One of the standard arguments against the creation of public housing is that it obliges some members of society to subsidize the housing of other members of society. The critics say that this not only robs the people who are paying the subsidy, but it also demeans the people who receive it.[1]
These arguments ignore the fact that the private housing market has historically provided decent housing at rates that low-income people can afford.
They also ignore the fact that for decades before Winnipeg got its first public housing projects in the 1960s, taxpayers were subsidizing the rents of low-income people who were living in housing provided by private landlords. In effect, they were subsidizing landlords.
This practice started in the 1920s when the province was hit by a post-war economic recession. The number of unemployed in the city was so high that the city’s Social Welfare Commission had no choice began to provide people on relief, as welfare was called then, with up to $25 a month for rent. This was only paid if the applicant was two months behind on their rent.[2] Labour member of Winnipeg city council W.B. Simpson claimed that the city was not paying rent until the bailiffs were at a welfare recipient’s door.[3] In 1924 the policy of paying rent if the relief recipient was two months in arrears was dropped. Instead, an applicant who was in arrears had to work at the wood yard, where he would be paid $1.75 for every cord of wood cut, with the money being applied to rent.[4] By then there were 2,229 married men on relief. Eighty-seven per cent of them were renters. Fifteen percent of these households were living in one-room suites, while another 40 per cent had only two to three rooms.[5]
During the Depression of the 1930s rent subsidy to people on relief was not given until families were three months in arrears. An appalled Independent Labor Party (ILP) member of council, Morris Gray, commented that “The only time the [Social Welfare] commission will pay rent before the time is when the people are thrown out of their homes.”[6]
By 1936 the city was giving families on relief between $10 and $20 a month for housing, with the average payment being $12.66. In addition, families were provided with $11.60 a month for utilities, a figure that everyone agreed was below the cost of the services. In that year there were 5,433 tenants on relief, with an average household size of 4.8 people.[7] Landlords across the city had become dependent on relief payments, so much so that when in 1934, Winnipeg contemplated a 20 per cent reduction in relief, the Winnipeg Tribune predicted that “many landlords will be unable to pay their taxes. This may mean wholesale eviction of tenants.”[8]
Twenty-five years later there was still no public housing and city was still subsidizing slum landlords. The point was driven home by a series of stories in the Winnipeg Tribune in 1959: The headline ran from one side of the front page of the paper’s October 14, 1959, edition to the other: “Probe bares city slum profit.” The subhead underscored the message: “Taxes subsidize big landlords.” The stories were based on a report prepared by the city’s health and welfare department showing that four landlords who regularly violated health regulations were collecting thousands of dollars from the city’s welfare department. In 1959, 187 city welfare cases were living in these properties. Over the previous three years, the city had identified 1,457 health violations in the 94 premises owned by these four landlords.
Providing inadequate housing to welfare recipients was also a very profitable business: one landlord collected 33 per cent of his property’s assessed value in rent in a single year, while a second landlord collected 47.7 percent of the assessed value. Property taxes to the city in one case amounted to 10 per cent of revenue.[9]
Welfare rates, which in 1959 had not been increased since 1954, provided no more than fifty dollars a month to rent an unheated premise—and to receive that level of assistance, there had to be six people in the household. Provincial health regulations could hardly be described as stringent: they allowed six people and any number of infants to live in as little as 430 square feet.[10]
While there was general agreement that welfare rates were too low to allow people to rent decent housing, council was reluctant to raise them.[11] The city’s welfare director, C.A. Patrick said that families on welfare tended to cover their rent by cutting down on their food budget. As he had in the past, Patrick warned that raising the housing allowance might well be followed by an increase in rents. “The real problem is the shortage of suitable accommodations. If you increased the allowance by much more than we propose, some people might still be living in the place they now occupy.”[12]
In commenting on some council members’ opposition to the idea of the city getting into the provision of subsidized housing, one unnamed city official said, “Winnipeg is in subsidized housing now—the worst housing in the city.”[13]
Back to The Struggle for Affordable Housing in Winnipeg
[1] “Chamber Thumbs Down Housing For ‘One Group,’” Winnipeg Free Press, 23 October 1953; “Attention Ratepayers” We are OPPOSING the Housing By-law because,” Winnipeg Free Press, 26 October 1953.
[2] “Unemployment Relief Before Council,” Manitoba Free Press, December 6, 1921. Michael Goeres, “Disorder, dependency and fiscal responsibility: unemployment relief in Winnipeg, 1907-1942,” Master of Arts Thesis, University of Manitoba, 1981, 61–62, 74.
[3] “Council to prepare for vote on street railway,” Winnipeg Evening Tribune, February 24, 1925.
[4] Unemployment Relief Committee, Report on Unemployment Relief Covering Winter 1924-25, 3, cited in Michael Goeres, “Disorder, dependency and fiscal responsibility: unemployment relief in Winnipeg, 1907-1942,” Master of Arts Thesis, University of Manitoba, 1981, 135.
[5] Unemployment Relief Committee, Report on Unemployment Relief Covering Winter 1924-25, Table 16, cited in Michael Goeres, “Disorder, dependency and fiscal responsibility: unemployment relief in Winnipeg, 1907-1942,” Master of Arts Thesis, University of Manitoba, 1981, 131.
[6] “Rent paying policy of social welfare commission probed,” Winnipeg Free Press, October 4, 1937.
[7] “Committee to study housing of unemployed,” Winnipeg Tribune, May 13, 1936.
[8] For the federal reduction, see: John Herd Thompson and Allan Seager, Canada 1922–1939: Decades of Discord, Toronto: McClelland and Stewart, 1985, 254; “What reductions may mean to those receiving relief,” Winnipeg Tribune, August 30, 1934.
[9] “Probe bares city slum profit: Taxes subsidize big landlords,” Winnipeg Tribune, October 14, 1959.
[10] Jim Hayes, “Rules halt cure of slum cancer,” Winnipeg Tribune, October 15, 1959.
[11] “$60 rent money claimed too low,” Winnipeg Tribune, December 15, 1959.
[12] “Welfare rent hike is urged,” Winnipeg Tribune, December 8, 1959.
[13] Jim Hayes, “Rules halt cure of slum cancer,” Winnipeg Tribune, October 15, 1959.