Proceedings of the Standing Senate Committee on
Aboriginal Peoples
Issue 13 - Evidence - Meeting of October 26, 2005 (afternoon meeting)
KELOWNA, Wednesday, October 26, 2005
The Standing Senate Committee on Aboriginal Peoples met this day at 1 p.m. to examine and report on the involvement of Aboriginal communities and businesses in economic development activities in Canada.
Senator Nick G. Sibbeston (Chairman) in the chair.
[English]
The Chairman: Honourable senators, we have with us this afternoon Tim Isaac, Band Councillor from the Okanagan Indian Band.
Tim Isaac, Band Councillor, Okanagan Indian Band: Thank you for this opportunity to make a submission to the standing Senate committee. I will just start off with my written report here. We would like to offer for your consideration the following submission, which has been developed and approved by our economic development committee, a body appointed by the chief and council.
Our understanding of the purpose of the current hearings is to discuss both success elements and challenges facing Aboriginal communities and businesses in the achievement of economic development benefits from both large-scale industrial projects and other projects relating to the development of non-renewable and renewable resources.
Our community has been, to date, impacted by a variety of these types of developments, but has received little benefit. We understand why this has been the prevailing outcome. It is really quite simple to understand the obstacles, but difficult to identify the solutions. Of course, if the solutions were easy, our community would be a model of sustainable economic development and would exhibit a high quality of life for all its members.
We have come to understand that the single most important barrier to successful, sustainable economic development is the attitude of senior governments towards reconciliation of the fundamental relationship between Aboriginal and non-Aboriginal peoples, including the relationship between our respective governments.
Although the elements of this relationship are varied and include settling outstanding land claims, negotiating jurisdictional powers and funding/revenue-sharing agreements on and off reserve, development of administrative, human resource and institutional capacities, and many others, all are intertwined. Although the parties who have responsibility or are seen to be responsible for tackling each task are as diverse as the list of tasks and cross many agencies and levels of government, their individual impact on success is profound; future success in community economic development depends on a more harmonized and collaborative approach.
Specifically, then, we see the following as critical success factors in the short to mid-term, five, ten years:
The first point is interagency coordination of resources, policies and program criteria; removal of fiscal budgeting barriers to allow for true multi-year and multi-tiered funding programs. These would support multi-phased projects, both modest and major in scope; flexible program rules to allow for unique approaches that match the situations of communities large and small, well-off and impoverished; building on the positive outcomes of the provincial government's new relationship, developing alterNative approaches to resolving land claims and increasing the level of participation in and jurisdiction over lands and resources within traditional territories.
Unfortunately, our submission was, by necessity, prepared on short notice and we would appreciate further opportunities to provide additional clarification.
There is a list of councillors and the secretary, who could be contacted if I cannot answer all your questions.
The Chairman: Thank you, Mr. Isaac. I know that the committee would benefit from knowing a little more detail about your band, including the number of members and whether the band is involved in some economic projects or businesses. That would be very informative.
Mr. Isaac: The band is located at the north end of Okanagan Lake. There are approximately 1,800 band members and our current development project is a gravel pit, an aggregate business. It has been in operation for about 10 years and it has just started to make a profit now. Before, it was in debt and we had to bail it out with band funds just to keep it going. We understand that there is not much aggregate left in the valley, so it is important to keep it going for the future of the business on the reserve.
Senator St. Germain: Thank you, Councillor Isaac, for coming today. The 1,800 members, are they close to Vernon?
Mr. Isaac: Yes.
Senator St. Germain: Do most people work off reserve?
Mr. Isaac: Yes, most people work off reserve.
Senator St. Germain: What is the unemployment rate for band members? Do you have that statistic?
Mr. Isaac: It is quite high. I do not have the statistic; I asked for it this morning. I agree we should have it.
Senator St. Germain: What about your gravel pit? Do you have huge reserves in there? Is it a good, viable entity?
Mr. Isaac: Yes, I think there is about a 20-year life span for the gravel pit. It has been tested and it is one of the higher-end gravel pits in the area.
Senator St. Germain: I see. How many members does that employ?
Mr. Isaac: Four.
Senator St. Germain: Four. That is it?
Mr. Isaac: Yes.
Senator St. Germain: Are you into treaty negotiations for land settlement at all?
Mr. Isaac: No, we are not. We do not believe in the process. I think there has to be a new process developed. We are with the Union of B.C. Chiefs and we are negotiating how we can resolve the land issues through a different process.
Senator St. Germain: How large is your land base at the north end of Okanagan Lake?
Mr. Isaac: I think it is close to 20,000 acres.
Senator St. Germain: Twenty thousand. Do you have much lake frontage?
Mr. Isaac: Yes, there is quite a lot of lake frontage.
Senator St. Germain: You have not thought of developing that for tourism, have you?
Mr. Isaac: It is all owned by individual band members.
Senator St. Germain: Is it on Certificates of Possession?
Mr. Isaac: Yes, it is, but we have another piece of land we are looking at developing, because we know the value. Lakefront property has high value in the Okanagan.
Senator St. Germain: Can you explain to us, if these Certificates of Possession are held by certain band members, how the rest of the band members benefit, or do they benefit from this?
Mr. Isaac: No, the band members do not benefit from it. It is the same as you owning a piece of land and you have all the rights to that land.
Senator St. Germain: Then is it passed on from generation to generation?
Mr. Isaac: It could be willed or it could be sold.
Senator St. Germain: If it is sold, it can only be sold to other band members?
Mr. Isaac: Yes.
Senator St. Germain: Yes, that is quite complex. We were talking about land registry here this morning with Manny Jules from Kamloops and Chief Louie from the Westbank.
Senator Fitzpatrick and I are talking about possibly trying to bring forward legislation in regards to a land registry, establishing a land registry for Aboriginal lands so that people will be able to better utilize their land as equity.
It is quite complex. How many owners are there on the reserve lands? Do you have that figure?
Mr. Isaac: It is relatively small. There are some owners of big parcels. Right now, I think all we are giving out is one-quarter-acre lots for social housing. A big part of the reserve is set aside for the cattle ranchers, for cattle range.
Senator St. Germain: For Aboriginal cattle ranchers?
Mr. Isaac: Yes.
Senator St. Germain: Do you have any grazing rights off-reserve?
Mr. Isaac: No.
Senator St. Germain: No? Thank you, and thanks for coming by.
Senator Peterson: Mr. Isaac, you indicated that you have no treaty land entitlement funding coming, or do you have a block of funding?
Mr. Isaac: We have funding from the federal government for administration and things like that.
Senator Peterson: Have you ever considered any joint ventures with private sector companies?
Mr. Isaac: We just started our economic development corporation and we are going in that direction now, but things move very slowly on reserves, at least on our reserve. I should not talk for everybody's reserve.
Senator Peterson: You said you have started the process, though?
Mr. Isaac: Yes.
Senator Peterson: It might help you to accelerate it a little if you get some outside money combined with your own and work together, because you could do that on a project basis. I know one of the barriers you talked about here is multi-year funding and block funding. This might allow you to then work on a project-by-project basis.
Mr. Isaac: Yes, that would be beneficial.
The Chairman: Mr. Isaac, we heard this morning from the Westbank and I am also aware that there has been quite a bit of development in the Kamloops area by First Nations there. Why is it, do you think, that some bands have made a lot of progress, have made advancements and are fully involved in business, while it seems that your band is having difficulty just getting up on its economic feet? Would you say something about that, tell us why?
Mr. Isaac: I think one of the issues is taxation. Some bands get into taxation, while our band is very reluctant to get into that area because they feel that if they do, individuals will be taxed also. They do not want to see individual taxation.
It is a learning process, a learning curve, and there is either legislation or some kind of policy in place whereby the band members would not be taxed, but there are a lot of old feelings and a lot of fear still in dealing with government on our reserve due to the wrongdoings.
Right now we are involved in the commonage land claims; it is 20,000 acres between Vernon and Winfield, both sides of Kalamalka Lake to Okanagan Lake. That happened in the 1800s, and five years ago, Minister Nault, of Indian and Northern Affairs, said that they would negotiate the land claims, but a couple of days ago, the negotiators came to the table and said that we do not have case any more because of the Wet'suwet'en case.
We are trying to strategize on how we will resolve that now through the courts. That is a barrier to economic development also, because that is land that we have been working on for 16 years now, spending a lot of money on it; a lot of the money that comes to the band goes towards these legal battles.
The Chairman: Are any of your lands situated close to a community or along the highway, with economic potential in the future?
Mr. Isaac: Yes, we do have those areas. We are planning right now for zoning in our band, but I think that still has to be through the membership. Our long-term plans have to be in place, yes.
Senator St. Germain: Yes. The Certificates of Possession that a few people own, were they granted through the Department of Indian and Northern Development years back?
I do not want to put you on the spot, but you have 1,800 members. I do not know how many live on reserve.
Mr. Isaac: About half.
Senator St. Germain: Therefore, you have 900 people on reserve, but your greatest asset is controlled by a few.
Mr. Isaac: Yes.
Senator St. Germain: And no benefit accrues to the other members.
I am just wondering how this was arrived at, and I am certainly not here to cause trouble amongst those that own the land, but I know that in certain areas in the North this does not exist. I am wondering how prevalent this is in the south, that land is controlled by few. If you own lake frontage, it should theoretically be developed into tourism ventures, where benefits could accrue to the band.
As I say, I do not know exactly how this has been done. DIAND negotiated the leases for the Musqueam, and that big blow-up was really their fault because they did not put in any inflation clauses, and so as a result of that, we have a big fight between the Natives and people who lease this land. The lease rates were ridiculous.
