Premier Doug Ford lashed out over interest rate hikes Friday as he defended his government’s housing plan in the face of more scrutiny over an auditor general’s report suggesting a decision to open up protected Greenbelt lands was designed in a way that would help a few developers make billions of dollars.
Speaking at a housing announcement in Mississauga, Ford was asked by a member of the media why he wouldn't commit to revisiting the process with developers to make sure that it is transparent.
Ford responded by saying that his government will accept most of the recommendations from the auditor general’s report for improving the process, but went on to add that building homes is important, particularly making sure that 10 per cent of them are affordable.
He alluded to developers putting billions of dollars into infrastructure like schools and long-term care homes, and said that land that has been opened up for development will go back into the Greenbelt if development does not move quickly enough.
However he then pivoted to a discussion about mortgage rates.
“The other thing that's really heating up my backside are these mortgage rates,” Ford said. “We keep hearing rumors that they may — and hopefully they won't — raise interest rates again. That's unacceptable,” Ford said. “They talked about inflation. They don't know, the Bank of Canada and the governor (of the Bank of Canada) doesn't understand inflation if they continue raising these rates on the hard-working people.”
Canada’s headline inflation rate fell to within the Bank of Canada’s one to three per cent target range for the first time in years in June – at 2.8 per cent.
However core inflation, which strips out volatile energy prices, remains elevated and economists have warned that it could be a long road to get to the Bank of Canada’s two per cent target.
Ford’s comments on mortgages came unprompted as he faced a barrage of questions from reporters about the scathing auditor general’s report. It found that the decision to open up 7,400 acres of protected Greenbelt land for development favoured a few prominent developers who already owned land in the Greenbelt, and the decision could see the value of that land increase by at least $8.3 billion.
Ford then went on to say that life is already too expensive and listed off a number of small pocketbook measures his government has implemented for “the little guy.”
“They're already seeing prices of groceries go up, they see gas prices go up. Just imagine folks, if we didn't cut the 10 cents a litre of (gas) tax. It'd be another 10 cents more. Just imagine if we didn't return the licence sticker, vehicle stickers there, or we didn't cut the tolls on the (Hwy) 412 or 418. We're a government that takes care of the little guy, little gal per se. We're going to make sure it's affordable.”
The target overnight lending rate in the country is set federally by the Bank of Canada (BOC), which has pursued an aggressive series of rate hikes in order to curb runaway inflation. The central bank has maintained that the hikes are necessary for the long-term health of the economy, despite the fact that some critics have said they make life more onerous for those who are struggling.
“On balance, our assessment was that the cost of delaying action was larger than the benefit of waiting,” BOC Governor Tiff Macklem said after the last rate hike in July, which brought the overnight rate to five per cent.
Federally, Conservative Leader Pierre Poilievre has been railing against the Bank of Canada for months, calling the hikes unnecessary and saying that BOC Governor Tiff Macklem should be fired.
While interest rate hikes have made it more difficult for many people to qualify for mortgages, the Ford government has also declined to end some real estate practices, such as blind bidding, which critics have said artificially inflates home prices. While the government said last year that it would allow sellers to choose whether or not to disclose bids to potential buyers, doing so remains completely optional.
