Housing is being held hostage by runaway bureaucracy

Canadian-born educator Laurence J. Peter once stated that “Bureaucracy defends the status quo long past the time when the quo has lost its status.”

He also formulated the Peter Principle, the concept that in a hierarchy all employees tend to rise to their level of incompetence and ultimately end up in a job for which they are not well suited.

It is his statement on bureaucracy, however, that intrigues me. The residential construction industry is, in many ways, being held hostage by a runaway bureaucracy.

The City of Toronto is a prime example.

Despite undertakings to speed up development approval applications, metrics show the city is still lagging, with intolerably long timelines for things like zoning amendments and site plan approvals.

Timelines are too long

A review of statistics presented to the city’s planning and housing committee recently showed that the six-month average timeline to complete the pre-application consultation process is 44 days while the average for combined Official Plan Amendment/Zoning Bylaw applications is 115 days.

Incredibly long periods for a city that is in dire need of housing.

The unacceptable long timelines only delay much-needed residential housing construction, significantly increase costs and contribute to unworkable projects that could otherwise move ahead.

Meanwhile, according to a recent progress report on 18 affordable housing projects identified for construction in the city, none have actually been started.

This in spite of the fact that new planning staff are being brought on board to get things moving.

Disappointing, to say the least, as the timeframes remain lengthy although there are fewer applications due to current market realities.

Canada lagging other countries

RESCON has been advocating and engaging with municipalities about the need to expedite approvals timelines.

It simply takes far too long to get residential projects going, which is contributing to the housing crisis.

Obtaining approvals and permits in major cities like Toronto and Vancouver can take years, not weeks or months. The delays cost developers time and money, which is passed on to the buyer.

Data from the World Bank shows that of 34 Organisation for Economic Cooperation and Development countries, Canada ranks 33rd in the time it takes to get construction permits. It’s a truly dismal ranking and emblematic of the problem. We are just ahead of the Slovak Republic.

In 2022, a study conducted by Altus found that the timeline for approvals in Toronto was the worst of 20 cities in Canada, with a weighted average approval time of 32 months, up from 21 in 2020.

Costly consultations slowing development

In The Toronto Star, columnist Matt Elliott recently shone the spotlight on the problem of bureaucracy at Toronto city hall, noting that the city ran more than 650 public consultation processes last year and, of those, 325 were related to individual development applications. Staff from all divisions engaged in development review reported spending a cumulative 190 hours on logistics for each community consultation meeting in support of a development application.

Elliott wrote that means a truly staggering figure of 61,750 hours was spent delivering development-related consultations if you multiply the 325 development-related consultations by 190 hours each. Add salaries into the mix and the costs quickly begin to add up.

Worse, a survey run by the city found 62 per cent of the public weren’t satisfied with the opportunities to provide feedback, and 73 per cent weren’t confident their feedback is even being considered.

Overhaul is needed

The supply of housing is being held hostage by a runaway bureaucracy, it seems. An overhaul is needed.

Presently, people are leaving our cities in droves because they can’t afford to live where they work.

New data from Angus Reid Institute reveals that 28 per cent of Canadians are seriously considering leaving the province they are in because of the cost of housing. The figure is highest in Ontario and B.C. 

The figure rises to 39 per cent for those who have lived in the country for less than a decade. In downtown Toronto, 44 per cent say they consider leaving, with 22 per cent saying it is a strong consideration

Cutting the bureaucracy is but one step that is needed to bring the cost of housing under control and spur the market. However, it is a start.

Richard Lyall is president of the Residential Construction Council of Ontario (RESCON). He has represented the building industry in Ontario since 1991. Contact him at media@rescon.com.