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Opinion

First things first: Help people pay their rent

Published on 13/04/2020

The COVID-19 crisis has changed many things, but some remain the same: Housing is a human right and a necessity for individual and public health. At this moment, our housing system is in crisis and we need federal leadership to fix it. We need both short- and long-term solutions, and we need to act now.

The pandemic underscores how vulnerable individuals are, and how vulnerable we are collectively when people do not have adequate, secure, affordable housing. Government responses to this public health crisis also highlight the value of federal leadership in seeking both emergency and long-term solutions to the housing crisis.

What’s been done

Many people have suddenly lost their income as businesses have shut down in the service of physical distancing. In response, the federal government stepped up in ways that we could only dream of before this crisis. In a matter of a few weeks, Canada developed the scaffolding of a new income security system. For example, efforts of the federal government to stabilize incomes through the Canada Emergency Support Benefit (CERB) and the new Canada Emergency Wage Subsidy Program have been herculean. About a fifth of Canadian workers have applied for federal income support in the past 3.5 weeks.

These foundational, across-the-board programs will help many people. But we must anticipate that gaps among households will remain, especially for those households facing high rental costs.

Many provinces and municipalities have issued eviction freezes to ensure that renters can maintain their housing, even if they can’t afford to pay their rent during the pandemic shutdowns. This emergency stopgap is welcome and needed. But to ensure we are not simply shifting the problem down the road, we need additional targeted financial support for renters, so that they do not accumulate rental debt and risk eviction or homelessness a few months from now when the eviction freezes are lifted. We need long-term, lasting solutions.

Renters were always at risk

The high cost of rent is a problem for people across the country. Data from the 2016 Census tell us that renter households make up nearly one-third (31.7%) of all households in Canada. Almost half (46%) of households have less than a month’s worth of savings to weather the economic shock and loss of income resulting from COVID-19 closures. Among workers at highest risk of immediate layoff (e.g., retail sector workers), about 40% make less than $14 an hour, and about 30% make $14 to $16 an hour. While the amount of rent Canadian households pay varies by income, they are paying, on average, $800 in monthly rent (Census, 2016).

This is not just an issue for notoriously high-rent places like Toronto and Vancouver. It stretches from Grande Prairie, to Hamilton and Halifax. While the CERB will provide eligible recipients $2,000 per month in support, after groceries and basic needs, there will be many people who are suddenly unemployed and will not be able to pay the rent, especially in urban centres.

National Rent Amounts

Average rents for one-bedroom units in 35 municipalities across Canada, October 2019

City, Province/TerritoryRent for One Bedroom Unit
Yellowknife, Northwest Territories$1,517
Vancouver, British Columbia$1,382
Toronto, Ontario$1,361
Port Hope, Ontario$1,237
Wood Buffalo, Alberta$1,198
Ottawa-Gatineau, Ontario part, Ontario/Quebec $1,178
Oshawa, Ontario$1,171
Barrie, Ontario$1,161
Guelph, Ontario$1,145
Victoria, British Columbia$1,130
Squamish, British Columbia$1,128
Ottawa-Gatineau, Ontario/Quebec$1,109
Kingston, Ontario$1,101
Kelowna, British Columbia$1,095
Woodstock, Ontario$1,092
Canmore, Alberta$1,090
Calgary, Alberta$1,079
Kitchener-Cambridge-Waterloo, Ontario$1,041
Edmonton, Alberta$1,028
Hamilton, Ontario$1,021
Collingwood, Ontario$995
Grande Prairie, Alberta$984
Belleville, Ontario$977
Brantford, Ontario$971
Halifax, Nova Scotia$960
Winnipeg, Manitoba$958
Cold Lake, Alberta$956

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Source: Statistics Canada. Table 34-10-0133-01 Canada Mortgage and Housing Corporation, average rents for areas with a population of 10,000 and over.

We need federal government leadership to help people maintain and secure housing during and in the aftermath of this crisis.

The next phase of Canada’s policy response to COVID-19 will need to address the diversity of Canada’s population of renters. As no one policy can address the supports that all renters may need, this is an opportunity for the federal government to work with provinces, territories and municipalities towards both immediate, practical and long-term, transformative policy solutions.

Three good ideas

Here are three ideas that can support renters in need across Canada.

1. Introduce a top-up for CERB Rental Support

The CERB provides $2,000 a month, for up to four months, to people experiencing a drop in income as a result of COVID-19.

The federal government should consider enhancing the CERB to support renters with acute housing needs through a top-up for renter households.

