July 22, 1946 (20th Parliament, 2nd Session)


John Oliver Probe

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

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

I listened for some two hours this afternoon to what should have been the report of the superoptimist who spoke to the House of Commons some time ago on the manner in which reconversion in this country was being effected to the satisfaction of Canadian citizens. I must confess that, after two hours of facts and statistics which I have no doubt eminently covered the subject of housing as it exists in Canada, I at least got the impression that we had been hearing, not the report of a superoptimist with regard to housing but rather an admission of the ineffectiveness of a plan that had been drawn up by some tired old gentleman.
It is not necessary for me at this stage to go into a large number of figures and statistics. They have been put on the record by all those who have spoken on the subject of

Housing Act
housing. But the fact remains, regardless of statistics that have been presented here this afternoon by the Minister of Reconstruction on behalf of the Central Mortgage and Housing Corporation, that there are not sufficient houses being built. That is the sum total of the criticism which citizens generally have to make, and which it is the duty of members of this house to bring forcibly to the attention of the minister, with every bit of energy they can summon.
I agree with the hon. member for Eglinton (Mr. Fleming) that the government was remiss in waiting four months after the session had begun before bringing down the report which the minister has presented to the house to-day. I suggest, however, that while the hon. member for Eglinton was drawing attention to the obvious fact that we are not building homes for the people of Canada, he should have gone a step further and indicated to the house just how the party to which he belongs would carry this ball. I do not think there was ever a more glorious opportunity for either the Liberal or the Conservative party in this house, the exponents of private enterprise, to demonstrate to us, who are simply socialists, how private enterprise could be made to work in this instance. I am sure that every member of this house and every person in the country must be in complete agreement on the necessity of constructing homes for the people of Canada. But how each Individual could be made a little capitalist in his own little backyard, with a house which he could call his own, neither the policies of the present government nor those of hon. members to my right would indicate. They do not show how the individual can best become that private entrepreneur. As I say, that opportunity was missed. We are in definite agreement with respect to one thing. In every part of Canada we need more houses. All parties agree that we could use better houses than many of those in which citizens of this country live, including, by the way, members of the House of Commons, who are now living in Ottawa. I am also quite certain that most of us are in agreement that by some means or other we should be able to provide less expensive houses for the people who are expected to buy them and live in them. These are the points which I feel have been missed both by the Minister of Reconstruction (Mr. Howe) and the hon. member who acted as critic for the Progressive Conservative party.
Once more I must draw this fact to the attention of the house. In spite of the fact that what the minister read was intended to be a glowing progress report, we have actually
fallen behind on current demand for housing this year. We have fallen behind somewhere between twenty and thirty thousand units. According to the minister, we had the best building year since 1928. Even that statement would bear some inspection. I recall that last year I was interested in a project on Carling avenue in Ottawa which was sponsored by the Minister of Veterans Affairs (Mr. Mackenzie). There a project of veterans' houses was being undertaken. I remember that last fall we had a little difficulty in keeping one of the basement walls propped up. I went there recently to have a look at the houses. It is now a matter of ten months since the construction was undertaken and these houses are still not being used by the veterans for whom they were intended. On the basis of that and other projects that I have seen in other parts of Canada, I would judge that the 46,000 and some odd houses which were reported to have been built are definitely not finally completed.
While drawing attention to the fact that we have a large problem on our hands in providing houses for Canadian veterans, the Minister of Reconstruction, both in his statement and in the resolution which he has introduced for the consideration of the house, is, as I see it, not approaching the problem. To illustrate what I mean, I think we all agree that people in the upper income brackets are well able to look after their house-building under any financial or building supply difficulty. The people whose needs, whether for ownership of for rental, will not be met by any policy which the government is willing to undertake now are those in the low-income group. [DOT]
Recently I had an interview with the president of Central Mortgage and Housing corporation where I acted on behalf of a housing group from my own city which wished to j{et moneys for the purpose of a fifty or sixty unit housing project in Regina, but they were definitely opposed to the present high interest rate of 4% per cent which the terms of the National Housing Act demand. I went to the president of this government corporation to find out the reasons why a body which consisted of fifty or sixty wage-earners of the middle-income group, $2,000, $2,300 or $2,400 -persons who represent the better than average income group, certainly of my city, and who were equally responsible financially and as secure in terms of the bank as any of those puppets of the mortgage companies which have contracted to put up their three thousand odd houses this year-could not get loans. The president of Central Mortgage and Housing corporation told me that it was against the policy of the government, as he was
Housing Act

