December 18, 1957


Louis Harrington Lewry

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

Mr. Louis Lewry (Moose Jaw-Lake Centre):

Mr. Speaker, I suggest to the minister that the changes proposed in the National Housing Act will only add to the ability of persons to go deeper and deeper into debt. The changes will mean actually that while the down payment will be less, the loan will be greater and the interest will be greater.

Nothing is being proposed and nothing has been done in the past to get at the crux of the housing problem in Canada. The need is not to provide housing that people cannot afford, but to provide low cost housing for the large number of Canadians who cannot afford these homes which are above their income levels. In the last three years the average cost of a dwelling in Canada has increased by $2,000. There are 62 per cent of Canadians who earn less than $3,000, and they are the people who cannot afford adequate housing. They are also the people who are being forced to pay rents far above their earning capacity.

The National Housing Act provides now, and has provided in the past, assistance to those whose incomes are in the better than


Ambrose A. Holowach

Social Credit

Mr. Ambrose Holowach (Edmonton East):

Mr. Speaker, I should like to say a few words on the matter which is presently before us. The order paper states that we are discussing a measure to amend the National Housing Act of 1954, which has as its purpose increasing from $250 million to $400 million the aggregate amount that may be paid out of the consolidated revenue fund under section 22 of the act, and also to provide for a reduction in down payments. Last evening we listened to the affable Minister of Public Works as he explained the purpose of this measure. During his remarks he showed considerable confidence with respect to the achievements these amendments would bring about. He painted a very rosy picture.

Sir, there are serious shortcomings in this bill which would indicate otherwise. Any consideration of the bill and the implications of its text necessitates, I think, a consideration of several broader aspects of the housing problem in this country. In doing this it will become obvious that there are serious and embarrassing facts which we must face squarely. Perhaps the advantage of doing that is that it may spur us on to more equitable legislation with respect to housing.

An illustration of what I have in mind is seen in a clipping from the Financial Post of December 14, where on the first page there appear a few figures of some considerable interest to all those who are interested in seeing the national housing problem solved. I read:

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You pay a high price for slums. They bring in only 6 per cent of total city tax revenues (reports Montreal's planning director C. E. Campeau), but they account for 33 per cent of total population, 45 per cent of major crimes, 60 per cent of tuberculosis victims, 35 per cent of fires and 45 per cent of total city service costs.

The measure itself is positive proof that previous government appropriations and policies have been quite inadequate to meet the needs of the people in the matter of their housing requirements. In my opinion we have never had really vigorous action in this field. I think we have been far too slow and ineffective in handling this problem. There is definite room for improvement. I believe we should profit to a greater extent by our past mistakes. In contrast to what has been accomplished thus far I honestly believe that the Twenty-Third parliament of Canada has a splendid opportunity to demonstrate that Canadian democracy can be made a dynamic process, and that we can do big things for all classes in our society who may be in need of better housing.

The bill proposes amendments which deal with only two aspects of the problem; first, an increase of $150 million in the aggregate amount and second, some reduction in the down payments. I must say that these are two worth-while purposes. As indicated by the hon. member for New Westminster last evening, these are forward steps and we in our group will support them. We hope they will make a contribution to the stepping up of the housing construction program in our country.

However, I cannot escape the feeling that to the extent that this is all that is being proposed, we have here nothing more than a few patches placed on already out-dated legislation which is inadequate and not in keeping with the requirements of our time. One of the obvious shortcomings in the proposal is that it does not make any provision for reducing the present excessive interest charges on loans, and for longer terms for amortization. These possibly would contribute to a more equitable solution of the housing problem. What our economy needs most at this time is bold government action against high interest rates, which have contributed to inflation more perhaps than any other factor.

Another tragic aspect of the existing housing program is the fact that there is too little provision for people who need help most. We are supposed to be interested in the common man, but there is no equality of opportunity for small income groups-elderly citizens, veterans, labouring men with large families-if they are unable to take advantage of available legislation providing assistance in home ownership. If we really believe in equality of opportunity I believe their

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special problems deserve our special attention at this particular time.

May I point out that the old age pensioners, the people on low incomes, are least able to take on any additional financial burdens at this time. Hence the reduced down payments proposed will not, in my opinion, help them very much. It is true that the down payments are proposed to be reduced, but at the same time the carrying charges and the required monthly payments have been considerably increased right across the board.

I mentioned equality of opportunity. May I say that equality of opportunity to these people in the low income groups can only come through amendments which (1) provide reasonable interest rates; (2) extend the terms of repayment of loans; (3) provide income tax exemptions on interest payments made in connection with home ownership; (4) substantially reduce required down payments; (5) provide government policies which aim at a program of minimum rent public housing projects designed for those on the lowest rung of the economic ladder, and in this category a housing program suited to the comforts and needs of our elderly people in the country; (6) permit a complete re-examination of taxing laws, sales and other tax reductions on essential building material, these with a view to reducing the high cost of construction. An example of what happens when prices come down is seen in a report in the latest edition of the Financial Times, that one real estate firm in the city of Toronto reported the sale of 70 houses in one subdivision in four days when the builder dropped his prices; (7) bring an energetic program for slum clearance as well as one to produce better and more functional homes for the rural population.

I feel that these are basic requirements which deserve attention in considering amendments to the housing act. I believe we must recognize that there is a shortage of purchasing power in the hands of the people, and that it is time our taxation and fiscal policies took this fact into account. Until we recognize this situation as the principal consideration in formulating a program, decent homes and stability for Canadians will be difficult to achieve.

Continuation of policies that plainly place our people deeper and deeper into debt is not the solution. As an example of the trend which has developed in that connection I should like to point out that to a question I asked a few days ago with respect to the gross national debt I received an astonishing answer. The question was:

In terms of dollars, what is the present position of the federal government of Canada respecting (a) gross national debt including all liabilities; (b) public debt in terms of per capita liability?

The answer to the question was that at March 31, 1957, the total gross national debt of the nation was $18,326,200,000. The second portion of the question read:

Since its inception, what is the total amount of interest that has been paid on the nation's debt?

The answer to the question was to March 31, 1957, $9,924,493,432. That is an example of a trend and situation existing in other fields, for instance in personal, small business, municipal and provincial debt. I suppose the aggregate debt of all those agencies and fields must be staggering. It has always seemed strange to me that in a country such as Canada, housing and shortage of accommodation should ever have been allowed to become a persistent national problem. It is difficult to understand, considering that Canada is probably the largest and certainly the finest lumber producing country in the world. Our unemployment situation is worsening. There are many skilled hands to do the job of building. Many of our people are living in substandard dwellings and under overcrowded conditions. Hence it cannot be said that there is a lessening of demand for homes.

Clearly the problem is not what it would be if we had tens of millions of people. Our population is only 16 million. In relation to area the population density per square mile is approximately 4. Compare this figure with a country like Great Britain whose population is approximately 52 million, with a density of some 542 to the square mile. What about the situation in a country such as the Republic of West Germany? Their population is 52 million; yet in relation to the area, some 528 people are crowded into every square mile of that country.

