Our guest blogger this week is Pedro Barata, Senior Vice President of Strategic Initiatives & Public Affairs at United Way Toronto & York Region. He has experience working within, and across community-based organizations, strategic philanthropy, and various levels of government.
Toronto has some titles that we’ve got to shake. The GTA is the child poverty capital, income inequality capital and housing poverty capital of Canada. These trends must be reversed. And the solutions start with housing.
In 2016, Toronto had some 200,000 households in core housing need, struggling to pay the rent, living in under-repaired homes or in crowded or dangerous conditions.
Our own research has shown that the GTA is more divided along income lines than ever. Increasingly, you’re either “have” or “have not”. While the incomes of the highest-earners in the GTA have risen, the lowest incomes have flat-lined. The opportunity equation is broken, and we need to make a change.
Housing affordability is at the heart of shifting income standards in our region. In Toronto, close to one in five households spend more than one third of their before tax income on housing—that’s the highest rate in the country, ahead of all other major urban centres.
Average rent for a 2-bedroom apartment in Toronto:
2015: $1326 (92% increase)
Toronto average annual income (in 2015 dollars):
2015 $50,479 (9% increase)
The numbers tell the story. More people in the GTA are spending more of their income on simply getting a roof over the head. Pathways to opportunity must be built on a basic foundation of economic security. But how can you succeed if you can’t secure a home? If you can’t make rent, you can’t afford the other necessities to thrive in life: food, warm clothes, child care, a phone.
Fortunately, today the Federal Government announced a game-changer: a Canada Housing Benefit. That’s a cash subsidy to help people close the gap between lower incomes and rising rental costs. And it’s the missing piece—along with new builds and repair of existing housing—to help lift more families out of poverty.
This benefit—focused on renters—will reduce homelessness and make housing affordable, and faster, for renters in crisis and those without shelter. The ”portable” in this benefit means that tenants can carry it with them through the private, social or co-op market. It’s innovative and it means that people can go where work and personal needs take them. It’s also an important piece to avoid rent inflation.
The portable housing benefit just makes sense. Most other Organisation for Economic Co-operation and Development (OECD) member countries have balanced strategies that support both supply and rent supplements. It’s really good news that Canada is doing the same. We know that income is not keeping pace with housing affordability, and we know that inequality in our region is only going in one direction—up.
Rent supplements are essential in the fight against homelessness. The growing success of the Housing First approach to tackling homelessness depends on access to rental supports than can be quickly deployed and can help a new renter hold their housing during the key transition period out of homelessness. Coordinated with provincial and local governments, a new housing benefit gets at the heart of poverty and income inequality by filling the gap for those who need it the most.
66% of people experiencing homelessness say that what they really need to end their homelessness is help to pay Toronto’s high rents.
These kind of policies are crucial to compliment the local community work that United Way and our partner organizations do every day. We welcome the federal government’s leadership today. Together with the recent increases to the Canada Child Benefit and enhancement to work income supplements, the federal government is making great strides toward a national poverty reduction strategy.
In the face of our own findings of the growing gaps in our region, this is the kind of approach that can give us hope for long-term change.