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Diane Francis: Can Canada's welfare state survive Trudeau's immigration targets?

Canada's Prime Minister Justin Trudeau walks to the House of Commons on Parliament Hill in Ottawa
Canada's Prime Minister Justin Trudeau walks to the House of Commons on Parliament Hill in Ottawa

Seven years of foolish Liberal immigration policy is cratering housing, health care and the middle class in the country’s two largest cities, Toronto and Vancouver. A new report by CIBC Capital Markets reveals that the overly rapid immigration problem is much more serious than most people realized.

In the fall, the federal government said it was on track to admitting a record 431,000 immigrants in 2022. That number doesn’t include the many “non-permanent residents,” such as guest workers and international students (and their families), who all need places to live, and some of whom gain access to Canada’s crumbling and understaffed universal health-care system.

CIBC’s report said the total number of newcomers in 2022, including “non-permanent residents,” was an estimated 955,000, which represents “an unprecedented swing in housing demand in a single year that is currently not fully reflected in official figures.”

According to Benjamin Tal, managing director and deputy chief economist at CIBC Capital Markets, “Any discussion regarding the housing market in Canada starts and ends with references to the growing number of new immigrants and to the government’s aggressive targets that are aimed at lifting the number of new immigrants by no less than 75 per cent relative to pre-pandemic levels by 2025. This in an environment in which the rental market is getting tighter by the day.”

This is one of the reasons why health care is flailing, housing is unaffordable, roads are clogged and infrastructure projects never keep up with demand — and it’s only going to get worse as the government continues to let in record numbers of newcomers. Prime Minister Justin Trudeau’s government is reducing the living standards of Canadians while at the same time attacking the country’s economic base and resource industries.

Last summer, the Organisation for Economic Co-operation and Development ranked Canada lowest among its 38 countries in terms of housing affordability, which compares average home prices to average incomes. And it’s going to get worse.

The CIBC report addresses another immigration red flag that has been proposed by the Liberals: “What’s more, the recently reported proposed plans by the government to reduce eligibility rules for visitors (in which foreign nationals would not need to establish that they will leave Canada when their visa expires), will in all likelihood work to add notably to demand for residential housing.

“While current visitor visa numbers amount to more than 1.1 million, that change of policy would prompt a spike in applications among some visa countries, and create huge incentive to visitor visa holders still in the country, wavering on returning, to remain in Canada and find accommodation.”

It concluded: “Accordingly, it’s not a stretch to suggest that the number of new international arrivals in 2023 might reach one million. This kind of inflow suggests that existing policy tools will easily fall short of addressing the current and future increase in housing demand. At the minimum, short-term housing solutions are needed to accommodate the upcoming unprecedented surge in the number of new arrivals.”

The other casualty is health care, because Canada provides free care to many immigrants and visa holders who are here to work or study. While immigrants can serve an important role in providing much-needed labour in certain sectors of the economy, the federal government has done a poor job finding newcomers who have the skills demanded by employers, and has no plan to expand housing development and the health-care system at a pace that would be necessary to accommodate the record number of people being admitted every year.

Liberal policy is grievously wounding our country. The legacy that will be left by Trudeau’s amateur cabinet of environmentalists, socialists and political organizers will be higher taxes, unaffordable housing, a debilitated health-care system, higher government debt and a lower standard of living for future generations.

Financial Post