November 15, 1949



On the orders of the day:


Clarence Gillis

Co-operative Commonwealth Federation (C.C.F.)

Mr. Clarence Gillis (Cape Breton South):

I should like to ask a question of the Minister of Transport, of which, because of morning sittings, he has not had notice. At some time before prorogation would he be in a position to make a report to the house as to the progress which is being made in the matter of the construction of a bridge over the strait of Canso?


Lionel Chevrier (Minister of Transport)


Hon. Lionel Chevrier (Minister of Transport):

When the estimates of the Department of Transport are under discussion I shall be glad to make a statement on the matter referred to by the hon. member.




On the orders of the day:


Thomas Langton Church

Progressive Conservative

Mr. T. L. Church (Broadview):

I should like to ask a question, of the Minister of Public Works. Would the government consider erecting a shelter for the large number of people who wait for buses next to the Chateau Laurier hotel in the cold and wintry weather? It is largely crown property. Would he confer with the civic authorities in the matter, and act accordingly? I raised the same question last session, and he said he would.


Alphonse Fournier (Minister of Public Works; Leader of the Government in the House of Commons; Liberal Party House Leader)


Hon. Alphonse Fournier (Minister of Public Works):

I cannot recall what I said on the previous occasion, but I know these crown lands are close to certain of our buildings. The policy of the government in the past has been to keep such lands free. I believe they have changed twice in the last three years the stopping places of these buses, and we do not know whether the city would wish to make any further changes. However, I have taken note of the hon. member's question, and I shall ask my officials to consider the matter.


Thomas Langton Church

Progressive Conservative

Mr. Church:

The fact that the city recently became the owners of the street railway might make some difference in the matter of their willingness to erect a temporary shelter.





Robert Henry Winters (Minister of Reconstruction and Supply)


Hon. Robert H. Winters (Minister of Reconstruction and Supply) moved

the second reading of Bill No. 142, to amend the National Housing Act, 1944.

He said: Mr. Speaker, before commenting upon the proposed legislation I should like to make some general remarks, including a few references to what has been achieved in the field of housing by the aggregate efforts of all who have concerned themselves with this important activity.

Housing accomplishments in the years before 1949 have been reviewed on a number of occasions in this house. Factual information will be found in the annual report of the Central Mortgage and Housing Corporation, which was tabled on March 22, 1949, and in "Housing in Canada", a quarterly publication of the corporation. I will therefore confine my remarks to the housing situation as it has developed in the course of this year.

On September 21 I said that new housing, even at the present record rate of production, was barely keeping up with current needs, and making no important inroads into the backlog. In degree this is less true in 1949 than in any previous post-war year. Our housing completions this year are likely to be about twenty per cent higher than in 1948, and net family formation is likely to be about ten per cent below that of last year. On this basis new housing would exceed net family formation by about 20,000 units. Two years ago net family formation exceeded the number of new housing units by a large margin. Last year new housing was just about in balance with net family formation. This is the first year that some progress will have been made to reduce the backlog of housing need accumulated both during the war years and the depressed thirties. It is not an important inroad, considering the magnitude of the backlog; nevertheless it is a significant reduction of the over-all housing need.

A favourable feature of the housing situation is a distinct levelling-off of building costs during 1949. During the first nine months of 1949 the weighted index of residential building costs changed very little. Hon. members will recall that in the years 1946, 1947 and 1948, construction costs, as represented by

National Housing Act

this index, rose 11 per cent, 22 per cent and 11 per cent respectively. The weighted index of materials is approximately one per cent under that of January 1, 1949. This is offset by a weighted wage increase of approximately 3 per cent, so that the index is now only fractionally higher than it was at the first of the year.

Furthermore, a more regular and adequate supply of materials, together with increased productivity of the house building labour force, has had the effect of reducing costs. I am not suggesting that the price of new houses has decreased appreciably, because under present market conditions it is the sale price of a house rather than the cost of construction that is the governing factor. A year ago Central Mortgage and Housing Corporation was having difficulty in securing contractors to build veterans' rental units. They were able only to secure prices subject to an escalator clause. This year there has been keen competition in bidding for jobs in all parts of the country, with the result that comparable houses are costing about three per cent less this year than last. These reductions are not large, but they do represent a cessation of the continuous upward cost trend experienced since the end of the war. In 1950 we may expect further improvement in the supply situation. As a result there is reasonable prospect that building costs will not be higher than in 1949.

There is general complaint about high building costs in the post-war period. High prices of building materials, high wage rates, high profits, and inefficiency of the building industry, are the reasons usually ascribed. We would all like to see construction costs lower than they are today. But it might be helpful to consider a few facts which provide us with a perspective in this matter.