Unless you get more land, things will not change too much on your reserve, will they?
Mr. Isaac: Well, I think we just have to start developing those opportunities that are out there right now. Down the road, we will need more land for housing. If we start using that for economic development, then that will cut back on places for people to live, so there has to be that balance struck somewhere where so we can harmonize both.
Senator St. Germain: Is the band in a position to buy some of this land back from the people who own the Certificates of Possession?
Mr. Isaac: Yes, they could buy it back.
Senator Christensen: Mr. Isaac, you say you are in the process of building an economic development corporation and I presume you are doing that in consultation with the members of the band?
Mr. Isaac: Yes.
Senator Christensen: What do the band members tell you about they see as defining economic development for them? What do they feel the community should be looking at? To what degree should they be developing?
Mr. Isaac: Actually, our community has not gotten to that point yet. We just developed a corporation as a legal entity, so we are not taxed on the dollars, to bring money in from outside and use it in different areas. However, we have not created enough money to plan that far ahead yet and we are in the process, now, of the five- and ten-year plans to see what the people want.
Senator Christensen: Well, you have this gravel pit; you say you have had it for 10 years, and you have a crusher and you sell the crushed gravel to wherever. Who actually runs this business and what happens to the profits?
Mr. Isaac: The band runs the business.
Senator Christensen: And the profits? Are they going into a fund for more economic development?
Mr. Isaac: Well, there is not much profit as of yet because it was poorly managed for the first 10 years, basically; it was about a million dollars in debt. We are just getting out of debt now, trying to move forward and be more financially responsible
Senator Christensen: So all it has really done is provide four jobs.
Mr. Isaac: Yes.
Senator Zimmer: Councillor Isaac, I want to go over something Senator St. Germain asked you. This land that is controlled by the few, what financial arrangements are there? Are there lease rates? Do you buy it back? Do you buy it back at market rates? Are they inflated? Give us some more information on the circumstances.
Mr. Isaac: It depends on the seller. We already bought some land back from band members at market rates, but if some of these people have resorts down there, I think the value would be higher and the market rate probably the same as the Okanagan.
Senator Christensen: Those lands are developed, are they?
Mr. Isaac: They have beach cabins, beach lots. They have built cabins all along the lakefront.
The Chairman: Mr. Isaac, can you tell us about the education situation in your area? Is it similar to other parts of the Okanagan or is it different?
Mr. Isaac: I think our area is one of the better educated, because we have a lot of graduates. I do see that the high school graduates do not move on. I have nieces and nephews who do not plan to go to college. There has to be more planning in that area.
If there were jobs available to them, I think they would have more desire to get more training for those jobs. Because we live in such a desirable area, it is nice just to kick back a little, I guess.
The Chairman: I see.
With that, I want to thank you for your presentation. I know that you came on short notice and so thank you very much. You have helped us a lot.
Mr. Isaac: Thank you.
Sophie Pierre, Chief, St. Mary's Indian Band, Ktunaxa Nation Council: Hello.
The Chairman: Welcome, Chief Sophie Pierre. I do not know if I can do justice to the name of the national council, so if you do not mind expressing that, and I take it you will speak on behalf of the St. Mary's Indian Band also.
Ms. Pierre: That is right. Good afternoon, ladies and gentlemen, and thank you for this opportunity to make this presentation on behalf of the Ktunaxa Nation Council and also my band, which is the St. Mary's Indian Band, called Aqam, which is just outside Cranbrook.
By way of introduction, I have been the chief of the St. Mary's Indian Band, and I was first elected in 1978. I have served since then on council, so I think that I have a little understanding of some of the challenges that Aboriginal people face today. I have tried to help alleviate some of those challenges from a leadership position.
I have a presentation; I believe you have a copy of it. My first few pages are slides. I was planning to do an overhead, but I did not read the instructions in here that said that I am supposed to let people know ahead of time, so I apologize for that. However, I think that you have the information in front of you.
With the first few slides I want to talk about the challenge. I know that you are well aware of that; to some extent, most Canadians are. Certainly Aboriginal people are very aware of what these challenges are, and I am not repeating these to create any feeling of guilt or anything like that, of which sometimes we are accused. I am simply stating facts.
I want to start out by talking about the political economy of First Nations today in Canada. It is an international embarrassment, we all know that, that Indian reserves today are ghettos of poverty in affluent Canada. Dismal disparities in wealth and income, poor standards of living conditions and deeply rooted social problems are only the symptoms of the exclusion of First Nations people from the Canadian economy. First Nations people are alienated from the economy because, for the most part, we are barred from participating in the process of creating and enjoying wealth.
To a large extent, the Indian Act is the anchor of this system of structural poverty.
The alienation of First Nations people manifests itself in the following forms: first, economic alienation — and we know all of these statistics of poverty, low income, high unemployment, et cetera; cultural alienation, brought on by the residential schools; social alienation, again as a result, as a lingering consequence, of residential schools that destroyed the role of Aboriginal families for several generations, and we are still feeling the effects of that; of course, political alienation. First Nations are excluded from the inner power circles and have no representation in the key political institutions of Canada.
Now, economies are ruled by three main things, land, the labour force and access to capital, and that is what I will be dealing with in the next section. I am still talking about the challenges that we face.
First, I was interested in the discussion earlier with the presenter just before me.
Indian reserves are usually small and marginal land holdings, often of minimal economic value, often located in remote areas of the country.
Indian reserves are not an economic factor of production. In fact they are a key factor in the underdevelopment of First Nations in Canada, since the array of economic transactions involving reserve lands allowed by the Indian Act is very limited, reducing dramatically the economic value of First Nations lands.
Indian reserve lands are not marketable because they can only be sold to another member of the same band and can only be leased to a third party after a cumbersome, expensive and risky land designation process.
Indian reserve lands cannot be pledged as security for debt financing.
The second factor is of course the First Nations labour force. The First Nations youth are the fastest-growing and most underutilized resource in the Canadian economy. First Nations people have lower education levels and much lower job-ready skills than other Canadians. Chronic unemployment rates on reserve are the highest in Canada, with limited career prospects, and all of that perpetuates an underutilized labour force.
The third aspect is access to capital. Capital and investment for on-reserve projects are rare and difficult to obtain. In fact, it takes six times longer and costs ten times more to bring an Aboriginal business to operation compared to a non-Aboriginal one. If Manny Jules was here earlier, he probably told you about the study that shows it is six times harder and ten times more expensive; I think the entire study is called "Ten Times Harder." I have personal experience in developing the St. Eugene Mission Resort that I can speak to if you are interested.
In fact, I could start a business in Cranbrook tomorrow; I just have pay a business licence, and all the legal, economic and physical infrastructure is already in place for my business.
However, it would take me at least a year and it would cost me many thousands of dollars to start that same business on my reserve, which is just six miles outside of Cranbrook, and that business would limp forever because I cannot borrow against whatever assets I create.
There is no financial system in place to foster and capture savings for business investment in First Nations communities, and the financing industry has a stigma against on-reserve lending — I have firsthand experience of that — both resulting in an absence of credit vehicles for investments on reserves.
Indian Act economics: The restrictions imposed on the marketability of First Nations lands, and an inability to pledge them as security for on-reserve business financing, are the key factors in the lack of capital in First Nations business.
Ownership, by sale or inheritance of land and buildings, of real property interests located on reserve is only transferable to other members of the same band, resulting in a much lower market value of the reserve lands. Succession or inheritance rights of First Nations persons are restricted to transfers of limited real property rights to heirs who are members of the same band.
Reserve lands cannot be sold to a third party, but they can be leased by a third party after the completion of a lengthy and expensive land designation process.
Severe restrictions apply on security that may be pledged as collateral for a loan assumed by an Indian for a business on reserve.
The exemption from taxation available to First Nations persons by virtue of Section 87 of the Indian Act is consumer oriented; it is not business or development oriented.
Those are the challenges, and as I said, we are familiar with them. I would like to offer some solutions.
The solutions in my presentation are limited to the current legislation. They are limited to things that government can do if it has the desire. However, I would also want to have a discussion on and suggest that the meaningful, long-term solutions come with real self-determination and the treaty process that we are involved with here in British Columbia. I am a strong supporter of that, and our nation is involved in the treaty process and has been from the beginning.
To improve the market potential of First Nations lands:
Allow bands to acquire lands where the jobs are. I am addressing the issue of reserve lands being in places where it is difficult to start businesses, so allow the bands to purchase lands where the jobs are and facilitate the process of converting those lands into Indian reserve lands, so that the few benefits we do have coming from reserve land status can be utilized.
Allow corporations owned by Indians or bands to be granted a Certificate of Possession for lands that they use in the course of business. I was listening earlier to some discussion about this Certificate of Possession issue and the perceived problems. Well, the difference between having a Certificate of Possession and using band land, if you are a corporation and want to do business, is that you have to go through the land designation process. In the case of the St. Eugene Mission Resort, that process cost us close to a million dollars and took two years. Businesses, whether owned by Indian bands or Indian individuals, should simply get a Certificate of Possession, rather than having to go through the designation process.
As I said earlier, Aboriginal youth are the single most valuable, however, underutilized, asset in the Canadian economy. We suggest a strategy of tax credits for employment, apprenticeship and training costs incurred by businesses, whether they are on or off reserve. Any business — Terasen Gas — it does not matter who, gets a tax credit for providing employment, apprenticeship and training in order to develop the capacity of the Aboriginal youth, both on and off reserve.
