Social housing: time for a reality check

A never-ending lobby campaign for the construction of 1,000 new social housing units in Nunavik dragged on this month, featuring the usual elements: uninformed political emotionalism and a couple of pandering petitions, including one sponsored by the Parti Québécois.

Here’s the gist of the dispute. Makivik Corp., in talks with the federal and Quebec governments, by 2008 had worked out a grand plan to build 1,000 social housing units in the Nunavik region, as a catch-up measure.

This scheme was expected to have been announced in March 2009 at a big meeting in Montreal.

But the matter was put off until the fall of that year, at a “Nunavik housing forum,” also to have been held in Kuujjuaq. With nothing of substance to talk about, the forum was cancelled, rescheduled, then put on hold for good. And so, throughout 2010 and into this month, the issue continues to fester.

Though this is difficult to verify, the stumbling block appears to be the federal government. They’ve been asking questions, it seems.

Good. The cost of building 1,000 new social housing units in northern Canada, give or take a few tens of millions, likely means capital spending in excess of $300 million.

For a region of only 10,000 people, that’s an enormous amount of money.

But as a short-term response to a humanitarian emergency, such spending is likely justified. As many as 40 per cent of people in the region live in overcrowded housing units. This, in turn, is directly related to the spread of serious respiratory diseases, especially among children, not to mention a long list of other health and social disorders.

But would this short-term humanitarian measure — and others like it — constitute a rational long-term response to the region’s housing shortage?

No. In the long run, this program, if implemented now, would make the housing crisis worse.

The very act of building ever-increasing numbers of heavily-subsidized social housing units will, in time, produce more of the very shortages they’re intended to mitigate. That’s what happens, always, when you create a valuable commodity and give it away for next to nothing.

A quick glance at the Nunavik region’s housing policies shows this is likely to occur sooner, rather than later.

Take rent, for example. The Kativik Municipal Housing Bureau charges a maximum rent — regardless of total household income or unit size — that ranges up to only $390 a month or so.

In Quebec, the standard social housing rent is 25 per cent of total household income. In most other provinces and territories, including Nunavut, it’s set at 30 per cent of household income, usually with a much higher cap than a mere $390 a month.

This rent scale policy, on its own, will guarantee the region will always suffer a housing shortage. This policy guarantees that few residents, regardless of what they earn, will ever want to become private homeowners. And it all but guarantees that private developers will rarely want to build housing for rent or sale to individual Nunavik residents.

This, and other misguided policies, likely explain why, as the Canada Mortgage and Housing Corp. reported in 2008, only 2.5 per cent of households in Nunavik — about 50 in all — own their own homes.

That’s right. Only 2.5 per cent. In Nunavut, homeownership stood at around 23 per cent in 2008 — not great, but a sign that at least some people are achieving financial independence. In Nunatsiavut, the homeownership rate stood at a fairly healthy rate of 61 per cent.

This means that in Nunavik, 97 per cent of the region’s population occupy housing that’s built, owned and maintained by agencies of the Quebec state.

This includes, of course, staff housing occupied by highly-paid, perk-laden teachers, nurses and government administrators. Such generously subsidized government staff housing is regarded as a minimum entitlement, to be delivered on demand to new workers who arrive from the South.

This in turn, produces local resentment and ethnic tension — a classic example of how perverse economic policy leads directly to perverse social consequences.

At the same time, except for a tiny handful of homeowners, there is no private market whatseover. The Quebec government and its regional agencies don’t even use private developers to build and lease back government buildings and staff housing. And they have no policy to encourage government employees to build or buy private housing.

For the people of Nunavik, all this adds up to a humiliating dependence on the Quebec government. To believe only in the ever-increasing construction of social housing is to believe in an odious assumption: that the Inuit of Nunavik are not capable of ever becoming more than perpetual wards of the state.

The numbers, however, help to point a way out of the current mess. They reveal, for example, that large numbers of higher-income earners are likely occupying social housing units.

So the first priority of government should be finding ways of shoehorning such people out of subsidized social housing and into privately-owned homes and rental units.

This, in turn, means government officials in Nunavik must develop an adult attitude towards private businesses, many of which could be started up by individual Nunavimmiut if they were given half a chance.

It also means that municipal councils and landholding corporations, especially in bigger communities, must do far more than they do now to encourage the construction of private homes and other buildings.

And of course, the housing bureau must quickly phase in higher rents and more stringent policies aimed at rent collection, such as the mandatory eviction of deadbeats.

The final answer, of course, does not lie in the constant expansion of the social housing stock. It lies in education and economic development policies that foster financial independence and self-reliance. This applies equally to Nunavut, where at least half the population still occupies social housing.

This, of course, will take generations to achieve. But Nunavik leaders must, at the very least, take the right steps now to point the region in a different long-term direction.

Yes, the housing shortage in Nunavik does create a humanitarian emergency to which senior governments must respond.

But until the Nunavik region gets its act together on social housing policy, it would be unwise for senior governments to spend hundreds of millions of dollars in response to emotional, but uninformed demands. JB