This year’s Alternative Federal Budget (AFB) was released on March 17.[1] A general overview of the AFB project can be found here, but in a nutshell, it provides an alternative fiscal framework for Canada’s federal government; it’s released ahead of the actual federal budget in an effort to stir debate about an alternative approach to taxing and spending.

I was primary author of the AFB’s affordable housing and homelessness chapter—that chapter is available here in English and here in French. With that in mind, here are 10 things to know about affordable housing, homelessness and the upcoming federal budget:

1. Federal housing spending is projected to decrease over the next decade (relative to GDP). That’s a key finding of this recent analysis by Canada’s Parliamentary Budget Officer (PBO).  Put differently, while some elected officials and advocates seem quite pleased with Canada’s National Housing Strategy (NHS) the reality is that we should all be very concerned about the future of Canadian housing policy.     
        
2. Federal spending on urban Aboriginal housing in Canada is expected to drop quite considerably. Indeed, the same PBO report cited in point #2 above also notes: “The planned level of funding for federally administered community housing for Indigenous households not living on reserves ($257 million) is less than half the level of funding provided over the prior 10 years ($534 million).” This comes at a time when the growth of Canada’s Indigenous populations is occurring at four times the rate of the rest of our population.        
     
3. Across Canada, federal funding for homelessness is rather modest. For each $1 invested federally, $13 is invested by other sources (mostly provincial and municipal dollars). That assertion is made in this federal report. What’s more, just 5% of new funding under the NHS has been earmarked towards the Trudeau government’s goal of reducing chronic homelessness by half. In light of these unfortunate realities, it’s crucial that Canada’s federal government enhance support for homelessness.
     
4. The National Housing Co-investment Fund (NHCF) has received considerable criticism. Created by the Trudeau government, this program both repairs existing social housing and helps create new housing; it can assist non-profit housing providers as well as for-profit private rental developers. However, it is primarily a loan program (as opposed to a grant program) and has been criticized for providing insufficient funding to make rent levels truly affordable for low-income tenants.      
     
5. Supportive housing providers across Canada need more financial support. Supportive housing refers to specialized housing for vulnerable populations that features professional (i.e., social work) staff support. This is especially helpful for people who have experienced long-term homelessness. The NHS contains no specific provisions for supportive housing, even though one of the Strategy’s stated goals is to reduce chronic homelessness by 50%. [2]
     
6. More than two years after the NHS was unveiled, we’re still waiting for the public release of three Indigenous-specific strategies. At the time that the NHS was unveiled, the Trudeau government said it was “working with First Nations, Métis and Inuit organizations on separate housing plans.” They have yet to be released publicly (though a credible source tells me that agreements have been drawn up). 
     
7. Housing across Canada remains unaffordable, especially in certain cities.[3] Central to the NHS is the planned launch, later this year, of a Canada Housing Benefit (CHB). This benefit will consist of financial assistance to help low-income households afford the rent in both private and social housing units. The Trudeau government estimates that the average beneficiary will receive $2,500 in support per year. This may be too little, too late.
     
8. We’re now expecting a recession, making it even more worthwhile to increase federal investments in affordable housing. There is growing consensus among economists that Canada will soon enter a recession (due largely to the COVID-19 pandemic) whose impact on the Canadian economy will likely last years. Increased capital funding for housing can boost employment during an economic downturn, and deeper rent subsidies can assist low-income households facing labour market challenges to pay for housing.
     
9. The Government of Canada’s COVID-19 Economic Response Plan is a short term measure. Announced on March 18, the Plan includes very important social policy items, including an additional $157.5 million in one-time funding for homelessness. However, Canada needs new annual funding commitments to address a lack of affordable housing and homelessness challenges that were in place well before COVID-19.
     
10. This year’s AFB calls for federal funding of $5.25 billion annually over and above what has already been committed by the Trudeau government. Specifically, it calls for: the enhancement of the NHCF with an additional $3 billion in annual grant money for new builds and repairs; the allocation of $2 billion annually to build new supportive housing for vulnerable populations; and the doubling of the federal contribution to the CHB.

In sum. This year’s AFB provides both a list of new, annual spending initiatives pertaining to affordable housing and homelessness, and a macroeconomic framework that can support them.