It is true that it costs about twice as much today to build a house as it did before the war. But it is also true that the income of the average person in 1949 is more than twice as great as it was in 1939. In that year, in per capita terms, the average Canadian had a net income of $371 after taxes. But in 1948, the year for which the latest figures are available, the corresponding income was $859, or about two and one-third times as high as it was ten years ago. The relationship between prices of housing and incomes is probably more important than the absolute level of construction costs. It is true that there are a number of families who cannot afford new houses at present prices and costs, but the fact remains that more new houses are being built and more existing properties are being sold when both

costs and incomes are up than was the case before the war when costs and incomes were much lower.

The outstanding feature of the housing program this year has been the continuation of the large volume of hew starts and completions. During the early months of the year, new residential starts ran far ahead of the corresponding months of 1948. In June, July and August the starts dropped sharply in comparison to a year ago, and it was thought by some that perhaps the experience of these three months indicated a trend. However, starts in September were buoyant and somewhat in excess of the corresponding figures for 1948.

Completions have been at new record levels. The heavy carryover of partly completed units at the beginning of the year, together with the high level of new starts, has resulted in completions far above 1948.

Complete figures up to the end of August and partial figures during September indicate that 62,500 new housing units were completed in the first nine months of 1949. This is an increase of 24 per cent over the corresponding period of 1948. If the last quarter of 1949 follows the pattern of the last quarter of 1948, completions of new units will amount to approximately 92,000. Adding conversions to new units, total completions of all kinds for 1949 would under these conditions be of the order of 96,000.

Starts in the first nine months of 1949 were about 71,000, almost the same as in 1948. Units under construction at the end of September, 1949, amount to 65,800, as compared with 63,700 a year ago. Projecting new starts for the remainder of the year on the same basis, a total of 86,000 starts might be expected.

There are, however, two important qualifications to the projection of the figures for the first nine months of 1949 as an estimate for figures for the full year. The effect of the steel strike in the United States may reduce the number of completions during the last quarter. In respect to starts, a repetition of last year's pattern requires weather as favourable as it was in the last quarter of 1948.

Speaking in this house on July 22, 1946, my predecessor, the present Minister of Trade and Commerce (Mr. Howe), estimated that some 480,000 units should be built during the five years ending March, 1952. He set a target of 80,000 units for 1947-48, and 100,000 in each of the following years. Up to the end of September, 1949-the first two and a half years-his estimate was 230,000 units. During that period completions have amounted to 212,134 units. This is substantial accomplishment of the target of completions, and full


IS, 1949

accomplishment if allowance is made for the increased number of houses presently under construction. The greatest part of housing completions in 1949 will be by private endeavour. Housing on direct government account, such as veterans' rental units, married quarters for the Department of National Defence, and other activities resulting in government ownership, will account for about 14 per cent of all completions. Another 25 per cent is financed under the National Housing Act. The remaining 61 per cent of completions will be without government sponsorship of any kind. I would call the attention of the hon. members to the fact that this unprecedented amount of housing has been built during a time when capital investment of other forms also has been at a record level. With the exception of a few areas, the construction industry is fully employed. Nor is there indication of an immediate decrease in the aggregate volume of non-residential construction. This is probably a good thing, because most of the current non-residential construction program is necessary for the growth and welfare of the nation. If there were a lessening in non-residential construction, it might be possible to increase residential construction by a moderate amount. I say a moderate amount, because the limitation upon our house building program is not only because the construction industry is fully employed, but also because of the shortage of serviced land. Much has been said about steps which the iominion government might take to promote ;fae building of many more thousands of hous-ng units each year. I need hardly remind ;hose familiar with housing problems that the irst and foremost need is for land upon vhich to place houses. Municipalities have lefinite ideas as to the manner of develop-nent of their communities. Services of all finds must be provided-not only those im-nediately adjacent to the houses, but also >asic services such as pumping stations, chools, sewage disposal and facilities of the find. Some municipalities are having trouble n financing these services for the current esidential construction program; other muni-ipalities have no undeveloped land within heir boundaries. This is an important limi-ation upon the volume of new housing which an be built. The bill now before the house ontemplates a co-operative arrangement between the provinces and the dominion to assist le municipalities in this respect. Quite naturally, a great many people are liking about housing these days. Some people elieve that the only solution is a subsidized ublic housing program to look after those National Housing Act who cannot afford to pay economic rentals. Others believe that the only way is for the governments to sponsor large quantities of modest dwellings to be sold to potential home owners on a rent-purchase plan with little or no down payment. Others believe that, if enough houses are built for those who can afford them, in due course the filtering process will work so that everybody will be comfortably housed. It seems to me that there is nothing mutually exclusive in various methods of making progress. There is great merit in-and certainly it is the policy of the government to encourage as much as possible-new housing by private enterprise. A good case can be made to widen the band of potential home owners by terms of financing. Hon. members will notice that we have taken steps along these lines in the bill now before the house, and I doubt if there are many who will object too strenuously to the proposition that there is a group of families in this country which is financially unable to improve its housing condition and for whom public housing with subsidized rentals is necessary. It seems to me that the problem is so large and so important that every reasonable approach must be used. Perhaps the most important principle of the legislation which we are now considering is the new structure being created for dominion-provincial co-operation. Years of experience of the federal government in the housing field on its own account have indicated very clearly the impracticability of the dominion being the sole participant in a long range national housing program. The provinces have authority and facilities in the real property field. Moreover they, with the municipalities, are better judges of local housing needs than is the federal government. Any good plan must contemplate close and continuous co-operation between all three levels of government. I hope that the pattern we are now proposing, which has received a measure of informal support from some of the provinces, will provide a long-term method of operation whereby the three levels of government can assist the orderly development of housing throughout the country. In the immediate future, this pattern will be useful toward making good the housing shortage. A further consideration is that the day may come when the building of a large volume of new housing will be welcomed as well for the employment it will provide. All hon. members will remember evidences of this during the thirties. Construction then was, and perhaps still is, one of our most volatile industries. The policy of the dominion government, and we presume most provincial governments, will be directed towards an even flow of new

