Municipalities say $600 billion in infrastructure needed to build 5.8 million homes

The Federation of Canadian Municipalities says new research it commissioned finds municipalities would need $600 billion in infrastructure funding to help support construction of 5.8 million homes by 2030.

That's the number of homes the Canadian Mortgage and Housing Corp. says Canada needs to build to restore affordability.

Canadian municipalities are voicing their disappointment that the federal Liberals didn't include a new infrastructure funding model in their fall economic statement this week, despite the prime minister promising one would come in the fall. 

The federation held a news conference Thursday in Ottawa to call on the federal government to convene provincial, territorial and municipal leaders to discuss a new funding framework that takes economic and population growth into better account. 

Municipalities say they need more money to build everything from roads to public transport to drinking water systems to support the construction of more homes and are turning to higher levels of government to pony up the funds. 

"We don't expect that the federal government and the provinces will turn around on Saturday morning and write a check for $600 billion to fix this gap," said Mike Savage, mayor of Halifax and chair of the Big City Mayors' Caucus. "What we do expect is that they accept that it's a real threat to the future of Canada, and particularly to its growth, and that they look at the things they can do."

The fiscal update that Finance Minister Chrystia Freeland presented earlier this week included few new housing policies, as the Liberal government acknowledges the pressure that high inflation and interest rates are putting on federal finances. 

"We recognize the fiscal constraints that the federal government are under, provincial governments as well," Savage told reporters. "But municipal governments are under even more fiscal pressure."

The Liberal government has generally taken a friendly approach with municipalities, opting to work with them on various priorities, including housing.

It launched the $4-billion housing accelerator fund program last summer, for example, which is giving cities with ambitious plans to boost housing construction the opportunity to apply for additional federal funding. 

Savage acknowledged that the federal government has done a lot for cities, but said municipalities need more support to accomplish Canada's housing ambitions. 

"We've had a pretty good relationship with this government over the last number of years," he said. "They (were) elected, you'll recall in 2015, on a promise to go into debt to help fund infrastructure, including municipal infrastructure. So we don't disparage what the federal government (has) done. But we need more."

In a statement, Freeland's press secretary, Katherine Cuplinskas, said the fall economic statement was "squarely" focused on housing with billions in new investments to get more homes built. However, she did not address why the federal government hasn't presented a new infrastructure funding model for municipalities. 

"The federal government is at the table with billions of dollars of support and expects what Canadians do as well — that all their elected officials work together to get more homes built, faster," she said.

This report by The Canadian Press was first published Nov. 23, 2023.