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Challenges and Opportunities of Canadian Municipalities

Inquiry--Debate Concluded

December 5, 2023

Honourable senators, I want to thank Senator Simons for introducing her Inquiry No. 2, calling attention to the challenges and opportunities that Canadian municipalities face and to the importance of understanding and redefining the relationships between Canada’s municipalities and the federal government.

Together we are navigating a reality of increased uncertainty on all fronts: economic, health, social and environmental.

At the municipal level, the challenges mount: unaffordable and inaccessible food and rent, homelessness, tent cities, displacement as a result of floods and fires, strains on the emergency health care shelter and food security systems. The effects of this stress on the health and well-being of people, their families and communities — well, it no doubt goes without saying that they are more than acute.

So many people are falling through the cracks of existing social, economic and health systems. There could and should be opportunities available to these people, but, at the moment, they are largely left with impossible choices.

Examining different approaches that can meaningfully provide stability, support and hope when and where people need it most should be our priority. Canadians rightly expect their governments both to help them survive financial instability and to treat public money with care. A growing number of municipalities have identified guaranteed livable basic income, or GLBI, as a viable initiative to respond to this dual goal.

A briefing note on the Ontario Basic Income Network’s website entitled The Case for Basic Income and Municipalities was developed by municipal policy and political experts to examine what guaranteed livable basic income can offer from this perspective.

The briefing note starts with acknowledging the challenge that “municipalities are struggling to keep up with the downloaded responsibility of providing essential public and social support services.”

It traces a history of the responsibility for and cost of maintaining essential public and social services being increasingly picked up by municipalities as they go unaddressed by other levels of government, creating a situation where poverty stretches municipal resources to the limit.

Unlike federal, provincial and territorial governments, municipalities are unable to run deficits and have limited sources of revenue, such as municipal taxation, service fees and government grants, leaving them with few options for relief in the face of increased need.

Municipal political experts talk about the reality that municipalities are:

. . . seeking the means to provide residents with the flexibility to be able to afford necessary services — including electricity, heat, and water — regardless of their economic status, and without compromising their wellbeing.

They point to guaranteed livable basic income programs as a way to provide this flexibility.

Guaranteed livable basic income is a program of cash transfers provided to people in need. Unlike existing social assistance programs, amounts that individuals receive would not be contingent on following complex and often invasively policed rules and requirements, would be sufficient to afford necessities and, thereby, would allow people the stability and certainty to rebound and plan pathways out of poverty.

According to “The Case for Basic Income and Municipalities,” GLBI offers two key benefits to municipal governments. First:

When people have a sufficient income, municipalities are better equipped to ensure that everyone has access to the public and social services they need, from affordable utilities to subsidies for programs and services. . . .

These services and supports provided by municipalities are particularly crucial, as the report notes, because from water to transport to housing, they have significant impact on the social determinants of health for community members.

Second, GLBI helps to build communities. As the briefing note states, “Improved financial stability makes it easier for residents to participate, contribute, and invest in their local economies and communities” through measures such as shopping locally and participating in community activities.

GLBI could also help give individuals more space to engage with and contribute to their communities in other ways, including through volunteer work.

What is more, just as GLBI gives individuals opportunities and means to get out of situations of crisis and instability, so too would it help free up municipal budgets and decision making from some of the burdens of having to constantly respond to crises of poverty, homelessness and emergency needs. GLBI could allow municipalities more space to explore new policies to enrich community well-being and to chart a course toward a brighter future.

With these potential benefits, it is no wonder that municipalities and mayors have become leaders and champions of GLBI.

Many people know that three municipalities partnered with the Province of Ontario in 2017 to be sites for a provincial basic income pilot. Less well known is the fact that these three cities were chosen from approximately 100 municipalities. That is nearly one in four Ontario municipalities that made pitches to the province for inclusion in the program.

Interest in GLBI continues to grow. As of November 2023, our office is aware of endorsements across Canada from the Union of BC Municipalities to the Atlantic Mayors’ Congress and from at least 51 individual municipalities from Victoria to St. John’s, spanning cities and towns in at least six provinces: British Columbia, Ontario, New Brunswick, Nova Scotia, P.E.I. and Newfoundland and Labrador.

The federal government has a duty to respond to these resolutions pouring in from city councils and calling on the federal government to work with them to make GLBI a reality.

Bill S-233, currently being studied by the Standing Senate Committee on National Finance, provides an avenue for us to support municipalities facing crises that have identified GLBI as a solution they want and need.

This legislation would call on the Minister of Finance to develop a national framework for implementation of a GLBI, creating a mandate and a home in the federal government to examine implementation as a potential solution to the problem of increasing income insecurity in Canada.

Crucially, the bill would require consultation with all levels of government, including municipalities as well as Indigenous and provincial and territorial governments and civil society experts, bringing together the key actors needed to begin detailed consideration of what a Canadian GLBI could look like.