National Housing Act residential construction by private enterprise. However, the pattern which we are now suggesting will provide an opportunity for public investment in this field should it be considered desirable. To illustrate my point, I can think of no better example than slum clearance and redevelopment of the site. If for no other reason than inability to rehouse families, slum clearance and redevelopment projects are not appropriate everywhere today. However, the time may come when effective demand for new housing will have dropped to a point where redevelopment of areas containing substandard housing will have not only social but economic benefit. The pattern of this legislation provides the machinery by which such steps can be taken. I should like now to make some comments upon the bill itself. It contains four major changes, as well as a number of minor amendments. The major changes are: (a) The reduction of the down payment required from people who wish to own their houses. (b) Enabling the federal government to join with the provinces in desirable housing developments of all forms, including the assembly of land. (c) An increase in the maximum amounts which may be made available for home improvement and home extension purposes. (d) Changes in the co-operative section of the National Housing Act so that its facilities will be more readily available. The bill changes the definition of a builder so as not to exclude a builder who holds a long-term lease or other satisfactory interest in the land. The previous limitation of ownership has caused difficulty in areas where long-term leases are customary. A continuation of the limitation of ownership would be inappropriate for Newfoundland, where ground leases are more general than land held in fee simple. The bill provides that a basic loan of 80 per cent of the lending value shall be made available to a builder or to a home owner. The amortization may be for a period as long as thirty years. Provided that the purchase price to the home owner is a fair and reasonable one, provision is made for an additional advance in amount of one-sixth of the basic loan. This change provides considerably higher mortgage financing than the act in its present form. Depending upon the price at which the house is sold by the builder to the home owner, the down payment requirements will range between one-sixth and one-tenth of the purchase price. The fair and reasonable price provision is included because previous experience under the National Housing Act, as well as our understanding of experience under the [Mr. Winters.l Ontario second mortgage legislation, indicate that increased mortgage financing tends to increase sale prices. Little purpose would be served if, by providing an extra mortgage loan of $1,000, the sale price of the house went up a part or all of this amount. The majority of present houses under the National Housing Act will, within the present range of sale prices, qualify under the fair and reasonable provision. Houses upon which the builder is taking a very long profit will not qualify. I should like to make it perfectly clear that the fair and reasonable provision is not a limitation upon the sale price of houses to be financed under the National Housing Act. A house with a lending value of $6,000 will qualify for a basic loan of $4,800, and for a further advance of $800 to a home owner who has purchased the house at a price not exceeding $6,720, which is the total loan of $5,600 plus 20 per cent, and would be considered the fair and reasonable price. The builder may sell the house at any price he desires. If, however, the price is above the fair and reasonable price, the basic loan of 80 per cent will be made, but the additional advance to the home owner is not available. During the last few weeks I have had a number of representations that the fair and reasonable price requirement is unreasonable, and that the legislation should be brought down without this provision. I can only say that these representations in many ways point up the very reason for the limitation. The bill also provides for revisions to the co-operative section of the act. During the past year or two there have been a number of representations from co-operatives that the act, in its present form, is unsuitable. With this we agree. Representations have been made that the rate of interest payable by co-operatives or by individuals who have built their houses under co-operative schemes should be less than the rate of interest available to home owners. As will be clear to hon. members, this point of view cannot be accepted. Therefore amendments are now being proposed to improve the mechanics, and indeed the terms, of loans to co-operatives, but no change is being made in the interest rate. It has been suggested to us that there is a similarity between the purpose of section £ and the co-operative part of the act. This of course, is far from being the case, because section 9 contemplates rental housing with nc proprietary interest by the occupant. It is also definite in its provision that continued occupancy is dependent upon family income being below a certain level. An examinatior of section 9 will show clearly the reasons why a co-operative is not a limited dividend rental housing project. It does not seem reasonable to us that individuals with a proprietary interest in the house in which they live should be afforded better terms under a co-operative than if they arranged the financing of their houses on an individual basis. The government deems it unwise to create such differential. In our experience we find that there are two kinds of co-operatives. There is the genuine co-operative formed by a group of people interested in producing houses for their mutual benefit. The legislation is being revised to suit their needs. The other type of co-operative is one developed by a promoter for the purpose of finding a lucrative method by which to market bis construction. This is the type of co-operative in which we believe Canadians would not wish the government to be interested. It will be noticed than an application will not ae approved from a co-operative unless the corporation is satisfied that 80 per cent of the family housing units will be occupied by co-operators. In other words the genuine nature of the co-operative must be evident at the time of the application. I may say that this limitation carries the judgment of several afficials experienced in the co-operative movement as it relates to house building. They are as anxious as we to avoid the use of the co-operative principle for purposes for which it was not intended. There are two distinct kinds of housing projects for which the legislation makes provision. In the province of Quebec, especially, co-operative housing maintains the co-operative principle until the completion of the unit, at which time full ownership is transferred to the individual. Hon. members will aotice that the legislation contemplates loans to such a co-operative in amount of 80 per cent of the lending value, and an additional advance of one-sixth of the joint loan at the time the member of the co-operative takes title to his home. The arrangements give advantage of blanket loans to the co-operative, together with the full advantages of the borne ownership provision of the act to the co-operator after he has full ownership of ais house. The other form of co-operative contemplates the co-operative principle continuing after the completion and occupancy of the lousing unit. Of necessity this must be the condition in the case of a multi-family unit. But where a multi-family unit or a group af houses maintain the co-operative principle after completion, provision is made for the additional advance comparable to that afforded to a home owner. Under the present co-operative legislation, where the co-operative principles extend National Housing Act beyond completion, there is a requirement of joint and several covenants. During the past few years a number of genuine and worthy co-operatives have been unable to finance under the National Housing Act because the solicitors of the co-operators have recommended to their clients that they do not participate in a joint and several covenant. In order to meet this difficulty the legislation before the house now provides for a several covenant only. In other words, if the cooperative gets into trouble and the mortgagee must realize on his security, each co-operator is personally liable only for his share of the loss suffered by the mortgagee. Although this removes one of the main limitations of the legislation as it now exists, there is no manner in which the equity of the nondefaulting co-operator can be protected against the default of a large enough number of co-operators to occasion default and foreclosure of the mortgage. This is an unfavourable but inherent feature of co-operative ownership. There is provision for an increase in the maximum amount of loans for home improvement and home extension purposes. The present maximum limits were established in 1944. Since then building costs have increased, and the limits are being increased by 25 per cent. Authority is being sought so that the corporation shall have the power to deal with properties acquired by it. The present act limits such powers to housing projects. Because the corporation now manages properties such as Ajax near Oshawa and Laurentian Terrace in Ottawa, like powers are needed to deal with all classes of property. On September 21, and again on October 28, I outlined the nature of the proposed dominion-provincial arrangements and the general reasons why enabling legislation is being sought. During the last ten years, in the construction of both war workers' and veterans' rental units, experience has shown that governmental operations in the housing field require participation by the provinces. Neither the provinces nor the dominion are happy with arrangements whereby the dominion enters directly into agreements with municipalities. It is quite true that most of the provinces passed enabling legislation to allow their municipalities to enter into such contracts. However, in my conversations with the provinces there was general agreement in principle that longterm arrangements and contracts between the dominion and the municipalities were not desirable. The provincial governments are familiar with local conditions, and their direct participation is required to develop housing