What are they doing about their housing problems? Well, if we review the history of the remarkable recovery in those countries it is plain to see what can be done when money is not the limiting factor, and the only limiting factor is the physical capacity to do things. In a small book published by the press and information office of the federal West German government I was surprised to read that the turnover in the whole home construction industry in 1955 was over $4 billion. In our country in the 12 years of the activities of Central Mortgage and Housing Corporation they have approved some $3 billion worth of mortgage loans. In the official report published by the West German government, I see this interesting comment. In 1955 alone the number of newly constructed apartments totalled 541,000. Since 1950 a total of $9.8 billion has been expended in erecting apartment buildings and further, in 1955, nearly 49 per cent of the total expenditure on housing was accounted for in the

capital market, approximately $2.4 billion. These broad figures relate to the amount of capital invested in home construction.

Housing is centred on government aided social housing projects, as in the erection of apartments for which rent or other charges are kept at a low level by the means of loans at low rates of interest and with long-term amortization, within the reach of the broad masses of the population.

Their first housing act provided that a total of 2 million apartments of this kind should be built between 1951 and 1956. For the years 1957 to 1962 provision is made for a further 1.8 million apartments of' the same kind. At first the majority of apartments completed contained few rooms, but larger apartments are now being constructed in a much greater ratio. In 1955 more than half the new apartments had four or more rooms including the kitchen.

Well, now, that is a small nation with limited material resources and possessing a special problem of meeting the requirements of some 11 million refugees and expellees. That that country is able to make such an impressive housing program presents, it seems to me, a sharp contrast to our own slowness. It also indicates how much more we in Canada could accomplish.

Let us look at what has happened in a country closer to our own. In its 24 years of operation the United States federal housing administration has insured over $40 billion of home mortgages and property improvements. Translated into the number of families affected this means that one out of every three families in the United States has benefited. These are outstanding accomplishments, and suggest that in the field of housing similar potentialities exist in our own country. One fact is clear, that of all the problems we face in this great country of ours the housing problem is, to say the least, the most embarrassing.

Who is to blame for all this? To be honest about it, I believe it is the horse and buggy thinking at the government level. The real story would show that money trusts have been operating against the best interests of our people. Government publicity keeps telling us of the tremendous progress we are making. That is not so. I am not suggesting we have not made progress, but I am saying that our progress in terms of what could be done has been quite unsatisfactory.

Let us look at these facts. It cannot be said that housing shortages in our country are of recent origin; the problem has been with us for the past 25 years, irrespective of who was in power, both in depression years and in times of relative prosperity. The

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question of providing adequate housing for our people has just never been resolved. The unhappy fact is that we have never made a proper effort to develop a comprehensive broad scale attack to eliminate substandard dwellings. Consequently today the greatest unmet need of our people is still in the field of providing homes on a fair basis.

What is the situation today? The minister in speaking recently somewhat played this down, but it is a fact that for two years now residential construction has been substantially dropping. This year starts were considerably lower than last year. I have in my hand daily bulletins from the dominion bureau of statistics, one dated Monday, May 6, 1957, which has this to say:

Starts on the construction of new residential units were sharply lower in this year's first quarter, dropping to 7,769 units from 14,473 in the first three months of 1956.

A further bulletin dated Tuesday, July 9, 1957, has this to say:

Fewer new dwelling units were started or completed in the first five months of this year than last, D.B.S. reports in an advance statement. Number of units in various stages of construction at the end of May was also smaller than a year earlier.

Then as recently as December 6 we have this information.

Starts on the construction of new dwelling units in the January-Oetober period this year numbered 102,197 units, some 11.3 per cent fewer than 1956's comparable total of 115,188, according to an advance D.B.S. statement.

Further on it says:

Completions in the 10 months totalled 94,868 units, down 13.1 per cent from the year-earlier total of 109,160 units.

In many cities of Canada the sag in the home building program has become a very serious problem. In my own city of Eamonton this has been especially so. May I point out to the minister that in 1956 only 3,800 dwelling units were built in that city, while during that year we had a population increase of over 14,000 persons. The difficulties experienced with our growth have been compounded by the tight money policies prevailing. Mortgage restrictions have hit our city harder than any other area in Canada. We made repeated submissions to the previous government; nothing happened. It is true that many of their candidates said something would happen after June 10 when they were back in power, but I would sincerely hope that the new Minister of Public Works, in facing the situation, will take heed of Edmonton's interest by making substantial increases in the number of N.H.A. credits available for that area.

I would also ask that we look at the history of this national problem in order that we

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may know what to do in the future. During the depression years we had a period of decline in residential building. That was a period of paradox. The only thing that was short was money; there were plenty of materials and manpower available. There was no decline in the volume of homes needed then, but in spite of these factors it was a period in which everything sagged because of the shortage of money. There were the demands and the physical facilities at our disposal, but the money just was not there.

In 1939 Canada was involved in a war. Suddenly and mysteriously money was no problem. Our capacity to do things in a big way was demonstrated to the world. People were prepared to forgo satisfying their personal needs and convenience and comforts in order to meet the drastic requirements of that great war.

Immediately after the termination of the war the tremendous housing requirement and public opinion forced the government to make one notable change. They enacted the National Housing Act in 1946 and we had a short period of boom in building. Then suddenly they turned on the tight money policy again. The government allowed tight money policies to be forced on the people of Canada, which resulted in interest rates being raised seven times in the course of one and a half years.

The country was told that these policies were necessary in order to stop inflation. The actual consequences were the highest cost of living ever, the restriction of building, higher cost of building for prospective home buyers, and a drastically reduced amount of credit for home construction.

It is a very significant fact that the building going on of late is limited almost entirely to families of middle or higher incomes. I believe the minister is aware of this, because in the first statement he made he pointed out that the average income of the borrower was $5,829. Perhaps I had better quote this statement as made by the minister at page 1878 of Hansard, where he says:

I was very much surprised to find that the qualifying income for the average National Housing Act loan made by approved lenders in the month of September of this year was $5,350. The average income for borrowers under the National Housing Act was $5,829.

I just wonder how many of our people qualify under those terms, or have salaries of that kind. The fact that the answer to inflation is production does not seem to have entered into the consideration of the government. This government and the previous government in sustaining tight money policies kept telling us they were necessary in order to stop inflation. Well, sir, there never was inflation

in the first place, certainly not in the sense of the term which means, properly speaking, too much money chasing too few goods. It is true that we have had cost and price increases, but they were a direct consequence of the present taxation policies, and these increases were aggravated by the tight money policies being applied. There was a marked decline in residential construction, yet the proponents of tight money just went their own way.

I wish now to say a word about present interest rates. In this connection we regretted very much to hear the minister state that the government has no present intention of reducing the 6 per cent interest rate on N.H.A. loans. This denial of intention to lower interest rates is serious, and nullifies whatever advantage is proposed in the reduction of down payments.

