies well-located government land that could be used for non-market development. Numerous studies have confirmed that the combination of free leased land and non-market development are the most important components of low-cost housing for low and moderate income households, with housing subsidies also necessary for very low income households.
- An acquisitions tool that identifies buildings that could be purchased by governments in order to preserve and expand low-cost housing. Acquisitions was an important component of government policy during the 1960s-1980s, and is currently used by a number of cities, including Montreal and Vancouver.
HART prototyped an evidence-based, comparable, replicable, equity-focused housing need methodology in Kelowna BC and is now rolling out this need assessment tool in 13 governments across the country. This tool uses the same basic methods as the 1944 Curtis report – which led to over one million affordable homes post-war— breaking down housing need deficit by income category, household size, and priority population. With deficit and population projections, the tool enables all levels of government to align targets and to transparently undertake monitoring of outcomes.