National Housing Act projects, particularly in view of the jurisdictional aspects of the various phases of the problem. For instance, new housing in a number of our larger municipalities is dependent upon land being made available. In many cases this land is not within the present boundaries of the municipality. The main municipality is reluctant to extend its civic services into the adjoining municipality. The adjoining municipality in some cases is reluctant to add new small residential units built within its area, because, even with full taxes, small residential units are a deficit item in the accounts of the municipality. This is the type of problem which the provinces can do much to resolve. It will be noticed that the legislation is general in form and enabling in character. In order to join with the dominion in such projects, the provinces will in most cases require authority from their legislatures. Procedures in operation have not yet been established. The bill contemplates regulations by the governor in council which will prescribe the type of projects and the conditions under which they may be arranged. I will now suggest a few types of arrangements which might be undertaken by the dominion and a province. In certain areas of the country there are builders and other individuals who are anxious to build houses but who cannot do so because serviced land is not available. The municipalities are pressed in financing other services within their boundaries, and do not feel that at this time they can undertake the capital financing of servicing new areas of land. Therefore authority is being sought to enable the dominion and the provinces to take ownership of tracts of land in fringe areas, and with the co-operation of the municipality, see to the installation of services. The land will be purchased jointly by the dominion and the province. Services, when installed, will be paid for by the dominion and the province. Builders and other individuals will be able to purchase these lots. In some cases the value of the fully serviced lot will be included in the lending value for National Housing Act purposes so that the cost of the land and the improvements will be paid off over the period of the mortgage. In other cases, it may be preferable for the municipality to assume the improvements, with the new owner paying off the costs of the improvements on a local improvement basis. Under this latter arrangement the municipality issues debentures secured by the annual local improvement taxes. Another type of dominion-provincial project might be the assembling of land as just described, together with the erection of houses for sale. There are certain localities in the country where such an arrangement

