Wanted: Child care and a decent place to live
OTTAWA—In pitching their post-pandemic vision for Canada this federal election, the main parties are all going to promise to make life more affordable.
Why? The high cost and scarcity of housing and child care has come into stark focus in recent months and those two things top the worry list for coveted suburban voters.
Here’s a look at the issues and what the parties are promising if they form government on Sept. 20.
Child care
From the widespread shutdowns of daycares to the pivot to online schools, it became abundantly clear during the pandemic a parent or caregiver’s ability to perform their own job — or even hold one down at all — is severely hampered when they’ve got to look after their kids at the same time.
A Statistics Canada study released in April showed that for parents who struggled to access child care during the pandemic: 36 per cent had to change their work schedules, 31 per cent worked fewer hours, 29 per cent juggled multiple-care arrangements. Among parents who looked but couldn’t find care — 41 per cent postponed their return to work.
The Liberals have pledged $30 billion over five years to bring fees for regulated child care down to $10 a day on average. By next year, they want to see a 50 per cent reduction in fees.
The money — passed in the last budget implementation bill — is contingent on provinces agreeing to certain benchmarks and the Liberals have already signed several deals.
But, there are holdouts, including Ontario.
Expect the New Democrats to jump on problems like that, and the fact that multiple Liberal governments in the past have promised national child-care programs and haven’t delivered.
The NDP pledge to keep the Liberals honest on this promise, saying the government is putting their commitment to child care at risk by calling an election as it means the deals could go up in political smoke.
They, too, are promising $10-a-day child care, and also to launch a relief fund to support centres at risk of closing due to pandemic pressures.
“New Democrats will actually create enough spaces so families don’t spend months on wait lists, and ensure that child-care workers are paid a fair, living wage,” the party says in a policy document released just ahead of the election.
The Conservatives would cancel the Liberals’ national program outright as they argue it’s not fair to people whose child-care needs are met outside a centre.
Instead, they’d turn an existing tax deduction for child-care expenses into a refundable one — meaning parents get the cash back — and expand it.
“Our flexible and comprehensive approach will help all families right away and offer extra support to those who need it most,” the Conservative platform says.
Housing
Just as daycare options grew scarcer during the pandemic, so too did the affordability of housing.
In March of 2021, the price of a home was 31.6 per cent higher than it had been at the start of the pandemic in March 2020.
Demand, and in turn prices, was driven by low interest rates but a few other factors: the shutdown meant fewer places for people to spend their cash, so they could save more for down payments, and work-from-home arrangements saw many also decided they needed more or different space.
The situation exacerbated an existing housing crunch; in a May report, Scotiabank economist Jean-François Perrault noted the pace of new home construction hasn’t kept up with population growth, leaving Canada with the lowest number of housing units per 1,000 people of any G7 country.
Rental prices have also crept up, even with vacancy rates increasing too.
With the situation most critical in Canada’s urban centres and their suburbs — where all parties need to make gains in the election — expect pledges from all that they’ll try to get those prices down. They’ll come at it from two angles. One will be promises on affordable housing, which means promises targeted at lower-income Canadians struggling to find accommodation that works.
The second will be the bigger picture of housing affordability, meaning people of all income levels are able to buy homes if they want them.
For the Liberals, both are wrapped up in a national housing strategy they’re likely to refer to often.
Launched in 2017, they promised to spend $70 billion over 10 years in the service of numerous goals, including cutting chronic homelessness by 50 per cent and building 160,000 new homes.
They topped up the program in the recent budget, promising an additional $2.5 billion in recognition of the additional pressures created by the pandemic.
The strategy also includes incentives for first-time home buyers, and in the recent budget the Liberals unveiled a proposed tax on foreign-owned homes that sit vacant, in a bid to compel those owners to either rent or sell rather than sit on places people could live.
Is it working?
Recently, the Parliamentary Budget Officer (PBO) said less than half of the funding earmarked for two programs under the strategy to encourage the building of more affordable homes, and rental housing, has been spent.
This is fodder for the Liberals’ rivals, of course, who say their plans will be more effective.
The Conservative say they’ll build 1 million homes in the next three years, spurring new construction via incentives to increase the supply of rental units, selling off federal lands specifically for housing development and change mortgage rules in a way they say will open up the market to more people.
The New Democrats say they’d build 500,000 housing units in the next 10 years, with half of that done within five. They’d also drive construction of rental housing by waiving the federal portion of the GST/HST on new affordable units, reintroduce government-backed, 30-year-mortgages and expand tax credits to assist people in covering the cost of buying a home.