McArthur Place in Edmonton, operated by a non-profit registered charity. Photo courtesy of the City of Edmonton.

There is a blocky, 34-unit low-rise just east of the Bonnie Doon Bridge on Edmonton’s south side. The slate-grey, four-storey building, called Hope Terrace, opened its doors in late 2022 with a mandate to house people with a history of homelessness and fetal alcohol spectrum disorder. The people who live here have often led complex, difficult lives and have struggled to maintain housing in the private market. At Hope Terrace, they have access to the resources they need to thrive. Residents receive daily support from specially trained staff who are on site around the clock, helping with everything from emotional regulation and budgeting to food security, medical service integration, employment, and guest management. Buildings like this, known as supportive housing, have become an important part of Canada’s housing system. They provide stability, care, and independence to people who might otherwise cycle between shelters, rough sleeping, and emergency services.

Like most supportive housing in Canada, Hope Terrace was built with a combination of federal and provincial dollars by private developers under the supervision of a non-profit—in this case an organization called Homeward Trust. After construction was complete, Homeward Trust, the formal owner of the building, used federal and provincial funds to contract out daily operations to another, smaller non-profit—in this case an organization called the Bissell Centre, where I happened to work as a director in the early 2020s.

This arrangement has become the default path for the construction of non-market housing: public money, private profit, non-profit liability.

Prominent housing advocacy groups, including the Federal Housing Advocate, The Shift, and Generation Squeeze, often push for more of this kind of non-profit housing. I can understand why. Non-profits—referred to mostly interchangeably as non-profit organizations (NPOs), non-governmental organizations (NGOs), registered charities, voluntary organizations, and the third sector—have been a huge part of housing policy for decades. They even played a role in solving the housing crisis of the 1970s. It is natural to see them as part of the solution to today’s housing woes.

However, after years working in the housing focused corners of the third sector, I can tell you that non-profits will never resolve the dysfunction in our housing system. They erode service quality, undermine labour power, and intensify Canada’s democratic deficit. NGOs have become a major impediment to housing justice.

This wasn’t always the case. In the Keynesian, post-war period non-profits were viewed as a supplement to the direct provision of services by national and provincial governments. Back then, states provided uniform services on an equitable basis and non-profits provided individualized services that filled unique service gaps. In the housing sector this meant non-profits served specialized niches in the housing continuum while robust federal programs met the lion’s share of the need by building and operating tens of thousands of units every year.

But Keynesianism is long dead and things have changed dramatically since Reagan, Thatcher, and Mulroney put it in the ground. Non-profits no longer exist to supplement social services but to replace them on the cheap, regardless of the impact lower costs may have on the people who rely on those services.

This pattern began in earnest in the 1990s when the federal government stopped funding the construction of non-market housing and downloaded responsibility for existing stock to provinces which were inadequately resourced to take on this new role. The provinces had little choice; they either defunded housing services, downloaded the responsibility to municipalities, or abandoned it altogether. Housing services that survived this bloodbath were hobbled. Government contracts with housing not-for-profits fell........

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