Extend Section 87 of the Indian Act tax exemption to income earned by Aboriginal trainees and apprentices during training programs taken off reserve. It is an incentive for the individual.
Improve access to capital: Enable Aboriginal capital corporations to assume deposit-taking capacity through a system similar to that of credit unions.
Establish a program of competitive tax credits for savings deposited at Aboriginal financial institutions such as the capital corporations, including for things like RRSPs.
Offer a program of competitive investment tax credits for investments made in on-reserve business. Again, I heard earlier a suggestion about entering into joint ventures. Well, the joint venture equity that comes into the business should get the tax break. It is an incentive for that joint venture.
Expand the existing loan guarantee insurance program and make it more accessible to First Nations small businesses. Aboriginal Business Canada is a good program, and St. Eugene Mission Resort benefited from that very much, but accessibility for small business, which at the end of the day we all know is really what creates an economy in the community, is more difficult.
Stop the economic leakages: Most First Nations persons make purchases at off-reserve businesses in neighbouring communities because there are no First Nations-owned businesses in our own communities. That is absolutely true of Aqam, St. Mary's, the community where I am the chief. We have no stores on our reserve. Every dollar that comes in immediately turns around and marches back off the reserve. When this happens, the money spent on purchases off reserve does not circulate in the First Nations community. It leaks out immediately, contributing to the welfare of other communities only. Very few of our people have jobs in these other communities.
In order to build First Nations economies, we need to have more businesses on reserve where First Nations persons can make their purchases and spend their money — more small business. In turn, this money will be spent on other purchases made on reserve by Aboriginal business owners, resulting in more First Nations employment and income and more profits being re-circulated in First Nations economies.
Expand First Nations' business base: Extend Section 87 of the Indian Act tax exemption to corporations based on reserve owned by Indians or bands.
Allow First Nations to pledge their GST revenues as security for debentures and bonds issued by First Nations governments for capital infrastructure, as they presently can with property taxes. Bill C-20, which was passed recently, allows us to do that with property taxes. It is a next step to use the GST revenues for the same purpose.
Encourage provinces to adopt a similar approach to provincial sales taxes as the First Nations Goods and Services Tax Act. For provincial sales tax collected on reserves, instead of the provincial government taking those revenues back for the provincial treasury, leave them on the reserves if there is a real desire to see benefits, to see some changes on Indian reserves. Or is it just all talk?
Building First Nations economies: Launch a First Nations development decade strategy whereby we achieve, in the next 10 years, what we have missed in the last 100 years. We quote that as "One Hundred in Ten." This would include a comprehensive package of effective economic development strategies that will attract more businesses to First Nations communities and create employment, career development and business opportunities for Aboriginal youth.
The synergies of applying all the tools concurrently, and as part of a comprehensive strategy for First Nations economic development, will create a momentum that will multiply its effectiveness and extend its lasting effects.
On January 7, 1998, the Government of Canada published Gathering Strength: Canada's Aboriginal Action Plan, with a similar agenda. We just have to do it.
I will be happy to engage in discussion, and I hope you have lots of questions for me.
The Chairman: You sound like a no-nonsense, serious type of person.
Ms. Pierre: Once in a while.
The Chairman: Your presentation has a lot of ideas, obviously based on your experience. You must have had some successes, and I would be interested to hear about what have you accomplished to date in the area of economic development.
Ms. Pierre: We have the St. Eugene Mission Resort, which is now a success. We did go through some difficult times, and I will explain briefly because I am not sure that everyone is aware of what we have done with the resort development. We took a former Indian residential school just outside Cranbrook and built a four-star hotel, 18-hole golf course and a casino.
We did this over about 10 years with five Indian bands that literally did not have two nickels to rub together. We found where all the various grants were available, used that as equity and convinced investors to come in.
Now, due to a lot of issues, some of which I mentioned here today, by the time we finished building the resort, we were $2 million short and had nowhere else to go. I had outstayed my welcome at every single department that I looked to for more equity and we were absolutely at the end in terms of debt.
We ended up in a CCAA situation, but out of that we found two Aboriginal communities that came forward and partnered with us to buy back our asset. Those are the Sampson Cree Nation out of Alberta and the M'njikaning Nation out of Ontario, and this is the first example of three First Nations from three different parts of the country coming together to get into this type of partnership.
Now our hotel is running well. Our golf course has had a very good season, and if you like to golf, I hope that some day you will bring your committee out to St. Eugene to visit us.
It is an incredible story, because it was a residential school. I spent nine years at that school, so it meant a lot to me to build this hotel, to build this resort.
Now, each of our communities has done various projects. One of our communities has a border on the 49th Parallel. About 20 years ago they opened a duty-free store, and they have done very well with that.
Another community to the north of us has done a lot of leasing out of their lands and they have lots of businesses there. They just opened a Tim Horton's on the reserve, a Home Hardware and other businesses.
In my own community of St. Mary's, we have a Native plant nursery. We are finding that there is more and more acceptance by industry that when they disturb land, they need to bring it back to its natural state, and so we started the Native plant nursery. It is struggling, but we know that we can do well with it. Those are just some examples.
Senator St. Germain: Thank you, chief, for being here. I have been to your place with Jim Abbott, the local MP in that area. You were not there that day.
Ms. Pierre: That is too bad.
Senator St. Germain: We had a coffee. It is an impressive place, first class. I never did go on the golf course, because I might still be there if I had.
On the question of Certificates of Possession, we talked about a land registry for Native lands this morning with Manny Jules, and Chief Louie from the Westbank also spoke of it; Mr. Isaac, just before you, brought this up. If you look across the board, there are different situations on various Native band properties or reserves
What do you really need to access capital? The simple CPs that the Department of Indian Affairs and Northern Development now issues, I believe, would not suffice, would they? You would still have to go through this one- or two-year deal, unless we got rid of the department, which I think is the best idea in the world, but that will not happen overnight.
How would we do this from your perspective? I know you are very entrepreneurial in your region, and as you say, you have joined up with two other Native bands, one from Ontario, so you have had to put up security, I would imagine. What would be the best way to go about this?
Ms. Pierre: The short answer?
Senator St. Germain: Yes.
Ms. Pierre: Sign treaties. That is the short answer.
That will not happen right away either, so in the meantime I made some suggestions in here about how we could make First Nations lands more accessible for small business. I think that in fact if nothing changes in the legislation and the Indian reserve lands continue to have the type of status that they have now, then in order to get small business going, you are better off with a Certificate of Possession. Maybe that is what First Nations need to do with whatever small land base they have, find a way for people who want to get into businesses to have Certificates of Possession.
Senator St. Germain: However, do the Certificates of Possession have to go to an individual now? They cannot go to a corporation? Is that what you are saying?
Ms. Pierre: That is what I am saying.
Senator St. Germain: Does section 87 of the Indian Act apply only to individuals?
Ms. Pierre: Yes.
Senator St. Germain: Suppose you form a corporation on reserve.
Ms. Pierre: It immediately loses its tax-exempt status. That is why I am suggesting that that is another way.
Senator St. Germain: That is a detriment to business then, or any economic development.
Ms. Pierre: Absolutely. However, the Indian Act was never developed to encourage business. I do not think there was ever a suggestion that we would still be around 140 years later. It was not developed with that in mind.
Senator St. Germain: You think the initial concept was they hoped you would disappear?
Ms. Pierre: Well of course. There is no question at all.
Senator St. Germain: I just want this on the record. I would hope that we can write a report and, as I say, it would not matter who is in government. It could be NDP, Conservative, Liberals, Bloc Québécois, whoever it was, it would be the same. This particular committee will have to take a real leadership role to make a difference in your lives, and that is why I am asking these kinds of leading questions; I am not trying to put you on the spot.
Ms. Pierre: No, I really appreciate this. I tried to give solutions that the Government of Canada can actually deal with, because my heart is with the treaty process, because I want other people to be self-determining and no more Indian Act, no more Department of Indian Affairs or any of that; no more of this reserve land status, et cetera.
That is where I want to bring our people to. However, in the meantime, you have the ability to effect some change that would make a great difference in our lives; that is why I made the recommendations I did.
Senator St. Germain: How many members does your band have, please?
Ms. Pierre: We have 362 registered and about 200 live on reserve.
Senator St. Germain: What is your land base?
Ms. Pierre: We have 17,000 acres on the main reserve and three other small reserves that are between 600 and 800 acres.
Senator St. Germain: Are there CPs on this?
Ms. Pierre: Yes, there are.
Senator St. Germain: Are they held generally by the 362 members?
Ms. Pierre: Every major family grouping has a CP, but not every individual within that grouping.
Senator St. Germain: Is that fair?
Ms. Pierre: Well, there is very little in life that is fair. In some ways I would say yes. However, because some families have grown faster than others and had small land bases to begin with, it would be fairer if the band were in a position to issue CPs. In my community, if a person came forward with a business plan to do something in particular, then yes, I would see that person getting a CP.
Senator St. Germain: Are there any lands in strategic areas that are held by the band and not on CPs?
Ms. Pierre: No, not in the same areas. We are somewhat out in the boonies. That is why I am suggesting that we be allowed to purchase lands where the jobs are.
Senator St. Germain: And include them in your reserve lands.
Ms. Pierre: Yes, and I would have a piece right by the mine in Elkford. That is where I would start.
Senator St. Germain: I apologize for asking so many questions, but it is an area that has intrigued me from the beginning. People like Councillor Isaac and Chief Pierre can answer them, so when we are formulating a report it will be based on the realities out in the field.
Senator Fitzpatrick: Thanks for coming. Your reputation precedes you, though you know that, because you have done some outstanding things in your area.
