Senior Research Fellow University of Ottawa Centre on Governance Transferring Social Housing Assets to the Community Sector: Non-Profit Housing in Canada and Lessons for Australia Steve Pomeroy Senior Research Fellow University of Ottawa Centre on Governance

Steve Pomeroy, U 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 Canada has not gone through a stock transfer; instead we refocused investment in early 1970s on NP, but retained pre-existing Public Housing (except recent transfers in Ontario). Focus here is not on transfer, but on the underlying premise of transfer – the notion that NP model offers advantages and benefits relative to State owned PH.I will use the purported benefits as an analytical framework to access actual experience in Canada. 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

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, Coops Two sets of administrative reform: federal transfer to Provinces (admin role), ongoing fed subsidy frozen at 95/96 level so P/Ts absorb inflationary increase in operating subsidies(partial offset by renewal of mortgages at lower rates) 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

Steve Pomeroy, U Ottawa Centre on Governance Research Question 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? 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

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) 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

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 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

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. 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

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. 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

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 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

Steve Pomeroy, U Ottawa Centre on Governance 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 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance

Steve Pomeroy, U Ottawa Centre on Governance 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) 11/23/09 Steve Pomeroy, U Ottawa Centre on Governance