by the two senior governments would be helpful. Land would be assembled and a contract would be awarded for the building of houses. Houses would be sold from the project to individual home owners. To the extent that these home owners financed their purchases under the National Housing Act, the unpaid balance of purchase price would be recovered by the dominion-provincial project, and the long-term mortgage risk would be assumed under the National Housing Act. Transactions such as this might give the appearance that the governments were taking the place of house builders. To the extent of a managerial position, this would be true. However, in practically every municipality in Canada the same men are going to build the houses, whether they are being built on the home owner's account, on their own account as a speculative builder, or for the account of the dominion-provincial project. We wish to avoid reducing the supply of houses which will be built by individuals for themselves, or by builders on a speculative basis. This is important, but it is even more important that the needs of prospective home owners be met. It is our opinion that in certain areas a sufficient volume of housing for prospective home owners can be achieved only by direct support of a dominion-provincial project. As a modification of this arrangement, the dominion and the province might assemble serviced land and arrange for builders to build houses on a speculative basis with the proviso, borrowed from the integrated plan, that in the event of non-sale the dominion-provincial project will take the houses over at a price somewhat less than their regular sale price, but rather more than the out-of-pocket costs of the builder. Another type of project would be the development or redevelopment of centrally located land to provide new rental housing, either on an economic or a subsidized basis. The procedure would be very much the same as in the other examples which I have mentioned. The province, with the co-operation of the municipality, would see to the acquisition of the land, to be paid for 75 per cent by the dominion and 25 per cent by the province. It may be that slum clearance provisions of section 12 of the National Housing Act would be used. After the land had been acquired for redevelopment, the dominion and the province, with the co-operation of the municipality, would determine the type of rental housing which is needed. In certain parts of the country it may be that rental housing can bear economic rents. In other localities an element of subsidy may be necessary. After the rental scale, allowing for the element of subsidy, has been determined, Central Mortgage will proceed with the construction of the buildings. When complete, the dominion and the province will seek local management in the form of a local housing authority, or such other method as may be mutually agreeable. The matter of local management is emphasized. The policy of the dominion is to reduce, not increase, its direct landlord position. The project, however, will remain in ownership of the dominion and the province. The operating profit or loss will be borne 75 per cent by the dominion and 25 per cent by the province. The annual subsidy will be the amount by which rentals received are less than operating costs of all kinds, including depreciation. These operating losses will be met on an annual basis 75 per cent by the dominion and 25 per cent by the province. Under our arrangements with the province, provision will be made that the municipality shall receive a payment in lieu of taxes so that houses in the project will provide tax revenue equivalent to taxes received on like houses in the municipality. We feel-and some of the provinces agree with us-that a suitable way to determine these payments in lieu of taxes is to have the municipal board of the province establish a fair level of payment. Although the costs of these projects will be borne 75 per cent by the dominion and 25 per cent by the province, it may be that the province will feel that some share of the capital costs should be borne by the municipality. This is a matter for determination by the province. Our arrangement will be directly with the province; the municipalities will not be party to the agreement. Any agreement providing for the municipality to assume financial responsibilities will be independent of our arrangements with the provinces. Dominion-provincial rental projects may take the form of houses in fringe area locations. The principles will be the same as those described for rental projects in central locations. Our main purpose is to increase the volume of housing. We wish to stimulate, and where necessary, supplement, the supply of housing from present sources. Care will be exercised to ensure that we are not replacing the normal activities of builders. The provinces which have shown an interest in the proposal feel that the joint efforts of both senior governments, in co-operation with the municipalities, will increase the volume of new houses. Hon. members may wonder how much housing can be expected as a result of this legislation. I can give them no satisfactory National Housing Act answer. It will depend upon the number of provinces participating. It will also depend upon the attitude of the provincial governments toward proposals which they may receive from municipalities and other interested groups. For our part, the federal government will require that the projects be sound, in that they fill a need at a reasonable cost. I am sure that the provinces will adopt the same attitude. As I mentioned in one of my earlier statements, each project must be satisfactory to both the dominion and the province. If a province is of the opinion that projects of the various forms I have described earlier are desirable, the federal government is likely to participate unless very obvious difficulties or deficiencies are present. We are entering a new field. Techniques have not yet been established. After a few projects have been considered, methods of operation will be more definite than they are at the present time. Techniques and methods will be found to implement the purpose and intent of the arrangement-a co-operative effort by the dominion and the province to improve housing conditions within that province. In this as in all other housing legislation the existence of the legislation and appropriations does not ensure new housing in itself. It is the energy and ingenuity of private endeavour and of federal, provincial and municipal governments working together which will achieve successful results.