Ms. Pierre: I hope.
Senator Fitzpatrick: I just want to pursue this question of acquiring lands. You can acquire lands outside the reserves; the problem is having them then converted to a reserve. That is the issue, is it not?
Ms. Pierre: Well, there are two issues: Yes, you can acquire lands if you have the money. First you have to have the resources to acquire the lands, and then the next big challenge is to have them converted to reserve status.
Senator Fitzpatrick: And that is a slow and expensive process.
Ms. Pierre: Yes.
Senator Fitzpatrick: Getting back to mortgaging and being able to borrow funds, I suppose you could borrow funds to purchase lands that would not necessarily have reserve status.
Ms. Pierre: Yes.
Senator Fitzpatrick: You could establish businesses on those lands. I know that does not solve the final problem, but it may be something to look at.
Ms. Pierre: I certainly hope that my band will be in a position to do that before too long, but we certainly are not now. As I said, we still do not have two nickels to rub together.
Senator Fitzpatrick: Let me just go back for a moment. I think your suggestions here, your recommendations, are good and practical and will be helpful to the committee, but on the issue of economic leakages, you talked about making purchases off reserve and having businesses on reserve. I am thinking of Westbank, where they have businesses on reserve. They are not necessarily their businesses, but Chief Robert Louie was talking this morning about the big-box stores. Does that qualify, in your mind, whereby you enter into a lease for a non-reserve business to establish itself on the reserve so that you generate some income from that?
Ms. Pierre: Yes, absolutely, because when you lease that land there is an immediate benefit to the community; you have taxation benefits for as long as that business is there. You have employment benefits, and whatever money comes into the community stays there for two or three rounds before it goes out again.
Senator Fitzpatrick: Thanks very much.
Senator Zimmer: Chief Pierre, thank you for your strong presentation. As the chairman indicated, it is evident that you are a no-nonsense woman. My question is related to the improvement of market potential of First Nations lands, allowing the bands to acquire land where the jobs are and facilitating the process of bringing those lands into Indian reserve lands.
Now, are you suggesting urban reserves? I know there is a successful one in Saskatoon that has assimilated into the community. Originally, there was some fear and misunderstanding, but it works very well.
In Winnipeg, we have the Kapyong DND Barracks. We are experiencing some of the same growing pains of fear and misunderstanding. What are your thoughts about urban reserves? Do you have any plans to implement that in your nation?
Ms. Pierre: We have no plans for our nation to implement that on the same scale as you are talking about in Saskatchewan and Manitoba. I am somewhat familiar with the examples that you have given. I do not know a lot of details.
What I was talking about would include urban reserves, because that is where the jobs are, and right now the Aboriginal populations in some of our cities are larger than on our reserves. I think right across the country, there are probably more people in urban areas than there are living on reserves.
In our instance in particular, because we are in this treaty process, we are talking about eventually having more lands available to us. These will be lands with primary resources, which are what B.C. still depends on to a great extent. If some of those lands were available to us right now, we would be able to provide employment opportunities, training, and some real economic development for our community.
I think that it is both — you are from Manitoba, I take it?
Senator Zimmer: Yes; Saskatchewan originally, and then Manitoba.
Ms. Pierre: All right. Some of those remote communities in Northern Manitoba, and Saskatchewan also, and the remote northern communities in British Columbia do not have a lot of economic potential around them, and unless somebody discovers oil or some such thing, which will destroy their land base anyway, there will not be a lot of jobs coming to those areas. If those remote communities were able to form partnerships with other first nations to purchase lands where the jobs are, whether in urban situations or where primary resource development is going on, that would certainly help.
Senator Christensen: Thank you for your presentation. I just want to pursue your thoughts on acquiring lands and having them become part of the reserve. It cannot be done at present?
Ms. Pierre: Yes, it can be done.
Senator Christensen: Do you have to trade it for existing reserves, or is it an expansion?
Ms. Pierre: I would suggest it would be an expansion of the land base, because one of the causes of the poverty in these communities is they either have small land bases or their land bases are very isolated.
Senator Christensen: Your suggestion is that if you develop these types of expansion to the reserves, individuals or companies or corporations that were working or developed on those reserves would receive tax breaks or exemptions?
Ms. Pierre: Yes, I am suggesting that.
Senator Christensen: At the present, a corporation does not, but an individual does. You want to see an expansion to corporations.
Ms. Pierre: The present tax exemption, as I mentioned, is a consumer tax exemption, it is not a business development type of tax exemption. If you buy something on the reserve, it is tax exempt.
Senator Christensen: That is right, but if you are working on the reserve — if you had your own little store, let us say — you are exempt from personal income tax.
Ms. Pierre: Yes, but an individual who goes into business on reserve and wants to borrow money has to form a corporation. You will not be able to do it as an individual using reserve lands. You will have to go through the land designation process and form a corporation. As soon as you do that, you lose your tax-exempt status.
Senator Christensen: However, if people are working for you on the reserve, they are exempt.
Ms. Pierre: They are exempt. We have lots of Aboriginal people working for us at our resort and their income is tax exempt. The company's income is not because we are a corporation. It does not matter that it is three Indian bands; we do not have three times the strength there. We are still a corporation and we are not tax exempt.
Senator Fitzpatrick: I have a supplementary question. This is intriguing to me. Why do you not give the profits out to the individuals who own the corporation? Is that taxable or is it tax exempt?
Ms. Pierre: Well, it can be. There are always ways to do this. We formed a corporation, a trustee. The bands are the beneficiaries of the trustee. The trustee is the vehicle that allows the bands to run the business without being there directly themselves, so that any profits from the corporation flow through the trustee to the bands. When they flow through the trustee, they become non-taxable to the beneficiary.
Senator Fitzpatrick: Good.
Ms. Pierre: That is what our five bands have done. Now, Sampson Cree and M'njikaning have done things differently. There are different ways to do it.
My point is that it takes a lot of money and a lot of legal time, and it would be so much simpler if you just said corporations that are Indian owned, and doing business on Indian reserve lands, have the same tax exemption as individuals.
Senator Fitzpatrick: The original intent of the tax exemption was to allow for the self-sufficiency of your own businesses on the reserves, and it was not contemplated then that these would all be corporations. Now we have developed this protection from liabilities for corporations, which has closed you out of the process.
Ms. Pierre: That is right.
Senator Fitzpatrick: That is interesting. Thanks very much.
Senator St. Germain: I have one more question: What is your view on Aboriginal lands? Do you believe that they should be able to be sold to non-Aboriginals, or should they always be held communally for the band?
Ms. Pierre: So long as they have the present status as Indian reserve lands, I believe that they should be held for the collective until we can replace that with something created by the Aboriginal people along with the Government of Canada, such as the treaty process.
I say that because Indian reserve lands as they are now are a very small land base compared to what we started with as Aboriginal people here in this country. If I can talk specifically about the Ktunaxa Nation, our people were on both sides of the border. We had a tremendous land base. We were a nomadic people and depended on our land base to survive. Now we have five small Indian reserves, and if the only way we can get into business is to alienate those lands for future generations, I would not be in favour of that. I think that there are better ways of allowing First Nations to do business on First Nations lands with the reserve status without risking their loss to future generations. That is the point of some of the suggestions that I have made and what people like Manny Jules and Robert Louie are suggesting.
We walk a fine line as Aboriginal people, because on the one hand we continue to be regarded as wards of the Crown. We are status Indian, we live on reserve lands and we are subject to federal government restrictions on that.
On the other hand, we are striving for self-determination, but we need to get there before you get rid of what little we have now. Otherwise, we will be in a worse situation.
Senator St. Germain: In other words, if you were to make your lands available to non-Aboriginals, it would be on a lease basis.
Ms. Pierre: Yes.
Senator St. Germain: They would take a 99-year lease, and at the end of the lease period it would be turned back to the Aboriginal nation.
Ms. Pierre: Yes. I would prefer to see the Aboriginal people themselves have the opportunity to do business, which is what I expect you are talking about. Leasing it or selling it to non-Aboriginal people was in order to do business. I would prefer that the Aboriginal people have the ability to do that business instead of having to sell or lease our land for somebody else to do it.
Senator St. Germain: That would be ideal in helping Aboriginal people, but often, what is ideal cannot take place immediately and you may have to go through a process of leasing to non-Natives for a period.
Ms. Pierre: That is what the law has said we had to do for the last hundred-and-some years. We have been doing that quite often for the last 20 or 30 years. I am suggesting that we have ways to do things differently.
We do not need to keep leasing our land to non-Indian people in order to bring business to our communities, and we should not have to. I do not understand why we have to continue to do that.
Senator St. Germain: Yet Westbank are very successful in doing that.
Ms. Pierre: Yes, and I am happy for them, but Westbank is only one of 200 bands in B.C. and we do not all have the same beautiful location that they do. I have a beautiful reserve, but it is not in the hub of development, as much as Jim would like to think it is. I am talking about Jim Abbott.
Senator St. Germain: Yes.
Ms. Pierre: At St. Mary's we have a lot of challenges.
Senator St. Germain: I know. Thank you very much.
The Chairman: Chief Pierre, would you like to say something about education? I get the feeling that this entire phenomenon of Aboriginal people getting involved in business is recognition, in part, that this is the way to go. While Aboriginal people have traditionally lived off the land, lived a much simpler existence, in many ways, they are being forced to recognize that their future is with the ongoing society of Canada. We have no choice but to be educated, get jobs, or get into business; what is your situation in that regard?
Ms. Pierre: Our situation is not dissimilar to a lot of other Aboriginal communities across this country. We still have a very high dropout rate, despite the many things that we have done.
