May 5, 1948

PC

John Ritchie MacNicol

Progressive Conservative

Mr. MacNICOL:

Can the minister give the average rent?

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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LIB

Clarence Decatur Howe (Minister of Trade and Commerce; Minister of Reconstruction and Supply)

Liberal

Mr. HOWE:

I could not do that at the moment. I will be glad to do it when we are in committee.

Tba other major form of assistance by the government towards housing construction has been loans under the National Housing Act. It was the largest year in the history of the

act, with 10,933 units being approved. The total figures for the year 1946 appear somewhat larger, but they included the loans made to Housing Enterprises Limited. During the first three months of 1948 activities under the National Housing Act are at new high levels. Loans involving 2,371 units have been approved as compared with 888 units for the first three months of 1947. Although the weather is much further advanced than it was last year, these figures show a great use of the facilities of the act..

Because they do not fall within my department, I will not deal with the other governmental activities in the housing field which include a program of housing for married personnel by the Department of National Defence, small holdings under the Veterans Land Act, and loans for housing purposes under the Farm Improvement Loans Act and the Canadian Farm Loan Act.

The government is taking vigorous steps in the housing field. I think it should be emphasized that the limitations are physical rather than financial. Effective demand remains very high for home ownership even at present prices. In view of the high rate of family formation, there is an effective demand for rental housing at almost any rental levels. It is difficult to make an estimate of likely accomplishment in 1948. With the large carryover from 1947, I think it is likely that we will equal 1947 completions. Just how far we can exceed this figure is uncertain. On the favourable side there is a better supply of materials, some improvement in the supply of labour, and an undiminished demand for housing. On the unfavourable side there is the increasing lack of serviced land, and a short supply situation in some items such as steel of all kinds. But in my opinion the most unfavourable factor is the continued buoyancy in the cost of construction.

From time to time we receive requests that the corporation increase its level of lending values. We agree that the lending values upon which National Housing Act loans are based are somewhat less than the present average cost of construction. Nevertheless, we do not feel that we would be justified in capitalizing into long term mortgage debt many of the elements of cost which now exist. A further increase in National Housing Act loans would be an inflationary step and would in itself contribute to higher costs. We realize that with the prices of houses rising and no corresponding increase in National Housing Act loans, equity requirements of the home owner are increasing. Nevertheless, after taking all factors into

National Housing Act

consideration, we have decided it would be unwise to contribute further to the general inflationary tendencies, and it is our intention to maintain during 1948 the present level of lending values.

The same problem of high and increasing costs may limit our rental program. Our present policy is that we will not enter into construction of rental units if total costs of all kinds are estimated to exceed $6,800 per unit, which under the rental formula, involves a rental of $37.50 for a five room house. Acceptance of these high costs by us has the effect of confirming the upward trend of prices. We realize that rental housing is needed, but the point has been reached where we must weigh the need for rental housing not only against the very high cost, but also against its contribution to the inflationary trend. Already this difficulty has occurred in municipalities where agreements have already been signed. Our present attitude is that unless arrangements can be made so that a maximum rental level of $37.50 can be maintained, construction will not proceeds

I turn now to the resolution. The proposed amendments to the National Housing Act follow our previous practice of making changes to meet changing situations. The most important of the amendments is the introduction of rental insurance. I have already mentioned that the greatest need in the housing field is for rental housing. The majority of 1947 rental unit completions were by the dominion government. I think that all hon. members will agree that it would be very desirable that there be an increasing supply of rental housing by private enterprise.

The dominion government is in the direct rental housing field because neither private enterprise nor other levels of government is providing greatly needed rental housing accommodation. I look forward to the day when the dominion may withdraw from the field of direct house building. Therefore we are anxious to do everything we can to encourage more private house building. The proposal before the house is designed to make rental housing more attractive to professional landlords and investors.

We have made a careful examination to ascertain the main reason for lack of rental housing by the entrepreneur. A number of builders engaged in the rental field have been interviewed and the whole situation has been thoroughly canvassed. It will be remembered that rentals upon new units are no longer under rental control. Economic rentals in relation to today's costs are readily available. It is our belief that the main deterrent to new 5849-231i

rental construction is the fear that although economic rentals will support present capital costs, the day will come when comparable rental units can be built at a lesser figure, with correspondingly lesser rentals. The builder and the landlord know that economic rentals at today's level will see them through. However, they doubt whether present rentals will be maintained.