Donald Methuen Fleming

Progressive Conservative

Mr. Donald M. Fleming (Eglinion):

Mr. Speaker, I am sure the house has listened with great interest to the statement made by the Minister of Reconstruction and Supply (Mr. Winters). I believe the house will be glad indeed to concur in his concluding statement, in which he laid emphasis upon the necessity for co-operation on the part of all governments in Canada in their approach to governmental responsibility in respect to housing. One of the criticisms many of us have had to make of this government in times past is that it has not shown that spirit of co-operation; consequently the co-operation between the dominion and the provinces which was so necessary has not previously been available.

I should like in all frankness to say to the minister who has assumed responsibility for this department and the very important subject of housing that he seems to have shown a co-operative attitude in his approach to the other governments in Canada. I believe that approach will be productive of results.

We on this side of the house have said, and we said it times without number in the last parliament, that this problem was so great and had so many aspects to it-I am not now speaking simply of the constitutional and

National Housing Act legal aspects-that co-operation between the dominion government and the provincial governments was an absolute essential. The present minister-and this is a reversal of the previous attitude-has demonstrated a willingness to co-operate. The house will be quick to note the change and to commend the minister.

The house will always be on its guard against a note of complacency in any statement from the government on the subject of housing. We have had so much experience in the last five years with statements made by the present Minister of Trade and Commerce (Mr. Howe), in which it was evident that he was gazing at housing conditions in Canada through rose-coloured glasses, that the house is naturally sceptical, and quite properly so, with regard to any ministerial statements in the matter which sound that note of optimism.

I wish to say, Mr. Speaker, that on the whole I think the minister has been fair in his factual approach to the provisions of the bill and the needs that the government hopes it will meet. There are, however, one or two considerations that are worthy of comment and supplement.

At the outset may I say that I do not intend to repeat or to cover again the ground that I sought to cover in speaking on the housing question at the resolution stage of the measure on October 31. At that time we had an extended discussion of housing conditions in general; today I hope to confine myself to some of the aspects of the minister's statement and of the bill itself which I think ought properly to be commented upon in the debate on second reading. In committee stage later we can expect extended discussion on some of the features of the bill, because hon. members undoubtedly will be seeking much more information with regard to some of its provisions.

The position in which the house finds itself today, as compared with that in which it found itself on October 31 on the resolution stage of the measure, is improved by reason of two factors. In the first place, the minister has tabled the correspondence between the dominion government and the governments of the provinces in the course of their negotiations since last spring with regard to a joint approach to this question. In the second place we have had from the Minister of Finance (Mr. Abbott) a statement of government policy with reference to rent control. The house would be in no position to review the adequacy of this present measure without at least knowing the contents of that correspondence with the provinces, and what the policy of the government is with reference to rent control.

As to rent control-and again I do not intend to repeat what I said on that subject in the house last Tuesday-and the relationship that the statement of the Minister of Finance on that subject bears directly to this question of housing, I shall simply say that the statement will not help in the slightest the efforts that the Minister of Reconstruction and Supply is making to meet the housing problem. I think one is justified in offering a word of sympathy to the Minister of Reconstruction and Supply in having his efforts to improve housing conditions in Canada hamstrung by a statement of policy on rent control of the kind made by the Minister of Finance.

Here you have a most amazing situation- and I am sure it could not exist under any other government than this. One minister is making efforts to improve housing conditions, and another is making declarations of policy which unquestionably will confuse and retard the efforts of the first minister. Surely the time has come, sir, when this government must at least make an attempt to unify its policy with regard to housing in Canada. Surely we have had enough of this situation *-of the government speaking with one voice through one minister on one occasion and with another voice through another minister on another occasion, and saying things that are frequently diametrically opposed in result and in policy.

In 1945 we started off with housing responsibilities divided not between two ministers of the crown but among three. Under insistent pressure from the official opposition, the government got round to concentrating housing principally under the then minister of reconstruction, with jurisdiction in respect of the wartime prices and trade board and its orders still residing in the Minister of Finance. When the functions of the wartime prices and trade board today are so greatly concentrated on the subject of rent control, surely the time has come when the simple step must be taken by the government of unifying under one minister all government policy and administration with respect to housing. Surely then we might hopefully look for an end of these contradictory statements and policies.

On the other aspect, as to the information now available to the house through the correspondence between this government and the provincial governments, which has since been tabled, I shall hope at a later stage in my remarks to make some comments.

I made mention of the factual information given by the minister today. He looks for encouragement to construction through the fact that building costs seem to have levelled off. He properly drew attention to the fact

that new housing starts in Canada have shown a reduction-which I will not say is critical but which certainly is disturbing- in the months of June, July and August, the season of the year when the volume of starts should be at its maximum.

