Prime Minister Justin Trudeau visits the construction site of an affordable housing project in London, Ont. on Sept. 13.Nicole Osborne/The Canadian Press
Cost-of-living issues will be front and centre when Parliament returns Monday, with grocery chain CEOs scheduled to meet with the federal Industry Minister and Conservative Leader Pierre Poilievre planning to table a new bill focused on housing costs.
Over the summer months, the rising cost of living, including housing, has become a dominant issue that political experts believe is behind changes in the country’s political landscape. MPs will return to Ottawa on Monday after a turbulent summer break for the governing Liberals and a season of political gains for the Conservatives.
The Conservatives have been leading in a number of public opinion polls at the expense of Prime Minister Justin Trudeau’s Liberals. At the end of July, Mr. Trudeau unveiled a major shakeup of his cabinet, including a decision to move Sean Fraser from the immigration portfolio to put him in charge of housing.
Home truths about Canada’s housing mess
Tim Powers, a long-time Conservative who is the chairperson of Summa Strategies and managing director of polling firm Abacus Data, said housing has been a top issue for months because of high home prices, a shortage of supply and the state of mortgage payments in light of current interest rate policy.
Earlier this month, the Bank of Canada paused interest-rate increases and held its key interest rate steady at 5 per cent after raising rates 10 times since March, 2022. Many mortgage holders are paying considerably higher monthly payments and increasing rates have made it more costly for new homebuyers to borrow money.
Mr. Powers’ colleague, CEO of Abacus Data David Coletto, said Friday that data suggest housing is a top three issue for all ages because parents and grandparents are worried about what will happen if their family members cannot afford a place to live.
Mr. Coletto also said rapidly rising rents are making people feel like “prisoners in their current situation,” which affects people right across the age spectrum.
Ahead of the return of Parliament, Conservative Leader Pierre Poilievre said he intends to put forward legislation entitled the Building Homes, Not Bureaucracy Act – a move designed to place a greater political emphasis on the issue of housing affordability. The Conservatives have made housing a key issue under Mr. Poilievre’s leadership.
The Conservatives say the act would require cities to increase the number of homes built by 15 per cent per year or lose federal funding. It would also provide a bonus for cities that exceed that target and withhold transit and infrastructure funding from cities until “sufficient” high-density housing around transit stations are built and occupied.
The federal government can lead on housing
“Are the Conservatives masterfully crafting policy and shaping a new vision of the future? No, not yet,” Mr. Powers said. “They’re benefiting from … frustration towards the government and dissatisfaction with the government.”
An election is not expected until fall 2025 because of an agreement in place between the Liberals and the NDP. But some Liberal MPs have vocalized concerns about the party’s direction while they feel the heat in their ridings.
Following a three-day meeting with the Liberal caucus in London, Ont., Mr. Trudeau announced a series of steps that Ottawa intends to take to address the issue of affordability, including cutting the GST from new home rental construction, as well as strengthening competition laws and calling on grocery chains to address food prices or face consequences.
The Retail Council of Canada said in a statement that grocery members understand Canadians are struggling with an “exceptional cost of living crisis.” But it said numerous reports over the past year have studied the issue and have concluded “grocer prices and profits have nothing to do with it.”
“The price on grocery shelves is driven by increased vendor costs from food manufacturers and producers, itself caused by a host of global factors – including supply chain challenges, the war in Ukraine, fuel prices, and climate events,” said the council’s national spokesperson, Michelle Wasylyshen.
Industry Minister François-Philippe Champagne said Friday in a statement he will meet with grocery store CEOs on Monday.
He said Thursday the government wants to see “meaningful action” taken by grocery retailers by Thanksgiving. There will be “consequences” if they fail to act, he added.
“We’ll give them a chance,” Mr. Champagne said.
Ottawa’s decision to lift the GST for new rental construction was a promise that never came to fruition from the Liberal 2015 election campaign. The move has been largely welcomed after premiers, housing and construction groups and other experts called for the step to be taken.
Vancouver Mayor Ken Sim said the city is pleased to see the federal government lift the GST on purpose-built rentals. Mr. Poilievre’s proposals amount to a “clear plan to build more housing,” he added.
Penny Gurstein, co-director of the Housing Research Collaborative at the University of British Columbia, welcomed the political debate on housing.
“I think it’s very good that anything to do with housing, right now, is debated,” Ms. Gurstein said. “To push the Liberals even further, I think, is a really good idea.”
She said, however, she was puzzled by Mr. Poilievre’s plan, with its target for cities to increase the number of homes built by 15 per cent in one year.
“If this was going to be a serious proposal, we would have a real rationale for why suddenly we get these numbers,” she said. “We don’t.”
Housing Minister Sean Fraser’s office has called the proposals put forward by the Conservatives “half measures.”
Mary Van Buren, president of the Canadian Construction Association, said she is encouraged there is a consensus among national parties that housing is a national issue and there is a role for the federal government in addressing it.
Asked about the Conservative plan tabled by Mr. Poilievre, Ms. Van Buren said she has questions. “I would like to understand it more and certainly have more consultation on some of the individual pieces,” she said.
As debate proceeds in the House of Commons, she said it is important to ensure housing plans consider the need for more skilled workers to build homes. Nationally, she said there are 61,000 open jobs in the Canadian construction industry and there are shortages of workers in associated industries, such as trucking.