Manitoba

Province should take steps to get out of public housing: KPMG

Consultants recommend some tenants receive vouchers for rent, others live in public housing managed privately

185 Smith Winnipeg

This downtown Winnipeg highrise, owned by Manitoba Housing, has sat empty for over two years. (Austin Grabish/CBC)

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A fiscal review into core government spending recommends Manitoba take steps to back out of public housing ownership and management in favour of more reliance on the private sector.

The consulting firm KPMG found the province is saddled with aging buildings that fail to meet the needs of tenants while Manitoba Housing is spending more money than it's taking in.

In 2016 the province spent $305 million on housing and rent programs but only made $293 million revenues, KPMG's Manitoba Fiscal Performance Review found.

"The current model is unsustainable and the cost curve is increasing," the report said, adding federal funding for housing has also been on the decline.

The consultants' solution is a model that would see recipients of Manitoba Housing supports with the most independence receive vouchers to pay for rent in private sector. Vulnerable tenants meanwhile would continue on in public housing that is either provided by Manitoba Housing or under contract between government and a private or community-based provider.

The consultants also said municipalities should play a larger role in providing public housing.

'Transitional housing, homelessness issues or things in the child welfare system could all be a part of ... social impact bonds.' - Families Minister Scott Fielding

According to KPMG the system would enable more self-sufficient clients to learn how to deal with private sector landlords, preparing them for a future when they may not rely on government assistance for housing — while still ensuring the most vulnerable tenants receive the supports they need.

The report goes on to say one of the tools Manitoba could use to implement transformation in public housing are social impact bonds.

The idea has been widely supported by Progressive Conservatives in the province as a way for business and non-profits to develop new ways to address poverty and other social ills in ways that have measurable outcomes. Government only pays out on the bond once a measurable social outcome is met.

Families Minister Scott Fielding said Friday the province is looking to hire an intermediary that will develop a "landmark" social impact bond that will come out in the next few months.

KPMG not experts in housing policy: CCPA

"We absolutely hope that initiatives whether it be like this or others that provide transitional housing, homelessness issues or things in the child welfare system could all be a part of innovative thinking in terms of social impact bonds," said Fielding.

"We're very supportive that."

Molly McCracken, Manitoba director for the Canadian Centre for Policy Alternatives, raised a number of concerns with the KPMG report.

'[KPMG] are auditors, they are not experts in social housing.' - Molly McCracken,  Canadian Centre for Policy Alternatives

On the question of social impact bonds, she said before supporting the idea she would want to know what outcomes the government is hoping to measure. If it is employement rates, she said, this may present issues among tenants who will never be able to hold down a nine-to-five job.

"It concerns me, I wonder what progress they would want to see," she said.

On the proposal of rent vouchers, McCracken argued Manitobans already have access to a voucher system — in the form of Rent Assist — and wonderred why consultants recommended a new program.

"That is a system that is working right now," she said. "There's no need to develop another voucher system."

McCracken also questioned expertise of KPMG.

"They are auditors, they are not experts in social housing. They do not have a social mandate," she said.

According to McCracken now is the time for the province to invest more in social housing. "There's no coincidence that we have a homelessness epidemic now," she said.  

"There was a divestment in social housing for many, many years and we actually did not build enough."

As of May 31, 2016 there were 2,050 families, 689 seniors, 966 single adults and special needs clients on the waiting list for social housing, according to KPMG. The Rent Assist program which provides rent subsidies to low-income Manitobans is "rapidly escalating" in costs and requires a change in policy, said KPMG in its report.

The largest waitlist is Winnipeg with 2,513 families and individuals on the list, and about 67 per cent of Manitoba's subsidized housing stock is more than 35 years old.

CBC has asked the province to comment on the report. 

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