ACORN's first read on Budget 2019: Almost $23 billion in new spending, but low and moderate income Canadians underwhelmed

ACORN members, hoping for bold action to tackle the affordability crisis sweeping across many Canadian cities, were feeling underwhelmed as the federal government tabled Budget 2019, their last budget before the election in October.

Firstly, we support the government’s plan to spend $300 million on energy retrofits in new and existing affordable housing, as part of the Green Municipal Fund. Successful energy retrofits present opportunities to revitalize existing housing stock, meet carbon reduction goals, and unlock a range of co-benefits for low and moderate income tenants. We were also pleased to see that the government announced an additional nine-year, $10 billion investment in the National Housing Strategy, through the Rental Construction Financing Initiative. Although we welcome this investment in purpose-built rental housing, we are concerned about the prospect of affordable rental housing construction being left in the hands of private developers who seek to maximize profits. To be eligible for financing through the program, 20% of units in the development are required to be affordable, for a period of only ten years. We encourage the government to prioritize support for non-profit development that can keep housing permanently affordable. In addition, it is crucial that support and incentives given for development and retrofits must not come at the price of gentrification and displacement.

Shared equity mortgages from CMHC were proposed as a tool to help first time home buyers. Measures to reduce the cost of owning a home are badly needed and this might prevent prospective home buyers from being forced to access subprime mortgages, but we are concerned that this initiative - along with the government’s additional proposal to let homebuyers withdraw from their retirement savings - simply delays the cost until further down the line.

We heard that the government is launching an expert panel on housing supply and affordability. ACORN members strongly recommend that the panel includes non-tokenized representation from members of low and moderate income communities, and other marginalized groups. Tenants must have a voice. Budget 2019 also includes the government’s proposal to legislate the National Housing Strategy so that government is required to maintain a strategy that prioritizes the housing needs of vulnerable Canadians, and report to Parliament on progress. However, ACORN members are disappointed by the government’s failure to commit to legislating the right to housing. 1.7 million Canadians are in core housing need; we need real commitment from government to address this crisis.

Budget 2019 outlines some initiatives that will benefit workers. A new tax credit for workers who want to upgrade their skills - the Canada Training Benefit - will allow workers to earn $250/year, up to a maximum of $5,000. However, we are disappointed that the benefit misses the mark for unemployed and precariously employed workers who are most in need of support and training. The upfront cost of training and income requirement are barriers for these workers. There is also a new EI benefit that will allow workers to take up to 4 weeks of paid leave to study, at 55% of their income. The government is also investing in the CRA to support outreach that raises awareness of the Canada Workers Benefit for low-wage workers.

A new agency has been proposed to work across provinces to negotiate the cost of drugs for Canadians. Although any cost reductions are welcome, low and moderate income Canadians badly need the government to go further, and were disappointed by the absence of a universal pharmacare promise.

We welcome the increase in Guaranteed Income Supplement earnings exemptions for low-income seniors, up from $3,500 to $5,000, as well as a partial exemption of 50% on additional earnings of up to $10,000. This measure will enable low-income working seniors to keep more of their income.

Some measures that we hoped to see, but were missing from the budget include:

- Expansion of the Connecting Families program, to provide affordable internet to low-income Canadians. Around half of low-income households (with incomes below $30,000) do not have internet access. The current program only benefits 200,000 households and is dependent on voluntary opt-in by telecoms companies.

- A national, multi-jurisdictional anti-predatory lending strategy to address gaps in regulation and allow the sharing of best practice across the country.

- Investment in child care to tackle sky-high child care costs and long waitlists. ACORN members recommend a universal, $10 a day child care program.

- A review of the EI system to modernize and fix employment insurance. The government needs to reduce the required hours to 360; raise benefits for low and moderate wage workers, indexed annually with a retroactive adjustment; focus on good jobs; and address racial and gender inequalities in the system.

In short, Budget 2019 presents some small measures to help low-income Canadians, but there’s a long way to go.


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