While there has been some improvement in the situation in September, I think it is too late in the season now to expect that it will be possible to overcome this diminution in housing starts that occurred in June, July and August. This situation cannot be viewed without great concern. We are glad to see a record of completions, and we shall bear in mind at the same time that many have contributed to that number of completions, among them the government of the province of Ontario through beneficial legislation which became necessary because the dominion government-this government-was so tardy in measuring up to its responsibility. Why did this government not see its responsibility in 1947, as it professes to see its responsibility today, late in 1949?-and so late in 1949, sir, that it is unlikely that any measurable benefit will be available in 1949 from this legislation; the most we can hope for is that it will produce some benefit in the building season of 1950. Think of all the precious time that has been lost, when the way was being pointed out to the government!

Central Mortgage and Housing Corporation, in its last quarterly-issued report, has some comments that may well be considered at this time. I refer to "Housing in Canada", and the last available quarterly report is the one bearing the date of July. The report opens on page 9 with this statement:

During the first six months of 1949, for the first time since the end of the war the rate of new families formed in Canada showed a significant decline. This is indicated by a drop of 10 per cent in the number of marriages, from 50,000 during the first six months of 1948 to 45,000 during the corresponding period of 1949. Immigration of married families, births and deaths changed little as compared with the same period of 1948. The reduction in the number of new families formed will tend to lessen the added pressure exerted on the housing market from this source.

I comment upon that to urge that the government ought not to lay too much stress upon that factor, because it would be highly dangerous at this stage of the development of housing programs for any thought to creep into the minds of those responsible for government administration in the field of housing that the pressure has diminished. I believe the minister was frank in his statement this morning when he intimated that no appreciable reduction is yet being made in this tremendous backlog of housing needs in Canada. This is no time for relaxation. If there is any evidence of a reduction in 45781-113

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the family formation rate; if there is a reduction in immigration this year, as there has been, then certainly this is the time for the government, in association with other agencies interested in the building of houses, to put forward all pressure toward making a substantial dent in that formidable backlog, which represents a great burden of hardship to hundreds of thousands of Canadians.

The report lays further emphasis upon the decline in starts, which I have already noted. A significant sentence appears at page 9 of the report:

If the trend of decline in starts apparent for June and July of 1949 continues it may mean that an immediate post-war peak in starts has been reached in the second quarter of 1949.

In the face of the critical conditions still prevailing in Canada, we dare not accept a situation in which we look back and see, in the condition that obtained some five months ago, the peak in housing construction in Canada since the war. That would be an intolerable situation. Surely this is the time when every effort should be made to build toward new peaks in housing construction. If the minister will dedicate his considerable talents and his commendable good will in that direction, I am sure the house will applaud his efforts and will give him credit when credit is due.

Looking at other fields of government endeavour, I believe it would be well to offer a word of caution in respect to some of the statements which have fallen so freely in recent days from ministers of the crown. On the subject of veterans' rental housing, one reads at page 11 of the same report:

Starts of rental housing units for veterans under the Central Mortgage and Housing Corporation dropped from 2,300 during the first half of 1948 to 1,500 in the same period of 1949.

And, sir, to those who listened to the statement made in recent days by the Minister of National Defence (Mr. Claxton) as to the way in which his department has been mustering its forces behind the provision of housing for married men in the services, one notes with considerable interest another sentence appearing at page 11 of the report. It has reference to construction operations in 1949 under the armed services housing program of the Department of National Defence. As hon. members are aware, that program was carried on through Central Mortgage and Housing Corporation. The sentence is:

No starts were made in the first half of 1949.

How does this measure up alongside the statements made by the government in recent days about the tremendous efforts they have

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been putting behind the housing construction program for the benefit of married personnel in the armed forces?

Then, sir, as having a bearing on the question as to the principal source of effort behind the house-building program in Canada-and I affirm it still must be the private builders -the house will be interested in a statistical table appearing at page 27 of the report. There are three figures dealing with the first six months in each of the three past years, and these figures have a direct bearing on the subject.

The first deals with direct government housing, that is to say, housing built and owned by the government or a government agency. In the first six months of 1947 the figure was 1,800; for the same period in 1948 it was 3,240, and for the first six months of 1949 it was 1,626-not a formidable figure indeed, and one which shows a substantial reduction from the first six months of 1948.

Turning to the broader subject of total government-assisted housing, which includes not only the figures I have already mentioned but also all forms of government assistance to housing, including loans under part I of the National Housing Act, we find that in the whole of 1947 the figure was 20,540; in 1948 the figure for the whole year was 29,348, while in the first half of 1949 it was 11,768. The figure for the first six months of 1949 is approximately the same as that for the first six months of 1948. Therefore we do not see any appreciable advance being made in the total number of units constructed with government assistance this year, as compared with last year.