I have never been able to figure out government thinking with respect to high interest rates and tight money. On the one hand they claim that this policy keeps housing costs down, but in fact the very opposite is the case, because as capital becomes scarce it becomes dearer to acquire, interest rates rise, and high interest rates result in less construction. Less construction, in turn, encourages higher, rents and a very vicious discount practice which is being carried on in this country at the moment.

Instead of operating in the interests of people the existing policies seem to be operating in the best interests of lending institutions. Instead of homes being built, bigger profits are being allowed for a few. Instead of contributing to stability in the lumbering and construction industries the administration's tight money policies have depressed those industries. Tight money has contributed to promotional schemes and giantism in business.

What about the future? At the fourteenth annual convention of the national house builders' association, which met in Montreal on January 9, 1957, an important message was given by the association's president. I quote from the Ottawa Citizen of January 19, 1957:

He told the 500 convention delegates that home construction cannot be allowed to lag if the "truly colossal" growth of Canada continues far into the future, as many economists predict.

"It has been predicted that we will require 4 milhon new homes in the next 20 years, necessitating a mortgage credit of $20 billion. If this is correct, and I think it is, the situation could become serious in my opinion if the production of houses is allowed to slip below the 1956 level", he said.

Well, it has slipped. Now, in bringing these facts to the attention of the house I do so because they illustrate how unsatisfactory the situation is, and how seriously the present government and the previous government have failed to solve the problem of housing

on a long-term basis. We Social Crediters believe it is high time the government did something about this situation and made sure that public moneys are deployed for the benefit of the people and not for the sake of the profits of lending institutions. We want to see the finance costs of housing lowered in order that the small income man may benefit first. We want to see mortgage credits forthcoming in sufficient quantities and on a steady basis, not on a stop and go basis. We want to see interest rates lowered.

In this respect it is sheer nonsence to insist that an iron-clad government-backed guarantee would require an interest rate of 6 per cent. Our people are excellent credit risks, and this has been proven by the low percentage of losses on approved loans. The rate of interest return offered recently on the No. 12 series of Canada savings bonds was

4.46 per cent, which was advertised as the highest yield ever offered by the dominion government, and as being a very good investment. I agree that this is a good investment and a good yield, but if a government-backed bond produces interest at the rate of

4.46 per cent, then these housing loans, made through lending agencies and guaranteed by the government, should not require more than

4.46 per cent interest. In fact the loan should be issued at cost.

Finally, in our view there is no greater responsibility of government at this time than that of instituting a brand new approach, a far-reaching housing program designed to make home ownership possible for every Canadian family, not just for a select few. Toward this end we are prepared to give full co-operation.

I might point out that we had an election on June 10. The Liberals lost the confidence of the public. Temporarily the Conservatives are in power. It seems to me that the moral of this story is that no government in Canada remains long in power which does not give the people the type of management they desire. This government and all governments will have to recognize that a new period is dawning in which people are thinking of a better life and, consequently, a new and more dynamic concept of government is necessary. Our policies on housing must reflect this concept.


Howard Russell MacEwan

Progressive Conservative

Mr. H. Russell MacEwan (Pictou):

Mr. Speaker, I should like at this time to make a few remarks regarding the changes in the National Housing Act. One speaker who preceded me this morning, the hon. member for Gloucester, has already dealt with what in his view will be the effect of these changes as far as the Atlantic provinces are concerned.

National Housing Act

Perhaps I agree with him in some respects, but I certainly do not agree with him in all respects.

I would heartily commend the Minister of Public Works for the proposed amendment which would allow extra money to be allotted for home building. Certainly this extra money in my area of Nova Scotia and in New Brunswick will mean that our small contractors will have a better chance of carrying out work during the winter period, work which will employ men in the mills providing the lumber, give work to a number of other tradesmen, and certainly provide a great stimulus to the building industry.

In line with the remarks made by the minister yesterday to the hon. member for New Westminster, in which he stated that he was ready to receive suggestions as to any possible changes which might help, I will just say, as I have already stated, that I believe this extra money will be of great assistance in our area.

However, I would mention one matter which will be a further help at a later time. I refer to the matter set out in the brief of the national retail lumbermen's council, namely that owner labour be considered as part of the down payment. In my area, and in the maritimes generally, the Veterans' Land Act has been a good means of providing impetus and help in the construction of houses.

Three friends of mine undertook to build new houses outside the town under the Veterans' Land Act. I watched them with a good deal of interest. They did much of the 'work themselves. They called in skilled tradesmen at different times to do the necessary important work, but a great deal of the construction was done by their own labour. I know this because at one time I was almost conscripted into the labour gang, but I got away from that.

However, I would point out that in my area, and in the province of Nova Scotia generally, there are a number of co-operative groups which have built houses. Young married couples who work in stores, in the local car works or in various places of business, whose incomes are certainly not in the high brackets, have, by means of the Nova Scotia housing commission and in other ways, undertaken co-operative efforts. These young couples, by the use of their own labour, were able to cut down the cost of the houses, and it has proved to be a very successful effort.

To my knowledge, what has happened in the past is that contractors have been actually engaged in the building of houses under the National Housing Act. I recommend that owner labour be made a permanent and

National Housing Act

integral part of this act so that men can do much more of their own work, thus cutting down the cost and helping in the down payment. Perhaps they could hire a contractor to look over the whole project and employ the various skilled tradesmen, as is done now. I submit that this is a matter which could perhaps be studied by the Central Mortgage and Housing Corporation and be included in the act.

The hon. member for St. Antoine-West-mount, I believe, yesterday stated something to the effect that we should not discourage other lenders from taking part in lending in Canada. I agree with that, but I would point out that so far as the province of Nova Scotia is concerned a young man, or anyone, building a house is limited by legislation in the amount he can borrow from other lenders. In most instances he can get a loan of only 60 per cent of the appraised value of a house. Some companies limit the borrowers to 50 per cent of the amount. This makes it quite difficult for a young couple to raise the amount of the down payment in the first instance. As I have said, in the first instance it is 40 per cent of the appraised value of a new house and in the second instance, 50 per cent.


George Carlyle Marler


Mr. Marler:

The hon. member is not referring to loans under the National Housing Act?


Howard Russell MacEwan

Progressive Conservative

Mr. MacEwan:

No; I am referring to private mortgage companies. I believe the change to 90 per cent of the first $12,000 of the lending value or any part thereof will help a great deal in our area but, as I have said, I believe there should be an amendment to the act in future to give builders a chance to have their own labour included as part of the down payment. I have received letters from various people in the area in this regard, and I have taken this opportunity to place the matter before the house.

Finally, one object of the amendment was to provide lower rental houses and smaller houses throughout Canada. I would close with a short quotation from a learned Englishman who said:

The nations of the world dwell in the cottage, and unless the excellence of your statesmanship and the beauty of your legislation is reflected there on the minds and the hearts of the people, rely upon it, you have yet to learn the duties of government.

