Proceedings of the Standing Senate Committee on
Aboriginal Peoples
Issue 8 - Evidence
OTTAWA, Tuesday, May 26, 1998
The Standing Senate Committee on Aboriginal Peoples, to which was referred Bill C-6, to provide for an integrated system of land and water management in the Mackenzie Valley, to establish certain boards for that purpose and to make consequential amendments to other Acts, met this day at 3:40 p.m. to give consideration to the bill.
Senator Charlie Watt (Chairman) in the Chair.
[English]
The Chairman: I know that we do not have a quorum, but we will proceed. Please proceed.
Ms Ruby McDonald, Chairperson, Sahtu Secretariat Incorporated: I am pleased to be here to speak on behalf of the Sahtu, Dene and Métis with regard to the Mackenzie Valley Resource Management Act. I am the newly elected Chairperson of the Sahtu Secretariat Incorporated, successor to the Sahtu Tribal Council. This organization represents 2,403 Sahtu, Dene and Métis who are currently enrolled in the Sahtu, Dene and Métis Comprehensive Land Claim Agreement.
Our people made a bold decision when they first decided to undertake regional land claim negotiations, and an even bolder one when they ratified the negotiated land claim package. These decisions were not taken lightly. Our people struggle with the enormity of these decisions, both within themselves and collectively. They believed that what they were doing was in the best interest of themselves, their families, and their communities.
Since the Sahtu Land Claim Agreement was enacted June 24, 1994, our people as well as the Government of the Northwest Territory and the Government of Canada have worked together to ensure that the intent, principles and obligations of the agreement have been met. It was in this cooperative spirit that members of the Sahtu Secretariat first began to work on drafting Bill C-6, through a comprehensive consultative process with representatives of the Gwich'in Tribal Council, the Government of the Northwest Territories, and the Government of Canada. This was a long and exhaustive process that exceeded the two year time frame outlined in the Sahtu Land Claim Agreement.
Bill C-6 will establish an integrated co-management resource regime in the Mackenzie Valley region of the western NWT. This is a constitutional obligation that the Government of Canada owed to the Sahtu, Dene and Métis under the Sahtu Land Claim Agreement. The process of Bill C-6 through our legislative system is evidence of the government's commitment to live up to its obligation, and I applaud it.
For the western NWT and Sahtu regions, Royal Assent on Bill C-6 will create several co-management boards. I will not speak to the Gwich'in boards, other than to say that we support their land claim and what they are doing.
In regards to the various boards that will be created under Bill C-6, I would first like to speak about the Mackenzie Valley Environmental Impact Review Board. This board will be the principle agency to undertake environmental impact assessment and review in the Mackenzie Valley. It will guarantee First Nation peoples equal representation on the board, including those who have not yet signed a land claim agreement. Due to the potential impact of projects that relate to the water systems and land use, there is a need for a territorial board to review and assess the potential environmental impact. An example of this would be the interprovincial pipeline project that starts at Norman Wells in the Sahtu region, and crosses the Deh Cho before entering northern Alberta.
The north has always been an area of megaprojects, and it will continue to be so. The only way to ensure a consistent means to review and assess these projects is to have a territorial board.
The second board that will be created is the Sahtu Land and Water Board. This board will regulate land and water use throughout the Sahtu settlement area. The board will issue, amend and renew land use permits and water licenses. This board guarantees Sahtu, Dene and Métis people equal representation as board members, and allows them, for the first time, to participate in a public body which makes decisions regarding land and water use in the Sahtu.
A third board that will be created through is the Mackenzie Valley Land and Water Board. This board would have all the main characteristics and powers of the Sahtu Land and Water Board but in a larger area, the Mackenzie Valley of the western NWT. The establishment of the territorial board will reduce the Sahtu Land and Water Board to a panel of the larger board, but the panel will continue to carry on as normal. Again, this territorial board will guarantee First Nation peoples equal representation on the board, including those who have not yet signed a land claim agreement.
The last board created is a Sahtu Land Use Planning Board. This board will be responsible for developing a land use plan for the Sahtu settlement area, and for reviewing and proposing approvals, exceptions and amendments to the plan. This board also guarantees Sahtu, Dene and Métis people equal representation to sit as board members.
The creation of these various boards under Bill C-6 will fulfil a constitutional obligation of the land claim agreement, acknowledge the extensive consultative process undertaken with the Sahtu, Dene, Métis, and prepare for co-management regimes in the Sahtu settlement area and western NWT. It will also provide for consistency, certainty and effective resource management and environmental assessment processes in the Sahtu settlement area and western NWT.
I have spoken about Canada's obligation to our people in regards to Bill C-6. Although our land claim agreement envisions one territory-wide board, it has never been our people's intent to enforce or impose a resource management regime on First Nations in the Mackenzie Valley who have not yet signed a land claim agreement. We have accepted the Government of Canada's assurance that this bill, C-6, will not prejudice the negotiations of future land claims or self-government agreements.
Bill C-6 will neither abrogate nor derogate the aboriginal or treaty rights protected by Section 35 of the Constitution. Guarantees to this effect are included in the draft bill.
The creation of Bill C-6 as outlined in the Sahtu Land Claim Agreement was designed to provide a system that would protect and preserve our ecosystem in the North, while at the same time ensuring a land claim commitment to the Sahtu, Dene and Métis. However late, I believe that this bill meets the obligation to establish an integrated resource management regime, made to the Sahtu, Dene and Métis under their land claim agreement. We are ready to accept our new role in resource management and environmental review and assessment in our historical lands.
Senator Andreychuk: Thank you for your comprehensive outline of why you believe this bill to be necessary for you, and why you think it is a good agreement, one that was required by law as a result of your settlements.
The debate is not about whether or not the agreement or the proposed legislation are good for you, however. The issue is how it traps other groups who have not yet finished their land claims. When you signed your agreements, were you aware that you would be binding other people to this water resource management, and did you get any legal advice on that?
Mr. Rick Hardy, Legal Counsel, Sahtu Secretariat Incorporated: Our view on the matter is that we are not binding any other groups by entering into the land claim agreement. The only legal requirement from the land claim agreement is to create the Sahtu Land and Water Board, and the Sahtu Land Use Planning Board. There is no requirement in the land claim agreement to create a territory-wide land and water board. So certainly there is nothing in the Sahtu agreement that would bind other claimant groups that have not yet entered into agreements.
Senator Andreychuk: If your water agreement goes into effect and these boards are set up, your actions can impact the other land areas, because what you do with your water and your catchment basin will have an effect on theirs.
Mr. Hardy: Yes, in the same way that whatever happens in those jurisdictions will have an impact on water use in Alberta, British Columbia and the Yukon, but these things are simply not under our control. All we can deal with is our geographical area.
Senator Andreychuk: Were you made aware that, by signing these agreements, we would be entering into difficulties with the other groups and their claims?
Mr. Hardy: To the best of my recollection, I do not think that we could say that we were aware that the government had decided to proceed on this basis. To the best of my recollection, our preference would have been that the Sahtu boards by enacted, which was all that was required under the agreement. We certainly are not in any way insisting that they also create the territorial land and water board.
Senator Andreychuk: Your interpretation would be that compliance with your agreements would simply be to set up the water management within your land area?
Mr. Hardy: Yes, that is correct.
Senator Forest: We appreciate your input. We would have appreciated travelling to the valley. Some of us have been there, and we recognize this bill's importance to the whole Mackenzie Basin.
We have heard that this bill will respond to the legal requirements of the government with respect to your land claims, and we came into this with the understanding that it would not abrogate or derogate the treaty rights of those people whose land claims have not been settled. There is a clause in the agreement which states this, and you have mentioned it in your brief this afternoon. Further, I understand that there is a letter from the minister assuring people that this would not interfere with their rights.
We heard this morning, however, that others are not completely confident of this. They are still concerned about it, and that they have a real concern that this act will apply to them while they are still negotiating their rights. They are asking for amendments which would restrict the application of Bill C-6 to the two groups, the Sahtu and the Gwich'in, who have already settled their land agreement. Others have suggested that the proposed legislation should be delayed until land claims are completed in the other areas. I wonder if you would care to respond to that, because we are hearing two sides, and we are sort of caught in the middle.
Mr. Hardy: I did review some of the other submissions, and particularly the one by the Dogrib Treaty 11 Tribal Council. If I understand it correctly, their proposal is to limit Parts 3 and 4 to the Sahtu and Gwich'in areas?
Senator Forest: Yes, I believe so.
Mr. Hardy: From a legal, technical perspective, I do not see any difficulty with that sort of provision. The constitutional obligation to the Sahtu is to create boards for them to have jurisdiction over their own territory, and that sort of provision would still allow that to happen.
Senator Forest: In your brief you mentioned that you would have good participation on the boards. Some of the groups which have appeared before us have indicated that there would actually be less participation by aboriginal people than at present on some of these boards. Have you a concern about that?
Ms McDonald: Personally, I do not. I sit on all of the working groups. They are called working groups, they are not called boards because the MVRMA has not yet been legislated. On most of the working groups there is equal aboriginal representation, and some even have more First Nation people than other people.
Senator Forest: We heard from the Deh Cho this morning.
Senator Taylor: In your brief you say,
Again, this territorial board will guarantee First Nation people equal representation on the board including First Nations who have not yet signed a land agreement.
Equal to who? Who else is on the board besides First Nations people?
Ms McDonald: The representation on all the boards is 50/50.