We believe that the steps to be taken should have the following characteristics:

1. Protection to the builder and subsequent owner against an anticipated decline from the economic rentals determined on the basis of present construction -costs.

2. Provide the builder or owner with some incentive for equity investment.

3. The arrangement should retain all the traditional debtor-creditor relationship.

4. The plan should avoid the payment of a subsidy or insurance payments before assistance is needed to protect the position of the owner.

5. It should be a plan which does not interfere with other forms of credit, particularly in the real estate field.

We therefore intend to introduce a plan of rental insurance. Generally it will guarantee that the owner, whether the builder or a subsequent purchaser, shall be assured of sufficient rental income to look after:

(a) Taxes.

(b) Debt service.

(c) Operating expenses.

(d) Repairs, renewals and replacements.

(e) A reasonable return on his equity investment.

Rental insurance will be limited to the class of housing in which we are most interested, family units, renting at not more than $80 per month on a fully serviced basis. Unserviced units would carry lower rental maxi-mums. We will not offer rental insurance in projects which average less than one and a half bedrooms per unit. There will be a requirement that the project consist of eight or more family housing units.

The terms of the contract with the builder will provide that the rents which he' may charge for the first three years shall not exceed the limits which I have already indicated. The contract with the builder will guarantee him annual rentals sufficient to meet charges and to provide a 2 per cent return on the equity investment. I would point out that this is a minimum return to the owner when claims are being made under rental insurance. If the rentals received are above the guaranteed

National Housing Act

rental level, then the owner's return is considerably in excess of 2 per cent. This guaranteed rental will be about 85 per cent of the economic rental which the owner may charge his tenants during the first three years. The owner will pay a premium for his rental insurance at a rate to be set by the governor in council. Provision is made for a lending institution to make loans up to 85 per cent of the estimated cost of the rental housing project. These are to be direct loans with all the funds to be advanced by the lending institution, rather than the usual joint loans under the National Housing Act. It is felt that these high ratio loans are appropriate as investment by lending institutions because, by virtue of the guaranteed rentals, little risk is involved. There should always be sufficient moneys available to service the mortgage debt and pay taxes. Provision is also made that in the event of a loan not being available, then the corporation may make this type of loan. The maximum rate of interest which may be charged on mortgage loans secured by rental insurance will be set by the governor in council. Provision is made for principal repayments of 2i per cent per annum. The loan will be for a period of twenty years.

If the resolution is adopted, more detailed examination of the proposal can be made at the time we are in committee of the whole.

Rental insurance is to meet the fundamental deterrent to a satisfactory volume of new rental housing by private enterprise. It will be recalled that under present National Housing Act loans, guarantees by the government are afforded to the lending institution. This new proposal gives the benefit of such guarantees to the builder or the owner so that he will be willing to enter into rental housing which to his mind is hazardous at this time. On the other hand, the lending institutions will be benefited by the government guarantee because they will be assured that the rental incomes will always be sufficient to meet mortgage payments and taxes.

We are not sure of the amount of new rental housing which will result from this proposal. We hope it will be substantial, and every effort will be made to encourage builders to operate under its provisions. It is likely, however, that most of the new housing will be in the moderate rental field because that is the type of housing in which landlords and builders are interested.

Although the rental insurance provisions will be applicable to rental housing of all types, I do not believe that low rental housing-that is beyond rentals of less than $35 a month- can, be built at this time without substantial capital subsidies or contributions to rent

reduction funds. Because of very high construction costs and because the building industry is now working at capacity, I do not think that the present is an opportune time to attempt initial steps into the low rental housing field. Certainly at this time I am not prepared to recommend capital subsidies or contributions to a rent reduction fund by the dominion.

However, the dominion does not take a dogmatic stand in this matter, and we are willing to discuss with the provinces and municipalities a course of action which would lay a sound foundation for a long term national housing program. The Canadian federation of mayors has already sent us a brief concerning low-rental housing. Their proposals have merit but are not acceptable in their present form chiefly because they contemplate full financing by the dominion government both in respect to capital costs and operating deficits. Whether suitable arrangements for adoption at a more opportune time can be found, I do not know. However, I am quite certain that no suitable arrangements can be found without participation by all three levels of government.