I submit, Mr. Speaker, this government has learned those duties.


Stanley Haidasz


Mr. Stanley Haidasz (Trinity):

Mr. Speaker, I would like to speak briefly with reference to the bill before the house, which proposes to amend the 1954 National Housing Act by increasing by $150 million the original amount

of $250 million which was provided by the Liberal government, and also to provide for the reduction of down payments.

I am grateful to the Minister of Public Works for allowing us to speak today with as much latitude as possible concerning the National Housing Act. As a new member, speaking for the first time on the subject of national housing, I feel obligated to express my acknowledgment and admiration for the wisdom, courageous solicitude and initiative that the Liberal administration in the past demonstrated for Canadians by enacting federal legislation to more easily provide low cost houses in which our people may raise their families in comfort, intimacy and security.

The Liberal legislation expanding the scope of the housing act in 1956 by assisting the redevelopment of substandard housing and slum areas gave further proof of the active interest of the Liberal government in co-operating with municipalities and provinces in vital social problems involving the security of the Canadian family. Such legislation has promoted the morals, health and good citizenship of the Canadian family more than any other legislation in the history of Canadian parliaments.

Among the principal goals of our society are both the continual striving to overcome the housing shortage which still exists in Canada and the vigorous quest for higher standards of housing. This quest finds its expression not only in individual pride in being a home owner but also in the collective concern for the proper housing of all members of the Canadian community, be they young, old, poor or of moderate means.

However, durability of housing, its conservation and eventual replacement, must be considered important factors in the maintenance of the nation's housing resources. Moreover, I do not have to emphasize the fact that the construction and maintenance of homes is in itself a major industry, using the products of our forests and mines and putting into action the manufacturing industries producing building materials and domestic equipment and employing numerous skilled and unskilled labourers.

For all these reasons the minister of the federal government in charge of the national housing program has most serious obligations to fulfil. The introduction of piecemeal legislation, the curtailing of discussions and the refusal of necessary amendments to these fundamental matters will not solve the existing housing problems, as stated by previous speakers. In the long run it might even harm our national economy.

During the last federal election campaign Canadians were promised that the needs and


IS, 1S57

desires of the Canadian people would be met and that good government would be provided. Alas, the numerous bits of legislation which have been actually forced through the present session of the 23rd parliament testify to the lack of sound planning on the part of the present administration. The argument that they have had only a short time in which to consider legislation is a very poor reason for very poor legislation, as there is no immediate deadline that must be met. The Canadian voters did not restrict the government only to six months in which to plan and introduce specific legislation in order to meet the needs of the Canadian people and the requirement to continue a sound economy in Canada. The mere provision of just $150 million for housing and the small reduction in down payments are at best only a mediocre attempt to help the ailing housing industry, and certainly do not solve the housing problems of the Canadian family in the low income bracket. In September the government released $150 million from the federal treasury for the construction of small homes, particularly with the hope of reducing the number of unemployed in Canada. But we see that this $150 million did not improve substantially the amount of homes being built, nor did it improve the unemployment situation. We learned from the statisticians a few days ago that there are 100,000 more people unemployed today than there were in September of this year. The statisticians have also reported that 70 per cent of Canadians earn less than $3,400 a year. According to the proposed changes in the legislation it will be possible for a man to obtain a loan of $12,200 on a $14,000 home only if his income is around $4,360. Even for a $9,000 loan the prospective home owner must earn at least $3,400 annually. If such low priced homes should be available, only 30 per cent of Canadians will be able to avail themselves of this privilege, leaving 70 per cent of Canadians out in the cold because they will not be able to benefit from the new legislation. The people who need low cost homes the most are being ignored by the government, even though the avowed intention of the national housing plan was to provide low cost homes for people in the low income brackets. I do not mean to blame the affable Minister of Public Works entirely for failing to provide adequate help for the low wage earner, because on December 4, 1957, as found at page 1880 of Hansard, he made this confession: Quite frankly, I should like to be able to help an income group even lower than those who will be helped by this legislation. National Housing Act This leads us to believe that many other factors, circumstances and perhaps persons in the present government have dissuaded the minister from presenting more generous and just legislation. Therefore the greatest blame once again falls upon the Conservative government as a whole for failing to assist adequately those in dire need. It would have been more just had the minister proposed more liberal changes by introducing greater reductions in down payments, a substantial reduction in the interest rate on loans and perhaps by reducing-[DOT]


Charles Edward Rea

Progressive Conservative

Mr. Rea:

Will the hon. member for

Trinity permit a question? Is the hon. member going to vote for the bill?

Topic:   IS, 1S57

Stanley Haidasz


Mr. Haidasz:

I was about to mention also that the abolition or reduction of the insurance fee on loans would be of help to the low income group. I cannot understand why the government could not have allowed the buyer to borrow 90 per cent of the full lending value. On a $16,000 house, the average price for a new, six-room, comfortable dwelling in the Toronto area from which I come, the down payment would only be $1,600 and the mortgage $14,400, with a monthly payment of $112 plus $20 for taxes. If the government had lowered the interest rate the monthly burden would have been lighter and the amortization period could then be extended more easily to 35 years or more. If the 2 per cent insurance fee were abolished this would save the prospective buyer another $228. These indeed would have been very liberal amendments, and would have really helped the poor workingman who is in need of a home.

However, there would still be thousands of Canadians who, being in the very lowest income brackets or because of their employment or for other reasons, would not find it practical to buy or own a home. For these people the solution is more low rental housing accommodation. There rests a definite responsibility upon the present government through its crown agency, Central Mortgage and Housing Corporation, to provide more effective leadership in working with provincial and municipal authorities to set up and approve without delay greater numbers of more adequate low rental housing projects.

The National Housing Act amendments introduced by the past Liberal administration, which provided for substantial federal

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assistance to municipalities to clear up slum areas, are to be highly commended. Toronto in particular has taken advantage of this legislation and has succeeded in developing modern low rental dwelling units in the Regent park area. There are other areas in Toronto that need clearing and redeveloping, such as Alexandra park and Moss park. Proposals have been made by the Toronto planning board in this regard, but the mayor of the peculiar creature called the metro, created by the Frost government, is repeatedly postponing these and many other worth-while projects in Toronto. Since Mr. Gardiner's boss espoused the Tory leader, it is difficult to understand why there should be such opposition from the metro level.

Furthermore, Mr. Speaker, an urban renewal study for Toronto recently suggested that the National Housing Act provisions be altered to include financial aid to the city for improvement projects intended to remove the threat of blight, to enable long-range planning to prevent slums, and to build well planned areas in our cities. The present government would indeed be very helpful and wise if it would agree to provide such assistance to municipalities.

