Ending Homelessness in Toronto · Chapter 2

The History: How We Got Here

A chapter of Ending Homelessness in Toronto — this project’s receipt-backed book on ending homelessness for less than the crisis costs now. Where a figure could not be confirmed against a primary source, the text says so on its face. How the checking works: how we verify · corrections.

Mass, chronic homelessness is a modern phenomenon in Toronto, and its onset is dateable. Before the 1980s, federal policy under the National Housing Act supported the construction of roughly 20,000 units of social housing a year nationally. That era ended in a specific policy sequence, most of it compressed into the 1990s, that dismantled the public housing pipeline and the income floor beneath it at the same moment — and Toronto has never fully rebuilt either.

The federal and provincial withdrawal, 1993–2000

The 1993 federal budget froze CMHC's social-housing budget and ended funding for new social housing going forward, formalized through the mid-1990s and completed by the 1996 federal budget's move to devolve existing social housing to the provinces (Library of Parliament, Bill C-66: An Act to Amend the National Housing Act and the CMHC Act, Legislative Summary). Had funding continued at 1985–1989 rates, Canada would have built an estimated 107,120 additional social housing units between 1994 and 2013 (Canada Without Poverty, "20 years ago Canada had a housing plan," Jan. 2014). The Wellesley Institute's own assessment is blunt: "the decline in the federal role in housing coincided with an increase in homelessness reported in major Canadian cities in the mid to late 1990s" (Wellesley Institute, "Federal role in housing," Aug. 2006).

Ontario compounded this within days of Mike Harris's Progressive Conservatives taking office in June 1995. The new government cancelled the province's non-profit and co-op housing programs almost immediately, killing an estimated 17,000 units already in the pipeline — some cancelled mid-construction — and effectively halted new non-profit housing development in Ontario for the rest of the decade (Co-operative Housing Federation of Canada, cited in Social Policy in Ontario, "The rise and fall of co-op housing in Ontario," Nov. 2024). Effective October 1, 1995, the same government cut Ontario welfare rates by 21.6% — a single adult's monthly rate fell from $663 to $520 — affecting roughly 1.3 million recipients (The Canadian Encyclopedia, "Ontario Cuts Back"). Then, through the province's 1997–1998 "Local Services Realignment," Ontario downloaded financial and administrative responsibility for social assistance and social housing onto municipalities, formalized for housing specifically in the Social Housing Reform Act, 2000, which made Ontario the only province in Canada to fully devolve social-housing funding and administration to the local level (Open Council, "What government is responsible for social housing in Ontario?"; Social Housing Reform Act, 2000, S.O. 2000, c.27, CanLII). This landed on Toronto at the exact moment the City itself was being amalgamated from six former municipalities into one on January 1, 1998 — a merger that, among other things, had to reconcile the fact that emergency shelters had previously been legally permitted only in the former City of Toronto and North York, leaving people in Etobicoke, York, and East York with no local shelter access at all (Ranasinghe & Valverde, "The Toronto Shelter Zoning By-law," Homeless Hub).

Deinstitutionalization without the promised supports

A parallel and compounding cause was the deinstitutionalization of psychiatric care. Between 1960 and 1975, Ontario closed approximately 35,000 provincial psychiatric hospital beds, offset by only about 5,000 new general-hospital psychiatric beds. The policy assumed people would be briefly hospitalized when unwell and otherwise supported in the community — but, in the Ontario Human Rights Commission's own words, "the shift from institutional to community care was marked by a lack of community supports, such as affordable, safe housing and a lack of accountability" (Ontario Human Rights Commission, "Historical context"). The consequences showed up directly in Toronto's shelter population: the city's own 1999 homelessness task force found that roughly one-third of the 170,000 different people who used Toronto's shelters between 1988 and 1996 lived with mental illness, and attributed this primarily to deinstitutionalization.

1998–1999: "national disaster," and the Golden Report

In late 1998, following an inquiry sparked by street nurse Cathy Crowe's question — why does a natural disaster mobilize emergency resources while a housing disaster does not? — Toronto, under Mayor Mel Lastman, declared homelessness a national disaster, a declaration subsequently endorsed by Canada's Big City Mayors' Caucus at their November 1998 meeting in Winnipeg. Lastman had already convened a Mayor's Homelessness Action Task Force chaired by Anne Golden, then president of the United Way of Greater Toronto. Its January 1999 final report, Taking Responsibility: An Action Plan for Toronto — the "Golden Report" — ran 290 pages and made 105 recommendations built on two central premises: that prevention and permanent housing should take priority over emergency response, and that all three levels of government needed to share responsibility. It documented that 3,100–3,200 people sought shelter on an average Toronto night; that shelter usage among families with children had risen 123% between 1992 and 1998; and that over 106,000 Toronto residents were paying more than half their income on rent. It called, among other things, for construction of at least 5,000 new social housing units and an implementation budget of $300 million — against which Ontario initially pledged $1 million.

The through-line from 1993 to today is direct and largely unbroken: the federal and provincial governments withdrew from building and funding housing at scale in the 1990s, income supports were cut and have still not recovered their real value (Chapter 3), the resulting crisis was documented in exhaustive, specific detail by 1999, and — with the exception of the National Housing Strategy launched in 2017, discussed in Chapters 3 and 6 — funding at the scale the Golden Report called for has still not arrived. Toronto's homeless population is higher than at any point before 2024 — Chapter 1's own count table shows 2025's 12,196 below 2024's record 15,418, so the through-line is a twenty-seven-year climb followed by a one-year drop, not an unbroken record high today.