Trudeau to meet with new cabinet as Liberal support wanes both in and out of the party

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Prime Minister Justin Trudeau and his newly reshuffled cabinet will tackle housing affordability when they meet next week to try and craft a plan that will deliver for voters and reverse the Liberals’ flagging fortunes.

Mr. Trudeau will join his 38 ministers in Charlottetown for a three-day retreat beginning on Monday as they prepare for the return of Parliament in September and refresh their policy agenda to focus on the housing crisis – an issue that a growing chorus of people inside and outside the government say the Liberals have been slow to respond to.

Cabinet will review past policies but focus primarily on what the government can do next, said a senior government source. In particular, ministers will consider the challenges facing first-time home buyers and households squeezed by the rise in rental costs. The Globe is not naming the source who was not authorized to discuss publicly the government’s internal plans.

In the months to come, the federal government plans to play a convening role with other levels of government and the not-for-profit and for-profit sectors, the source said. It is unlikely that an announcement will come immediately out of the retreat, they added.

In an interview, government House Leader Karina Gould said the government’s focus is on making housing attainable for the middle class. She defended the government’s record to date, pointing to its National Housing Strategy, but acknowledged that Canadians are feeling a “considerable amount of anxiety.”

“We need to do more and do things differently,” Ms. Gould said.

Go big or go home on housing, Mr. Trudeau

Adding to the Prime Minister’s challenges is the drop in support for his party after eight years in power.

The Liberals are looking at the possibility of their worst fundraising year yet under a Trudeau government, while the Conservatives are on track for their best since 2015. Across Canada, the Prime Minister’s party is slipping in popular support or playing defence in every region but Quebec, according to Nanos Research. And even within his own caucus, the mood has turned, with MPs telling The Globe they are angry about Mr. Trudeau’s July cabinet shuffle that they believed was driven by virtue-signalling rather than merit.

The Globe spoke with five Liberal MPs from across the country, who shared their views on the government. The MPs say voters are telling them they are tired of the Prime Minister and believe his government is out of touch on the cost of living.

The Globe is not naming the five MPs who were not authorized to discuss internal party matters.

On the doorstep this summer, the MPs said the mood of voters is angry. Several MPs said that the response is uncomfortably reminiscent of the 2015 federal election or 2018 Ontario election. They said without significant changes from the government, the Liberals could end up with the same result as Stephen Harper or Kathleen Wynne.

While one MP said they believed it was time for Mr. Trudeau to go, most said the government can reverse course and show Canadians that the Liberals understand voters’ anxieties as they struggle to make ends meet.

Polling from Nanos Research suggests the Conservatives have the support of 35 per cent of Canadians; the Liberals, 29 per cent; the NDP, 19; the Bloc Québécois 7. The rolling phone survey of 1,000 respondents is accurate 3.1 percentage points, plus or minus, 19 times out of 20.

Pollster and firm founder Nik Nanos, said the polling suggests the Conservatives now have a sustained six-point lead.

He said there is voter fatigue with the government and the Liberals need to hone in on the economic and housing concerns facing voters. But Mr. Nanos cautioned that when the mood for change sets in, it’s often only countered if the alternative choice for voters is viewed as too risky, meaning the Conservatives led by Pierre Poilievre would have to “make a mistake to change the trend line.”

This summer, Mr. Poilievre’s team launched an ad campaign to soften his image among voters. The ad-buy is backed by fundraising that is far outpacing the Liberals. Numbers released for the first half of this year show that the opposition Tories have raised $16.3-million, compared with $6.8-million amassed by the governing Liberals.

Pollster and Liberal strategist Dan Arnold said eight years into a government’s mandate, desire for change among voters is expected. He said governments hit a point of no return when people think the governing party is out of touch. But Mr. Arnold said the Prime Minister hasn’t hit that threshold, based on polling research that suggests voters still think he is connected to them and cares about regular people.

Mr. Arnold was the Prime Minister’s director of research and advertising until 2021 and now works with the Pollara polling firm and Alar consulting group.

What’s weighing heaviest on the government is voters’ economic anxiety, Mr. Arnold said. Unlike past crises, such as the NAFTA talks with Donald Trump or the COVID-19 pandemic, Mr. Arnold said with the inflation crisis he doesn’t think “Canadians have that same sense that the government is 100 per cent devoted to solving the issue.”

He said while the government’s hands are tied on some of the issues contributing to the rising cost of living, the Liberals need to find ways to show it’s a key priority and Canadians need to feel like the Prime Minister is on top of it.

The senior government source said the Prime Minister’s direction to cabinet ministers is to focus their work on ensuring they are advancing the promise of Canada: where Canadians believe that with hard work their standard of living can build on past generations. The source acknowledged that belief is challenged and said the government is developing policies under two planks – the first focused on affordability and the economy, the second on safety and security.

To jump-start its work, cabinet will be joined in PEI by the authors of a new report that says the federal government is backsliding on its goals to address housing affordability and homelessness. The authors call on the government to establish an industrial strategy for housing, saying to restore affordability by 2030, the country needs to build 5.8 million more houses, of which approximately two million should be rental units.

Report authors Mike Moffatt, founding director of the PLACE Centre at the Smart Prosperity Institute, and Tim Richter, president and CEO of the Canadian Alliance to End Homelessness, will be among the experts to present to cabinet. Also attending will be Canada Mortgage and Housing Corporation CEO Romy Bowers and managing director and deputy chief economist of CIBC Capital Markets Benjamin Tal. Halifax mayor Mike Savage, who also chairs the big city mayor group, will also present to cabinet.