I have been informed that on October 1, 1957, representations were made by the association of Ontario mayors and reeves to the government requesting federal aid of up to 75 per cent of the cost of acquiring and clearing blighted and substandard areas in any municipality, and asking that the municipality's share of such cost be repayable by the municipality without interest over a period of 40 years. I suppose these representatives were also told that the government had considered the proposal, and the problem was swept under the carpet.

A more urgent need for Canada is to make available more low cost serviced land in and around our municipalities. There is no doubt that many cities missed the opportunity provided years ago under the National Housing Act to embark upon municipally initiated land assembly schemes. The federal government should take the leadership once again in this matter. The 2 per cent insurance fee charged to home buyers to protect the lender has already, we know, accumulated a surplus of $27 million. Could this money not be used to buy land and sell it at cost to municipalities for building really low cost housing areas, completely serviced?

The biggest beneficiaries in Toronto are the subdividers who had land for sale. With the return to the industry of many builders who had gone out of business previously, the subdividers have been able to unload their land holdings. This occurred at a time

when market conditions had begun to force land prices down. It would appear that if there has been any benefit to the subdividers, there has been very little benefit to the potential home purchasers.

Moreover, Mr. Speaker, in the Toronto metropolitan area the price of serviced land is too high to permit the construction of very small houses. It does not make sense to build a $12,000 house on a lot costing $5,000. A sharp distinction, therefore, has to be drawn between very small housing units, which is what the government is providing, and low cost housing which it was their avowed intention to provide.

Any experienced builder will tell you that the size of a small home may be increased by 10 per cent beyond the 1,050 square feet limit imposed by the government at an increase in cost of perhaps only 4 per cent. This extra size is the really low cost part of the house, and at the present time it is lost to potential home purchasers because of the existing legislation. It seems to me much more sensible to build the basic structure a little larger, to provide more adequate and durable accommodation to which the home purchaser can add extra features as his income allows, than to limit him to a very small, cheap structure which cannot be expanded nor be expected to last very long.

Another drawback of the present system is the fact that too many houses will be built in the same size range, and consequently the potential purchaser does not have the variety to which he is accustomed in a free market. The design is also limited, because it is most difficult to achieve good design and balance when the floor areas are so rigidly controlled. Just a few weeks ago the regional awards of the national design council were presented, and one could not help but be impressed with the giant strides that have been made in the design of small homes. It seems to be a bit inconsistent for the design council to encourage variety and beauty while, on the other hand, the government forces uniformity, drabness and that regimented appearance of those box-like structures of which we see so many and which we all deplore.

The big problem of the building industry seems to be one of cost, and it is a real problem which seems to be receiving little or no attention. The builders claim that over a number of years they have held down, within reason, the cost of the house itself in spite of tremendously increased wages and the rising prices of construction materials. The price of serviced land, however, has skyrocketed beyond their control out of all

proportion. It is in this field that the federal and provincial governments will have to make a real contribution. But if, on the other hand, nothing is done and land prices, wages and the cost of construction materials continue to rise, then even the advantage of the reduced down payment to the potential home buyer will be lost.

In conclusion, Mr. Speaker, I should like to say that the proposed amendments can only be regarded as a short-term emergency measure, a meagre palliative. I say that unless the regulations are changed as the result of much more thought than they appear to have been given, the results, rather than being beneficial, will remain inadequate to the building industry, to the home buying public and to the taxpayers of Canada who are underwriting the whole scheme.

Topic:   IS, 1S57

Thomas Speakman Barnett

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

Mr. Barnett:

May I call it one o'clock,

Mr. Speaker?

At one o'clock the house took recess.

Topic:   IS, 1S57

AFTER RECESS The house resumed at 2.30 p.m.


Thomas Speakman Barnett

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

Mr. T. S. Barnett (Comox-Alberni):

Mr. Speaker, last evening my colleague the hon. member for Burnaby-Coquitlam expressed his pleasure that we have a much respected fellow British Columbian as the Minister of Public Works and the member of the government who is responsible for housing activities initiated by the federal government. He also gave the minister one or two good marks for attempting to do something about the housing situation.

I should like to say that I concur very heartily in the remarks that were made last night in this respect. However, at the same time I must also say that to me it is a matter of regret that the minister's horizons as to what can and should be done in the field of housing appeared to be quite restricted. Actually, of course, the amendments he is proposing to this house in connection with the National Housing Act are, I think one could fairly say, relatively minor.

In that connection perhaps I should remind the minister that when the act we are now proposing to amend was brought into this house he felt it was such a bad act that he was completely opposed to it and that he, along with his colleagues, when the vote on second reading was taken on January 29, 1954, opposed second reading of the bill which, as I suggest, he now is apparently content to deal with only by two relatively minor amendments.

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In describing the amendments in that manner I am not attempting in any way to detract from the view that some good will be accomplished by them. However, I think the minister himself, in saying that he would like to do something more about housing, has made it clear that some of us have some justification for suggesting that his horizons on what can be done are rather limited.

I also recall that as the discussion progressed on the original bill which brought in the present housing act, some of the views which we in this corner of the house were then expressing were rather similar to some of the views we are expressing now, particularly when it comes to the matter of dealing with what should be done about interest in the provision of funds for housing. On March 8, 1954, as recorded at page 2758 of Hansard of that year, my colleague the then member for York South, the late Mr. Joseph Noseworthy, proposed an amendment on third reading of the bill. That amendment reads as follows:

That Bill No. 102 be not now read a third time but that it be referred back to the committee of the whole house for the purpose of amending it so as to provide a fixed limit as to the rate of interest to be charged on loans made under the provisions of the said act.

On that occasion the then hon. member for York South had this to say:

It is said, for example, that there will be an advantage in the lower down payment. It is true a few dollars will be saved on the down payment but the interest rate will be higher, and any benefit which might accrue from a saving on the down payment will be swallowed up in the increased rate of interest over the years.

Then Mr. Nose worthy went on to say this:

The bill does not solve our housing problem. It will be just as difficult for those in the lower income groups to get houses after this bill becomes law as it was under the old act.

The interesting thing, perhaps, about that matter, in addition to my suggestion that the views of the C.C.F. have been fairly consistent on this subject over the years, is that the present Minister of Public Works and his colleagues, after having opposed second reading of the bill, did not see fit to support that amendment for referral back to the committee, and ^hat the then leader of the Conservative party, Hon. George Drew, made it clear that he was not prepared to go along with our ideas as to what should be done to ensure that a lower interest rate should apply on loans made under the National Housing Act.

Hence, Mr. Speaker, it becomes apparent that the principal stumbling block, as far as action by the present government is concerned, is similar to that which we felt was the principal stumbling block to effective

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action as far as the legislation of the previous administration is concerned.

In discussing this aspect of the matter, Mr. Speaker, I should like to make some reference to what I consider to be a most important document, and one which in my opinion should be receiving much greater attention in this house than has been the case to date. I am referring to the annual report of the governor of the Bank of Canada, which was addressed to the minister of finance under date of February 28, 1957.