The other main provision in the bill is the winding up of Wartime Housing Limited and the transfer of its assets and liabilities to the Central Mortgage and Housing Corporation. The proposal gives the corporation the power to carry out the functions previously performed by Wartime, Housing Limited. It also authorizes the transfer to the corporation of His Majesty's leasehold interest in houses converted under the home conversion plan.

As from January 1, 1947, the corporation has been supplying the management, both for the operation of existing wartime housing units, and the construction of new units. The construction function has been carried on in the name of Wartime Housing Limited. The corporation has been paid a fee for the management of the .wartime housing units. Under the new arrangement, the net revenues from the properties would be payable to the corporation, and would be accounted for pursuant to the Central Mortgage and Housing Corporation Act. Hon. members will recall that pursuant to the corporation act, when its reserve fund reaches $5,000,000, all net revenues of the corporation, are payable to the receiver general. We believe that it is desirable to have this new function of the corporation conform to its financial pattern set up by statute. Thus, in place of acting as an agent, it will in the future act as a principal with reference to wartime housing operations, and be subject to account for such

National Housing Act

operations in the same manner as it must account for its lending operations under the other portions of the National Housing Act.

Other powers given to the corporation under this amendment include authority to make title to crown lands. The corporation is at present engaged upon a sale program of certain wartime housing units and it is desirable that they be in a position to convey title rather than relying upon letters patent. Authority is given to the corporation to make payments to municipalities in lieu of taxes.

The other provision is that moneys appropriated by parliament for new construction shall be a liability of the corporation on such terms and conditions as are approved by the Minister of Finance.

The resolution proposes two other measures of somewhat lesser importance. It authorizes lending companies to purchase mortgages or an interest therein from the corporation. These mortgages may result from sale of wartime housing units or from direct loans under section 31A made by the corporation. The purpose of this amendment is to ensure that lending institutions may acquire mortgages from the corporation.

The other change concerns the limited dividend section of the act. Hon. members will recall that little success has attended our efforts in the formation of limited dividend companies to erect rental housing. It has been suggested that if at the end of the amortization period, say forty or fifty years, the owners might have title to the residual value of the property, then this type of limited dividend company might be more attractive to investors. The important feature of the limited dividend section is to provide low rentals for forty or fifty years with a nominal return to owners. If indeed the reversion of the residual value to the shareholders of the limited dividend company will lend encouragement to the development of such companies, I am sure that there will be general agreement that such a change should be made.

We are ' continuing to encourage and assist a large volume of residential construction. It is desirable that private enterprise look after as much of our housing needs as possible. However, to the extent that the housing need is not being met in this way, we are continuing to supplement the over-all program with direct construction. Every effort is being made to see that the improvement in the supply of building materials and building labour is maintained. The provisions of the National Housing Act, including the amendments which are proposed in this resolution, will be vigorously promoted. Our attention is directed particularly to ways and means of increasing the supply of new rental housing units.

Our primary concern is to deal with immediate needs. The long term housing problem, including slum clearance, is one which will require working arrangements with the provinces and the municipalities. It is the earnest desire of the dominion government to do all it can within its constitutional limitations to improve housing conditions. Until some longterm basis can be established with the provinces and municipalities, the dominion is doing what it can within these limitations to alleviate the immediate problem and in particular to discharge its responsibilities for that part of the program that is the direct result of war.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. C. C. I. MERRITT (Vancouver-Bur-rard):

Mr. Speaker, this is the first opportunity we have had this year to debate a problem which is still one of grave concern to the Canadian people, no matter what may be going on throughout the world. The minister has given us an interesting resume of housing activities in Canada. Quite apart, however, from what happened last year, I wish to take this opportunity to indicate a concern which has been in my mind ever since the minister made a speech in Vancouver on October 10,

1947.

I am concerned, and nothing the minister has said today leads me to change my mind, that the minister and the government are quitting their leadership in the housing field. I should like to refer to what the minister said two years ago shortly after he was appointed by the Prime Minister (Mr. Mackenzie King) as the housing expediter for Canada. I well remember the comprehensive and vigorous speech he made on that occasion, and I remember my own feeling which I expressed at the time that he was really going to go after this problem and solve it. I think he thought that himself. He threw himself into the task, if one can judge from his speeches, with a great deal of energy. I should like to read from page 3690 of Hansard of July 22, 1946, where the minister is reported as follows:

The legislative and administrative steps which I have outlined today give clear indication of a positive and integrated housing policy. This policy is designed primarily to see to the immediate shelter problem, but it does not neglect the long-term implications of the need of raising the standard of housing for people in this country. In conclusion, I would like to sum up the main principles underlying our aims and objects.

