The Math of Austerity: FAO Report Exposes Growing Gap Between Ontario's Homelessness Crisis and Provincial Spending
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As the known population of unhoused Ontarians climbs toward 89,000, a new fiscal watchdog report reveals a projected decline in provincial support for the very programs designed to mitigate the crisis.
At Queen's Park, the governing Progressive Conservatives often frame their fiscal approach as one of efficiency and targeted investment. However, as CBC Toronto first reported, a new report from the Financial Accountability Office (FAO) of Ontario suggests that this efficiency is manifesting as a dangerous disconnect between the reality on the ground and the province's budgetary priorities.
**The Growing Scale of the Crisis**
According to reporting by CBC Toronto, the FAO has identified a sharp upward trajectory in the number of people experiencing homelessness across the province. The "known population experiencing homelessness"—a figure that excludes those who have not consented to be included—has risen by more than 23 per cent over the last four years.
Specifically, the FAO estimates that the population grew from 62,252 individuals in 2022-2023 to 76,741 people in 2025-2026. The crisis is not expected to plateau; the fiscal watchdog projects a further increase of 15.8 per cent over the next three years, meaning the number of unhoused individuals is expected to reach 88,859 by 2028-2029.
While Toronto remains the epicenter of the crisis with 19,462 unhoused people in 2024-2025, the FAO report highlights a significant shift in where the crisis is accelerating. Between 2022 and 2025, the highest growth rates were recorded in the surrounding regions: Durham saw an increase of 130.8 per cent, Peel rose by 90.5 per cent, and York grew by 79.6 per cent. In contrast, Toronto's total number of unhoused individuals actually declined by 8.2 per cent during that same window.
**Austerity in the Face of Expansion**
***Opinion:*** *The most damning aspect of the FAO's findings is not merely the rise in homelessness, but the simultaneous contraction of the provincial safety net. Premier Doug Ford's administration is steering the province toward a fiscal cliff where the demand for basic human services is soaring while the funding to meet that demand is being systematically reduced.*
CBC Toronto reports that the province is projected to spend less on homelessness even as the population of unhoused people grows. According to the FAO, the number of households receiving support from provincial homeless programs is expected to fall from 204,876 in 2025-2026 to 187,205 by 2028-2029.
This decline is attributed to two primary factors: a reduction in base program spending and the expiration of time-limited funding. These cuts impact a broad spectrum of critical interventions, including community outreach, rent assistance, supportive housing, and emergency shelters.
**The Political Fallout**
The report has provided significant ammunition for opposition MPPs, who argue that the government is ignoring the current reality of the housing market. Ted Hsu, the Liberal MPP for Kingston and the Islands, noted that he specifically requested the FAO report because the province had been relying on outdated, pre-pandemic data. Hsu stated that the government "does not have a handle on the problem," noting that the logic of spending less while homelessness increases simply does not add up.
Similarly, NDP MPP Jessica Bell, representing University-Rosedale, criticized the decision to let time-limited funding expire at a moment of peak need. Bell highlighted the desperation of families facing rising costs, stating it is "unacceptable" that individuals are forced to seek shelter in libraries, public transit systems, and condo stairwells.
From the Green Party, MPP Aislinn Clancy for Kitchener Centre warned that the government's lack of accountability will lead to more suffering and lost lives. Clancy called for immediate action to protect renters from rent hikes and illegal evictions, while urging the province to invest in community, transitional, and supportive housing.
**The Government's Defense**
Despite the FAO's projections, the Ford government maintains that it is providing the necessary resources to combat the crisis. Michael Minzak, press secretary for PC MPP Rob Flack, told CBC Toronto that the government has provided municipalities with the tools required to build supportive housing and address homelessness. Minzak further asserted that the province has made "record investments in mental health support."
However, the FAO's data suggests a different narrative. While the report acknowledges that some growth in homelessness is partially offset by an expansion of provincial supports and increased federal funding for asylum claimants in 2025-2026, the overall trend remains one of increasing vulnerability.
As Lee Fairclough, the Liberal MPP for Etobicoke Lakeshore, pointed out, the failure to invest in "upstream prevention" does not result in savings. Instead, it shifts the burden onto frontline workers, hospitals, and shelters—particularly in Northern Ontario. Fairclough argues that without a clear, province-wide strategy, Ontario is merely managing the symptoms of a crisis while the underlying cause—a lack of affordable housing and declining supports—continues to accelerate.