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“For tenants, the attack by a CIBC official shows rent control works and needs to be expanded.” — Larry Brown, NUPGE President
Ottawa (10 April 2017) — In March, it was revealed that CIBC is laying off 130 people and moving their jobs overseas. CBC reported that workers at the Canadian Imperial Bank of Commerce (CIBC) and other major banks felt forced to use high-pressure tactics to sell clients expensive services they didn’t need. Now, CIBC has turned its focus to housing, claiming that limiting rent increases is bad for tenants.
“CIBC’s treatment of its workers and the allegations about how it treats its clients makes it clear it is not on the side of low- and middle-income Canadians,” said Larry Brown, President of the National Union of Public and General Employees (NUPGE). “For tenants, the attack by a CIBC official shows rent control works and needs to be expanded.”
Private sector won’t build affordable rental housing when condo profits bigger
There is a shortage of affordable rental housing, but it has nothing to do with rent control. Developers can make a lot more money building condominiums and they’re able to pocket their profits in a fraction of the time. That’s because condominium builders are able to pay off loans quickly as units are sold, while those owning rental housing may be making mortgage payments for decades.
Where new rental housing is being built, it is high-end units that most people can’t afford.
Governments must act to get affordable housing built
The only way to get affordable rental housing built is through public funding. And the size of the problem means the federal government needs to be involved.
While there was funding for affordable housing in the last federal budget, it is nowhere near what is required to solve the housing crisis. After decades of governments doing little or nothing, we have a large affordable housing deficit.
As with other essential services, we also have to watch how the money is spent. Business groups and conservative think tanks want public funds to be used for tax breaks or rental subsidies for landlords. But when money goes to private sector for affordable housing, it is a lot harder to ensure the housing stays affordable than when the non-profit, co-op or public sector receive the funds.
CIBC using the affordable housing shortage to attack protection for tenants
CIBC’s attack on rent control is part of a larger pattern. Those arguing for policy changes that make the rich richer are trying to claim their policies will somehow benefit low- and middle-income people.
Those arguing against laws and regulations to protect precarious workers claim that people want “flexibility.” Those arguing for private health care claim it will reduce waiting times for people in the public system — in spite of all the evidence that the reverse is true.
In its 2016 budget, the federal government introduced a tax break that largely benefited people earning over $90,000. People earning the median income received no benefit from this tax break. But that didn’t stop the federal government from selling it as a “middle-class tax cut.”
“The fact that those pushing for more income inequality are trying to portray themselves as the defenders of average Canadians shows that the work NUPGE and others have done to increase awareness of income inequality is having an impact,” said Brown. “Our challenge now is to build awareness of what changes are needed to reduce income inequality so it is easier to expose these gross distortions of the facts.”