(1) High priority. Adequate housing for the Canadian people is one of the major tasks before us. The utmost effort will be directed towards meeting this need, and the resources of the country will be used to this end.

Later on that summer, in a press release in August, the minister talked about the need for

National Homing Act

a definite plan, an organization to implement it and constructive help of all interested in housing needs as the way to meet his objectives. We went on in 1946 and 1947, and the minister set targets of 60,000 and then 80,000, which were met if you take the over-plus from 1946 to make up the deficit in meeting last year's target.

In the meantime a new difficulty added itself to the original problem, which was a shortage of houses and of building materials. The new problem was one of high construction costs and, therefore, one of high rents. A year ago, in February, the minister warned us that the need for rental housing was our chief problem and he put into effect a double depreciation scheme and offered priorities for the building of rental housing. That appears to have failed because, from the minister's own figures, there were only 370 units in respect of which application was made for double depreciation; that is 370 units out of a target of 80,000 and more. It appears, too, from the minister's statement that we have not had much rental housing constructed in the past year. You could see the minister's concern in the speech he made this afternoon that rental housing cannot be provided at rents which the low-income groups most in need of that type of housing can afford to pay. Consequently, when the minister announced in Vancouver his new rental housing policy to take the place of Wartime Housing he rather receded from his enthusiasm of 1946, when he was going to put the whole resources of the country behind a housing drive. He had this to say:

As far as long-term housing program for Canada is concerned, dominion participation must necessarily be indirect, because of the limitations that I have mentioned. The authority lies with the provinces and the dominion can participate directly only when it is invited so to do.

Then he goes on to say:

The principal shortcoming of Canada's housing program to date has been the failure to provide sufficient low-rental housing. To meet this shortage, the active co-operation of dominion, provincial and municipal governments is necessary, since the problem is of such magnitude that no one level of government can see it through alone.

We will all agree with that statement, but not. with this next one:

The responsibility for initiating such a program lies with the provinces.

So we find that in the short space of two years his enthusiastic approach to have this housing problem solved has vanished, and the minister and the government are now crawling under the constitution to get out from the responsibility which the minister assumed

pretty wholeheartedly in 1946. In my view the government is no longer heading the drive for housing but has abdicated its function and is going to do just as little as it must in this field in the future.

I believe that the basic reason for the change in the government's attitude is that it has refused to enter the field of subsidized low-rent housing for those in the low-income group. The minister knows it is not possible to provide rental housing at rents which those in the low-income group can afford to pay, unless this type of housing is subsidized. This is particularly true of veterans, upon whom the present situation bears most heavily, as some figures I shall cite will show. It is not possible to provide housing, unless it is subsidized, at rents which these veterans can pay.

In the face of the rising costs which the minister has mentioned, a rent reduction scheme and a rent reduction fund to be participated in by the three levels of government constitute, in my opinion at least, the only hope for veterans obtaining housing at reasonable rentals.

It was all very well for the minister to say this afternoon that this is not the time, and that the government is not taking a dogmatic stand on this point. I say to him that this is the time to face up to the problem of subsidized low-rent housing. I say that the attitude taken by the government is very dogmatic indeed. I want to call the attention of the house to a statement made recently by the Secretary of State for External Affairs (Mr. St. Laurent) in a public speech. He said:

No government of which I form a part will ever pass legislation for subsidized housing.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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?

An hon. MEMBER:

Shamel

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

That was a dogmatic and definite statement, and I think it is the mainspring behind the minister's recession from his enthusiasm in approaching this problem two years ago. That statement indicates a fatal refusal to face realities in this field.

There is nothing necessarily socialistic about subsidizing housing for the low-income groups. The Secretary of State for External Affairs and no other minister need ever worry about that. Subsidized housing for those with low incomes was introduced in Great Britain in 1920 by a Conservative government, and it has been in operation, and in useful operation, in the United States of America since 1938 or thereabouts.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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LIB

Clarence Decatur Howe (Minister of Trade and Commerce; Minister of Reconstruction and Supply)

Liberal

Mr. HOWE:

Is it in operation in either country today? I can tell my hon. friend, if he does not know, that it is not operating now at any rate.

