Provincial, municipal governments praise 2022 federal budget for its focus on the housing crisis

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Provincial and municipal governments praised Thursday’s federal budget for its focus on the housing crisis, including its $4-billion fund to encourage local governments to speed up construction approvals and its two-year ban on foreign home purchases meant to curb speculation.

But provincial finance ministers were quick to point out the budget fails to deliver on their long-standing demand for a dramatic increase in the payments Ottawa sends provinces and territories to fund their health care systems.

In Vancouver, one of Canada’s most expensive housing markets where runaway prices are driven in part by foreign money, Mayor Kennedy Stewart issued a statement calling the document a “landmark budget” that would help make life more affordable for Canadians.

“Truly moving the needle on housing will require all levels of government working together to build the homes we need,” the mayor’s statement said.

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Toronto Mayor John Tory said the budget’s moves to boost housing supply should help reduce home prices, and its cash for affordable housing and homelessness initiatives was also welcomed. But he said he looked forward to seeing more details about the $4-billion housing accelerator fund. He also said he would continue to push for additional financial aid for cities such as his facing massive COVID-related shortfalls.

“We are determined to keep these discussions going to protect needed infrastructure improvements, many of which support the creation of new housing, create jobs and build our economy,” Mr. Tory said.

Halifax Mayor Mike Savage, who is chair of the Federation of Canadian Municipalities’ Big City Mayors’ Caucus, said the budget could make a meaningful difference to the housing situation. He lauded it for acknowledging the scale of the housing challenge and recognizing municipalities “are a serious partner” in addressing it.

“These are extraordinary times. We need to build housing,” he said. “The problem isn’t going to go away any time soon and I think bold action is needed and I see a lot of that in the budget.”

Edmonton Mayor Amarjeet Sohi, who applauded the government’s housing commitments but wanted to see more effort on energy retrofits for buildings, said the proposed tax credits for carbon capture and sequestration, along with hydrogen projects, could propel Edmonton’s economy and bolster Canada’s campaign to cut emissions.

“Those two initiatives have the potential to open up billions of dollars of investment,” he said.

Absent in the budget is any pledge to dramatically increase the amount Ottawa sends to the provinces to fund the health care system, something for which the country’s premiers have been pressing Prime Minister Justin Trudeau.

The budget document makes a point of mentioning the billions in emergency cash Ottawa sent the provinces and territories over the past two years has had a “significant impact” on their finances. The document also says any future increases to baseline health care funding needs to improve “health outcomes.”

While praising Ontario’s “strong, collaborative partnership” with Ottawa on funding for the auto sector and other issues, the province’s Finance Minister, Peter Bethlenfalvy, said in a statement that more money is needed both for infrastructure and those health care transfers.

While Mr. Bethlenfalvy applauded the housing moves, he took issue with the two-year timeline on the foreign-buyers ban saying, “there are no ‘temporary’ solutions to the housing crisis,” pointing to Ontario’s recent move to hike and expand the reach of its non-resident speculation tax.

B.C. Finance Minister Selina Robinson said British Columbia was also hoping for a shift by Ottawa to contribute more to health care transfers to the provinces but said “on the surface” the housing affordability measures will be welcome.

“All the premiers right across the nation have talked about the need for the federal government to more fully participate in health care transfers. We were hoping for more,” she told reporters in Victoria, adding that she understood Ottawa was committed to dialogue.

Travis Toews, Alberta’s Finance Minister, said he was disappointed the federal government chose not to increase health transfers to provinces, while opting to create a $5.3-billion dental-care program.

“We would be much more in favour of a more robust funding approach to the Canada Health Transfer as opposed to a boutique program,” he said in an interview. “That’s where the additional funding should have been.”

The Alberta government, Mr. Toews said, was pleased to see Ottawa provide details on tax credits for carbon capture, utilization and storage projects, but added it is still unclear which types of expenditures will fall into which categories.

With reports from Dustin Cook at Queen’s Park and Justine Hunter in Victoria

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