From the Fraser Institute

By Matthew Lau

The city’s homelessness operating budget alone works out to about $51,000 per homeless person per year. For reference, the median after-tax income among Canadians in 2023 was $39,900. In other words, if you took the City of Toronto’s homelessness services operating budget in 2024 and divided the cash among the city’s homeless population, each homeless person would have 28 per cent higher income than the typical Canadian.

According to a recent City of Toronto report, in October 2024 there were an estimated 15,400 people experiencing homelessness in the city—more than double the approximately 7,300 homeless in April 2021. Of the homeless population, about 80 per cent stay in city-administered sites, 10 per cent in provincially-administered sites, and 10 per cent outdoors.

Clearly, homelessness and poverty are significant problems in Toronto, and governments should undertake some efforts to tackle these problems and mitigate their effects. However, whether politicians are using taxpayer money effectively in trying to do so is another matter, and in the case of Toronto’s spending on homelessness services, the numbers suggest there’s significant room for improvement.

In 2024, the gross expenditures operating budget for Toronto Shelter and Support Services, which is responsible for managing homelessness services, was $787.5 million. The capital budget was another $78.2 million. With a homeless population of 15,400, the city’s homelessness operating budget alone works out to about $51,000 per homeless person per year. For reference, the median after-tax income among Canadians in 2023 was $39,900.

In other words, if you took the City of Toronto’s homelessness services operating budget in 2024 and divided the cash among the city’s homeless population, each homeless person would have 28 per cent higher income than the typical Canadian.

Another data point in the report: the average market rent for a bachelor unit in Toronto in 2024 was $1,456 per month, which works out to $17,472 per year. This is one-third of that $51,000 per-homeless person to put a roof over the head of each of the 15,400 homeless people, even at a level of quality such that the amenities and comfort is comparable to that of an average resident of a bachelor unit in the city. Homelessness services include more than just providing shelter, but again, the wide gap between $17,472 and $51,000 suggests taxpayer money is not efficiently spent.

I am reminded of a 1978 speech by famed American economist Milton Friedman on the welfare state. If you took the total annual welfare expenditures made by federal, state and local governments in the name of helping the poor, according to Friedman, and divided it among the entire population that the government defined as being in poverty, it would work out to $9,000 per person. For comparison, the average after-tax income per person in the United States in those days was $6,500 per year.

“If that $9,000 per person were really going to the poor,” Friedman exclaimed, “they’d be among the rich! That income given to them would put them in the top 20 per cent of the income distribution.” The obvious explanation for what was going on: money the government spent, supposedly on helping the poor, wasn’t actually going to the poor.

The same appears to be true with Toronto’s homelessness services spending. Divide the city’s homelessness services spending among the homeless, and the homeless could well be considered richer than the average Canadian.

Toronto residents aren’t alone in having their money spent ineffectively. There’s plenty of evidence that governments elsewhere are ineffective in anti-poverty spending. See for example a California state auditor report last year detailing the state’s significant rise in homelessness even as nine state agencies spent US$24 billion on at least 30 programs over five years to prevent homelessness. Taxpayers—in Toronto, California and everywhere else—should demand better.

From Resource Works

By Nelson Bennett

The Roberts Bank terminal expansion would generate 132,400 jobs across Canada, according to an economic analysis by the Port of Vancouver, generate $9.3 billion in wages, $16.3 billion in GDP and $32.7 billion in economic output. It was approved by the federal government in 2023 with 370 legally binding conditions. The environmental review process has gone on for about a decade now, and continues to get bogged down in a permitting morass.

Sometime this year, the Mark Carney government is expected to announce a list of major “nation-building” projects that it will help advance with its Bill C-5 fast-tracking legislation. These projects have been dubbed as PONIs – projects of national interest. Let’s hope this doesn’t turn into some kind of federal welfare scheme in which the taxpayer ends up footing the full bill.  “We should absolutely start with the ones where there’s already a private proponent, not a province seeking subsidies,” says Heather Exner-Pirot, senior fellow and director of energy, natural resources and environment for the Macdonald Laurier Institute.

I would argue that projects that facilitate exports — pipelines, rail, ports — ultimately provide the most economic value because it means increasing market access and getting a higher price for our commodities.  I think there’s a strong argument to be made that a new crude oil pipeline to the West Coast and infrastructure needed to develop Ontario’s Ring of Fire mining region are two nation building proposals that would have maximum economic impacts, and therefore should top the PONI priority list. “Energy projects or anything related to manufacturing-value added initiatives should be categorized as nation building projects,” says Ellis Ross, Conservative MP for Skeena-Bulkley.