National Housing Act

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
Permalink
PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

No one will suggest that either of those countries at the times I spoke of were in any way socialistic. I am not aware of my own knowledge of the answer to the minister's question, but I should be most surprised if Great Britain is not now subsidizing low-rent housing. I know that the Conservative government in Northern Ireland is doing so today. I am perfectly certain that the act in the United States is still on their statute book, and if it is not in operation it is there to be used whenever there is a need for it.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
Permalink
LIB

Clarence Decatur Howe (Minister of Trade and Commerce; Minister of Reconstruction and Supply)

Liberal

Mr. HOWE:

Whenever the costs come down so that it can be made operative.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
Permalink
PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

The minister says, "Whenever the costs come down so that it can be made operative." I remember making a speech in this house on housing within the last two years in which I complimented the minister on the provisions he had brought in. I made the criticism that they were all good provisions but were one year late. That has been the record of this government on housing since 1945. In the fall of 1945 we on this side of the house, not only in this party but my hon. friends to my left, all urged the government- the minister was not responsible for housing then-to appoint a housing expediter, to put the whole problem in his hands and to get after it. That was done months after it had been urged from this side of the house. We also urged that special steps be taken to expedite the production of building materials. The minister took those steps one year afterwards.

It is not good enough for the minister to say that this is the wrong time to start building this type of housing. This is the time to concert a plan between the three levels of government concerned and to put it on the statute book and to set up your local building and administration organizations. In my view this is the time to put it into effect as well. Even if the minister is correct today that it would not be the proper time to put the scheme into effect, if we wait until it is right to build before we start negotiations, it will take a whole year even to scratch the surface of all the work that must be done before agreement is reached and houses are actually built.

I want to say a word about the specific measures referred to in the resolution. I say that when the minister has recognized that rental housing is the need, when he recognized it a year ago, and when he recognizes it today, the measures he has brought in now are just puny and entirely inadequate to meet the problem that faces so many people across Canada. I was going to refer to these figures

later, Mr. Speaker, but I wish to draw your attention to the fact that in Vancouver today there are about 4,500 veterans who have active applications for wartime housing on the list. Of these 4,500, 2,000 are married, have families and served overseas. They want wartime housing only because they are not financially able to buy houses, and they cannot rent at S80 a month or something of that kind. Their only hope is through the wartime housing scheme or the minister's new scheme, which, incidentally carries a concealed subsidy in itself, and forces the municipality taking on the scheme to put up some money as well.

The suggestion of the minister that you can solve the rental housing problem for those veterans in particular, who are most in need, by guaranteeing rents and getting rental units built at rents of S80 a month is quite ridiculous. What is needed is an expansion of the scheme that he undertook in Vancouver in October, by which rents up to $37 a month would be charged. Even that amount is high enough for the income group in most difficulty because of the housing shortage. It will not do any good to produce a house at a rental of $80 a month or something like that. There is a sufficient demand for housing by people in that group to take up the lot of it without any filtering down and making houses available to those in lower income groups. I do not believe that in the scheme the minister is proposing today he has added one unit of rental housing for the low-income group person who wants to rent a house.

In his speech the minister said that the limitation on housing is a physical and not a financial one. ll do not think that is true at all. I think there is a definite financial limitation on home ownership today as well as on rental housing, as I have already indicated. The province of Ontario has recognized that fact-the minister commended it a moment ago-and has provided guarantees to lending institutions of part of the prospective home owner's down payment. I believe the guarantee is up to $1,250 a unit. At the same time, in the Ontario Act provision is being made for grants in aid to low-rent housing as well. It may be that all sorts of mortgage money is available in lending institutions, but there certainly is a financial limit on what those seeking new housing can put down as a down payment.

The minister mentioned that the cost of housing had risen; I think he said 15 per cent. The figure I obtained from the report of the Central Mortgage and Housing Corporation was 18 per cent over 1946.

National Housing Act

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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LIB

Clarence Decatur Howe (Minister of Trade and Commerce; Minister of Reconstruction and Supply)

Liberal

Mr. HOWE:

That is the cost of materials and labour, the cost of actual housing 15 per cent.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

Very well. My figures refer to materials and labour, and they have gone up since 1939 a total of 84 per cent to 94 per cent. The minister talks of the average time for completion having been reduced from eleven months to eight months. That is very good indeed; but we must not forget that in 1939 it took only five months to complete a house of a size comparable with the figures given by the minister.