Mr. Hardy: Appointment to the boards is made by Order in Council. The federal government makes all of the appointments, but half of the appointments must be chosen from nominees put forward by the First Nations. In effect, the First Nations have half of the appointments.
Senator Taylor: Is there any split between the First Nations as to Sahtu or Dene? Could they all be from the same nation?
Mr. Hardy: If we are only dealing with the boards that would apply in the Sahtu territory, that is the Sahtu Land and Water Board, and the Sahtu Land Use Planning Board, the 50 per cent would only be Sahtu. If the board is expanded and Part 4 is brought into force for the Mackenzie Valley Land and Water Board, however, the 50 per cent would come from the First Nations throughout the Mackenzie Valley.
As to the exact numbers each can appoint -- I believe the Sahtu are guaranteed at least one of the First Nation representatives on the Mackenzie Valley board. Perhaps one of your officials could give us more detail on how the other appointments are done.
Senator Taylor: We could calculate it by considering that half of the territory-wide board is dedicated to the First Nations, and a certain amount is guaranteed to the Sahtu. What is left over for those who did not sign?
Mr. Hardy: Perhaps what we must do is look at the proposed legislation itself, and see what it says.
Senator Taylor: I could do that. I thought that you might be more up-to-date than I am.
If the board is only 50 per cent First Nations, and the Sahtu and the Gwich'in have a dedicated number of seats, what did you leave for the three that have not yet signed?
Mr. Hardy: That is somewhat unfair, because it was not up to us to leave anything for them.
Senator Taylor: This is what I am getting at. It does not sound like they were in tender hands.
Mr. Hardy: This is a federal government bill, and you must look to the federal government to ask what has been done.
Our chairperson has not raised one outstanding issue, and that is because she is making a deliberate effort not to raise any negatives. Under the Sahtu, Dene, and Métis land agreement, the Government of Canada had an obligation to bring the boards into being within two years of the agreement. We are very quickly approaching the fourth anniversary of the legislation.
When the agreement was settled upon and enacted, we knew that it was a two year timeframe. At the same time, however, we realistically expected that the two years would be an outside date. We thought that these things would be done quickly, and expected by now the boards would have been up and running for about three years. That has not been the case.
The lack of the Land Use Planning Board has created particular difficulties. The board was to have a five-year timeframe to develop a land use plan for the Sahtu which would govern all activities and developments in that area, and we have now, in our view, lost about three years of this planning time. In the meantime, activity is continuing. There is a lot of oil and gas exploration, exploration licenses are being issued, there is mining activity through prospecting and mineral claims, and a number of settlers are moving into the country wanting to take up land -- all of this should be governed by a land use plan. We are not worried about the fact that the government has failed in its constitutional obligation. We are concerned about the practical effect of the loss of three years of land use planning.
On two different occasions we have proposed a solution to this problem -- once to the previous minister, Ron Irwin. Under the Territorial Lands Act, the minister has the ability to implement a scheme of land issuance and permits that would require the consent of the Sahtu, Dene and Métis. We requested this of the previous minister, and another request has gone in to the current minister. Our view is that, because of the failure of the government to act on its promises under this agreement, it should be doing something to ensure that the Sahtu, Dene and Métis have the say that they would have had under the land use and planning regime. The only practical way to do that is to take appropriate action under the Territorial Lands Act. That is, any further land interest in the Sahtu issued by the Crown must not be done without the consent of the Sahtu, Dene and Métis. This is the one caveat that we would have to this whole process.
The Chairman: I believe you had your land claims settlement agreed to by the Government of Canada four years ago, is that correct?
Mr. Hardy: The legislation was passed almost four years ago. The agreement itself was ratified about four and a half years ago.
The Chairman: On your side, I am sure that you have no difficulties implementing the agreement. What about the private sector side, however? This is part of public sector responsibility. Where are you getting your resources, in terms of the money that you need for public sector implementation?
Ms McDonald: In the implementation plan we have enough money to do what we must do, but that is not what we are saying. We are saying that our agreement was signed in 1994. We do not have a land use plan in place. People are coming into the Sahtu, giving land leases, building cabins, moving in to explore oil and gas, and we have no control unless we receive a land freeze from the government.
Mr. Fred Koe, Deputy Minister, Ministry of Aboriginal Affairs, Government of the Northwest Territories: I am pleased to present a submission on behalf of my minister and the Government of the Northwest Territories. The minister could not be here because he is in a legislative assembly today.
There are many exciting economic opportunities for the Northwest Territories, many of which are based in the Mackenzie Valley. The mining, oil and gas sectors are already well established, and we will soon be the first diamond producer in Canada. There is an increasing interest in oil and gas. However, it has always been the policy of the Government of the Northwest Territories that economic development must occur in a socially and environmentally sound manner, while respecting agreements with aboriginal peoples.
The proposed Mackenzie Valley Resource Management Act will establish a coordinated system of resource management to regulate the use of land and water in the area. It provides northerners with an increased role in the regulation of land and water use. It also fulfils obligations of the Gwich'in and Sahtu Comprehensive Land Claim Agreements.
Consequently, the Government of the Northwest Territories supports the proposed legislation. This does not mean that the government is satisfied with each and every clause. We have some concerns, but we will accept that resource management is often an optimization of many differing interests, values and needs. The essence of decision-making related to resource management is a balance of interests.
The design of the regulatory regime and the development of the legislation itself are also products of balance and agreement by many different interests. The proposed change is an improvement over the existing regulatory regime, and it successfully incorporates many of the aspirations and needs of First Nations people through public government institutions. Obligations of land claims agreements are met, and many long-standing objections of aboriginal peoples related to the approvals process for land and water use are also addressed.
Enhanced coordination through this new regulatory regime will simplify the decision-making process for approval of development proposals, thereby creating greater certainty and clarity for industry wishing to invest in the north. Consequently, passage of this bill will serve to enhance economic development, will ensure the sustainable development of our natural resources, and will contribute to our goal of self-sufficiency and self-determination.
A particularly appealing attribute of the proposed regulatory system is the partnership it creates for aboriginal, community, territorial and the federal governments, as well as the public at large. Each has a significant role to play, and will make a contribution to the overall decision-making related to the use of the Mackenzie Valley's natural resources.
The design of the regulatory scheme has a long history. It is not something that suddenly appeared in 1992 in the Gwich'in Comprehensive Land Claim Agreement. The design goes back to the 1980s, when government and the Dene and Métis of the entire Mackenzie Valley worked together to design a system that was more responsive to the needs of the Dene and Métis. An innovative approach was pursued because, generally speaking, reserves have not been established in the Northwest Territories. Communities have been established, and they continue to be comprised of both aboriginal and non-aboriginal residents.
As I mentioned, the development of Bill C-6 is also a product of a balance of interests. The fact that the legislative development process took almost five years is a clear indication of this. Our response to consultation efforts over the past several years is not as ideal as one would hope for, but the Government of the Northwest Territories is satisfied that the concerns expressed were reviewed and incorporated to the extent possible.
The application of the MVRMA to the entire Mackenzie Valley has considerable merit. There have been calls for reform of the regulatory system from the public for many years.
Late last year, Dene from a community near Yellowknife peacefully protested the current regulatory regime, saying that it is not responsive to their needs. Most people want change.
The Government of the Northwest Territories is sensitive to the concerns raised by aboriginal nations in areas of the valley without settled land claims. Those concerns centre around a potential prejudicial nature of the new regime to the settlement of their land claims. Bill C-6 acknowledges that future land claims and self-government agreements may result in changes or modifications, and clearly accepts, indeed, anticipates, that the legislation must be amended to accommodate these changes. Comprehensive land claims agreements are paramount to other legislation. This is a further guarantee that land claim agreements will prevail if any inconsistencies between the land claim agreements and the legislation exist.
After the creation of the two new territories in 1999, the Government of the Northwest Territories expects to see two politically and economically viable units within Canada. Further fragmentation at the political and administrative levels will undermine this goal. Bill C-6 provides the balance between participation and decision-making at the regional and community levels, and the need for coordination and consistency for the entire Mackenzie Valley.
Areas of improvement, in addition to increased public participation, include more coordination, integration of the regulatory processes, and reduced duplication. The one window entry point for land and water use approvals and environmental assessments is also notable. In the end, this system should lead to more effective and efficient decision-making processes.
The Government of the Northwest Territories is sensitive to concerns raised during consultation, and repeated before the Standing Committee on Aboriginal Affairs and Northern Development, especially those which relate to the areas with unsettled land claims. There is some concern over the fair representation on the valley-wide boards established by Parts 4 and 5 of the bill, as well as the prejudicial nature that the passage of the bill may have on future land claims, treaty entitlement, and self-government negotiations.
A large degree of flexibility on representation already exists, and non-derogation clauses have been incorporated. Further amendments were adopted as a result of the deliberations of the House of Commons, and these served to further address these concerns. Consultation has also resulted in suggested improvements to the transitional clauses. Recognition and protection of existing rights, interests, and land, and assurances that unnecessary duplication of environmental screening, assessment and review will not occur, are two important matters that may require further attention.
In conclusion, the economy of the Northwest Territories is dependent upon natural resources. The proposed legislation provides certainty in coordination of the regulatory regime for the use of land and water. This will not only enhance economic development, but it will also ensure that economic development occurs in a socially and environmentally sound manner.