This document I feel, Mr. Speaker, sets out in very clear terms an explanation of the financial situation in which we find ourselves today, and makes it quite clear that much of the loose talk we have heard in this house and across the country about tight money and related matters is just so much nonsense. It also, I think, could make a fairly important contribution to our thinking as to what it is possible and feasible to do about providing proper housing for the Canadian citizens. I am going to read from the report of Mr. Coyne some excerpts which I feel relate themselves most closely to the problem of providing adequate housing for our citizens. At page 5 of the report Mr. Coyne has this to say:

Since the demand for loanable funds exceeded even the greatly increased supply, lending institutions have not been able to accommodate all potential borrowers in full; they have made such disposition of their funds as they chose, within the terms of any statutes governing their activities. In view of the rather frequent complaints which have recently arisen with regard to the availability of housing finance, it should, perhaps, be explicitly stated that banks, insurance companies, and all other institutions and individuals concerned with the provision of loans for this purpose are under no regulation in the nature of credit control preventing them from lending money for housing, or requiring them to reduce the scale of such lending. So-called "federal credit controls" do not exist.

Then, Mr. Speaker, on page 9 of the report following through with this discussion of this matter Mr. Coyne has this to say:

This limitation on the availability of bank credit has not apparently affected the ability of the companies concerned to obtain funds from other sources.

I am sorry; that is a reference to instalment finance, but a little further down on the same page he says:

Throughout 1956 the chartered banks continued to make substantial advances by way of insured housing loans, although commitments for new investments of this character progressively decreased. The total of new approvals of housing loans by banks in 1956 was about half as great as in 1955, and by the year-end the banks had very largely withdrawn from this field of lending.

Long-term investments made from and limited by funds accruing from the growth of savings deposits are in quite a different category from credit expansion in the form of current or demand loans to businesses and individuals, which may reach excessive proportions. As discussed later,

the financing of such credit expansion through the use of funds arising from savings deposits, both directly and from the sale of government bonds, in which savings deposits previously received had been invested, has been one of the less predictable and less stable features of monetary developments over the past two years.

Turning now to page 27 of the report in which Mr. Coyne is continuing his discussion of the banking system, I find these words:

One reason why it is not possible to predict the effects of monetary measures with accuracy is the uncertainty, which must always exist to some degree, as to the reaction of the banking system itself to such measures. In Canada this has been more noticeable perhaps than elsewhere because of the extent to which commercial banking functions and savings banking functions are intermingled in the operations of the chartered banks. Over 80 per cent of total personal savings deposits in Canada are held with the chartered banks, and the pattern of investment of such deposits has varied widely at different times.

Then at page 29 he goes on:

Housing loans and other investments have been the residual form of investment for the savings departments of the banks.

In other countries personal savings deposits are chiefly held by separate and specialized institutions, sometimes called building societies, sometimes called savings and loan associations, sometimes called savings banks or mutual savings banks, which make a practice of investing such funds in housing loans and in relatively long-term securities.

Then on page 30 Mr. Coyne continues:

In 1954 the Bank Act was amended to permit the chartered banks to make mortgage loans on new houses, loans insured under the National Housing Act. This was an important improvement in the machinery of the Canadian capital market. I believe it would be desirable if means could now be found to encourage greater stability in the rate of longterm investment by the banks in those fields where they may now operate . . .

To maintain their relative position, the chartered banks may find it desirable and necessary to operate in respect of the resources of their savings departments in much the same way as a savings bank and use such resources to provide funds for the kinds of investment naturally associated with longterm savings.

To the extent that personal savings were segregated from the commercial lending field, they could be regarded as likewise removed from the category of "money supply" . . .

Fluctuations in mortgage lending would of course be much less pronounced. The workings of monetary policy would become more predictable and more effective . . .

In any condition of an excess of physical demand over physical supply, some elements of demand must of necessity give way, lose out to others. Competition for money with higher interest rates produces fewer casualties and less social stress than unrestricted competition for goods with higher prices. Better a rise in the price of borrowed money . . . than a very great rise in the price of goods and housing, in the cost of schools and hospitals and public utilities.

I am reading that section, I might say, to indicate to the minister that I am attempting to give a fair picture of all Mr. Coyne has to say in this most important connection. He goes on:

Whenever there is an excessive demand over supply, and the competition for funds with which

to make the desired expenditures is intense, the results in terms of who gets how much at what cost will not give satisfaction to all. Those who find themselves unable to borrow as much or as cheaply as they wish, or unwilling to pay interest at the new and higher rates will naturally be dissatisfied. What is more important, the actual distribution of loanable funds may not seem to be the most desirable one from the point of view of society as a whole, or of large groups within it. This is a question of opinion, and a matter of public policy.

Well, Mr. Speaker, the governor of the Bank of Canada, I would suggest, very properly dumps this whole question right in the laps of those of us who are members of this house. He brings us his analysis of this situation and, on the basis of the facts which Mr. Coyne has so clearly set out, we should consider what action could and should be taken about the whole question of providing housing finance.

The Minister of Public Works last night, as recorded at page 2498 of Hansard, said:

. . . one of the main problems worrying me about housing. It is this. Next year, where is the money coming from to provide for the number of houses that should be built?

Well, the minister is not the only one who is worried about that, because I think all of us in this house recognize that the extra money which we are being asked to approve in this bill is not really enough to go very far toward solving the over-all need for houses across Canada. But the thing which concerns me is that the minister goes on to say that the government obviously cannot take over the business of providing mortgage money; it simply cannot be done.

Well, Mr. Speaker, I think that is where the minister and those of us who are in the C.C.F. party really part company. The minister says it cannot be done. As far as we are concerned, we say the only reason it cannot be done is that the minister does not want to do it; and if one follows through with the analysis of the situation which Mr. Coyne has made and which he has, as I suggest, dumped in our laps as members of this House of Commons representing the people of Canada, then I suggest that we are coming to the crux of the situation thas has to be debated.

Why could not the government take over responsibility for seeing that there is adequate mortgage money available for housing? Mr. Speaker, I suggest the reason this government, speaking through the Minister of Public Works says this cannot be done is exactly the same reason for which Mr. Winters, when he was minister, said it could not be done; and that is because of the fact that the Conservative party, like the Liberal party, refuses to recognize the basic fact that capital is something which is socially created.

National Housing Act

While it may be true that certain people legally have a large comer on certain amounts of it, nevertheless the reason we have capital which would make housing on a large scale possible, if it were devoted to that end, is that fifteen or sixteen million Canadians have created it.

We in the C.C.F. party maintain that at least a sufficient proportion of that socially created capital should be available to the people who created it in order to ensure that they shall have decent housing at a cost they can afford to pay. We maintain that it is not necessary for us to go on forever paying tribute to the moneylenders so they can continue to extract their pound of flesh over a period of 25, 30 or 40 years while a house is being paid for. That is the issue, and that is the challenge which those of us in this corner take up with the Minister of Public Works when he says this is something which cannot be done.