In 1988 we started a small school on our reserve because we saw kids start at the age of five going to school and they were like all five-year-olds. They had lots of energy, they loved life, they figured everybody loved them and they were raring to go.
By the time they get to grade 4, you can see that that is starting to be chipped away. By the time they get to grade 7, you are beginning to losing them, and you have lost them by grade 9. We wanted to do something different. We wanted to try to harness the energy of those kids when they were still at that point where they just loved life.
We are still in that process, and it has been difficult. I wish I could say that it immediately turned around, because we started this in 1988 — in another couple of years, it will be 20 years. It will not turn around that quickly, and I was really discouraged in the first 10, 12 years, when we were expecting to start seeing some graduates come out of that.
Then I realized that it has taken us four or five generations to get to where we find ourselves today, and no matter how much we push, it will not change immediately. However, I am seeing more successes with our children now. It is starting to happen, and I think that it is important that the children be given the support and the foundation they need to believe in themselves at that very young age.
We now have a daycare so we can start that at an even younger age. We have introduced the Head Start program to our communities. I think that is where it will make a difference.
I also know, because I have been around now long enough, that it will not happen overnight. I wish to God that it would. We just have to keep doing what I believe is the answer, which is to work with individuals from as young an age as possible.
At the same time, though, you cannot just forget everybody else, and I do have to put in a plug for something else that I am involved in. In fact, I was just in Ottawa last week, shopping this one around. It is the Chinook program, out of UBC. We have gone into partnership with the Sauder School of Business, because we have a real lack of management capacity in our communities, whether it is for business, which is my interest, or for every aspect — health, housing, education. We need the managers in our communities.
We have entered into a partnership with the Sauder School and the program has four facets; one is the high school program, so we can get young Aboriginal people to start thinking of business as a real life, as a possibility for First Nations. In British Columbia we have 1 per cent of high school graduates leave with grade 12 math. That has to change.
Then we have partnerships with community colleges here in British Columbia so that people can go into a diploma program. The Sauder School of Business has recognized those diploma programs and they will accept people if they wish to get their degree. At the same time, we have an opportunity for people who are employed to work towards a diploma or a degree with either the community college or the Sauder School.
We are working on those four facets at the same time so that we can build some management capacity within our Aboriginal communities. At the same time, we know we have to put an emphasis on the children being born today and giving them the foundation so that as citizens they can reach their potential.
The Chairman: I can see that you are pretty convincing; what is the effect of you taking a trip to Ottawa? Does anything happen?
Ms. Pierre: Well, I am always hopeful, and actually, I think that this particular trip did help. I think that we got to see the right people, but again, you have to have been around as long as I have to know how to get through the right doors. I think that is a real difficulty. When First Nations chiefs want to do something for their communities, if they do not know the right people to call in Ottawa, they will not get the kind of results that I believe we got for the Chinook Program.
On the other hand, when we were developing St. Eugene Mission Resort, we were able to get support from Aboriginal Business Canada, Human Resources and all of those. There is no doubt that you have to be able to get in the right doors.
Senator Lovelace Nicholas: Chief Sophie Pierre, I do not know what it is like out West, but in the East we have access to Crown land. Do they have that here?
Ms. Pierre: Access to Crown lands for —
Senator Lovelace Nicholas: The lands are set aside for Natives for future use.
Ms. Pierre: Oh, no. That is what we are trying to get through the treaty process; we do not have that.
Senator Lovelace Nicholas: Having access to this Crown land held for Natives for the future would greatly improve your situation.
Ms. Pierre: Yes.
Senator Peterson: There is no question that education, which you brought up earlier, is a major factor, and the fastest-growing group in the 15-to-25-year-olds is First Nations students.
Ms. Pierre: That is right.
Senator Peterson: It is a problem for all of us, not just First Nations people, so the time to try to bring some resolution to this is now. Is education something that the First Nations should look after themselves? Or should it be in collaboration with the provincial governments, who have jurisdiction over education, particularly off reserve? On reserve it is a little easier, but a lot of First Nations people are off reserve; how do we deal with that?
Ms. Pierre: We have to do both, as you have described, working with First Nations and with the various provincial governments, because yes, the majority of Aboriginal students live off reserve and they need to know who they are in order to be strong people. We all do. We have a background that roots us, that gives us a foundation.
When you are living in an urban area and do not have a connection to your own home, when somebody says you are Ktunaxa, you have no idea what that means. You see the Haidas with their poles, and you think, "Maybe I would rather be a Haida." Sometimes, I would rather be a Haida. I wear all their jewellery.
The important point is that as an Aboriginal person, you have to know who you are. Here in British Columbia, we have the First Nations Education Steering Committee, FNESC, which is headed by an incredible woman named Christa Williams and makes real partnerships between urban settings, urban schools, and the First Nations communities. We have contact with Ktunaxa students living in the Vancouver area and we encourage them, through the families that are on reserve, to have contact with their own people.
There are all kinds of programs, some of them successful, and I am more familiar with those in British Columbia, like FNESC, that I know are always coming up with new ways of doing things. If something does not quite work, well, then you try something a little different. You do not necessarily try harder, you try something different to make them work, but it has to be a partnership between the Aboriginal community and the provincial governments.
Senator Peterson: Talking about pride, I could certainly refer you to the Santa Fe model in New Mexico. They did extraordinary work there, and the First Nations students actually excelled state-wide. In fact, they were accused of maybe setting exams that were a little easier, and it turned out they were writing the state exams, just like everybody else.
On financial institutions, you talked about how there was no access to money, and yet there are First Nations financial institutions. Are there none here?
Ms. Pierre: There are Aboriginal capital corporations; they are limited in what they can do. There is Aboriginal Business Canada; it is limited in what it can do.
I was talking about how if the existing programs were doing everything that they could — I will not say that we would not have the problems that we do — we would not have as severe a problem as we have now.
Again, we need to do things differently, and I am suggesting that corporate Canada is quite ready to start doing business on Indian reserves if they have some incentive to do so. They are there to make a dollar, and if there is some way they can do that by partnering with Aboriginal communities on Indian reserve lands, then I believe that they would do that.
Senator Peterson: You talked about the potential of First Nations lands, particularly urban reserves. In Saskatchewan they have done a lot of this relatively seamlessly. They have taken their land treaty entitlement money and have bought in urban centres; it has not taken a long time. Why would it be different here?
Ms. Pierre: You used the words "land entitlement money?"
Senator Peterson: You do not get that?
Ms. Pierre: No.
Senator Peterson: So that is that. If you did, you could then set up an urban reserve relatively quickly.
Ms. Pierre: Yes, I would think so.
Senator Peterson: You talked about a number of the reserves here being quite small. In Saskatchewan, 12 of them have come together as the P.A. Grand Council. Is that a possibility here? It would not work geographically? Could you not bulk up? If you are small, if three joined together, you would have some mass and size that might help.
Ms. Pierre: Well, when you have one reserve here, and 150 miles away you have another small reserve, and another small reserve another 150 miles away, it is a little more difficult.
As the reservation system was moving across Canada, fairly large reserves were created on the Prairies. That is not dissimilar to what was happening in the United States. Some of the reserves we have here in B.C. are 50 acres, so it is a little tougher. Our reserve is the largest of our five bands, the 17,000 acres we have at St. Mary's.
Senator Campbell: I had the pleasure of being present when you were appearing on the Chinook program, so I got it chapter and verse. I also have it in writing, so my office in Vancouver is now copying that and I will give it to everyone. It is an amazing program, and I believe that it is from the University of Alaska.
Ms. Pierre: Yes.
Senator Campbell: I think that the treaty process would then put you in the position of First Nations in Saskatchewan, who get large amounts of money every so often through the treaty process that allows them to go out and buy land that then becomes reserve land. If you do not have that money coming in, then you are relying on the resort, in your case.
I am just new here, but how long before we will see results from this treaty process? We are old and do not have much time.
Ms. Pierre: Tell me about it. I was hoping it would be before I had grandchildren, but that has come and gone; I have grandchildren now. I do not know. The process we set up back in the early 1990s was a good one, with some real potential, and then it just got bogged down by, I do not know, just people. We like to bog ourselves down.
Senator Campbell: Certainly that is critical to economic success within the First Nations.
Ms. Pierre: Right.
Senator St. Germain: Are both sides to blame, the Aboriginals and government?
Ms. Pierre: There are actually three parties, and all are to blame. The governments made a commitment to the treaty process, but it was just on paper. There was never a commitment in a mandate given to the negotiators. I think that we have more of a mandate now, but it is like a dog with a tire; they finally caught it, and they do not know quite what to do with it. We have lots of dogs chasing tires on the reserve; that is why I use that example.
Senator Fitzpatrick: I am wondering if you have noticed a negative impact from what I think has been a pull-back on the economic development programs of the federal government that were making some progress. Success breeds success, and I can give you examples — I do not have to, you know them — of some very successful economic development programs in this area. Establishing those examples should provide a strong motivation for on- or off-reserve business activities.
Have you noticed this pull-back and has that had a dampening effect on opportunities?
Ms. Pierre: Yes, there definitely has been. Indian Affairs still has a department they call "economic development," but it does not have the financial resources that the communities need. Then Industry Canada, of course, has Aboriginal Business Canada, but I made my recommendations on how to make that more accessible to small business.
Yes, we have examples, and the ones that are readily seen are of fairly large developments, but I think we all know that small business is really the backbone of the community.
Senator Fitzpatrick: The most jobs.
Ms. Pierre: Yes, you need a lot of small businesses, and there are not that many. Even in those areas that are called "successful," you will be hard pressed to find those small businesses.
