Darrell Greer
Northern News Services

Rankin Inlet (Sep 21/05) - The Government of Nunavut (GN) is phasing out cheap staff housing for its employees.

The plan, announced earlier this month in Iqaluit, will be phased in during a five-to-10-year period.

The new strategy will see the GN increase its base rents by 15 per cent in January 2006 in Rankin Inlet, Iqaluit and Cambridge Bay.

Subsequent yearly increases will take base rents to market value in those three communities by the year 2010.

All other Nunavut communities will reach market rent levels by 2015.

There have been no increases in GN staff housing for the past 10 years.

The GN will withdraw from providing staff housing in Iqaluit during the next five years and in Rankin and Cambridge during the next 10 years, transferring its landlord responsibilities to property owners.

GN staff housing will continue to exist in all other communities until private markets are established.

Program adjusted

The GN's rental assistance program has been adjusted so that employees will pay no more than 20 to 30 per cent of their household income towards base rent.

Employees earning up to $90,000 will pay no more than 20 per cent of their household income, while those earning $90,000 to $120,000 will be set at 25 per cent and above $120,000 at 30 per cent.

Employees making more than $90,000 but with a large number of dependents may still qualify at 20 per cent.

Nunavut Housing Corp. president Peter Scott said the GN's staff housing program costs $34 million per year to run and only brings in revenues of $10.8 million annually.

He said the biggest concern with the strategy is recruitment and retention, which will be closely monitored during phase-in.

"The phase-in period allows lots of time for people to make decisions, including the current union negotiations with the Federation of Nunavut Teachers and next year's negotiations with the Nunavut Employees Union," said Scott.

"The time frame will also allow for future training of local Nunavut employees.

"More than 55 per cent of GN positions are still held by non-beneficiaries.

"But, we're quite sure we'll be able to fill many of the positions during the next five years with local people."

Outside landlords

The majority of GN employee housing benefits are paid to outside landlords.

The GN has a $34-million budget for staff housing, of which $27 million is lease payments to landlords.

The GN owns about 200 units across Nunavut and leases another 960.

Scott said the strategy will mean a new way of doing business for Nunavut contractors.

"Our private contractors tend not to respond until there's a guaranteed revenue stream and, once we start withdrawing from staff housing, that stream will be gone.

"So they're going to have to take a look at what the market is out there.

"The market is going to shift and they're going to have to adjust accordingly. We've seen that in Iqaluit during the past five years and you're going to see it more and more in Rankin Inlet during the next five years."

Scott said anywhere else in Canada, a landlord has to deal with individuals, but, in Nunavut, they've been dealing with one tenant, the GN.

He said landlords write one invoice and receive one cheque per month.

"It's a shift in business planning the developers will have to look at, but we're confident, if our current developers don't want to do that, other developers will come to fill the gap.

"We're going to meet with the landlords in the next few weeks to discuss where the strategy is going to lead."

Scott said the GN anticipates its rental rates will match those of the private sector within five years.

He said all GN employees, beneficiary or not, will have the same choices as far as the housing market goes.

And, he said, the playing field will be levelled.

"Right now, you could have three employees earning the same income but - because one is in public housing, one in staff housing and one is a home owner - all paying different levels of shelter cost.

"The moving of the highest-income bureaucrats to the market rate for housing has also been a concern for awhile.

"You can have two individuals living side by side in identical buildings.

"One household is making twice as much as the other, but pays the same rent.

"Over the next two or three years, we're trying to fix these scenarios."