The Government of the Northwest Territories, as a signatory to the Gwich'in and Sahtu Comprehensive Land Claims Agreement, is committed to meeting those obligations. Bill C-6 is a product of those commitments. As a party to ongoing and future land claims, treaty entitlement and self-government negotiations, this government is committed to the fair settlement of claims and the implementation of aboriginal and treaty rights.
A long-standing goal of the Government of the Northwest Territories has been the full transfer to the north of powers, programs and responsibilities related to the northern land. We have been unsuccessful for several reasons, but the desire to control our future has not been an issue. The Government of the Northwest Territories is encouraged that the Mackenzie Valley Resource Management Act is a progressive step in the political development of the Northwest Territories. Building partnerships and placing more decision-making in the hands of northerners are undeniable benefits of this bill. For these reasons, the Government of the Northwest Territories supports Bill C-6.
Senator Andreychuk: You do not support all of the act, but you feel that, overall, it is the correct way to go. Are you concerned that, despite assurances to the contrary, several group feel that they are being prejudiced? How should the government handle these groups, or do you believe that the assurances within the proposed legislation are sufficient?
Mr. Koe: The general principles, the framework, and the approach contained in Bill C-6 are the same as can found in the current government mandates for negotiating comprehensive land claims in the Mackenzie Valley. Until that mandate is changed, all parties recognize this fact. For its part in current negotiations, the Government of the Northwest Territories advocates a coordinated land and water use regulatory system implemented through public government institutions.
The current government mandates and the principles and approach of Bill C-6 are consistent with the federal inherent right policy. It is questionable whether the proposals of some claimant groups are consistent with the policy, and that is why we are negotiating. However, we feel that there is enough latitude in the negotiations to allow for modifications and improvements to meet the specific needs on a regional basis.
If the MVRMA does not apply to the entire Mackenzie Valley for reasons that it may be prejudicial to consideration of fundamentally different proposals of land claims and self-government negotiations, the current negotiations may be prejudiced. Negotiations will likely stop while the new options and proposals are developed, and subsequently analyzed by the government parties.
If these proposals are found to be workable, the mandates will need to be changed, resulting in further delays. It is self-perpetuating. We support this on the basis that we like a valley-wide comprehensive regulatory regime.
Senator Andreychuk: This morning we heard from some groups who said that it would be better to implement the water management only in the Sahtu and the Gwich'in areas. In the interim, a separate consultation could cover the rest of the Mackenzie Valley until full management could be put in. I understand that you would rather have legislation covering the entire area in place, and that you trust that it will not prejudice the land claims and other issues, is that correct?
Mr. Koe: Yes, that is our opinion from a regulatory perspective. The maintenance of two or more regulatory regimes would be very impractical for our territory, for the western Arctic, and for the Mackenzie Valley. From an environmental management perspective, the larger ecosystems of the Mackenzie River basin cannot be protected in an effective manner. We all know that the water flows from Alberta and northern British Columbia, through the southern Northwest Territories, up into the Mackenzie Delta, and subsequently into the Arctic Ocean. The two groups who have settled claims are the Gwich'in and Sahtu, and the Inuvaluit who are much further downstream. We are proposing that the whole Mackenzie-wide system be incorporated, so that all of the parties can work together for whatever environmental and regulatory protections they need throughout the valley.
Senator Chalifoux: We have had several presentations regarding the representation on the boards. You have said that you are not concerned about that, but other presenters are very concerned, because they feel that there will not be enough representation. Secondly, they have great difficulties with this bill until their land claims are settled. Could you please expand on how you feel about those issues? We have three separate land claim issues that have not been dealt with yet in this area. What is your opinion?
Mr. Koe: We are well aware of the issue, and of the concerns of First Nations peoples who do not have settled claims. Part of my role is to work on negotiating these claims on behalf of the Government of the Northwest Territories, so we are very active at all of the tables, and we are well aware of their concern. We feel, as a government, that the bill is flexible; that it gives the minister flexibility to appoint members, and to try to ensure that all the representatives of these aboriginal nations get appointed to one or another of the various boards.
Senator Chalifoux: What part is flexible enough for these issues to be addressed?
Mr. Koe: We are confident that there is enough flexibility, and that things will be worked out. We also know that all of the details of all the memberships will be dealt with up front. Many of these issues will be deal with in self-government negotiations, and different groups are at different stages of negotiation across the valley. Some groups are at active tables, and some are just preparing to get to tables. We believe that the provisions in Bill C-6 should be considered an interim step, until all the agreements are fully negotiated and completed.
Senator Chalifoux: Earlier you said that there is some concern over the fair representation on the valley-wide boards established by Parts 4 and 5 of the bill, as well as over the prejudicial nature the passage of this bill may have on future land claims. Are you now saying that this is not relevant? You are saying you have concerns there, but that the bill is flexible enough to deal with those issues?
Mr. Koe: We are very sensitive to concerns raised by the aboriginal nations who do not have settled agreements. As negotiations progress, we believe that the bill will be flexible enough to allow these nations to negotiate positions on the various boards. We cannot predict the outcome of the negotiations, and there are two areas -- the Treaty 8 and the Deh Cho nations in the NWT -- which are not yet at a main table. When they do get to the table, we do not know what the positions will be at that stage.
Senator Chalifoux: Does that also include the North Slave Métis and the South Slave Métis?
Mr. Koe: The South Slave Métis are at a table. They are currently working towards an agreement in principle on the comprehensive claims, and are looking at negotiating self-government. The North Slave Métis are not at a table. They are trying to work with the Dogrib Nation and the Treaty 8, which are both around the areas surrounding Yellowknife, so we are not sure where they are. We know that the South Slave Métis are in active negotiations, and I know that they want us to delay support of this. Again, however, that is an issue that they must work through at the negotiations table.
Senator Forest: Bill C-6 is intended to provide an integrated system of land and water management in the Mackenzie Valley, and this is one of the strong points of it. Concerns have been raised with us by various groups from the Mackenzie Valley, however, about the number of institutions being established, and their ability to coordinate and integrate their processes with each other and with the other institutions. Some of them have called it a rather bureaucratic structure, one which may be more difficult to direct than the present one is. Do you have any concerns about that, or do you feel that this coordination will work well?
Mr. Peter Bannon, Director of Policy and Coordination for the Northwest Territories Ministry of Aboriginal Affairs: Compare the existing regulatory regime, with all the different statutes and different regulatory agencies, to what is being proposed in Bill C-6. The proposed legislation actually simplifies things, and also co-ordinates activities a lot more. It calls for coordination between the boards in the institutions, and we are confident that it will be an improvement over the existing system.
Senator Forest: I gather from these presentations that you want to go full steam ahead with this, and that the groups who are concerned will be tended to when they go through their negotiations. I recognize that the previous claims have been settled quite some time ago, and that those groups are very anxious to get on with it. We have these two camps at odds then; one wishes to delay the bill, or to have it not apply to them, and the other feels that this is long overdue, and wants us to get on with it.
Mr. Bannon: We agree that it is better to get on with it. Bill C-6 offers more participation in decision-making -- to both the public and the aboriginal nations -- than the current system allows. It is an improvement over what exists today. The First Nations groups also have the opportunity to negotiate their land claims and self-government agreements, to try to incorporate their regional needs and aspirations as well.
Senator Taylor: If the government were to amend Bill C-6 to state that it was only effective for three or four years, unless land claims agreements were reached by the other people in the valley, what would your reaction be? The government would want to reach an agreement, or get this bill through, because it would die in three years if it did not. On the other side, the three groups that have not reached a land claim agreement would know that, unless they reached an agreement within three years, the whole water agreement would die. It is kind of a shotgun clause.
A lot of people make a lot of money negotiating, and the idea is to go on forever. I thought that this might be one way of bringing both sides to the table, however.
Mr. Koe: As a government, we would have difficulty supporting that. As was mentioned earlier, we feel that this regime would standardize a system. An integrated system would be in effect up and down the valley. Our water flows down, and our animals and birds flow back and forth, and use the ecosystem from the water. By putting shotgun clauses in it, we do not feel that it would give it the impact that it deserves.
At the end of three years, what would happen? If some of the aboriginal nations have not settled claims, we must bear in mind that the negotiations work both ways. The government and the aboriginal nations must come to some arrangement. After all of these years, some of these aboriginal nations are not even at a table. Many others are at a table, and some have settled, so there is quite a range of opinion. There is also a range in terms of what the aboriginal nations want from an agreement, be it a treaty agreement or a comprehensive land claims agreement. Until they sort out what their needs, wishes, and aspirations are, it is hard to say, "Yes, we will wait three years." It could be 10 years, but it is not in our interest to prolong these negotiations forever and ever.
Senator Taylor: How would you feel if the other three areas were able to negotiate a better deal than you had on representation, and maybe even a better land deal? Would you still consider that you are finished and everything is through, or do you operate on a favoured nations idea -- if they get something better you want to reopen negotiations?
Mr. Koe: That is the nature of negotiations. Some of the aboriginal nations are holding off to see if they can make a better deal, and to see what happens with the governments of the day in terms of negotiations. They may well be able to do exactly what you say. Some claims have clauses in them to make amendments, to accept or take on things that are negotiated that are better than what they have today. There is flexibility. The nature of negotiations is such that the strategy of some groups is to hold off and see if they can make better deals. Again, I cannot put any time frame to it, because we have two major nations who are not at the table today.
Mr. Richard Nerysoo, President, Gwich'in Tribal Council: I thank you very much for your efforts to meet with me.