Again, we need to do things differently so we start making the financial resources through Industry Canada, through Human Resources Canada and Indian Affairs, available directly to small business and readily accessible. Do not make them go through 50 million steps to get that bit of help, because by then you have killed a lot of initiative.
Senator Fitzpatrick: Thanks very much.
Ms. Pierre: The opportunity will pass by.
Senator St. Germain: Do you mind me asking whether your casino is profitable?
Ms. Pierre: For the provincial government it is very profitable, yes. For us? The casino is not achieving the projections that we had made for it. Overall, our resort has suffered from a couple of things; number one, from the fact that we had to go through the CCAA. That definitely had an effect on us. It is like protection from your creditors. As I mentioned, we got into financial difficulty.
Senator St. Germain: Chapter 11, or whatever you call it.
Ms. Pierre: Yes. That definitely has had some impact on us. Also, we need a major marketing effort, because we are in a beautiful part of the world, but the world is full of beautiful places. We have to get the word out so that people can come to visit us. We have a lot of work to do in marketing to bring people in. I think we have the potential to be very successful, it is just we need to bring more people in.
Senator St. Germain: Good luck.
Senator Zimmer: Just to follow up on the casinos issue, in Manitoba I worked for seven years as vice-president of marketing in charge of the lotteries and the casinos. In Manitoba they have allocated four Aboriginal casinos from which whatever profits they make they keep; and they are very profitable, just to follow up on the point that Senator St. Germain made. Is there any possibility the same thing could happen here in British Columbia, whereby Aboriginal groups would be able to manage and keep the profits from the casinos?
Ms. Pierre: We have not been successful yet. I pursued that with the NDP government when they were in power, because they approved our proposal, and I have been pursuing it with this particular government. There is not a lot of desire to share that, but it would make a tremendous difference, yes.
The Chairman: With that, thank you very much for appearing, Chief Pierre.
Ms. Pierre: Thank you.
The Chairman: Without doubt, a lot of the information you have provided will be helpful to us in writing our eventual report.
Ms. Pierre: Thank you very much. I hope that what I have said was helpful, and if there is anything else, we would be happy to provide you information.
The Chairman: Our next witness, honourable senators, is Chief Clarence Louie of the Osoyoos Indian Band.
Welcome. I am glad that you could make it.
Clarence Louie, Chief, Osoyoos Indian Band: Thank you. I was really speeding all the way up here. I am sorry I am late. I have a package here. I was telling the chair that I had to squeeze this in between a $3-million referendum project we are having tomorrow, on which I had two meetings today, and a youth meeting on a new youth coordination centre. I had to spend my noontime with a bunch of youth, which I always love doing.
In any case, I compiled the package you have before you. I have been asked to speak before dealing with Indian Affairs on the ridiculous economic development issues we have with them. I also have here what I call my "very brief," which is not part of the package, but which I will leave with your assistant and she can make copies for everybody. As I mentioned, I was rushing out the door, so there is a spelling error in here too.
I titled it "The Solution to Aboriginal Poverty." I have been reading, as all of you have, in the paper about the Prime Minister and all these First Nations round tables, of which I think most are a complete waste of time and money. We have had the royal commission report, on which the federal government spent millions of dollars. It sounds like another one of those things going across the country.
In any case, people in government like to use the words "Aboriginal poverty" and do more studies on it; everyone around here knows the statistics.
This is my presentation to your committee. I will just read it quickly and if we have time for questions and answers, that is fine, but I am always respectful of people's time, especially of people who are hundreds of thousands of miles away from home and have to get back.
The Canadian economy is not "discretionary." Neither should the Aboriginal economy be discretionary. Today, after over a hundred years of federal and provincial government control, First Nations all across Canada still have the highest unemployment rates, the highest dropout rates, the highest incarceration rates, the highest child welfare rates, the highest drug and alcoholism rates and the worst health statistics. Many Native families live in substandard housing due to poverty.
In 2005, the federal government in its wisdom, after over a hundred years of failed social programs, still calls First Nations economic development funding "discretionary funding." In the upcoming five-year period, the federal government has chosen once again to cut First Nations economic development by $107 million, by $20 million starting next year and $29 million for the next three years after that.
The enclosed graph, done recently by the National Aboriginal Economic Development Board, clearly demonstrates that the federal government's past 100 years' of neglect on Aboriginal economic development is the biggest problem when it comes to Aboriginal poverty. Why the heck cannot the politicians at all levels of the federal and provincial governments, as well as all the Canadian people, see that when you spend 92 per cent of $8 billion a year on social programs and only 8 per cent on economic development, Aboriginal poverty will always be Canada's hidden shame. No country or society in the world looks at economic development as discretionary.
Every time there is a federal or provincial election, the economy is always the number one issue. It is the economic status of a country, a province or a state that determines the standard of living of its citizens.
History proves that all over the world, those societies that are economically strong have the best health, the best education rates, the best housing, and are culturally strong. Therefore, it must make business sense that in all the current Canadian Aboriginal people's round tables — on health, lifelong learning, housing, negotiations, accountability — every one of those issues will depend on the economic opportunities round table.
The Assembly of First Nations has been in existence for over 35 years, and during that time they have proven themselves to be the most knowledgeable on the issues that face Canada's First Nations people. The representatives from the Assembly of First Nations, beginning with the national chief, have not only studied the difficult issues of Aboriginal poverty, unlike the federal and provincial politicians and bureaucrats, the Assembly of First Nations leadership have lived amongst Aboriginal poverty. From the very first national chief to the present national chief, all have stated over and over again that the priority must be First Nation economic development, and they have struggled against the obvious disregard of the Canadian government that continues to see the Aboriginal economy as discretionary.
I have quotes from our past national chiefs, going back to the first in 1973, George Manuel: "Without an economic base our communities will never be able to be in control of our future." Ovide Mercredi said, "It is the economic horse that pulls the social cart." Matthew Coon Come said, "Economic development will be my first order of priority." One of the most prominent Native leaders and defenders of Native rights, Grand Chief Billy Diamond from Northern Quebec, said, "Economic development is the key to extending Native rights."
When it comes to First Nations, the federal government is represented by the Department of Indian Affairs, which is governed by the Minister of Indian Affairs. In my 20 years as Chief of the Osoyoos Indian Band, I have focused on economic development, but only one Minister of Indian Affairs has attempted to focus on First Nation economic development. That was the Hon. Robert Nault, and what he said a few years ago every member of Parliament should be saying: "There can be no social justice without economic justice."
The Harvard 20-year study on American Indian economic development proves that those tribes that are focusing on socio-economic development are the ones breaking the government dependency cycle. Making your own money and creating your own jobs is what gets rid of poverty.
Aboriginal economic development funding must become the priority of the federal government in relation to the first ministers' commitment to make Aboriginal poverty part of Canada's history and not its future.
That is what I put together today. I sit on the National Aboriginal Economic Development Board, recently formed in this province; the Indian Affairs economic development board; the First Nations forestry board in this province. I do not waste my time on all of these political meetings that happen across the country, even the Native meetings, unless they deal with creating jobs and making money. I think most things Natives and governments do are a complete waste of time.
That is my pitch here to your committee, sir, and I hope you send my message along. I am working on an open letter to the Prime Minister of Canada about all the wasted money, this $8 billion that most taxpayers complain about, and how 92 per cent of it gets spent on social programs. That is why a hundred years later we are still chasing all these bloody social programs. It bothers me that these four round tables deal with social programs. I do not care who you are, Native or non-Native, everything depends on the dignity of a job. You go to school to get a job. What kind of rent are you able to pay if you have no job? When you go to the city of Calgary, or anywhere you want, you can tell who is on welfare and who is not.
I am sick and tired of welfare programs coming down from the federal and provincial governments. I just hope that your committee gets the message to the federal government, the provincial governments, that you want to deal with Aboriginal poverty by giving First Nations the dignity of jobs, the ability to create our own and make our own money.
The Chairman: Well, thank you very much. I cannot help but notice a sense of confidence and boldness, and I would be interested to know about the difficulty, the struggle, that you went through to accomplish the things that you have over the years.
I hear generally that the Osoyoos Indian Band is doing very well, you have quite a number of economic ventures, and you could probably be considered one of the more successful bands in the province. Obviously, it did not just happen; it took a lot of determination and hard work.
I would be interested to know the factors that led to your becoming as successful as you have.
Mr. Louie: Well, part of it is what I read in the papers about the Progressive Conservative Party leadership, and now you even hear it from within the Liberal Party, that one of the things that contributes to First Nation poverty is we do not own our own land, we do not own our own homes. I was reading in The Globe and Mail that home ownership has to be a priority.
I do not know where they get their false information from. Everyone knows most of the bureaucrats who give the politicians their information have never lived on a reserve. I do not know where they get their research from.
Home ownership is not the issue. We have had home ownership on the Osoyoos Indian Reserve, and every Okanagan reserve, under social programs. Our people pay rent, and it is rent-to-own; half of our people own their homes right now, and the other half are paying mortgages on their houses under the federal Indian Affairs social housing program. Previous to that, the Department of Indian Affairs had private home ownership on the reserves going back to the 1960s, 1950s, 1940s and 1930s. Home ownership is not the issue.
It is this continued attack on our heritage and culture, our tribal ways, our community ways and our communal way of doing things, rather than the "me-ism" that is the Anglo-Saxon or Christian way. If you study Native history, one of the federal government's first assimilation tactics was to break down the tribal community ownership of property and make it like non-Native, individual property ownership, which is why on most reserves you have this checkerboard system of land allotments. It is no different from what happened in the States.
