The parliamentary budget office projects in a new analysis that Ottawa's new housing agency will fill only a small gap in the housing market.
The Liberals launched Build Canada Homes in September and tasked the new federal agency with boosting the total stock of affordable housing with an initial $13 billion in funding for loans, financing and land acquisition.
The budget office said in a report Tuesday that Build Canada Homes is projected to add 26,000 units to the total housing supply across the country over the next five years, half of which would be affordable homes for low-income Canadians.
That represents an increase of 2.1 per cent over the PBO's baseline projection for new home construction over that period.
It also accounts for only 3.7 per cent of the roughly 690,000 units the PBO estimates are needed to restore housing affordability over the next decade.
While the Liberals have promised to double the pace of housing construction, the budget office noted in its report the government hasn't released a complete plan to achieve that goal.
The fiscal watchdog also warned overall federal housing spending is set to decline by 56 per cent over the next three years without renewed commitments to existing programs.
New funding for Build Canada Homes only partially offsets other programs that are set to expire or haven't been publicly renewed yet, the office said.
The report flags expiring funding agreements for Canada Mortgage and Housing Corp. under the Liberals' national housing strategy. That includes the $4.4 billion housing accelerator fund — a flagship program under the Justin Trudeau government — which has funding set out to the end of 2028.
Interim parliamentary budget officer Jason Jacques told the Senate's national finance committee on Tuesday the government did not respond to his office's questions about which programs are being cut or wound down in the context of spending reductions across the public service.
The PBO's projections are based on public announcements, corporate plans issued by the CMHC and any details offered in the federal budget tabled last month, he said.
"If not addressed, the current public data indicates that we're on track for a substantial decrease in spending in this area and federal spending in this area," Jacques said.
Housing Minister Gregor Robertson did not stop to answer questions about the projections on his way into the Liberal cabinet meeting Tuesday.
Picture Courtesy: THE CANADIAN PRESS/Spencer Colby