Municipalities are witnessing first-hand the suffering caused by income insecurity, and stretching their limited resources to provide stopgap emergency measures. This is not a fair, sustainable or effective response to what is a national crisis. It is time for collaboration among governments to coordinate resources and responses in order to more proactively address the root causes of this insecurity in ways that will save money and lives in the long term.

Municipalities are leading the way in urging Canada to imagine communities where we are no longer spending $80 billion per year on programs that still subjugate people to poverty and homelessness. We need to invest in Canadians and stop condemning the most marginalized to emergency rooms, compromised health, shelters, tent cities, the streets and prisons.

We can — and must — answer the call for safer, healthier, more just and inclusive communities. We must insist on governmental collaboration to address the inequities that create current social, health and economic poverty and income insecurity.

Thank you, Senator Simons, for encouraging us to examine the vital roles of our municipalities. Meegwetch. Thank you.

The Hon. the Speaker [ - ]

I wish to inform the Senate that if the Honourable Senator Simons speaks now, her speech will have the effect of closing the debate on this inquiry.

Hon. Paula Simons [ - ]

Honourable senators, two years ago this very week, I launched an inquiry into the challenges and opportunities facing Canadian municipalities. My goal is to encourage us all to think about the importance of understanding and redefining the relationships between Canada’s municipalities and the federal government.

Over the past two years, more than a dozen senators have risen to address this inquiry, and, over the past two years, the issues facing Canada’s municipalities — from the housing crisis to the climate change crisis to the opioid crisis — have grown all the more acute. In the wake of COVID, we see downtowns with empty office towers hollowed out while, at the same time, rural communities are fighting to find the internet services that they need to recruit and retain remote workers as new residents.

Meanwhile, the bickering between federal, provincial and municipal governments has become even more heated — a heat that sheds very little light on the root causes of this tension.

Today, I want to thank every senator who took part in this inquiry, but I also want to conclude these discussions so that we can address the next pressing question: What comes next for Canada’s cities and towns?

Last month, the premiers got together to lambaste the federal government over its housing policy. Their complaint was that Ottawa was giving housing incentive dollars directly to municipalities. To a lay person, this outrage may seem misplaced. Canada is, after all, in the grip of a housing crisis. We’re simply not building enough houses, townhomes and apartment buildings to allow working Canadians to buy or rent homes for their families. The Canada Mortgage and Housing Corporation, or CMHC, estimates that this country needs to build 3.5 million more housing units by 2030 to meet the demand, yet, according to new CMHC data, housing supply in Canada’s biggest cities grew by only 1% in the first half of 2023 compared to the same period in 2022.

Even that number is a bit misleading. Toronto and Vancouver led in housing starts, making up two thirds of new units breaking ground — most of those being apartments. But in Canada’s other large cities, housing starts are actually down. Montreal, Canada’s third-largest city, saw its most significant decline in residential construction in 26 years. Total housing starts in the Edmonton census metropolitan area, or CMA — where I live — declined by about 30% in the first half of 2023 compared to the same period in 2022.

And, here in Ottawa, construction of single-detached, semi‑detached and row houses was down by half. What’s going on? Well, you could put some of the blame on stricter borrowing rules, on higher construction and labour costs and, of course, on higher interest rates. Some have also blamed everything from nimbyism to municipal zoning rules about everything from parking to secondary suites that discourage infill construction.

That is the impetus behind the federal government’s Housing Accelerator Fund which gives money to municipalities to reduce regulations that discourage urban density. Federal Housing Minister Sean Fraser has been inking deals with Halifax, London, Hamilton and Calgary to get such housing built, and that is why the premiers were so angry: Ottawa bypassed provincial governments to make deals with municipalities, doing an end run around the Constitution, which makes the cities and towns the creatures of their provincial governments.

There, in a microcosm, we see the problem baked into the nature of our Confederation. We have major issues confronting our country — issues around housing, infrastructure, climate adaptation, social integration and reconciliation. It is the cities and towns that are on the front lines of dealing with those problems.

Our municipalities, which do the real heavy lifting, have the fewest resources to do so. Rather than giving them the money, respect and autonomy to carry out their responsibilities, we get bogged down in the constitutional squabbles that make it all the more difficult to do the work that needs to be done.

Don’t misunderstand me; I have nothing but the greatest respect for the constitutional division of powers. You don’t have to tell me, as an Albertan, that provinces get touchy when the federal government trespasses into areas of provincial jurisdiction.

But this latest housing squabble lays bare the absurdity in trying to use the constitutional framework built into the British North America Act of 1867 to run a country where the population of Toronto outstrips that of Prince Edward Island, New Brunswick and Nova Scotia put together; where the population of Ottawa is greater than the population of Newfoundland and Labrador; and where 3.2 million Albertans live in either metro Edmonton or metro Calgary, leaving only 1.5 million Albertans living outside of the two big metropolitan centres.

Municipalities aren’t just the order of government with the most direct responsibilities for looking after the day-to-day needs of ordinary Canadians. They are also the order of government that can move the most nimbly in a time of crisis. They have the tools and the knowledge to address the needs of their communities, but we don’t give them the runway they need to get those jobs done.