Do we really need to add a top-up to a brand new program that opened just last week? Yes. The CERB is the primary policy tool available to the federal government to support Canadian workers quickly and directly. The structure of the CERB has already been built, so it makes sense to use it and adapt it to better support the needs of renters in Canada.

While not all CERB recipients will need support for rent costs, the majority of those at risk of losing their employment have annual incomes less than $50,000 per year. It is likely that their rental costs are somewhere between $800 and $900 per month (Census, 2016).  A rental top-up could be designed to cover a proportion of rental costs for those who need help paying their rent. For example, a supplement of 30-50% of average rental costs would translate to an increase of $250-$450 per month. Allowing applicants to attest to their need would make the application process simple, fast, and dignified.

The approach doesn’t vary the amount of housing support provided based on local housing market realities, but it would help provide support to a broad range of people quickly and directly.

2. Increase income supports for people living in deep poverty by increasing federal transfers to provinces/territories

The CERB is targeted at workers and people who have recently been employed. People living in poverty without employment income, many of whom receive social assistance, among others, do not qualify. We will need to use other means to reach people who will not benefit from the CERB.

In 2018, there were 1.3 million social assistance cases across Canada, and not one province provided welfare rates adequate enough for people to have total incomes that reach any measure of poverty. The COVID-19 pandemic reveals the existing weaknesses of provincial and territorial government income support programs, and their ability to support people living in poverty.

For example, in Ontario, over 80% of people receiving social assistance live in market-rental housing. Social assistance rates are inadequate to pay for market-rental housing at the best of times —  they need to access additional supports such as food banks to help them their basic needs. Now those supports, too, are shuttered or under stress, making the need for additional income even more urgent.

Focused increases in social assistance rates — calculated based on a proportion of local average market rental amounts, and calibrated by family size — have the power to be a transformative public policy change in the short and long term. The amounts that are provided to social assistance recipients would vary based on where they live and their local housing market. Such an investment would be nuanced and targeted according to need, and could be sustained over the longer term. Importantly, it wouldn’t be administratively cumbersome, because, as with the CERB, the distribution mechanism is already in place.

Given the fiscal limitations of provincial and territorial governments, and the high degree of inter-governmental collaboration at this time, provincial and territorial governments should not shy away from discussions on how the federal government could increase, and sustain, the amount of income support that is provided to people living in poverty.

The Canada Housing Benefit is set to start rolling out this spring; one option is to increase funding provided to provincial and territorial governments by introducing an enhanced Canada Housing Benefit allocation, with a focus on social assistance housing-related rate increases. Another option is to finally make overdue increases to the Canada Social Transfer. Either option would leverage the policy and delivery collaboration of provinces and territories, trigger a common pan-Canadian front to support low-income renter households with their housing needs, and re-affirm the federal government’s role in this important policy space.

3. Create an Emergency Housing Support benefit

For those who don’t benefit from the CERB rental support top-up, or housing-related social assistance rate increases, an emergency rental support benefit would help provide much needed rent support to people that fall through the cracks.

Introducing this separate emergency housing benefit would help provide support to renters in need, without requiring them to access social assistance or even qualify for the CERB. Furthermore, given the stigma associated with social assistance, a separate benefit approach may provide support to those who otherwise may be reluctant to seek help.

This separate benefit could be fully funded by the federal government and administered directly by municipalities and/or not-for-profits. The emergency housing benefit could be available to those in need — whether they receive social assistance or not. This would help target the support provided to those with low and moderate incomes, without requiring recipients to deplete their assets before qualifying for social assistance. (Asset limits in social assistance programs vary across the country. In PEI, the asset limit for a single adult is $250. In Ontario, the asset limit for a single adult is $10,000.)

While some municipalities may already have such programs in place, and others do not, this administratively heavy option can lead to important public health gains. By providing a catchall benefit for people who fall through the housing support safety net, the most marginalized and vulnerable in our communities could have access to supports that help them afford safe and secure housing. People can only stay at home if they have a home.

A crisis means creative thinking

The COVID-19 pandemic reinforces the importance of housing for public health and well-being. We have an unprecedented opportunity to do this right.

The options that we have presented are not mutually exclusive. If we are going to build the foundations of effective housing policy that responds to the urgent issues that renters across Canada face, we need to think creatively and courageously as we move forward. While these options vary in the renter population they address, and the policy mechanism used to deliver support, they are practical and implementable. Most importantly, they share are common goal — that everyone in Canada can realize their fundamental human right to housing.

Originally published on the First Policy Response website.

Summary

The COVID-19 crisis has changed many things, but some remain the same: Housing is a human right and a necessity for individual and public health.

Topic(s)

Housing and homelessness, Human rights, Income security