I served in the legislative assembly of the Northwest Territories for 16 years. I was Government Leader, Minister of Justice, Minister of Renewable Resources, and Minister of Energy, Mines and Resources. I was the Speaker of the Legislative Assembly, and I was the Chair of the Standing Committee on Finance, and also of the Standing Committee on Legislation. I held almost all of the portfolios. I served as President of the Indian Brotherhood, and as Vice-President of the Dene Nation. I am now the President of the Gwich'in Tribal Council, a position which I have also previously held, so I have had a varied history in my short life. Today, I represent the Gwich'in Tribal Council, which is responsible for implementing the Gwich'in Comprehensive Land Claim Agreement. We support the passage of Bill C-6, and the establishment of an integrated system of land and water management in the Mackenzie Valley.
I would like to briefly outline why the Gwich'in Tribal Council supports this most important piece of legislation. I would then like to respond to some of the political opposition that we have been tracking, both before the House of Commons, and now at the level of the Senate Standing Committee.
Ladies and gentlemen, when I appeared before the House of Commons committee last year, I made certain that they did not lose sight of the purpose of Bill C-6. The underlying purpose of the MVRMA is to fulfil the obligations of the Government of Canada and the Government of the Northwest Territories under the comprehensive land claim agreement between Her Majesty the Queen and the Gwich'in. The Gwich'in Comprehensive Land Claim Agreement was affirmed by legislation in December, 1992, and is constitutionally recognized as a land claim agreement within the meaning of Section 35 of the Constitution Act, 1982.
As we have outlined in our brief to you, until the signing of our land claim agreement, the Gwich'in were not involved in decision-making regarding land and water use in our region. Our values and opinions regarding the land and waters that we have lived and travelled on since time immemorial were not recognized or sought after by government.
In the 1970s, we spoke out against the Mackenzie Valley Pipeline Project, which we knew would bring harm to our land and to our traditional way of life. We also understood that it would not bring sustainable economic development to our people. The Berger Inquiry set an important benchmark in environmental and social impact assessment which Bill C-6, I believe, will achieve.
Following the inquiry, and with the recognition of aboriginal rights and the Constitution, Canada could no longer ignore the fact that aboriginal people in the North had a right to self-determination.
You have undoubtedly heard from other witnesses in the last two weeks who have told you that the administrative and decision-making structures that the bill creates may pose some problems for those without land claim settlements. I would like you to focus for a moment, however, on what Bill C-6 provides for aboriginal people and the public in the valley.
Bill C-6 recognizes the direct involvement of the Gwich'in, the Sahtu, and other communities soon to have land claim agreements, in resource management decisions, and provides environmental protection for the land and waters of the Mackenzie Valley. This state of the art piece of legislation is based on a number of important advances in the field of applied and environmental thought with which Berger and others have worked. It has been influenced by aboriginal people -- this includes ecosystem or watershed approaches which must be used to properly regulate land and water uses. This protects the rights of those downstream.
The environment includes biophysical, social and economic factors. Developments have cumulative impacts on land and water. Development must take future uses into account. Aboriginal people, through their land claim agreements, have the right to participate in the management of land and water use through institutions of public government.
Bill C-6 is based on the theory of co-management. This approach of managing resources requires the establishment of public boards that not only honour the assumption that aboriginal people have rights to make decisions on their traditional lands, but also that resources, wildlife and economic development in the settlement regions must also consider the best interests of all Canadians and non-aboriginal public who live and work in those regions. It is a partnership arrangement.
Bill C-6 will require the establishment of a Gwich'in Land and Water Board, a Gwich'in Land Use Planning Board, a Regional Environmental Impact Review Board, and a valley-wide land and water board. These boards will act as institutions of public government within an integrated system of land and water management in the Mackenzie Valley.
Bill C-6 has been drafted over the past five years in close consultation with the Sahtu Secretariat Incorporated, and the Gwich'in Tribal Council.
I will address some of the concerns raised most recently by Treaty 11, the North Slave Métis Alliance, and the South Slave Métis Tribal Council. Firstly, however, I would like to commend those individuals at the Department of Indian Affairs and Northern Development, the Government of the Northwest Territories, and the staff and leadership of the Tribal Council and the Sahtu Secretariat, who have worked so hard in drafting this legislation. There was a collaborative planning effort aimed at involving northerners in every stage of drafting. While some groups are not ready to adhere to DIAND's legislative schedule due to land claims negotiation situations, the involvement of those who had the capacity has undoubtedly strengthened the bill as a result.
During the standing committee hearings which took place in the latter part of 1997, the Gwich'in Tribal Council became aware of the nature of opposition to Bill C-6. Leading up to the hearings, we heard the concerns of both industry and the South Mackenzie Valley groups. More recently, we have heard some very strong opposition from the North Slave Métis Alliance, the South Slave Métis Tribal Council, and the Dogrib Treaty 11, who have already appeared before this committee.
The issue of land claim and self-government negotiations is a difficult one, and one with which the Gwich'in sympathize. However, the current opposition to specific aspects of the MVRMA is no reason to stall its passage. The proposed legislation is four years overdue. It has cost the Government of Canada, the GNWT, the Gwich'in Tribal Council, and the Sahtu Secretariat considerable money and time to ensure that the bill is now ready to go before the Senate.
In the regions, the working groups have been preparing diligently to take over regulatory responsibility from DIAND. Any further delay in the passage of this act would be a further breach to the Gwich'in Comprehensive Land Claim Agreement, and the Sahtu Comprehensive Land Claim Agreement. The Gwich'in feel that it is imperative to move ahead with the establishment of these boards so that the implementation of our land claim structures may continue on some sort of reasonable schedule. This legislation has already been delayed for four years, which has negatively impacted the implementation schedule of our land claim agreement.
Bill C-6 sets up a state of the art framework for land and water management, and this is even more important than the expediency issue. It includes the rights of the aboriginal people through their land claims, and is second to none in the north with respect to ecological resource management principles. It is one of the first instances of a resource management regime based on the co-management of land and water, within the framework of a comprehensive land claim agreement. We are proud to be part of this framework, and we think that other groups, especially those who seek to benefit in the future, should be too.
I urge these groups to take a serious look at the overarching and long-term benefits of this legislation, and they will see that it benefits all people living in the Mackenzie Valley. If they have a system in mind that supersedes this one in terms of its fairness, balance, and accountability to environmental, social and economic principles contained within current land claim discussions, I would like to see it.
There has been opposition to the formation of the Mackenzie Valley Land and Water Board, a board which will bring together the regional panels to deal with land use or water licence applications that will have an impact on more than one jurisdiction. This opposition is due to the fact that land claims in the southern regions have not been settled.
The board would be triggered, for example, if there were an application for a land or water licence in the southern Mackenzie Basin that might have a downstream impact on other jurisdictions in the basin. The Dogrib have suggested they will not support the bill if it includes Parts 3 and 4, which deal with land and water regulation and the establishment of the Mackenzie Valley Land and Water Board.
This amendment would not impede the implementation of regional boards, but it would impede the implementation of the board that will ensure that the downstream impact of developments which occur in the Gwich'in and Sahtu settlement area are captured in the preliminary screening process. We oppose waiting any longer for the establishment of this board, and feel that southern membership on this board will be of benefit to those in the southern regions, even to those without land claims.
With respect to the application of the MVRMA, the Government of Canada has already provided for the accommodation of individual land claim negotiations in the future. It is important, however, to separate the issue of the watershed framework that the proposed legislation provides for from the issue of individual resource management systems still to be established through negotiations between First Nations and the Government of Canada.
The MVRMA is a state of the art system of coordinated management for the entire valley. It provides for aboriginal and public participation in land and water decisions that address cumulative impacts and downstream effects on water quality and quantity. It does not in any serious way limit the manner in which a jurisdiction may wish to develop policies or guidelines that support the unique characteristics found in its political jurisdictions, or as per its individual land claim agreements.
Let me provide you with an example using the Gwich'in and Sahtu land and water boards. Yes, the bill does dictate that both jurisdictions will establish regional and independent land and water boards, each with a specific number of seats from the government, and from the Sahtu Secretariat and the Gwich'in Tribal Council. The bill does accommodate the unique features found between the Sahtu and Gwich'in agreements, based primarily on the contrasting nature of property right structures found in each jurisdiction. This difference was a direct result of independent land claim negotiations that went on in both the Sahtu and Gwich'in regions.
In the Sahtu region, regional corporations own settlement lands within their jurisdiction, whereas in the Gwich'in region, all settlement lands are held collectively by the Gwich'in Tribal Council. As a result, the manner in which the land use permit and water license applications are processed is quite distinct, and this difference is reflected in the policies and the procedures of each land and water board. The consultation processes are also quite distinct due to this property right.
There is latitude within the proposed legislation to provide for the individual preferences of each jurisdiction. At the same time, however, the bill ensures that each jurisdiction adheres to certain principles, including respect for jurisdictions downstream, where adverse impacts of developments may impact on wildlife, water and land.
It is important to note again that the Government of Canada has stated that the bill can be changed after future land claim negotiations in the southern Mackenzie Valley. I urge all senators not to lose sight of this fact, and to focus on the overarching principles of this bill that I touched on earlier. This bill will provide for a regional land and water regime that will ensure that the downstream impacts of developments can be examined, and that the affected parties will be involved in decisions.
The integrated nature of this bill also provides for the examination of the cumulative impacts of developments, and this will allow a balanced public system of land and water management that must take the views of the public into account.
