Justin Trudeau’s government is standing by its threat to withhold funding from the Ontario government due to a lack of planned affordable housing.
“I don’t think it’s responsible for me to transfer funds for housing construction, for housing that will never be built,” Housing Minister Sean Fraser told reporters at a news conference Wednesday.
His comments are the latest in a war of words with his provincial counterpart over $357 million in funding earmarked for affordable units.
In 2018, Doug Ford’s government signed a 10-year bilateral agreement committing to deliver 19,660 units of affordable housing.
In a letter sent to Ontario Housing Minister Paul Calandra last week, Fraser said the province’s count is significantly lower, putting it at around 1,184 new units by the end of 2024-2025.
“Ontario is desperately behind all other provinces and territories,” Fraser wrote on March 21. “This leaves 94 percent of the target to be achieved during the last three years of the agreement, which is unrealistic.”
Since then, Fraser said the province has updated its housing plan to reach 28 per cent of its target. However, that number is still too low, he said.
“Typically, governments across Canada have achieved about two-thirds of total funding,” he said of Ontario’s progress. “If there is no clear path for the Ontario government to deliver on the full commitment it had agreed to with its eyes wide open, it should not expect to receive the full amount of money.”
Calandra has argued the province is working to repair and renovate affordable units in addition to building them, noting the province has one of the oldest housing stocks in the country.
If those units were counted, he added, Ontario would reach almost 60 per cent of its target.
“We are still willing to be at the table, but our position is not going to change,” he said. “They’re changing the criteria every day and it’s starting to get frustrating.”
The Association of Ontario Municipalities (AMO) sided with Calandra and argued that withholding this funding “would have devastating impacts on low-income families and individuals” while further exacerbating the housing crisis.
“Ultimately, we must fundamentally rethink the way we fund community housing in Ontario and Canada. But the answer is not unexpected funding cuts in the midst of a homelessness crisis,” they wrote in a letter to Fraser on Tuesday.
The federal minister, for his part, confirmed that the money will be used to build affordable housing in Ontario, but may not be provided by the provincial government.
It is important to note that the Ford government has been using a similar tactic for its Building Faster Fund to encourage development, withholding funds from municipalities that have not met their targets.
The city of Mississauga lost about $30 million because it didn’t have enough housing starts for 2023, even though local officials argued they had permits awaiting approval.