I wish to thank Susan Falvo, Ron Kneebone, Jeff Morrison, Steve Pomeroy and Vincent St-Martin for assistance with this blog post. Any errors are mine.

[1] For a history of the Alternative Federal Budget, see this overview.

[2] Having said that, supportive housing has received NHCF financing.

[3] For more on how housing affordability varies across Canada, see this two-page analysis by Ron Kneebone and Margarita Wilkins.

 I’m co-author of a new study on cost savings to the health and justice sectors associated Housing First, focusing on Calgary.[1] The other co-authors are Ali Jadidzadeh and Dan Dutton.

Here are 10 things to know:

1. Housing First refers to the immediate provision of subsidized housing (with social work support) to persons experiencing long-term homelessness. With Housing First, there’s no requirement of ‘housing readiness’ on the part of the tenant (i.e., abstinence from drugs or alcohol, or being medication compliant).
    
2. Previous research found there to be cost savings in the health and justice sectors associated with Housing First. However, that research was experimental, meaning that new program settings were developed for the purpose of research. Our study, by contrast, looks at programs already in place, meaning they had several years to evolve and improve before we studied tenant behaviour. It also means that we studied Housing First in the context of a central homeless-serving organization (i.e., the Calgary Homeless Foundation) that has been providing program oversight for many years.   
     
3. Supporting a person in Housing First in Calgary typically costs between $14,000 and $30,000 annually. The precise amount depends on the intensity of the staff support. I’ve referred to this support above as social work support, but it can actually be more specialized than that.  
      
4. The study looks at the impact of Housing First programs on public service utilization for people experiencing homelessness in Calgary. Specifically, we look at single adults without dependants.  
     
5. The study has two main research questions. First, it asks if the delivery of Housing First reduces the utilization of the health and legal systems. It then asks by how much and over what period. (This particular study doesn’t estimate the benefits of Housing First to individual tenants—e.g., improved health, greater life expectancy, etc.)  
     
6. The study is based on a large sample. There are 2,222 individuals in the study’s dataset, spanning the years 2012-2017. The data on individuals was taken both at move-in and in subsequent follow-up assessments every three months.   
     
7. The questionnaires completed by tenants helped us estimate both health and justice costs. Tenants were asked: how many times they’d been hospitalized in the previous three-month period; how many times they’d used Emergency Medical Services in the previous three months; and how many times they’d had interactions with police in the previous three months.  
     
8. The study estimates the actual cost of hospital use thanks to costing data provided by Alberta’s provincial government. Alberta Health publishes reports on the cost of providing hospital and Emergency Room services for people experiencing homelessness. These per-visit costs are higher among persons experiencing homelessness than for the general population.  
     
9. Justice costs are estimated with our knowledge of the cost of the warrant cycle, which we assume to be the average cost of an interaction with police. The estimated cost of police issuing a ticket in Calgary is $139. Arresting an individual who has not paid their tickets costs an additional $135. And the resultant court appearance ranges in cost between $222 and $253. If an individual is convicted, then one day in jail costs $220. Each warrant cycle in Calgary is therefore estimated to cost a total of $1,376, which we use as the unit cost for a single interaction with police.  
     
10. The study finds that every $1 spent on Housing First in Calgary is associated with more than $2 of savings to the public system. In other words, the roughly $42M budgeted by the Calgary Homeless Foundation for Housing First for fiscal year 2018-19 likely resulted in savings of more than $84M in terms of hospital visits, ER visits, and justice services. In the Calgary context, these savings accrue mostly to the province (which funds the health system and courts) and the municipal government (which funds police services).

In sum. This research, which began while Ali and I worked at the Calgary Homeless Foundation, would not have been possible without the cooperation of the Calgary Homeless Foundation and the Government of Alberta. Future research could build on this study by tracking the costs and types of service utilization through linked data.

I wish to thank the following individuals for assistance with this blog post: Dan Dutton, Susan Falvo, Ali Jadidzadeh, Ron Kneebone and Vincent St-Martin. Any errors are mine.

 

 [1] For a full copy of the article, please email me at falvo.nicholas@gmail.com.