Despite arguments against the bill, there is a great deal of opportunity here for aboriginal people to participate in an environmental assessment review process, which is a management regime that is to the advantage of the indigenous people. We can all argue the basis on which claims are negotiated, and what the policies of governments are, but the reality is that the negotiating positions are a matter of public policy, and those issues are a matter for the government and cabinet to decide, not an issue on which a piece of legislation should be articulated. It is an important distinction to note when dealing with these matters.
Senator Forest: Do we also have your presentation in writing?
Mr. Nerysoo: Yes.
Senator Forest: I was particularly interested by your comment that accommodations had been made with respect to the Gwich'in and the Sahtu in their land agreements, and that these would allow for an individual operation with respect to the land and water. That is an important point -- if differences were allowed between your group and the Sahtu, then exceptions and differences could be allowed for the peoples whose land claims have not yet been settled. That signifies that there is some flexibility, which gives me some comfort, because we have heard real concerns.
A number of the other groups have told us that they are not confident that the clause in the bill which states that there will be no abrogation or derogation of treaty rights will ensure that this does not happen. They have had a letter from the minister, which is comforting, but they are still not confident that this does not in some way restrain them in their negotiations.
We have heard from many different groups, and we have heard both sides of the question. Our task is to digest all that we have heard, and to try to reach a conclusion that will be acceptable to all people, and which will result in the best integrated system for the Mackenzie Valley. We have our work cut out for us.
Senator Chalifoux: In the proposed legislation, the Gwich'in and the Sahtu have the majority of membership on the board, and the other nations only have four seats. They do not have as much representation as they feel they should have. I would like your comments on that.
Mr. Nerysoo: Clause 11 of the bill is quite clear on the fact that the appointment of the membership is left up to the minister. There is nothing in the legislation to suggest that the other First Nations cannot be accommodated on the board in the valley. If anything, we have been quite clear that most First Nations should be considered as members of that board, because it only improves the quality of the contributions that are made to the management of the resources.
At a certain point, you must determine whether or not you continue to divide the indigenous people into various groups, or whether or not you try to ensure that the voice of the indigenous people is clearly understood and placed on these boards. There is a point where you may appoint so many people that it is not functional. That is a very important consideration.
On the other hand, we have not taken the view that none of the First Nations that are at the negotiating table should be appointed. If anything, it would be in our interest to have all of the parties on the board, simply because there is a need for us to get on with doing the work. People complain about the fact that other developments are occurring. It is important that we have a voice now, not later. We have been arguing this case for years, and it is time for us to participate.
Senator Chalifoux: The other First Nations are saying they want a larger share of the voice. Once we subtract the Gwich'in and Sahtu members, if I understand it correctly, there are seven board members left. Of those, three are government appointees, which leaves only four seats for the remaining nations. This is their contention.
Even at that, the Sahtu and the Gwich'in must make the recommendations. The minister must choose the member from those recommendations, but you could effectively appoint another Gwich'in or Sahtu person. That is their concern, and I would like to hear your response regarding that.
Mr. Nerysoo: Let me read clause 11:
any special members appointed under Section 15 shall be appointed by the federal Minister and, to the extent provided in Parts 2 to 5, shall be nominated by a first nation or the territorial Minister or following consultation with first nations.
It does not say that this will be restricted to the Gwich'in Tribal Council or the Sahtu Secretariat. It would be applicable in those circumstances and situations where those regions were effected. It must be a consideration when developments extend beyond the regions of particular groups, or the consequences affect more than one jurisdiction.
Mr. Brian Crane, Legal Counsel, Gwich'in Tribal Council: Some appointments have been made to working groups. The theory is that this will give future board members an opportunity to learn about their roles on the board. The working groups are starting to become familiar with how a board functions, and how their applications will be handled.
Many of those appointed to the working groups have been aboriginal people, even though these have been the minister's appointments. In fact, so far even more aboriginal people may have been appointed than is called for in the agreement.
There is an important aspect to the representation feature. Mr. Nerysoo mentioned that there are many aboriginal groups, and there are many sections of aboriginal groups that are appearing before you. How many appointments there can be is a practical matter.
The key aspect, however, is that the board will sit in panels. As a general rule, those panels will have three members. The agreements provide that the representation on those panels will be 50/50. When applications are heard, there will be a chairperson, plus an aboriginal person nominated by a First Nation, plus a person nominated by the minister. The balance will be there when the board actually sits to hear cases.
Senator Chalifoux: Chapter 24.1.1 of the Gwich'in Comprehensive Land Agreement says: "the government shall retain the ultimate jurisdiction for the regulation of land and water." Does that mean that the government person appointed by the minister would have the final say on these permits?
Mr. Crane: No. The board is regarded as a public board. It is part of the government structure, even though it is a co-management board.
Senator Taylor: If the other nations do not sign, that could, you said, affect the land claim agreement that you have already signed. I thought it was written in stone or blood, but you statement makes it sound as though your land claim could be hurt if the others do not join the boards.
Mr. Nerysoo: I do not recall saying that. What is important is that the whole concept of the integrated resource management structure brings together all aspects of the management of land and water.
Senator Taylor: I understand the value of it, having been in engineering, mining, and development. In your presentation, you said that it would affect your land claim agreement, and that is what puzzled me. Will you give us a copy of your brief?
Mr. Nerysoo: Yes.
Senator Bernston: A number of years ago, I carried the Gwich'in Land Claim Agreement through the Senate for our side. My memory is not what it used to be, however, and I do not remember some of the details of the legislation. Perhaps you could enlighten me a little bit.
When the land entitlement agreement was signed, did the Gwich'in people know that a bill such as Bill C-6 would later deal with land outside of the entitlement -- land whose title may well be in dispute?
Mr. Nerysoo: Under chapter 24.1.1 in the Gwich'in Comprehensive Land Agreement it is quite clear that further legislation was anticipated. It says: "an integrated system of land and water management should apply to the Mackenzie Valley." There is no doubt in my mind that that is a clear indication.
It goes on to say that any other land and water board established in an area shall assume the powers of the land and water board, and shall become the land and water board for the purposes of the agreement. It is quite clear that they understood that this would happen.
Senator Bernston: The boards to which we are referring were provided for in the land entitlement legislation?
Mr. Nerysoo: Yes.
Senator Bernston: Land is still in dispute outside the Gwich'in agreement, however, and somehow someone is getting the cart before the horse. The groups who have not yet reached land entitlement agreements with the government should not be expected to stand by and watch all of this happen. I do not know who is dragging their feet in getting the other three claims resolved. At the end of the day, these groups will be presented with a done deal, as opposed to having negotiated that deal. Do we have some obligation to ensure that they have the same opportunity to negotiate what is reasonable and fair as the Gwich'in and the Sahtu did?
Mr. Nerysoo: I will not disagree with that basic principle. On the other hand, though, nothing in the proposed legislation takes away from the ability of those First Nations to negotiate an additional arrangement that would allow for the amendment of this legislation.
The Dogrib Treaty 11 made reference to the Yukon, but even there negotiations are ongoing between the First Nations and the Government of Canada. I have been personally been involved in the Yukon development assessment process and that piece of legislation.
My own experience with the proposed Mackenzie Valley Resource Management legislation tells me that it is a better management system than the one proposed in the Yukon. It is less complicated, and it amalgamates a lot of issues. The Yukon system maintains all of the structures that exist right now, with the exception of moving the Canadian Environmental Assessment Act process into YDAP, which is the Yukon Development Assessment Process.
Senator Bernston: If it is all that positive, I am happy to have been associated with it.
Senator Adams: The Gwich'in and Sahtu have settled claims now, and there are no problems with boundaries at the moment. Everyone agreed with you with regards to these boundary lines. What will happen in the future, however, when it comes to things like power lines? Who will decide where those lines should go? In the future, there may also be problems with fish and whales.
Mr. Nerysoo: When a particular development only affects a single region -- regardless of which region it is -- that is a matter for that particular area. When a project extends beyond that region, the Mackenzie Valley Land and Water Board will review it.
There is an aspect to this legislation which a lot of people do not recognize. I am from Fort McPherson, and the Peel River goes into the Yukon. There are circumstances where other rivers flow into Alberta and British Columbia. This piece of legislation allows the Mackenzie Valley Land and Water Board to call a review on a project outside the jurisdiction that effects the downstream. That is a very important component. It changes the way that we view the matter of land and water management, because it changes the attitude of the jurisdictions. That must be taken into consideration.
Senator Adams: My concern is zoning. We do not want it to end up like Churchill Falls or the people in Labrador that are controlled by the Quebec government. If the power lines go through the three different areas, the income from the power must be dealt with. We do not know what will happen. These people are living off the land, and hydro plants that go up in other areas affect them. I hope that they are protected by Bill C-6.
The Chairman: Including the Inuvaluit, there are three settlements in the upper part of the NWT. Why are the Inuvaluit not part of this exercise -- in other words, why are they not part of the board?
Mr. Nerysoo: Their agreement and structures were established prior to our agreement. When we were negotiating, we worked within the context of the Dene and Métis final agreement, and then dealt with the structures accordingly, as a result of that failed agreement.
The Chairman: In the future, might there be some jurisdictional overlap between the two that would need to be rectified? Is there a place anywhere in your government's legislation or in this particular proposal to accommodate a dispute resolution mechanism?
