By Murray McNeill

THE Manitoba government has no plans to do away with rent controls, Consumer Affairs Minister Greg Selinger said yesterday.

At a news conference earlier in the day, the Winnipeg Chamber of Commerce called on the government to abolish rent controls, saying they do far more harm than good.

However, Selinger said that's not going to happen. He said a provincially appointed landlord and tenant committee is reviewing the rent control system to see if there are ways to improve the current system, but doing away with controls altogether is not one of the options under consideration.

"We think flat-out abolition of it could put tenants at risk," the minister explained in an interview. He said deregulation could lead to substantial increases in rents, which seniors and others on low or fixed incomes could not afford.

So instead, the landlord-and-tenant committee is looking to see if there are less drastic steps which can be taken to improve the system that are fair to tenants, but also encourage more investment in new rental units and in the rehabilitation of existing rental stock, he added.

No deadline

Selinger said the government hasn't imposed any deadlines on the committee, so he wouldn't speculate on how long the review process might take. Nor would be speculate on what options the committee is considering.

"I don't want to pre-empt what the committee comes up with," he added.

Although he ruled out deregulation, Selinger said he is prepared to consider a second Chamber proposal, which calls for a more transparent system for determining the annual rent control guideline for Manitoba.

Chamber president and CEO Dave Angus said yesterday that rent control guidelines are now determined behind closed doors with no public input and no public explanation of how the government arrives at its guideline. This year's guideline has been set at 1.5 per cent.

"If there are some ways to do that (make the process more transparent), we're prepared to consider them," Selinger said.

The Chamber also said if the government won't abolish rent controls, it should at least hold a public review of the rent control system and seek public input on what changes should be made, rather than leaving it up to a committee to decide.

Selinger said while the committee won't be holding any public hearings, if the government decides to make legislative changes to the rent control system, those proposed changes would be open to public hearings and debate.

Angus said the Chamber is calling for an abolition of rent controls because with vacancy rates at an all-time low in Winnipeg -- an average of 1.1 per cent -- and construction of new rental units remaining virtually non-existent for the last 20 years, renters are finding it increasingly difficult to find suitable, safe accommodations.

Undue hardship

Not only is that creating undue hardship for those people, he said, but it's also stunting economic growth because it discourages new companies and workers from moving to the province.

Another downside to rent controls is that they also discourage property owners and managers from building new rental units or upgrading existing ones, he added.

"So, this is not good for anybody."

The Chamber's position was wholeheartedly endorsed yesterday by a spokesman for the Professional Property Managers Association.

"We're 100 per cent onside with everything the Chamber says in their policy paper," association vice-president Avrom Charach said in interview.

Charach said the province's rent control guidelines were supposed to limit rent increases to 1.5 per cent last year, yet 35 per cent of the rental units in Winnipeg -- 18,127 out of a total of 53,660 units -- saw increases of more than 1.5 per cent.

In fact, the average rent increase for 2004 was 2.9 per cent, he noted, which was higher than the average increases in five other Canadian cities -- Toronto, Regina, Saskatoon, Calgary and Vancouver -- that don't have rent controls.

'Not working'

"So, what that's saying to me... is that the system is not working," he added.

Charach also noted exempting new rental units from rent controls for their first 20 years was supposed to encourage more apartment construction. But there were no new apartments built in Winnipeg between 1985 and 2002, he said, and fewer than 500 new units in each of the last two years when vacancy rates have been at historic lows.

However, Selinger said the fact some landlords are able to obtain increases that are greater than the guideline shows the system is flexible and is working.

He also dismissed the suggestion there are few or no new units being built, noting there have been 1,000 built in the last three years. That's more than in the previous 10 years combined, he added.