One of the secrets of our success is every one of our projects is done on band land. It is band owned. Most of our best economic development lands are band owned. They are not cut up into individual, self-serving parcels — this individual land ownership that government is still trying to force down our throats. Our best lands are all band owned, they are all tribally held, they are owned by the community. We have nine profitable businesses; they are all community owned and it is not cut up into this individual land system.
People say, "Well, look at the Westbank Band, how come they cannot do what Osoyoos does? Look at Penticton Band, why can they not do what Osoyoos does?" Even the Chief of the Okanagan Band up in Vernon admitted, "Look at Osoyoos. Most of their land is band held. Most of our land is privately owned in this checkerboard system of cut-up pieces." We have big chunks of property to work with because they are all band owned.
That is the first reason Osoyoos is successful. I would not say we are that successful. Most of our businesses are less than five years old. The first reason is we have community-owned property, still vast acreages of it.
Second, we are fortunate to be in the South Okanagan. I have been across this country and seen the isolation of most First Nations, which again was purposely done during the settlement era, the colonial period, when the Natives were pushed up against the rocks and the best farmlands were taken. Natives were given the marshlands and were pushed away from the best farming areas, the best trade routes and so forth. Osoyoos does not have to face the isolation factor.
Of course, third would be governance. You have to have good governance. I do not care where you are in the world, investors will not come and dig into their back pockets and make investments in any country, province, state or society where there is not good governance. Over the past 20 years of my being chief, we have concentrated on the business approach. We call it "community capitalism." That is what we focus on.
Good governance is leadership, and our turnover on council is not like most bands. Most of our councillors are third or fourth term. As I mentioned, I am in my tenth term right now.
It is all based on, in every council I have worked with, that we are not satisfied with just accepting or existing on underfunded social programs. We want to go out and make our own money, create our own jobs and participate in the economy in the South Okanagan. That is my council's focus. Economic development is at the top of the agenda of every council meeting. We start every council meeting with economic development. That is the problem with most First Nations; they do not have that opportunity to even talk about economic development.
The Chairman: Would you say that this attitude is prevalent amongst your band members? Obviously people see what it takes to succeed and that economic business is important; has that spirit gone down to the ordinary people? Obviously you are supported by the band members.
Mr. Louie: I would say most band members. There is this fantasy out there that you have to have consensus, that there is consensus amongst Native people. You know, with the influx of different religions over the years, the attack on our language and culture and the fact that 95 per cent of my people do not speak their language any more, we have no greater consensus than non-Native people. Your governments are elected by less than 50 per cent of the people, yet you still call those valid.
I always say that in Osoyoos we do not look for consensus. I do not believe in consensus; it does not exist any more. The majority rule. We make decisions. We have a vote tomorrow on a $3-million power project going through our reserve, and for all those people who want to vote against it, vote against it. As long as the majority vote for it, this project will go ahead.
The Chairman: Good. Would you mind saying something about whether education is a factor in your success?
Mr. Louie: To me, once you get beyond the fluff and all the touchy-feely words about what education is for, the educators and the philosophy of education, I believe education is about making yourself employable. That is what I always wanted. We all want our kids to graduate so they become employable. Nobody I know goes off to get a college degree or a certified ticket as a carpenter, or whatever it may be, unless there is a job at the end of the rainbow. People go to school to become employable. That is the way I look at education; it is all about making yourself employable.
You cannot say you support education if you do not support economic development, because without economic development, your youth do not have jobs. If youth do not have jobs, they will not stick around your community — and they should not. Within the Osoyoos Indian band, because we have nine band-owned businesses, we have been able to watch some of our members go off to school in the States, go off to school back East, and come back and become managers. At the Osoyoos Indian Reserve, because of economic development, we are able to provide career opportunities, not just ditch-digging jobs or entry-level jobs.
Our entire economic development platform is no different from that of the Canadian government or the provincial government. It is all about creating jobs. Unless people have good jobs to go to — most First Nation communities are so isolated, with their dropout rates and the fact that their people just see constant poverty in this cycle of welfare — why would they be motivated to graduate or to go off to college or university? There is nothing in those communities, there are no job opportunities. It is a sad fact that across Canada, the biggest employer in most First Nations is the band office. It is the government-controlled and funded band office with all these underfunded social programs.
As one CEO from one of the most successful tribes in the States told me 15 years ago, if you go on most Indian reserves and call a meeting of all of those who work in social services, many will come to the table. However, call a meeting in the afternoon of those people whose mandate is to create jobs and make money, and you are lucky to have one person around the table.
That is what the federal government has done to us over the last 100 years. That chart that went around — it is in your packages there — proves it; 92 per cent of $8 billion is spent on social programs.
The Chairman: Can you also say something about the environment in which all of your business activities occurred? I am aware that there are businesses, there are governments, and was it very difficult? Was there some cooperation? Was there give-and-take, or was it just you boldly forging ahead, despite the opposition, and whoever is around just has to fall by the wayside or step aside?
Mr. Louie: Within our operations we have referendums, which we do not have to do under the Indian Affairs rules and regulations that still govern a lot of our activities. We have referendums within our membership when we do not have to, and we do not call Indian Affairs officials over for those referendums.
We have transparency and accountability that are beyond the Indian Act, and as I mentioned, it is all about showing our people the numbers. For most people, whether you are Native or non-Native, it does not take long to realize that it is better to have a job than to be on welfare. Once you start showing people the monthly results of having a good, paying job that is not dependent on some government-controlled grant, Native people are no different from non-Native people. They want the best for their kids; they want a comfortable lifestyle, a good house, a good car.
Our referendums are always well attended and when there are votes on the Osoyoos Indian Reserve, the numbers are better than for any non-Native vote, percentage-wise. Non-Natives, any government party — I do not care if they are Liberals, NDP or who they are — they raise the flag when they get 60 per cent of the people voting in favour of something. Votes for the government of the Osoyoos Indian Band are always over 60 per cent.
Senator St. Germain: Thank you, Chief, for coming, and I find your presentation very interesting. I agree with you it is a simplistic solution, this business of private ownership proposed by my party, the Conservatives, and now the Liberals are climbing on that bandwagon. It does not make sense.
I think home ownership is great, but it has to be driven by the fact that you can pay for it; the pride of ownership is part of it.
You talked about the AFN. I have been in Ottawa now for 23 years and I have seen these grand chiefs and everybody else coming there. There is an industry of Ottawa Indians. They come and they go.
Mr. Louie: Industry of misery.
Senator St. Germain: That is right, and they just continue to come. Why do they not say, "Look, it is over?" We were up North recently, and one of the chiefs came by and said exactly what you said: "I got a million dollars for welfare for my people." "I asked for economic development money and the most I could get is $87,000, but a million bucks for social programs."
I have used this statement — it is not mine, it is a former prime minister's — the best social program is a job, and basically that is what you are saying.
Why do they continue to go to these round tables? I say, "Look, unless you are prepared to change the direction of this entire process, start dismantling DIAND in a systematic, intelligent way and get rid of all the stumbling blocks, we will not participate."
I travel this country and talk about our Aboriginal peoples because I have been on this committee for years, and I always cite you people as the epitome of success.
Can you tell me why they keep doing the same thing? If you do what you always did, you will get what you always got, as it were. Why are they doing this? Can you possibly explain it to me, to all of us here?
Mr. Louie: Not totally. As I mentioned, I do not attend most AFN meetings, I do not attend most Union of B.C. Chiefs meetings, I do not attend most summit meetings, because in order to be an entrepreneur or businessman, you have to stay home and look after your own. I always feel you should look after your own backyard before going off to try to save all the whales, save all the trees and hug everybody. Stay home and look after the potholes in your own backyard.
The majority of your time should be spent in your own backyard, and that is the problem with most of the Aboriginal leadership. One of the biggest complaints amongst Aboriginal people is the attendance of their chief and councils at home. They have travel budgets and are going all over the bloody country. There is a conference on some issue every week — health issues, education issues, and drug and alcohol issues.
The other thing that has happened in Indian country or Native country within the past five years is they are now having economic development conferences. They never used to. I was asked to speak, my first time ever, two years ago, at a health conference. As I mentioned, the biggest staff, the biggest funding, is always for welfare. It is always the biggest budget. When I went up to Prince George, I think it was, and spoke to this health conference, I told them, "You guys might not like what I am saying, but I will say it anyway. You will not see me again. I will not see most of you people again. If you do not like what I am saying, get over it."
I told all those Native people, mostly women, "You know, most of your jobs should not even exist. You people are no different from all these councillors and all the do-gooders everywhere. You guys support an industry of misery — all these consultants, drug and alcohol counsellors, social workers and so forth." I said, "Every one of you should be the champions of economic development. Your people should be getting the jobs. The most important counselling you can give, according to me, is employment counselling. Do not send people off to drug and alcohol treatment centres to have them come back just so you can hand out welfare cheques to them."
I have stayed away from most of those meetings you are talking about, and it is only recently, now that we have these businesses up and running, we are getting the structure going. We have a full-time economic development officer who is a professional. Unless somebody has been out there and made millions of dollars and created hundreds of jobs, we do not want him as our economic development officer. We do not want just a bureaucrat or somebody who has a degree. We want someone who comes from the real business world, who can put on his resumé that he has made millions of dollars and created hundreds of jobs. That is who we have as a full-time EDO.