We need to attract private capital to help build mega-projects. So let’s hope Alberta Premier Danielle Smith can find a proponent in the private sector willing to invest in the new pipeline to the West Coast. So far, it doesn’t look promising. Two Canadian midstream companies – Enbridge and TC Energy – have basically said they’re not interested in Canada anymore and are more focused on the U.S. now. And who can blame them? They wasted hundreds of millions of dollars on pipeline proposals – Northern Gateway and Keystone XL – that became deflated political footballs. But if Danielle Smith can find a private sector partner to build a new crude oil pipeline from Alberta to Prince Rupert, I think that should be a top priority for the Carney government. The Carney government will need to consider just how realistic some of the projects being proposed are. How close to shovel-ready are they? How quickly could they be built?

The federal government’s own criteria for designation of projects for federal support and fast-tracking include:

• projects that “strengthen Canada’s autonomy, resilience and security”;
• contributes to clean growth and climate goals;
• advances First Nations interests; and
• have a high likelihood of success.

To tick that “clean growth” box, Smith’s new pipeline would need to be paired with the Pathways Alliance’s $20 billion carbon capture proposal. That project has private capital behind it, so it’s essentially shovel-ready. While other Canadian premiers have publicly championed their own pet projects for consideration, David Eby appears not to have pitched any projects yet, at least not publicly. Maybe that’s a tacit admission that nation building designations are likely to be limited to one per region, and that a new pipeline to the West Coast – Northern Gateway 2.0 – is the most likely candidate for Western Canada. Or maybe he feels B.C. may not need the federal government’s help in advancing projects in B.C. like Ksi Lisims LNG and new mines – that these projects can be advanced without Ottawa’s help. And that may, in fact, be the case.

B.C. has its own fast-tracking legislation – Bill 15 – with 18 projects already designated. They include the Teck Resources Highland Valley copper mine expansion, Cedar LNG, and Enbridge’s Aspen Point natural gas pipeline network expansion. Just last week, Teck announced the sanctioning of its $2.4 billion project Highland Valley copper expansion project, with construction to start this month. “What B.C. did — I have to give them credit, for once — is they just made it easier for proponents already in the system. They didn’t subsidize, it didn’t cost them money, there is a private proponent, there is a business case. And they just made it easier. And this seems to me to be the right approach.”

In other words, apart from an oil pipeline to Prince Rupert, Exner-Pirot does not believe B.C. necessarily needs to put any PONIs in the federal race. “B.C. is in the enviable position of having great resources, of having LNG, of having tidewater access already,” she said. “They have tens of billions of projects all in the queue with private investors. The territories don’t have that, Manitoba does not have that, Atlantic Canada does not have that. “They shouldn’t really even need the feds. They just need them to get out of the way.”

If there is one major project in B.C. that might warrant a federal designation, it’s the Roberts Bank terminal expansion, Exner-Pirot said. The Roberts Bank terminal expansion was approved by the federal government in 2023 with 370 legally binding conditions.  The expansion would generate 132,400 jobs across Canada, according to an economic analysis by the Port of Vancouver, generate $9.3 billion in wages, $16.3 billion in GDP and $32.7 billion in economic output.

Surely this should qualify as nation-building, as it would facilitate the movement of Canadian goods and commodities to markets in the Asia Pacific.

But it has been in an environmental review process that has gone on for about a decade now, and which continues to get bogged down in a permitting morass. So if there is one project in B.C. that could use a federal designation for fast-tracking, it’s the Roberts Bank Terminal expansion, Exner-Pirot said. Otherwise, the only other PONI that B.C. would benefit from is Northern Gateway 2.0. “That would have the biggest GDP impact for Canada,” Exner-Pirot said. B.C. would benefit from billions spent on the B.C. portion of the pipeline. One need only look at the Trans Mountain pipeline expansion project to see what kind of an economic juggernaut a major pipeline project can be, for Alberta, for B.C. and for Canada.

In terms of job creation, TMX generated an estimated 36,917 jobs — 16,476 in Alberta and 16,476 for B.C. – according to Energy Connection Canada. EY has estimated that TMX, which cost $31 billion to build, would generate $52.8 billion in economic activity, add $26 billion to GDP, pay $11 billion in wages, and generate $2.9 billion in tax revenue.

Over the next 20 years, it is expected to generate $17.3 billion in total economic activity and add $9.2 billion to GDP. Oil is Canada’s most valuable export, accounting for 19% of Canada’s total exports. When Alberta’s oil sector is thriving, Canada thrives.  Getting a private company to build the new pipeline will require the Carney government to scrap its West Coast oil tanker ban, oil and gas emissions cap, and essentially exempt it from the Impact Assessment Act, otherwise it just ain’t going to happen. As for some of the other major projects being proposed across Canada, like the Grays Bay road and port project and the Churchill port project, they certainly seem to qualify as nation-building projects, but would require massive amounts of public funding. “Those are all ones looking for the government to fund and build,” Exner-Pirot said. “Grays Bay has zero private dollars. They’re looking for 100% covered by the feds. “Is this just regional welfare? Is this an excuse to dole out money to different regions to buy votes? This is what it looks like.”

Nelson Bennett’s column appears weekly at Resource Works News. Contact him at [email protected].