Mr. Speaker, we are dealing particularly in this bill with a provision to increase the direct lending activities of Central Mortgage and Housing Corporation, and we have already made it clear that as far as the measure goes we are prepared to support it. But we have also made it clear, I think, that we do not feel it is necessary that the people of Canada should continue to have to pay the present kind of interest rates over a long period of years, as they will be required to do if nothing more than this proposal is put into effect.

The main discussion has quite properly turned on the idea of the minister of making additional direct loans available to those who are building family homes, individually. But I think we have to realize that included in the direct lending activities of the corporation there are some other activities which are a matter of concern, and that in increasing the amount of money available and refusing at the same time to make provision for lowest possible interest rates, we are creating a problem for those who are attempting to provide low cost housing for senior citizens for example, in the type of community project which is becoming increasingly popular in many communities.

I have one such venture in the particular part of my constituency in which I happen to live, where a local organization formed for the purpose of attempting to provide low cost housing for senior citizens feels it is right in the bite at the present time because of this question of what is going to happen about interest rates.

They have gone to the trouble of determining what difference in the rentals will be brought about as a result of the interest increase which took place in the housing field

National Housing Act

recently, and according to the figures as they have had them supplied by someone competent to work out these things, on the basis of amortization over a 40-year period, they arrive at this conclusion. For a loan of $110,000 at 31 per cent the annual payment will amount to $5,352.54. With interest on the same sum at 4J per cent, the annual payment would amount to $5,977.75. This, they say, is an increase of $625 annually, or approximately $52 a month. They point out that if they had 26 people paying rent it would mean a rental increase of $2 a month merely to meet an increase in the interest rate of three quarters of one per cent.

Well, Mr. Speaker, as I said, this idea of people in communities taking action to provide housing in this particular field is arousing increasing interest. For example, in another community in my constituency at the present time a group of people is interested in forming what it proposes to call the golden age housing society. This house may be interested to know that their plan calls initially for the erection of two units, one of which they propose to name in honour of the late J. S. Woods worth, who was the first leader of the C.C.F. party, and the other which they propose to name in honour of Mr. A. W. Neill, who was for a long time the independent member for Comox-Alberni, because of the fact that both these gentlemen took a pioneer interest in the initial establishment of an old age pension in Canada.

I mention this because I know these people will be placed in exactly the same position with regard to interest rates as those of whom I was speaking a moment ago with regard to the other project.

So it seems to me that from whatever angle we tackle this question we get back to the problem raised by the pressure of the interest rates which must be paid over the period of up to 40 years, which add so much to the cost of providing these facilities whether for individual owners or as rental accommodation for senior citizens.

The minister has already made it clear in dealing with the amendment proposed by my colleague the hon. member for Regina City, at the resolution stage that we have not much hope of persuading him to do anything about changing this bill at the moment. Nevertheless, I think we would be less than kind to the minister if we in turn did not make it equally clear to him that the problems which arise in this connection are, in our opinion, going to continue, and that we in this group will continue to draw them to his attention and to the attention of the Canadian people with all the vigour of which we are capable.

We do not take the defeatist attitude toward this question that the minister takes. We do not say this is something which cannot be done. We believe in the adage "where there's a will there's a way," and we think it is becoming more and more evident all the time that the new Conservative administration just has no better solution than its predecessors had while in office.

Topic:   IS, 1S57

Thomas Speakman Barnett

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

Mr. Barnett:

As long as they are content to bandy about such terms as "state socialism" and all the rest of it, as some of the members of the Conservative party did with regard to the suggestions we were making when this act first came in, so long are we going to find them in a sea of despond as far as housing in this country is concerned.

Therefore, Mr. Speaker, although as I said at the outset, like a great many other people in British Columbia, I have a very high personal regard for the present Minister of Public Works, nevertheless I must say I cannot share his rather gloomy outlook as to what can be done to provide the Canadian people with decent houses.

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Chesley William Carter


Mr. C. W. Carter (Burin-Burgeo):

Mr. Speaker, I should like to say a few words in support of this bill which proposes to make available an extra $150 million for housing and also to lower the down payments. I should also like to add my voice to those who have urged a change in the regulations under which these funds are now administered. This money is being made available by the parliament of Canada, and we therefore have a duty to see that it is used to help those who have the greatest need. That is not happening under the present legislation.

If I am to judge from past experience, the benefits to my province from this legislation will be negligible. Since the first $150 million was made available about two months ago I believe only $200,000 has been used in Newfoundland, and most of this has gone to people with high incomes. Of the $200,000, $117,300 has gone to St. John's for 11 units and the other $83,000 to the Gander area for 9 units. These were the official figures up to the end of last week. Of the first $150 million, only $2.3 million to date have gone to all the maritime provinces combined.

The reason, of course, is that the people in the maritime provinces and in Newfoundland are not able to benefit from this legislation because under the present regulations their incomes are too low to enable them to take advantage of the act. I know the minister deplores these facts as much as I do myself, but this situation is the result of regulations

which cause federal housing funds to be distributed among the provinces in proportion to the average personal income in the provinces. Consequently Ontario, with the highest income, gets the lion's share and Newfoundland, with the lowest income, gets the smallest share.

One way to correct this situation is to change the regulations so that a proportion of the funds will be allocated to provinces according to population and need. Along with that I believe there should be a change in specifications to permit cheaper houses to be built in poorer areas. Statistics prove that persons with incomes of as low as $3,000 have been able to benefit even under the present regulations. These cases should be singled out for special study to find ways and means of building more houses for people in this income bracket.

The changes introduced by the present government to promote cheaper houses are commendable as far as they go, but they have two important defects. The houses are cheaper because they are smaller, and therefore they do not represent any increased value for the money spent. In the second place, they do not take account of human needs. A man with a small income very often needs a larger house than a person with a high income.

According to statistics, the average income of people benefiting under this act is around $5,000. Now that inflation is supposed to have been checked and credit restrictions are being eased, it should be possible for people in this income bracket to provide houses for themselves in the usual way without too much assistance from government funds.

I believe the government should concentrate on providing houses for people in the $3,000 income bracket and under. Unless this is done Newfoundland can never derive much benefit from this legislation. One way to do this is to encourage co-operative housing schemes and schemes for people who can build their own houses in whole or in part. Veterans have used funds under the Veterans' Land Act in this way with outstanding success. In particular I should like to see a special scheme to provide houses for fishermen. Fishermen do not need houses as elaborate as do people who dwell in the city, and most fishermen, particularly in Newfoundland, are able to build their own houses.

A family man actually needs two houses in his lifetime. He needs a small one when he is just married and starting out in life to raise a family. After four or five years, when the family begins to grow up, he needs a larger house. Then in later years, when the family has grown up and gone, he could

National Housing Act

get along better with a smaller house, with one or two bedrooms. I believe these facts should be taken into account, and some scheme worked out whereby one house could be traded in on another.