The only new suggestion coming forward from the minister is the idea of stimulating private building of rental housing by means of a guarantee of income. With that in mind, I want to refer for a moment to the situation in my particular city, which I imagine is pretty well typical of any big city in Canada. Earlier I gave the figure of the number of veterans who want wartime housing. I may say that they want wartime housing because they believe it is the only way to get rental housing at a rate that they can afford to pay. That figure is 4,952. At the same time there are 1,500 applications for home conversion units or for emergency shelter units. Therefore, in the city of Vancouver today there are more than 6,000 veterans in the lower income groups who are looking for housing accommodation. When you contrast that with the all-Canada total of 12,000 units, as I understand it, which are contemplated by the minister's new scheme to take the place of wartime housing, you will see that the new plan is just as inadequate as the plan which has been going on for the past two or three years.

I may say that I was quite horrified this afternoon to hear the minister suggest that some of the houses which are proposed to be built under the scheme he announced in Vancouver in October might not be started if building costs continue to rise. We can handle half of them in the city of Vancouver alone. From his figures there are only 1,115 under negotiation in Vancouver, and I should hope that the minister was not talking seriously when he said there was a possibility of a reduction in that number. I should hope the number would be sharply increased if it is possible to get the materials to do so.

The situation in Vancouver with regard to housing is well summed up in a publication of the Vancouver Housing Association entitled "The Housing Situation in Vancouver, Janu-

ary 1948". Under the heading "Over-all Picture", that association says:

Regarded as a whole, the housing situation, in spite of the apparent building activity, has steadily deteriorated during the past year.

It goes on to say:

The city's social service administrator, in his annual report for 1947, states: "The situation

has greatly deteriorated during the past year. Low-rental housing is not available and social allowances and pensions are so far below the level of economic rentals that it is useless to hope that private landlords will rent quarters at the rates our clients are able to pay."

Later on it points out that, although some 14,800 persons came into the city during the year, the new dwellings completed total only 2,669, and it would take 4,600 houses to handle the newcomers alone.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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LIB

Clarence Decatur Howe (Minister of Trade and Commerce; Minister of Reconstruction and Supply)

Liberal

Mr. HOWE:

May I ask what year you are referring to?

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

The summer of 1946 to the summer of 1947 is the precise period.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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LIB

Clarence Decatur Howe (Minister of Trade and Commerce; Minister of Reconstruction and Supply)

Liberal

Mr. HOWE:

His figures are off.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

The suggestion here in any event is that the situation has got worse in Vancouver by 2,000 houses during 1947. It points out that building permits issued in Vancouver in 1947 were 36 per cent down and, in greater Vancouver, 20 per cent down on the previous year. The drop was partly due to cessation of wartime housing construction, but the basic cause is undoubtedly the rapid rise in construction costs.

That, I suggest, is a situation which is probably typical of every city across Canada, and I see nothing whatever in what the minister has said today that even begins to meet the problem.

I see too, in the figures for the new scheme, another cause for alarm, and it is this. The whole history of negotiations between Wartime Housing Limited and the municipalities has been a history of irritation and long delay because of the inability of the dominion and the municipality to get together on terms.

In Vancouver, which again is the situation I know best, I think the first move toward the construction of new wartime houses in 1947 took place in January or February of the year, and it was not until October, and the minister's speech in Vancouver, that anything was accomplished in respect of wartime housing or its substitute in that city. That has probably been so ever since the end of the war in every municipality, and many additional houses would have been built if it had been possible

National Housing Act

for the dominion and the municipality to agree at once on terms and get after the actual construction of houses.

We find that on October 10 the minister announced a new scheme. In the annual report of the Central Mortgage and Housing Corporation it is stated that some 8,000 houses are being negotiated for, but it does not suggest that any have been finally agreed upon and put in hand. The minister has today given some figures which, if I heard them rightly, are to the effect that about 3,500 houses are actually contracted for and some 5,200 are still in process of negotiation.

Here we are, Mr. Speaker, six months after the announcement of that scheme, with a suggested ceiling then of 12,000 houses, and in six months we have only 3,500 agreed upon. I do not know how many of these have been started, probably very few. And that is all we have to show for this new scheme.

I know the minister has blamed my city often for haggling over the terms of these deals; but the minister must know, and undoubtedly does know, that municipal finances are limited, that they have limited sources from which to get funds. All the haggling has been because the municipality was being required to enter into an agreement to subsidize housing without having any certainty that, after they had committed themselves to subsidies, they would in future years be supported by their provincial government or by the dominion government.