Mr. Crane: When a project has an impact in another region, additional members can be brought on the board from that region. That provision was included in direct response to what is already in the Inuvaluit agreement, so there is a link.
There are also provisions for cases where a project which will have a general impact needs an environmental assessment. There are provisions under which a joint board between the two regions can be established by the federal minister. When projects overlap, these links between the jurisdictions will accommodate the Inuvialuit, and will also accommodate the Inuit and the Yukon.
The Chairman: Without meaning to, we sometimes leave out the most important elements when negotiating. With that in mind, let us suppose the Inuvialuit agreement says one thing, the Tungavik Federation agreement says another, and this particular bill says yet something else. Which would override? Is there any mechanism in place to resolve disputes over overlaps?
Mr. Nerysoo: If any disputes arise between the bill and the final agreements -- be it the Gwich'in agreement, the Nunavut Tungavik agreement, or the Inuvialuit agreement -- those agreements prevail. An arbitration vehicle to resolve those differences would have to be established, because the agreements are constitutionally protected pieces of legislation, whereas this is a piece of legislation that can be amended by the House of Commons.
The Chairman: Do you feel that this particular provision is already accommodated within the proposed legislation?
Mr. Nerysoo: Yes.
The Chairman: Let us return to the three areas with unresolved land disputes.
You mentioned that this bill provides an opportunity for them to avoid missing the boat. That is, you believe that this is an opportunity for the other groups to get on board.
Why are you so sure that their interests, such as hunting rights and royalties, or different elements that they might want to negotiate, will be taken into account when the law is already in effect?
Mr. Nerysoo: Firstly, there are aboriginal people from those regions who already sit on the working groups, and who are making very significant and positive contributions to those structures.
The Chairman: You mean to say that some people without settled claims are already on board?
Mr. Nerysoo: In some cases, members of those communities are on the working groups, and they provide some very good advice in terms of how these boards could work in the future.
The Dogrib have an agreement and probably could have pursued it. In spite of that fact, they have been able to negotiate a benefits arrangement with BHP outside of their land claims agreement. In my view, that is a good basis for other First Nations to use in negotiations. It is outside the agreement, but it is a good example of the fact that, even if we do have an agreement, other First Nations are doing things that could be of advantage to us in the future. We have not had that experience, and it therefore is very good for us.
The Chairman: The understanding of the Sahtu Secretariat is that this legislation would only apply within its settlement area. The impression I got was that what is outside of the Sahtu settlement area really is not of concern to them.
Why do they seem hesitant to recognize that this piece of legislation can go beyond the settlement area?
Mr. Nerysoo: I cannot speak for the Sahtu Secretariat. They voiced their position.
In my view, it is in our best interests to work collectively, with the exception of the Inuvialuit, at the bottom of the Mackenzie River Valley. Working collectively has been the whole idea since the formation of the Indian Brotherhood and the Métis Nation in 1969. While claims may be negotiated individually, that collective principle should always be a foundation by which we, as aboriginal people, build systems of management.
The Chairman: That was the intention of your groups before they started carving themselves into independent organizations in 1990. Nevertheless, the same format has been adopted throughout this whole negotiation. Perhaps they have forgotten that they were no longer together.
There is another interesting point which you should address. You mentioned that this piece of legislation can be revisited at some point. There is no reason why a serious amendment could not be made to this particular piece of legislation after the three groups have completed their land claims. Could you elaborate on that?
Mr. Nerysoo: The legislation itself can always be amended to respect any claim agreements that are negotiated. We have never suggested that the proposed legislation should not be amended to accommodate changing circumstances. In fact, as a result of consultations, we made some amendments to accommodate industry and some of the First Nations during our review in the standing committee.
I believe that we need to move on, because we need to have the system functioning in the valley. It is important that we do that.
The Chairman: What would your recommendation be, Mr. Nerysoo? We are in a bit of a predicament, due to the arguments brought forth by groups who have not yet been able to negotiate their settlements. It seems that we are damned if we do, and damned if we do not. I understand your eagerness to move forward and to implement claims, and I share it. I have been there before, and I know what it is like. I am quite surprised that you are relaxed and not pushing. If I were you, I would probably be hammering away, especially when you have people to represent. I understand you fully on this.
Is there any way out? What does the minister have to do? I am not talking about the department -- I am talking about the minister, the political person. What must she do to satisfy the three groups without making changes to this bill? As you know, we would have to send it back to the House of Commons if we were to make any amendments. If we do not want to do that, what would your recommendation be?
You have a wide range of experience in dealing with the government and ministers, and I am sure that you have some answers.
Mr. Nerysoo: One very important element is the policy position on claims negotiations, and the whole matter of how self-government matters and the mandate are addressed. If the mandate has not changed, it will obviously affect the negotiations of other First Nations. That is a very important component, and the proposed legislation does not take away from that. In my view, it only provides a vehicle for all of us to work together.
I was always under the impression that the Senate was the upper chamber and the so-called house of sober second thought. I have to view this in those terms.
The Chairman: We will hear now from the Mikisew Cree First Nation, which would like to make its case on the question of taxation.
Mr. Ian Taylor, Director of Economic Development, Mikisew Cree First Nation: The presentation that we will make is essentially a duplicate of the one we made this morning to the Standing Senate Committee on Banking, Trade and Commerce. Our remarks will revolve around Bill C-28, which concerns amendments to the Income Tax Act, and the impact that it will have on economic development in the First Nations.
We hope that, with this information in front of your committee, we may be able to expand on other issues involving self-government and mechanisms which the Government of Canada can support.
Ms Rita Martin, Councillor, Mikisew Cree First Nation: I will address the proposed amendment to section 149(1)(d) of the Income Tax Act contained in Bill C-28.
The Mikisew Cree First Nation is located in the extreme northeastern corner of Alberta on the shores of Lake Athabasca. Our principal reserve lands sit on either side of the hamlet of Fort Chipewyan, established in 1788. It is the oldest permanent settlement in Alberta.
For nine months of the year, our community is only accessible by boat or plane. The winter months allow for the construction of a temporary winter road, which allows us to stockpile essential materials for the remainder of the year.
The Mikisew are by far the most influential group in the area in terms of population, organization and innovation. In a few short years, the Mikisew have developed a variety of corporate structures to address the economic effects which stem from the fact that we are one of the most isolated communities in the country.
Since 1985, the Mikisew Cree have made some bold attempts to change. In response to the direction of our community members, we have set about creating a number of businesses. We have set up companies to manage fuel distribution, air travel and shipping, construction, building materials, and labour services for the oil sands developments to our south in Fort McMurray.
Unlike corporate structures in mainstream Canada, our companies are not designed to return a dividend or a profit to shareholders. Instead, they are designed to provide opportunities for our members in training, employment, and the delivery of services essential to the life of our community.
The goal is to reduce our dependence on outside materials, skills, capital, and transfer payments from social assistance. It is in this development of self-reliance that the proposed amendment is so very important.
In practical terms, the Mikisew Cree are attempting to build a functioning economy in what can only be described as a hostile environment. The small protection provided by the existing exemption is of critical importance, because it provides a slight levelling of the economic playing field.
The big oil companies have recently announced more than $20 billion in new oil sands investment, and our community is prepared to launch an aggressive bid to organize and participate in what all observers agree will be a sustained period of growth and prosperity for the entire region. We have no resources of our own which will allow us to gear up for this boom in the short term. If we fail to get it together in time, we will be left behind once again.
Participation in this new oil sands activity will produce returns for the Mikisew Cree for up to 20 years. These returns will be reinvested in training, employment and planning for sustainable use of renewable resources, such as tourism, fishing and controlled timber harvesting. These new industries will support the development of our children and grandchildren for generations.
If the amendments to section 149(1)(d) contained in Bill C-28 become law, they will literally gut economic development in our community, as well as in many other First Nations. We need the exemptions contained in 149(1)(d) to develop self-sufficiency.
Under section 149(1)(d), a First Nation that is organized, controlled and operates as a real government receives the same protection from taxation as do other governments on different levels in Canada. When a First Nation bases the design and development of its institutional and management structures on this provision, two important things happen.
First, economic development through investment, construction and job creation takes place with the assurance that all income is reinvested in the community, and not leaked out through dividend payments, profit taking or taxes. This has the effect of creating a pool of capital for further development and reinvestment, which, in the long run, will increase self-reliance.
Second, by developing the government and management structures needed to be eligible for the exemption, the First Nations are developing the foundations of self-government. In this regard, the Mikisew Cree have made real progress by establishing by-laws for the management of land use and internal and external financial controls, as well as rigid and transparent accountability measures to our community.
The Mikisew are well on their way to completing a constitution, including a comprehensive set of by-laws. This will provide the Mikisew Cree with the same protections that the Constitution provides for the mainstream population. This is exactly what Canadian governments and all parties represented here have been trying to do for years -- develop a legitimate aboriginal government consistent with both the letter and the spirit of the Constitution.
Without the protection of section 149(1)(d), only a tiny handful of First Nations in the country will enjoy the land base, resource base, geographical advantage and the opportunity for jobs which are needed to become self-sufficient and self-governing. If the proposed amendments to the Income Tax Act are passed, that progress will be reversed.
With respect for the wisdom and knowledge of this committee, we request today that you consider adding one paragraph to the proposed amendment. The paragraph is included in the briefing paper that we have already presented.
Senator Taylor: A number of companies are set up under the Indian Act, as opposed to under the Income Tax Act. Why are you setting up under the Income Tax Act?