This extra money will be welcomed all across Canada on account of the unemployment situation. Newfoundland itself has a very acute unemployment situation, probably just as bad as that of any other province. Our unemployment figures are double what they were at this time last year. As I pointed out before, this money will not have any effect at all in improving the unemployment situation in Newfoundland.

It is commendable on the part of the government to try to kill two birds with one stone in this way, but I think we should keep in mind that the two goals of providing low-cost housing, on the one hand, and creating employment on the other, are not entirely compatible. The use of national housing funds in the past has in some instances helped to inflate housing costs. The primary aim of this money should be to provide low-cost housing, and we should take whatever precautions are necessary to ensure that this goal is attained. If the primary aim is to provide employment, then the objective of low-cost housing is to some extent defeated. I think we should have one or the other, but I have serious doubts whether we can have both.

Topic:   IS, 1S57

Horace Andrew (Bud) Olson

Social Credit

Mr. H. A. Olson (Medicine Hat):

Mr. Speaker, in taking part in this debate I do not wish to cover the same ground that has been covered so well already. Furthermore, two of the Social Credit members have already outlined our position on this question nationally. There are, however, one or two things I should like to say about the local situation in Medicine Hat.

There is a need today for a plan whereby homes can be built with lower down payments and lower monthly payments. We also have a very definite need in Medicine Hat for a low rental housing scheme for some of our senior citizens and those people who have reached that stage in their lives when they are not prepared to invest in a new home. In that regard may I say that a committee considered the matter in Medicine Hat not too long ago. The committee was comprised of representatives of all sections of the community, and they agreed that there was a definite need for these two things.

Furthermore, recently a group of low rental apartments in Medicine Hat were closed. I certainly think it was necessary for them to be closed, because they were in such a condition that they were not fit for human beings to live in any more. But the fact remains that those people had no place to go. A large number of

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them were old age pensioners and, as I said, they do not wish to invest in a new home. It is quite a problem right now to find some place for them to go where they can obtain accommodation within their ability to pay.

I think the bill is a step in the right direction, and for that reason we are prepared to support it. Our main objection is that there is no provision to cut interest rates, and we think that 6 per cent interest on government-backed money is simply too high.

Topic:   IS, 1S57

John William Kucherepa

Progressive Conservative

Mr. J. W. Kucherepa (High Park):

Mr. Speaker, I rise today to speak on a subject which has concerned me for many years as a member of the city council of the city of Toronto. The bill we have before us today is designed to increase from $250 million to $400 million the aggregate amount that may be paid out of the consolidated revenue fund, and it also provides for a reduction in down payments. In addition, in the minister's remarks in the house on December 4 there is reference to a reduction in the income level with respect to which applications for loans may be made.

The hon. member for Trinity has been most critical of this legislation. I wonder whether the hon. member is aware that there has been a decline in housing construction from the maximum level of 1955? I am sure he would not disagree with me if I were to say that this was the result primarily of the tight money policy instituted by the now defeated Liberal government. This decline reached a maximum point during the first six months of 1957, and along with it came the other great evil of unemployment in the construction industry. With an increasing labour force and an increasing population, the previous government's policies were geared to a slow-down in this vital field, and the result was that the construction industry suffered a degree of depression which it has not known for many years.

I would venture to say, sir, that as a result of these Liberal policies the people gave their answer on June 10 in an unmistakable way when they returned to the House of Commons only one Liberal from the 21 ridings in the Toronto area. That lone member is the hon. member for Trinity, who came here with a majority greatly reduced from that of his predecessor in the house.

I wonder whether the hon. member for Trinity is aware of the fact that so far as section 22 of the National Housing Act is concerned, no direct loans were made for ordinary home construction purposes in the city of Toronto under the previous government, and further that under Liberal government policies funds under this section were not available to house builders in the city of

Toronto or other comparable large urban areas who were producing houses for sale or for rent. It is indeed alarming that the qualifying income for the average housing act loan was $5,350 in September of this year. This record of Liberal policy does not seem to be in keeping with the thinking of the hon. member for Trinity, who made such a strong plea for assistance to those in the lower income brackets.

The hon. member referred to the Regent park area in the city of Toronto, and was very critical about the slow progress the present government has been making in the field of housing. I should like to point out to him that since expropriation proceedings were taken by the city of Toronto on July 14, 1947, a total of 1,289 housing units were constructed over a period of 10 years. That is at the terrific rate of 128.9 or 129 units per year.

As a member of the housing committee of the Toronto city council I would have to say that there was indeed a great deal of red tape to be overcome in achieving even this figure. The contribution of the former government was $1,362,000 out of a total of $13,400,000 which the Regent park development cost the city of Toronto. We had to consult with the federal government authorities constantly to make sure that we made even this meagre progress. I should also like to point out that the Frost government, to which my hon. friend also referred, will have made a contribution of $1,289,000 on completion of the project, a sum almost equal to that granted by the previous federal government for the Regent park development.

In view of this history I cannot see how the hon. member for Trinity can lay any blame at the feet of this government. Indeed, in my opinion the government has done a great deal toward advancing the housing program in Canada.

The hon. member for Trinity also made reference to the chairman of the metropolitan Toronto council as a peculiar creature. I should like to point out that I am well acquainted with the chairman of the metropolitan Toronto council, and I can say that Frederick Gardiner is one of the finest municipal administrators this country has ever known. I do not think his record in the administration of municipal affairs will ever be equalled by any person in this house or outside it.

To paraphrase the words of the hon. member for Trinity, he also said that the present government has "swept the problem of housing under the carpet". I would say to him in reply that if that is his thinking, then in my view the former government buried the

housing problem in the ground when they invoked the tight money policy, and when they restricted under subsection 1 of section 22 of the act the lending of moneys to the city of Toronto and other large urban areas for ordinary home construction purposes.

I also noticed that he criticized the former Liberal government for the 2 per cent insurance fee they placed on loans, and he now asks that the surplus from this source be used for the purpose of subsidizing subdivisions at the expense-this follows naturally, sir-of those small home owners who are now paying on N.H.A. mortgages.

The hon. member criticized the small homes which this legislation permits, and appealed for larger structures to be built on existing land parcels. I wonder if my hon. friend is aware of the zoning by-laws of the city of Toronto or any other municipality which control the density of population in given areas, and which prohibit a certain density in residential areas.

I might point out for the information of the hon. member and this house that even Regent park, the redevelopment which covers 42.45 acres, has 33.5 acres in open space occupied by playgrounds, park areas, lawns, parking plazas and the like. That is the way we plan in the city of Toronto and I think in most other municipalities which are making progress in redevelopment.

The hon. member also made a plea for reducing interest rates on mortgages under the National Housing Act. The hon. member seems to forget, however, that it was a Liberal government and their advisers who caused the increase in interest rates during the last few years of their administration and created the havoc of unemployment which reached such alarming proportions during the first part of 1957, prior to the ousting of the Liberal government from office last June 10.

( Translation):

Topic:   IS, 1S57

December 18, 1957