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Achieving target to halve chronic homelessness would require an additional $3.5 billion per year, says PBO

Ottawa (Ontario), May 22, 2024

The Parliamentary Budget Officer (PBO) has released a new report providing an update on federal spending to address homelessness.

Infrastructure Canada provides funding to communities to help them reduce and prevent homelessness through a program called “Reaching Home”, which is part of Canada’s broader National Housing Strategy. Over the term of Canada’s National Housing Strategy, planned spending on homelessness programs is $561 million per year. This is an increase of $443 million per year (374%) in nominal spending over the prior 10 years. This includes an additional $1.3 billion over four years allocated in the 2024 Budget.

Canada’s target under the National Housing Strategy is to achieve a 50% reduction in chronic homelessness. “According to our analysis, an additional $3.5 billion per year would be required to reach this goal, which is about a 7-fold increase in funding over the National Housing Strategy’s average. Furthermore, this funding would have to be sustained on an ongoing basis, taking inflation into account,” says Yves Giroux, PBO.

“We estimate that interventions funded by “Reaching Home” are reducing the point-in-time count of homeless individuals by approximately 6,000 (15%), relative to what the count would have been without those interventions,” adds Mr. Giroux.

Nevertheless, according to the latest available data, homelessness has increased in spite of “Reaching Home.” In the latest point-in-time count published by Infrastructure Canada, the number of homeless people had increased by 20% relative to 2018 reaching 34,270, and we estimate that the number of chronically homeless people had increased by 38%. The number of individuals living in unsheltered locations also increased 88%.

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