instructed to administer it, to consider members of the cooperative housing association as being anything other than a group of individuals attempting individually and on their own security to secure loans under the National Housing Act. Therefore they could get no better terms than 4% per cent.
I wish to draw the minister's attention to what they are doing across the border with respect to cooperative housing associations. Lest anyone think that the United States has gone socialist with respect to cooperatives, I desire to remind hon. members of the fact, which they already know, that the United States is still an exponent of private enterprise. Perhaps the difference is that they still believe they can put a little enterprise into this old machine. But thej'' are willing to play ball with cooperative housing bodies. The housing act which came up last November, the Wagner, Ellender, Taft proposal provides assistance to non-profit corporations for mutual ownership housing, which would be eligible for ninety-five per cent of their loans with a forty-year maturity, and a -maximum interest rate of 3i per cent. The act foresees the possibility that the private mortgage companies might not care to play ball with cooperatives. Therefore it makes the provision that if private capital should not be available to mutual ownership corporations on these terms, then the federal national mortgage corporation is authorized to make the necessary loans. That is the way in which the mutual home ownership proposition is being handled in the United States. They have an interest rate which is lower than ours; they have an amortization period which extends to forty years. By their attitude toward cooperative home-owner groups they are adopting an attitude which has been recognized for years in Great Britain, Sweden. Denmark, the Netherlands and other enlightened countries.
If we are to build houses for our people- and I presume the -minister is as sincere in that desire as any other hon. member-the minister must not let his personal or political prejudices blind him to the methods by which this can be done. If he is flexible, if he is a business man, when one procedure fails he should try another one which might have a chance to work. But I maintain that the present government are opposed to any cooperative form of building enterprise; they are definitely opposed to anything which is going to provide ownership to a low-income family at a decent, repayable amount. Of course the proof of the pudding is in the eating, and the fact is that the low-income people are definitely not getting houses.

In the resolution the minister has brought in for the consideration of the house there are certain suggestions for the extension of the lending feature. For example, apparently he proposes to lend money for the construction of homes by those who have only a leasehold interest in the land, and his explanation this afternoon suggested that this would be for the purpose of building homes in public parks and elsewhere in the public domain. I venture to suggest that before the bill to be founded upon this resolution has ran its course or is replaced we shall have a capitalist corporation lending its property on a leasehold basis to individuals who thereby may be tempted to build on corporation premises. Then, for one reason or another, this corporation eventually will have the down payment of the individual plus the property on which the home was originally constructed. It follows the old English practice whereby property was retained in the name of the landed aristocracy; I think it was called, "in entail".
Further, in the fourth section of this resolution the minister proposes to subsidize, again not the home-owner but large pulp and mining corporations, to perpetuate ghost towns paid for by the money of the people of Canada. I see several of these projects under way now along the Canadian Pacific main line between here and Fort William, and I venture to predict that if these companies are not already operating under some form of agreement with Central Mortgage and Housing Corporation to take over the risk of the projects, they will approach the minister after this resolution and the bill to be founded upon it are passed.
The minister has not shown, either by this resolution or in his address, that he has done anything to get the cost of materials down, or that he has taken positive action for the production of additional building material. I know this afternoon he gave us statistics showing that the production in April of this year was up some thirty per cent in some commodities as compared with April of last year, and so on all down the line; but the cold fact is that we are still not getting material in sufficient supply, that we still get letters from our constituents and others asking where the bottleneck is and what are the government doing about it. The right hon. minister gave no indication that he had taken any positive steps to remove any of these bottlenecks in supplies. Nor has he done anything to reduce the cost of these materials. As a matter of fact, material costs are continuing to increase.

Housing Act
In the two or three minutes remaining before six o'clock I should like to suggest to the minister that he extend the provisions of the National Housing Act in two important particulars. I am certain that a combination of these two extensions will bring about a considerable increase in the number of homeowners in this country. My first suggestion is that he permit cooperatives to be treated on the same basis as mortgage companies, so that they may borrow money at three per cent for construction purposes. The second suggestion is that he give the low-income groups an opportunity to become home-owners by combining a changed amortization principle with a reduction in the cost of money to the individual. The period of amortization should be extended to thirty or forty years. If we can lend money to Great Britain at two per cent, starting in 1949, there is no reason in the world why we cannot lend money at the same rate to Joe Doaks out in Regina or Vancouver or anywhere else. If wre can do it in the one instance, if it is humanitarian and good business, then we can do it in the other instance.
I should like to give the house just one or two figures to indicate the approximate monthly repayment required on a loan of $3,000 at various rates of interest and over twenty-year, thirty-year and forty-year periods:
Approximate Monthly Repayments on $3,000 Loan
rate *
per cent 20 years 30 years 40 years
$13 86 $ 9 69 $ 7 622 ....'
15 29 11 17 9 153
16 81 12 76 10 824
18 40 14 46 12 645
20 07 16 38 14 58
Three per cent is the present rate allowed to mortgage companies, and five per cent is just above the present National Housing Act rate. I want to warn the right hon. minister of what I am sure he must know, if he would only admit it and do something about it. That is, until you bring the cost of building materials down, by legislation if necessary, or by going into the business on a socialist basis as a government, and change the basis of amortization from twenty to thirty or forty years and at the same time reduce the interest rate, you will never have the citizens of Canada housed as they deserve to be.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.

Full View