I believe a percentage comparison would be of interest. The total of government-assisted housing in the whole of 1947 as compared with the total housing constructed in Canada gives a figure of 28 per cent. In the whole of 1948 it was 33 per cent, and in the first half of 1949 the figure is 29 per cent. This shows a slight reduction in percentage, for the first half of this year as compared with the first half of last year, in housing to which the government has contributed in any form compared with the total of housing constructed.

If one compares the total of government-built housing, or direct government housing, with the total of houses built we find that in 1947 the total of government-built housing was only 9J per cent of the total number of houses built in Canada. In 1948 it was 11 per cent, and in the first half of 1949 had dropped to 4 per cent.

One other figure which has great statistical importance is the number of houses in the

construction of which the Ontario government has assisted by means of second mortgages. I shall have a word to say about that in a moment.

The minister has indicated that this bill has four major provisions. The first is the reduction in the down payment. The house will be glad to see this provision introduced into the legislation, regretting at the same time that the government has been so slow to follow the good example of the government of the province of Ontario.

Here is the other statistical figure that I wish to give the house. Since the Ontario government in 1948, one and a half years ago, instituted the plan of government second mortgages to bridge the gap between the cost of construction and the available loan on first mortgage under the National Housing Act, or by straight private loan, the number of houses that have been so assisted now totals 10,000. That, sir, is a formidable accomplishment on the part of the government of the province of Ontario. I hope that the minister and the house will be fair enough to acknowledge that, having regard to the figures which were quoted this morning, showing completions of houses in Canada, the efforts of the government of the province of Ontario in this field ought to be recognized. Not only that, sir, but the fact that in the province in one and one half years those who are constructing houses needed this form of assistance to the number of

10,000 establishes conclusively the great need that exists throughout the whole of Canada today for legislation of this kind. The house welcomes it at long last, but regrets that one and a half precious years were lost while this government was sleeping soundly and blinding itself to a useful and constructive example that was offered to it by the government of the province of Ontario.

I pass over, for the moment, the second main provision of the legislation, and take the third, which is an increase in the maximum available for home improvement and home extension. The house will be glad to provide anything in this sphere that will be put to work by the government to improve housing conditions in Canada. The house has never been niggardly or penny-pinching in its approach to this question. It has pleaded with the government for action, and it has furnished the government at all times in this critical post-war period with every tool and weapon that the government asked for to meet the needs of Canadians who lack housing and who have been living under substandard conditions. If the government will use additional money in this way for

improving housing conditions, there will be no cavilling on the part of any hon. member about making sums available for these purposes if the government will put them to work. -

The fourth provision relates to changes made in the co-operative housing sections of the act to meet particular needs in this field, as the government sees them, in three provinces in which co-operative housing is a factor. Again I say this: While there will be something to be said in committee, on this part of the bill in general I am sure the house will grant any request the government makes that will have in it any promise of bringing about an increase in the construction of houses in Canada, or an improvement in housing conditions, but will wish to be sure that the legislation will be put to work.

I come now, sir, to the second principle that the minister emphasized. It has to do with the joint efforts on the part of the dominion and the provinces in several fields of endeavour.

When the minister visited and conferred with the governments of the provinces during the late summer and early fall, there were three subjects that came particularly to the fore. They are referred to in the minister's letter of September 13. I have in mind now particularly his letter to the premier of the province of Ontario, although a letter in almost identical terms was written by the minister on that same day to the premiers of all the provinces. In the second paragraph of the letter the minister said:

In general, I believe the provinces feel that the proposals already discussed with you are reasonable, and the dominion is prepared to proceed along these lines. Therefore on or about the 20th September I propose to make a statement in the House of Commons that the government intends to introduce legislation-

We come now, sir to the three features of the proposals:

-to enable the dominion to enter into agreements with the provinces for publicly assisted housing projects. These projects may take the form of the assembly of land and services to enable an increased volume of housing by private builders. They may take the form of the dominion and province proceeding with moderate priced houses for sale to home owners. They may also take the form of rental projects, in, which event the dominion and the province will seek local management for the project after it is completed.

The minister goes on to comment on these three features. May I, in the hope of clarification, sir, emphasize what these three proposals are, the three projects that were discussed? The first is assistance in the assembly of land and services to enable an increased volume of housing by private builders. The second is assistance for home owners to proceed with moderately priced houses-that is,

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house construction; and the third, rental projects with local management.

This is the observation that the minister made on the reactions of the governments of the ten provinces after his personal consultation with them:

We found that the other provinces agreed with you in favouring the first two forms of project.

Now, sir, as to the second, namely, the assistance in the construction of moderately priced houses for sale to home owners, I take it that the first feature of the bill is the one that is designed to carry out that undertaking by increasing by one-sixth the loans at present available under part I of the National Housing Act. The area, therefore, within which the second feature of the present bill will have operation, I assume, will be with respect to projects of the other two kinds mentioned by the minister in his letter-first, the assembly of land and services to enable an increased volume of housing by private builders, and the second, the rental projects.

I take it, sir, there will be no quarrel-

Topic:   IS, 1949

November 15, 1949