Transferring Social Housing Assets to the Community Sector: Non-Profit Housing

in Canada and Lessons for Australia

Steve PomeroySenior Research Fellow University of

Ottawa Centre on Governance

Outline

• Canada & Australia compared• Some context - Characteristics of Canadian

non-profit community sector• Proposed benefits of NP sector• Evaluating outcomes in Canada• Lessons for Australia re stock transfer

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Canada – Australia Comparable

• British colonies;Resource based economies, similar parliamentary and federation structure; large geography and dispersed urban systems.

• Very similar tenure mix 69% Ownership; 26% Private Rental; 5% social - but subtle differences (Harloe)

• Similar initial evolution – post war public housing (supply response)

• But early 70’s divergence– Australia persisted with state owned public housing – Canada shifted to community based Non-profit– (various funding and subsidy arrangements – most F/P cost

shared, increasing decentralization)– Important variations in and across the NP sector: PNP, MNP,

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Research Question

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Australia seeking to adopt/adapt UK model of loan stock transfer. What are the inherent benefits of a non-profit community based model over state owned managed public housing?What does the Canadian experience with 35 years of Non-Profit housing suggest for Australia?

Theoretical Underpinnings

• Concepts of Managerialism and New Public Management (Clarke and Newman 1997; Walker 2001)• Decentralization, competition, private business

models, efficiency, customer responsiveness and measuring results

• Grass roots reformist movement and role of Third Sector (Van Til 2009)

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Suggested benefits of Non Profit – community sector

• Ability to access financing – leverage existing assets (vs. restriction on public sector borrowing)

• Cost effective (access charitable funding, voluntary professionals on boards)

• Community based providers – smaller scale developments, community support, avoids stereotypes of PH (less NIMBY)

• More responsive to residents (satisfaction)• Important role in policy advocacy

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What is outcome in Canada?

• Small community based PNP/Co-ops still confront NIMBY;

• Excessive number of small providers = fragmented inefficient sector;

• Notion of choice is a myth – sector too small• Access to financing not generally an issue Access

is similar for Public or community NP – and both equally constrained in refinancing/levering due to CMHC regs and insurance policy.

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What is outcome in Canada?

Efficiency • Small scale PNPs tend to have lower

“manageable costs” but more often in financial difficulty and issues of governance (board burnout).

• MNPs higher cost but wider range of service and expertise. Benefits of both alignment and separation (arms length) from municipality.

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What is outcome in Canada?

Responsiveness • Public Housing – large bureaucratic – least

responsive, moderate accountability• PNP – small community based but not

necessarily more accountable or responsive (boards not publicly accountable)

• MNP – small to mid size, very responsive (access to councillor), most accountable

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Conclusions• Who owns and manages less critical than scale

and regulatory regime (permissive vs constraining) which underpins culture of provider.

• Separation (arms length and specific focus can help if balanced with right regulatory regime

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Conclusions• Among Canadian models MNPs may be best

option (but larger PNPs also effective)– Local knowledge– Accountable– Access to financial resources and expertise

• Critical to support capacity and expertise of sector beyond new build (leadership role in of NP associations – comes mainly from larger professional MNP/PNPs)

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