Mr. Taylor: The protection provided to band-owned companies under sections 87 and 89 has been steadily eroded. Our consultants and experts, as well as our feelings on the mood of Revenue Canada and the Department of Finance, tell us that this will continue.
In terms of developing confidence for the future, even a bad rule is a reasonable rule, if you know what the situation will be 10 years from now. In that respect, we have no confidence in the Indian Act. In essence, the Income Tax Act has its foundation in the Constitution, whereas the Indian Act does not. As such, we realize that any change to the Income Tax Act has to go before Parliament, and that, through that process, it must come before a committee such as this one. If a change like this were being considered to the Indian Act, we would never have this opportunity. This is why we are concentrating on the Income Tax Act.
Senator Taylor: Why do you believe that you are governed by an amendment that affects municipal or local governments? For instance, in the provinces of Alberta and Ontario, Crown corporations are not taxed. Why would you not consider yourself to be equivalent to a provincial Crown corporation, rather than a municipal Crown corporation?
Mr. Taylor: We consider ourselves to be the equivalent not only of a provincial Crown corporation, but also of a federal Crown corporation. There is no legislative or administrative mechanism for us to organize ourselves under that pretence, however, nor for Revenue Canada to accommodate our organization in that respect.
In that respect, our adjustments -- structural, administrative, bureaucratic, whatever -- to fit into this hole are exactly that. It is a rear-guard action, and, in trying to shove square pegs into round holes, we are trying to find some sort of mechanism which will provide protection for our companies.
In the last 18 months, we have spent more than $1 million on income tax consultants and lawyers to develop administrative structures which will afford us this protection. We would have preferred to have a clear definition of the rights that a First Nations government has to conduct business under the Income Tax Act. We would have preferred to spend that money on the social services for which it was it was originally intended.
Senator Chalifoux: I have been hearing from a number of areas that businesses on reserve lands are income-tax exempt. Off-reserve, companies must pay income tax. What makes your reserve separate and different from the places such as the Enoch nation or Hobbema?
Mr. Taylor: Of the 650 First Nations in Canada, only a handful have access to markets, highways, and urban centres. The Mikisew Cree First Nation is completely remote; there is no permanent road. Some winters we do not get a road at all. That was the case this year, and we were in a disaster area for several months over the winter. Owing to this situation, Mikisew has developed a number of businesses -- some successful, some still struggling -- all trying to develop a return on investment that is completely rotated back into the development of infrastructure.
If the 10 per cent rule is to be imposed as indicated in the amendment, we will lose virtually any tax protection that we have. It is impossible for us to develop an economy on the basis of a market of 1200 people, 78 per cent of whom live on an average of $18,000 to $20,000 a year. There are not many resources to go around. In order to develop a resource base for the community, we need to access the markets in Fort McMurray, and the opportunities that exist there in oil sands development.
If the amendments to Bill C-28 become law, we will lose all exemptions, unless 90 per cent of our economic activity actually occurs on the reserve itself.
Senator Chalifoux: Have you worked out an amendment or a plan? Once this is within the proposed legislation, that would open the door for the other reserves in the south to get the same benefit.
Mr. Taylor: The Mikisew are raising a fundamental issue about self-government and the challenges First Nations in remote communities face to a point where it could be accommodated on a structural level across Canada. We do not object to any amendment or adjustment to the policy that will leave the door open for the Mikisew. This is why we are dealing with it at this level.
We are negotiating on different levels with the Department of Finance and with Revenue Canada to try to find other mechanisms to get around this. It would, however, be nice to see the Government of Canada moving to remove one of the significant barriers to the eventual self-reliance of the First Nations.
Senator Chalifoux: I understand the situation well. I am saying that the southern bands would have the very same opportunity that you would, and yet they have access to all of the markets, including the ones in the United States. Have you even considered what type of exemption you would require?
Mr. Taylor: We have.
Senator Chalifoux: In the mid-Canada corridor it is a bad situation, as it is in the north. That is why I am asking.
Mr. Taylor: Revenue Canada essentially bases its determinations on geography. We are asking for that point and view to be adjusted, and for purpose to be considered instead. Where revenue is generated is not necessarily as important as the purpose for which the revenue is used. Under 149(1)(d), it is the role and purpose of the revenue that is being generated by a public body that is most important -- not how or where it is produced. The whole spatial concept deals with the long term.
Senator Fairbairn: Prior to the introduction of this bill, were you consulted on this provision?
Mr. Taylor: No.
Senator Fairbairn: Do you feel that, in the drafting of the bill, people were cognizant of these difficulties? Do you have the impression that you are bringing a new twist to the interpretation of the legislation?
Mr. Taylor: It is an interesting question, senator. In my more cynical moments, I sometimes wonder if I am paid to be paranoid.
When Bill C-28 first came out as part of this omnibus bill, it was a very large bill to revamp the Income Tax Act, and it had been under construction and consideration since about 1995. When we first started making inquiries around Finance and Revenue Canada about the nature of the amendment, we were told that it was an oversight, and that no one had ever meant to get in the way of First Nations becoming self-reliant.
Delving deeper into this thing was like peeling the layers off of an onion. We finally had the chance to meet the architects of the amendments, however. There is no doubt in my mind that these people got burned on Otineka, and this is their way to get back. This is quite clearly intended to close the window that was opened by Otineka.
Senator Chalifoux: Opened by whom?
Mr. Taylor: Revenue Canada.
Senator Fairbairn: Perhaps these questions are unfair, and would better be asked of officials. They are trying to close what they see as a loophole.
Mr. Taylor: In the eyes of Revenue Canada, Otineka is a loophole. Section 149(1)(d) is not seen by officials in the Department of Finance or Revenue Canada as a tax rule that should be utilized by the First Nations.
Those rules are intended to deal with municipalities in a classical, mainstream sense. There is a certain amount of surprise and disgruntlement among Revenue Canada and Department of Finance officials when they see that an Indian band has the gall to call itself a municipality, and expects to be treated as such.
There is no perception among the Department of Finance people that this is an appropriate vehicle for First Nations to use in economic development. Of course, the question then becomes: If we cannot use this one, which one do we use? There really is not anything available to us.
Senator Fairbairn: Have you had an opportunity to talk to any of the ministers responsible?
Mr. Taylor: We have never spoken directly with a minister. We have met with ADM level officials in the Departments of Finance and Indian Affairs and Northern Affairs. We are, as I mentioned earlier, working on another path, which could best be described as a tax rent agreement similar to the Westbank GST operation. We have just begun working on this, and it could take a year or two to develop. We are looking at the prospects of doing a tax rent agreement for corporate taxes on our own property.
Again, we are being offered political solutions to what are essentially structural problems. They seem terrified that accommodating an adjustment to Bill C-28 would open a floodgate. It is a moot point. The government is not currently making any money in taxation from First Nations business investments.
Very few First Nations can operate at a level which would make them eligible under the criteria for section 149(1)(d). Therefore, we see the criteria for qualification as one of the most important tools for developing self-government -- one of the best encouragements there could be. We are not organizing administrative, decision making, or accountability structures at the community level to fit some program for which we have been funded, nor to fulfil obligations under some transfer agreement. These have to grown from the ground up to actually manage a geographical area, becoming de facto government.
This is free encouragement for developing self-government institutions, and it is custom made to the needs of the communities across the country. There is no extra expenditure, and no one needs to be funded. We are not asking for help, nor are we asking for funding. We are simply asking the government to remove a barrier to the development of self-sufficient and self-sustaining economies. We think that it is a reasonable request, but it seems to scare the hell out of people at Revenue Canada.
Senator Adams: You mentioned the oil sands at Fort McMurray. This committee went through there two or three years ago. We saw quite a few native business people contracting to do maintenance on heavy equipment for the oil sands. How does this system work with regard to Bill C-28?
Mr. Taylor: A number of bands members own their own companies and work, for example as trucking contractors, or in construction. They deal with Revenue Canada on their own, and they quite clearly fall under section 87 of the Indian Act. Unless their income is being generated on a reserve, they pay taxes. They have no problem with that, and neither do we.
Our concern is our "state corporations", if I can use that term. These are companies owned and operated by the First Nation itself, with a mandate to develop training and employment opportunities for First Nations members. They are 100 per cent owned by the bands, and all returns on investment are used to develop infrastructure, both physical and social, on the reserve. As a public utility, these companies can enter into business and contractual arrangements to make revenue for a municipality or a province. Under the Constitution, they are tax-exempt, as one level of government cannot tax another level of government. We would expect the same sort of arrangement with the Government of Canada, and we are anticipating it.
Senator Adams: Income earned on the reserve is not currently taxable. Will it be taxable under Bill C-28?
Mr. Taylor: Individuals have income tax exposure on an individual basis, and nothing in Bill C-28 will impact on that. The provision to which you refer occurs in both the Income Tax Act and the Indian Act. The amendment to Bill C-28 pertains to taxing a Crown corporation; our airline, our labour markets, our fuel distribution companies, our construction company.
Senator Adams: Is there any oil in your area?
Mr. Taylor: No. As beautiful as it is, Fort Chipewyan is probably the only place in Alberta that does not sit on oil. We are actually on the Canadian shield, so our geology is similar to that of northern Ontario.
Senator Adams: If this bill passes, will it affect your economy? My concern is that if Revenue Canada takes money away from you, it may put some people out of work.
