OTTAWA – By presenting their post-pandemic vision for Canada in this federal election, the major parties will promise to make life more affordable.
Why? The high cost and shortage of housing and child care has become a focus of attention in recent months and those two things top the list of concerns for coveted suburban voters.
Here’s a look at the issues and what the parties promise if they form government on September 20.
From widespread daycare closures to the switch to online schools, it became very clear during the pandemic that a parent or caregiver’s ability to do their own job, or even retain one, is seriously hampered when they have to care. your children at the same time.
While parents always knew it, the pandemic brought evidence.
A study by Statistics Canada released in april showed that for parents who had difficulty accessing child care during the pandemic: 36 percent had to change their work schedules, 31 percent worked fewer hours, 29 percent juggled multiple care arrangements. Among parents who sought but could not find care, 41 percent postponed their return to work.
The majority of respondents were women, further reinforcing the argument that it is women who most often transform their professional lives into pretzels to take care of children.
One change brought about by the pandemic is the demand for affordable and accessible child care that is now coming not just from workers, but also from their bosses.
The Business Council of Canada, several chambers of commerce and the CEOS of the big banks joined the push for more federal action.
Liberals have seized the moment, promising $ 30 billion over five years to cut regulated child care rates to $ 10 a day on average. By next year, they want to see a 50 percent reduction in rates.
The money, approved in the latest budget execution bill, depends on the provinces agreeing on certain benchmarks and the Liberals have already signed several agreements.
But there are holdouts, including Ontario. There are concerns about the plan’s long-term funding model.
The 2021 budget says the goal is to finally reach a 50/50 cost-sharing agreement with the provinces for funding, and the Ontario PC government is wary of committing to that approach.
Expect the new Democrats to pounce on issues like that and the fact that multiple liberal governments in the past have promised national child care programs and failed to deliver.
The NDP is committed to keeping liberals honest on this promise, saying the government is putting its commitment to child care at risk by calling elections as it means the deals could go up in political smoke.
They also promise child care for $ 10 a day and will also launch a relief fund to support centers at risk of closing due to the pressures of the pandemic.
“The new Democrats will actually create enough space for families not to spend months on waiting lists and ensure that child care workers receive a fair and living wage,” the party says in a policy document released just before the election. .
Conservatives would outright cancel the Liberals’ national program, arguing that it is unfair to people whose child care needs are being met outside of a center.
Instead, they would convert an existing tax deduction for child care expenses into a refundable one, which means parents get the cash refund and expand it. People could recoup up to 75 percent of their expenses, depending on their income.
“Our flexible and comprehensive approach will help all families immediately and offer additional support to those who need it most,” says the Conservative platform.
Just as daycare options became scarcer during the pandemic, so did housing affordability.
In March 2021, the price of a home was 31.6 percent higher than it had been at the beginning of the pandemic in March 2020.
Demand, and in turn prices, was driven by low interest rates, but a few other factors: The closure meant fewer places for people to spend their cash, so they could save more for the down payment, and deals working from home also saw many Decided they needed more or a different space.
The situation exacerbated an existing real estate crisis; in a May report, Scotiabank economist Jean-François Perrault noted that the pace of new home construction has not kept pace with population growth, leaving Canada with the lowest number of housing units per 1,000 of any population. G7 country.
Meanwhile, the National Bank of Canada economists say mortgage payments now consume 45 percent of some households’ income. The threshold for an “affordable” home is that those payments must be less than 30 percent.
Rental prices have skyrocketed as well, even with availability rates.
With the most critical situation in Canada’s urban centers and its suburbs, where all parties must profit in elections, expect promises from everyone that they will try to lower those prices.
They will approach it from two angles.
One will be the pledges for affordable housing, which means pledges aimed at low-income Canadians struggling to find housing that works.
The second will be the bigger picture of housing affordability, which means that people of all income levels can buy homes if they want to.
For liberals, both are wrapped up in a national housing strategy that they probably refer to often.
Launched in 2017, they pledged to spend $ 70 billion over 10 years serving numerous goals, including reducing chronic homelessness by 50 percent and building 160,000 new homes.
They completed the program in the recent budget, pledging an additional $ 2.5 billion in recognition of the additional pressures created by the pandemic.
The strategy also includes incentives for first-time home buyers, and in the recent budget, Liberals unveiled a proposed tax on foreign-owned homes that are vacant, in an attempt to force those homeowners to rent or rent. sell rather than sit in places. I could live.
Recently, the Parliamentary Budget Officer (PBO) said that less than half of the funds for two programs have been spent under the strategy to encourage the construction of more affordable housing and rental housing.
Program delays at the Housing and Mortgage Corporation of Canada, expired community housing deals with the provinces and a shift toward more expensive affordable housing have “limited the impact” of the strategy, budget official Yves Giroux said.
He also projected that the number of households that need a suitable or affordable place to live will rise to around 1.8 million in five years, unless more funds flow into the problem.
The affordability gap, the difference between the cost of a housing unit and the price a low-income Canadian can afford, will increase by 24 percent to $ 9.4 billion over the next five years, he calculated.
The PBO also previously suggested that the foreign homeowner tax will actually make much less money than the government predicts, and early data on the first-time homebuyer incentive suggests that uptake has not been great, though Liberals recently increased the purchase quantities they bought. I will help support.
All of this is fodder for rivals of the liberals, of course, who say their plans will be more effective.
Conservatives say they will build 1 million homes in the next three years, spurring new construction through incentives to increase the supply of rental units, selling federal land specifically for housing development, and changing mortgage rules in a way that, According to them, it will open the market to more people.
“The main cause is that the supply is simply not keeping up with the demand,” says its platform.
“Governments have not allowed Canadians to build enough homes to keep up with our growing population.”
The new Democrats say they would build 500,000 housing units in the next 10 years, and half of that will be done in five. They would also boost rental housing construction by forgoing the federal portion of the GST / HST on new affordable units, reintroduce government-backed 30-year mortgages, and expand tax credits to help people cover the cost of buying a home. .
“Finding a good and affordable place to live should not be like winning the lottery,” the party said in its policy document.
“It is time to relieve the stress and worry that people feel when choosing to make it easier to rent and buy a home.”
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