My friends, just glance down to our Order Paper and think about all the issues that we’ve been debating and discussing here of late, and how often they relate to municipalities, whether we’re talking about protecting the Chignecto Isthmus, creating a national urban park in Windsor, guaranteeing fair internet service, debating the role and the future of the RCMP or conducting an inquiry on land use planning.

We’re also talking about fundamental issues that deal with the roles of municipalities when we’re talking about creating safe cities where people released on bail don’t reoffend, or when we’re talking about the need to get rural communities hooked up to the power grid so that people don’t have to rely on propane or oil to heat their homes and yards.

The truth is that the interests and jurisdictions of the federal, provincial and municipal governments often overlap and intersect, and maybe it’s time for us to start talking about practical intersectional governance, where different orders of government stop guarding their turf, stop bickering over who’s responsible for what and just get on with the business of solving problems for Canadians where they live and work.

I want to thank and commend every senator who rose to take part in this inquiry. Your speeches were insightful and inspirational, and each one was a reflection of your regions and your passions.

From Ontario, Senator Omidvar spoke about the role of municipalities in helping to settle and integrate new Canadians, and also their critical role in fighting climate change.

Senator Marty Deacon spoke to the importance of urban planning, preserving green space and creating conditions for healthy and active communities.

Senator Black spoke about the importance of small and rural municipalities like his beloved Fergus, where his family has lived since 1834, and the need to ensure policies that help municipalities to not forget the role of small towns and villages.

Senator Dasko spoke passionately about the role of cities as economic engines, and about what can happen when provincial governments overstep their role and undermine the autonomy and authority of municipal leaders.

Senator Clement gave us a lyrical speech about her experiences as the Mayor of Cornwall working toward reconciliation with neighbouring First Nations, and the need for municipalities to partner with nearby Indigenous communities to build communities for all.

Senator Pate spoke to us just now about the role that municipalities play in fighting homelessness and championing poverty reduction, and the possible impact of a guaranteed basic income for people in Canada’s cities.

Of course, it wasn’t just Ontario senators who spoke. My fellow Albertan, Senator Karen Sorensen, drew on her experiences as the Mayor of Banff to talk about the importance of working across jurisdictional lines, as well as the leadership roles that smaller municipalities can play in championing green infrastructure.

From Saskatchewan, Senator Cotter, a former deputy minister of municipal affairs and a former deputy minister of intergovernmental affairs, reflected on the disconnect between the Canada of 1867 and the Canada of today, as well as on the importance of recognizing First Nations in any discussion about municipalities and municipal powers. His colleague Senator Arnot spoke to the essential role municipalities play in tackling issues from mental health, addiction and homelessness to the management of water resources in times of drought.

My dear colleague Éric Forest, former mayor of Rimouski, spoke about the need for tax reform to give municipalities new taxing powers and tax resources to do their essential work.

Senator Cormier began his speech by quoting the great Athenian politician and orator Pericles, “Because of the greatness of our city the fruits of the whole earth flow in upon us.” He went on to talk in passionate detail about the role of municipalities in protecting official language rights in Canada and especially in his home province of New Brunswick.

Senator Ravalia, a proud resident of Twillingate, spoke about the unique challenges of Newfoundland and Labrador in finding ways to keep rural municipalities vibrant.

I realize, as I count up, that means this inquiry was made up of speeches from me plus — dare I even say it — 12 disciples. This close to Christmas, perhaps that’s not quite the right way to express it, but I’m profoundly grateful to every senator who spoke and who, in so doing, brought this inquiry to life.

What happens next? I’m happy to say that my office has received permission to republish all the speeches that were part of this inquiry in English and in French so that we can share them widely with Canadians. In the new year, my office will organize a series of online, town hall-style panel discussions with municipal leaders, academics, authors and advocates to talk about the issues raised by this inquiry. We’ll share those panels as widely as possible, too. What happens after that is in no small part up to us sitting right here.

There is no Senate committee responsible for municipal issues, though the work of many of our committees touch on the issues of municipal responsibility. So, do we need to strike a special short-term committee to deal more in depth with this matter? I confess that I would like to see that happen, but with the continuing issue of Senate vacancies, we may be hard-pressed to populate a new ad hoc committee. Do we need to ask an existing committee to broaden its scope far enough to undertake a study? Again, we have issues of capacity that may pose a challenge.

What we can all do collectively, however, is use our bully pulpit here to underline the fact that our current constitutional model is no longer fit for purpose. Since a constitutional amendment is an arduous and daunting prospect, I think we will need to be more creative and flexible.

Senator Cormier concluded his speech to this inquiry with these ringing words for Pericles:

To be happy means to be free, and to be free means to be brave.

And we too need to find the courage to admit that we need a new paradigm for a 21st century Canada — one that empowers and enables our cities and towns, one that recognizes the responsibilities of the federal government to work with municipalities and to work with provinces to get the job done.

Thank you all. This was a collective creation. Thank you. Hiy hiy.

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