Mr. Taylor: Competition is an issue that is brought up continually. I will give you a couple of quick examples, using our airline, Contact Air, and the third largest employer of aboriginal people in the region, 2000 Plus.
Our company, 2000 Plus, has been operating for about seven years, and has made a profit for the last three years. It provides labour market support services in man-watch, safety, and maintenance for oil sands plants such as Syncrude and Suncor. When the new companies start up, hopefully we will also work with Mobil and Shell.
Our labour base is 88 per cent aboriginal, and 76 per cent of those are Mikisew band members. The vast majority of these people would not have found work in any other company. They have neither the skills, the background, nor the education. Our company trains these people, mentors them, and provides them with the support that they need to stay on the job and to organize themselves. They are taught everything from maintaining a bank account to following a bus schedule. These are the support services that we provide, and we provide them on a profitable basis. No one else in Canada is willing to take that risk, or to put that amount of effort into hiring and training aboriginal people.
The second example is our airline, Contact Air. Again, Fort Chipewyan is an isolated community. Several years ago, the Mikisew Cree bought the only airline that was providing service to the community. At the time, the service was intermittent. Today, the community has regularly scheduled flights twice daily, and also provides all medical evacuation services by air.
In setting up the company, the first goal was to reduce the leakage -- the amount of money going into somebody else's pocket from the band's spending on transportation. Now, we have money going from one pocket into another. We have made some savings.
The next step is to reduce the cost of air travel so that the average resident of Fort Chipewyan can actually go somewhere. This is a very poor population. Currently, the company is struggling along. We are making ends meet, but it still costs $240 for a return airplane ticket for the 25 minute flight to Fort McMurray.
In order for us to continue to develop the level of service that we deserve, and that most other communities in Canada accept as a matter of course, the company must identify the profit centre. We must get into air charters and tourism. We must find some other method of raising revenue, in order to reduce the costs so that our people can have reasonable access to transportation. What private sector company will do that?
If we lose the protection provided by 149(1)(d), we will lose the airline. We can barely keep up with the debt load that we now carry. With the proposed taxes, we will lose the airline. I can guarantee that no capitalist is chomping at the bit to go broke in one of the most isolated communities in the country.
Senator Adams: Is the runway privately owned?
Mr. Taylor: I believe that all airstrips in the country are owned by the federal government. In our case, the municipality of Wood Buffalo operates the air strip.
Senator Chalifoux: For years we have been fighting the perception that Indian bands have all of the privileges. Native people do not have to pay taxes. Have you considered anything to combat this issue?
How many Indian bands read the Income Tax Act?
Mr. Taylor: That is a good point.
Senator Chalifoux: Have you spoken to any of the other northern Indian bands? I am not speaking about the southern bands, as they have access to many things, but rather the isolated settlements.
Mr. Taylor: As you are well aware, Mikisew First Nation is a member of the Athabasca Tribal Council, which has been fully briefed.
As you also know, different bands have developed at different rates in that part of the country, and all of them have pressing problems. A band must be successful, well organized, and have established businesses which generate income. That income must be used to develop the infrastructure of the community. If a band does not have these things, there are bigger problems to worry about.
Mikisew Cree are leaders in northern Alberta. We are the only band in the region doing anything. As such, we are being penalized. The issue has gone even further than that. Our chief made a presentation at the last All Chiefs Conference in Alberta. A resolution emerged from that conference, telling the AFN to move this along. From here, I will go to a meeting with the AFN, to try to bring their technicians up to speed.
For us, the dangers of this amendment are relatively obvious, because we are in a position where it is relevant. However, most other First Nations are not at a stage of development where this is all that important to them. They face much more immediate problems.
In a way, it is disheartening. If any issue could have flushed out the winners and the leaders in the aboriginal community, I had hoped that it would have been this one. It is distressing to see so little awareness, and so much struggling.
I do not mean to be flippant, but the views among the Mikisew on the question of accountability are ridiculous. This community has had an incredible level of commitment over the years, and the notion that a band member does not have complete access to information about what is going on there is laughable. I wish we had more support. It would be easier to come to Ottawa and make these presentations if we had some help.
Senator Forest: As an Albertan, I am particularly interested in this issue. It makes good sense that the bands are becoming well organized and able to sustain their lifestyle, and that they get some help.
You said that when you first approached the government on this, the officials thought that it was an oversight, and they were running scared. Did they say why this had to be in place? Have you ever asked the tax man why? Has there been no indication that they are prepared to look seriously at this?
Mr. Taylor: They are not keen to look seriously at 149(1)(d).
Senator Fairbairn: Is there any other way around that amendment?
Mr. Taylor: Yes. There are ways the government has been using for years; buy one off, shut one up, and take advantage of the rest. This is what is being put forward to us.
I do not want to prejudice our ongoing negotiations with the Department of Finance and with DIAND. We are in the process of negotiating a tax rent agreement, as a path toward self-government. In the short term, they are negotiating an arrangement that would benefit the Mikisew. The Mikisew would be bought off, and, as other first nations reached our level of development, they would have to fight the same battle again.
I think that Canada could simply and easily reduce or remove a significant barrier. Perhaps I am being too idealistic or too optimistic. I have been hearing about the inherent right to self-government for years. It is in both versions of the red book, in the work on section 35, in the RCAP, in the report itself and in the response to it, and in "Gathering Strength." We have all of these commitments, but we do not have a single structural adjustment that would allow First Nations to achieve self-government on their own.
Senator Forest: It certainly cannot be a matter of the income lost or generated. That is, if you become financially independent through your businesses, it will take a load off of them financially. It just does not make sense.
Mr. Taylor: That is why we are here.
Senator Forest: Presently, there is a downturn in oil prices in Alberta. With respect to that, do you see a move away from large developments?
Mr. Taylor: We have not seen any indication of that.
Senator Forest: Do not bet on it.
Mr. Taylor: Plans for development, redevelopment, or expanded development have time lines which far exceed short-term fluctuations in the spot market for oil.
Senator Forest: You are still looking to the aboriginal economy in the area, then and you think that your people would be able to profit from that if some of these barriers were removed.
Mr. Taylor: We have our fingers crossed.
Senator Chalifoux: The Westbank band near Kelowna owns everything on its reserve. If you were able to cancel out of this amendment, how would it affect them?
Mr. Taylor: Westbank is one of those rare communities in Canada that can meet the 90 per cent rule. If 90 per cent of your income is being generated on the reserve, you will still get the exemption. Only those bands that lack the capacity to develop on the reserve will be hurt by this. The bands which benefit from it are those which are more advanced, in the mainstream sense of accounting or administrative structures. We are encouraging those that are doing well, and making sure that those who have not done so well never will.
Senator Chalifoux: Ms Martin, what does your council say about all this?
Ms Martin: We are very supportive of amending Bill C-28. The Mikisew Cree First Nation is very progressive and very sophisticated. We have been running our businesses since 1985. We have done that through our own determination, and we have hired the best qualified technicians to carry out the work. We are very proud that we own our airlines and oil companies, and that we have good rapport with Syncrude, Suncor and other oil companies. We are progressive, and we want to move ahead. This is why we are the first to come to this table to ask questions, to see if we can amend Bill C-28.
I expect that Sawridge will also be somewhat affected, because they have businesses in Slave Lake as well.
Our council is very aware of what has been happening. We continually meet our taxation and legal advisors. We are well versed on this.
The Chairman: I enjoyed your presentation, and your comments will be of use to us when we begin to examine the self-government concept, and how we can give it an economic base. You cannot talk about self-government unless you have a strong economic base, and abilities such as taxation power.
I have dealt with airline companies over the years, and I certainly share your concerns in terms of the costs that are passed on to consumers. This is becoming an urgent matter. The question of taxation is particularly unfair to remote communities, and we have to find some way to address that.
Have you any other recommendations for dealing with this particular bill, aside from making an amendment? What about the tax-free zone, if we can come up with legislation? Would that be helpful to you?
Mr. Taylor: Tax-free zones? Is that something like the free-trade zones?
The Chairman: Yes.
Mr. Taylor: Some bands would benefit from it, such as Kamloops and Westbank.
The Chairman: These zones would have to focus on the isolated communities.
Mr. Taylor: I am not all that bright or creative, but I cannot see the benefit that such a zone would bring an isolated community like Fort Chipewyan. It would certainly be an immense benefit to a First Nation on the edge of a highway or close to an urban centre. It would encourage even more location of business there. I do not see how it would affect an isolated community like ours, however.
The Chairman: I think that it would definitely be beneficial -- not only to the companies, but also to the consumers. Could you look into that get back to us on it?
Senator Fairbairn: How did your presentation to the Standing Senate Committee on Banking, Trade and Commerce go?
Mr. Taylor: They were pretty nice. There was a very different tone; I have never made a presentation to the Senate before, and your approach is far more pragmatic than is typical in the House of Commons committees. They were sympathetic, and they wanted to cut a deal at the table. There was a bit of interest.
Finance representatives were there in force, and they had a pretty hard time. They were not keen on the amendment that we suggested, which reduces the barrier and levels the playing field a bit. They proposed that the best answer was a political accommodation, for lack of a better term. Beggars cannot be choosers; we realize that. We will try anything, and we will go down any road we can to get there. Sometimes what you have to say in order to do that is scary. I am talking to seasoned politicians here. I am not going to teach you anything.
The Chairman: Thank you very much for your presentation.
I would like to deal with one issue in camera.
The committee continued in camera.