I am sure that the reason for all these delays in starting on this problem is that the dominion government has refused to undertake its responsibility of giving a lead in working out with the municipalities and the provinces a definite allocation of responsibility in the housing field, including a definite division of responsibility for the putting up of a rent-reduction fund.

I am perfectly certain that if that were done and if there were an over-all agreement on the part of the three levels of government, and the necessary legislation on all levels to make that agreement workable, with a definite allocation of responsibility for construction and for the financing of projects of this kind, we would not have found in the last two or three years, as we shall find in the future, one dominion government agency trying to fill this essential field and having trouble in negotiating each one of the agreements. We would have found in every big city in Canada a local housing authority making plans because of local needs, knowing exactly what assistance they would get from the municipality, the

province and the dominion. Instead of having one agency producing these houses, with friction, we would have across Canada a dozen or more agencies working smoothly and producing a much greater volume of housing. And in that there would be no socialism either. That would be a perfectly proper activity for any government which supports private enterprise. All the work would be done by private contractors in various cities, and the whole community would be behind a plan of that kind.

Every political party in Canada other than this government, the federation of mayors, the Canadian Legion, every social service organization in the country, and the Curtis report on housing, which was produced, I believe, in 1943, have all committed themselves to this principle. This is the one government which has not been willing to move in the direction of subsidizing low-rent housing. It is to a large extent because of that unwillingness that so many people find themselves in difficulty in this rental housing field today.

There are, of course, many other matters concerning housing upon which any one could make extended remarks in the first debate this house has had on the subject this year. But because of the importance I attach to the obtaining of a definite plan on all levels of government as to how low rental housing is to be handled in Canada in the future, I shall limit my remarks on this occasion to that subject only.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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CCF

John Oliver Probe

Co-operative Commonwealth Federation (C.C.F.)

Mr. J. O. PROBE (Regina City):

I have been a member of this House of Commons, Mr. Speaker, for nearly three years now. In that time I have come to know a little bit about the present Minister of Trade and Commerce (Mr. Howe), the right hon. gentleman who is at present in charge of the federal housing program. When he said this afternoon on several occasions that the government was taking vigorous steps with respect to such things as emergency shelter, whereby 3,700 units were produced last year, and that vigorous steps were being taken to increase the production of this and of that-everything except houses-I do not suppose it would be particularly flattering if I were to say to him it seems to me that those vigorous steps always bring him back exactly to the point from which he started. For three years now we have listened to the same story, and that is that next year is to be the big housing year.

3648

National Housing Act

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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SC

Charles Edward Johnston

Social Credit

Mr. JOHNSTON:

He must have lived on the prairies.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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CCF

John Oliver Probe

Co-operative Commonwealth Federation (C.C.F.)

Mr. PROBE:

Sometimes those on the prairies believe in next year. Of course they must, by virtue of the weather. They are trying to do something about it this year.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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SC

Charles Edward Johnston

Social Credit

Mr. JOHNSTON:

It is not so windy out there.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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CCF

John Oliver Probe

Co-operative Commonwealth Federation (C.C.F.)

Mr. PROBE:

I am afraid the minister of housing, elections, trade and commerce and so on, is back with his annual excuses. This debate should give the members of the house an opportunity to offer their ideas on what is wrong with the policy of the government, and to offer their humble suggestions as to how some improvement might be made.

In the first place, in my view what is wrong with the minister's housing program, is that the Central Mortgage and Housing Corporation is being run by officials who are trained in terms of insurance company practice or mortgage company technique. They have no other viewpoint. I want to give them credit for full sincerity. I respect the president of the Central Housing and Mortgage Corporation as a courteous and painstaking officer of that company. But the legislation that is offered for the approval of this house is always legislation which tends, in terms of housing, to make reasonably secure the dividend position of the corporations who have moneys to invest or, in certain cases-one of which I shall outline in a moment-to make certain that the contractor himself is protected against financial loss in the construction work he is doing; but the end user, the family man, neither gets a house he can afford to buy, nor is he protected in any way against the policies of the government.

Topic:   NATIONAL HOUSING ACT
Subtopic:   AMENDMENT WITH RESPECT TO POWERS OP APPROVED LENDING INSTITUTIONS, ETC.
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May 5, 1948