We are the only band in our region that finally — maybe it was three years ago — hired a full-time accountant. We have a full-time CFO and our development corporation has those two positions, and I would say those are the two most important positions that a First Nation can and should have. I see all these cutbacks by the government that take away all the economic development officers' funding because of the pressures of these Native people. They run around to all the meetings to put pressure on the federal government. The cry the tears and show them the stats and all that. "We need more money in health, we need more money in housing; we need more money in all these social programs." They moved all the economic development dollars, which they called "discretionary funding," over to these health and social service round tables.
I have travelled more in the last two years than I did in the previous 18, and the reason is to say to Native people exactly what I am saying to your group here, and I do not pull any punches with them, either. If they do not like it, too bad. As I mentioned, all I have to worry about is my own Osoyoos Indian Band.
Now that we have these staff positions at Osoyoos and I have spent most of my 18 years looking after my own backyard, I can go out there and say I have the proof; I am not just talking. I am not just going out there and winging it. I actually have lived it, I have gone through it. We have set it up, we have done it.
Osoyoos now is one of the biggest employers in the South Okanagan. We pump millions of dollars into the region. We have the ear of the chamber of commerce in our area, the mayors and councils, the local MLA. We are a force in the South Okanagan. I had to stay home for 18 years to do that. Now I can go out and there and say, "Hey, I am talking from success."
That is what I am doing right now. I get asked to speak to First Nation communities across the country on the topic of First Nation economic development. Because they are dealing with the treaty land entitlement on the Prairies, we had the mayor of Saskatoon come with a group of bands to spend a couple of days, and we put on a short economic development workshop and toured them around our operations. We are hosting bands and non-Native people all the time because we have the structures now, we have the proof that we are not just faking it or talking the talk. We have walked the walk and we have done it.
Part of my answer to your question is I will now start going to some of the AFN meetings and I will tell those national chiefs across the country, "Quit wasting everybody's time and money doing what you have been doing for the last 20 years. We need First Nations people with business sense and who want to create jobs and make money."
I always tell people when I stand up at these Indian meetings, "None of you ever talk about this, but the two things I like doing are, first, creating jobs, second, making money." Those are the two things I love doing and will continue to do.
Senator St. Germain: Well, you put it quite succinctly.
The Chairman: What more do you have to say?
Senator St. Germain: Not a heck of a lot. He has pretty well said it all. The one thing I want to know is how you got by DIAND, because you must have had to deal with them, and this is one of the issues that have come up. I would also like you to tell me how many members your band has and how many live on reserve.
Mr. Louie: We have a membership of approximately 420 people, and because of our business growth over the last five years, those who lived off reserve are now coming back.
We have probably about 50 people living off the reserve and most of them have lived off the reserve all their lives. They grew up in foster homes and things like that.
The other neat stat is that we probably have more Native people from elsewhere than any reserve that I know of — they live either on the reserve or just in the town of Oliver — because we have jobs. I do not golf much, but I was out golfing a couple of years ago and ran into a young Native guy. I asked him where he was from. He said, "I am from the Yukon." I said, "Oh, what are you doing down here?" He said, "Where I come from, there are no job opportunities and my band does not do anything. I heard about Osoyoos and I came looking for a job." I said, "Oh, did you get one?" He said, "Yes, I am working on this golf course." He is still there.
We employ Natives from just about every band in the Okanagan in our nine operations, and there are Native people from the Prairies, from the coast, from up North. That is one thing that makes all the hard work and all the arrows that I have taken over the years worthwhile.
Getting back to INAC, we fight with INAC all the time on their land designation process, their stupid rules. That is why right now we are in the land management process, where we take over. We kick DIA out, and we take all those sections of the Indian Act and do up our own land code. We are in the process of developing our own land code. What we have done has been under the Indian Act. I find you cannot blame most bureaucrats in any level of government too much. They are stuck in a system. They have to follow the rules that are laid on their table. That is their job, right?
With most bureaucrats, it is the approach you have to people. We fight with those guys, but also we give them the business case, and most bureaucrats try, even under the constraints of the Indian Act, to help push our projects through. We have some good people on staff. A lot of our projects would not have happened if it were not for the economic development funding at Aboriginal Business Canada when INAC did have economic development funding; our winery would not have started, our heritage centre would not be under construction right now, our campground would not be where it is at. Our golf course we developed with our own earned money.
There is no doubt there are definite problems in the INAC land designation process, the land sections of the Indian Act. I have a paper on that that goes through some of the points that cover the INAC rules and regulations.
The bottom line is, if INAC does not move, we just say, "We are doing it anyway." On one of our vineyards that we leased out to Mission Hill, I think it was, they said to hold the entire project, because "We have to study that tree; we have to get someone in to look at that." It was just one pine tree. It would delay the project, and because of all the plantings that the winery had ordered, it would have just been a mess. We went down there and cut down the tree. We said, "There it is. If you guys want to give us heck, to penalize us, what do you intend to do?" We cut down the tree, pulled it out and the project is going ahead.
When INAC gets in our way, a lot of times we just ignore them and bulldoze our way forward. We are willing to take that risk. If the government wants to fine us, sue us, let them go ahead.
Senator Lovelace Nicholas: Chief Clarence Louie, I was looking at your report and you are the first one who mentioned anything about the election terms being too short. Would you explain to us why?
Mr. Louie: Well, that is just the Indian Act. Let's face it, we have the opportunity, every band has the opportunity, to customize elections. We have had that opportunity for a long time. Some of that was actually put together by my staff, our economic development staff. We have elections every two years. Penticton has a four-year term; they customized theirs many years ago. Lower Similkameen Band customized theirs to four-year terms. It is our own fault that we did not get around to customizing ours. We get so busy with economic development, two years goes by so fast, and I always catch heck from my economic development staff. They say, "Hey, Clarence, we were supposed to work on our election code and change it to three-year terms or take it to the membership." We just have not done that yet.
Every First Nation has the opportunity to customize their code and make the terms three years, four years, whatever they want. We just have not done it yet.
Senator Lovelace Nicholas: Do you think that we should come up with our own Native system of elections?
Mr. Louie: Individual bands? I think every band should. Because we are under this land process, we have a land committee formed right now to look at taking over the land management. Fourteen bands in Canada have done that. There are 70 bands across the country on the waiting list to develop their own land code and we are one of those who squeezed in at the end of last year. We got some funding and now we have a land committee of youth, elders and adults going through our land code. I brought up with them a couple of weeks ago, "At this time, let's take the opportunity to see if we can customize our elections."
Personally, I do not mind two-year terms. They go by fast and keep you on your toes. I have been elected eight times in a row.
Senator Christensen: I am interested in how, as you have developed, you have kept your development corporation separate from the political arm of the band. How are the revenues that are generated by the corporation managed?
Mr. Louie: I am a student of Native issues. I went to the University of Lethbridge and the University of Regina to take Native American studies: How did reserves start? What is the colonial system of reserves? What is the Indian Act? How did First Nations get into the mess we are in today? That is what I went to university for, and ever since then it has been a passion of mine to study Native issues and Native societies.
We were the first band in Canada to bring up the professors from the Harvard Project on American Indian Economic Development. We had one of the professors come up in 1987 to spend an entire day with us and run through their findings.
The American tribes are no different. They are the same. They had residential boarding schools down there, we had residential schools. They have reservations, we have reserves; they deal with the BIA, we deal with the DIA. The historical fact is the Canadian government always sent officials down there in the 1800s to find out what the Bureau of Indian Affairs was doing. That is how we got reserves, that is how we got residential schools.
In fact their election terms are two years, too, unless they customize them. Their development is no different than that of the bands in Canada.
In any case, the Harvard Project talks about how the tribes that are successful separate business from politics. Everybody talks about that, the federal and provincial governments, too.
We are a small band of 400 people. We are not like the Blood Tribe, or some of these other bands that have thousands and thousands of members, so our talent pool is not deep. In most communities the talent pool is not very deep. That is one thing I disagree with the Harvard people on, and I have told Stephen Cornell and Joe Kalt that. The Colville Tribe, which is just south of us, has a huge reservation, a million acres. You could take all the reserves in B.C., probably in all of Western Canada, land-wise, and plunk them down on that one reserve. They have a membership of 11,000 people. I have cousins on the council down there. Given the dynamics and the closeness of an Indian reserve, our tribal ways and our communal ways, you cannot separate business from politics. You cannot.
What you have to do is put in systems, policies and rules to manage it — conflict-of-interest guidelines, nepotism rules and immediate-family guidelines. It must be managed in a documented and structured way.
However, you cannot separate politics from business, even off the reserve. I do not care what anybody says, the federal government gets involved in business and politics, the province does, even the municipal level. Business and politics are always intermingled. However, our development board is made up of the council and past council members. When people get voted off, we just leave them on a development board. The board can get large — we have an eight-member development board.
The best advice I always give First Nations people is I do not care if you are Tiger Woods — the best golfer in the world — the best hockey player, or Donald Trump, you have to have an adviser. We have six advisers to our corporation. Again, they all come from the real business world, they have all made lots of money, they have all created a lot of jobs, and they give us advice on everything we do with our nine band-owned businesses.
We do not have to take their advice, but anyone who is smart and sits there and develops a relationship with these people will take their advice 99 per cent of the time. It is the council that looks after the corporation, and at the same time we still keep the council on the political side.
Senator Christensen: I think you would have to admit that on some councils that do not have the structure that you are talking about, and the business is integrated with the political, there is often a lot of pressure on the political leadership to feed the revenues from the economic development back into the community, thereby starving the development, which will then crash.
Mr. Louie: Yes. We have those pressures, too. We want to make sure that every one of our band members feels the economic development direction we are taking in their back pocket. We pay out a certain portion of our lease revenues as a dividend. Every one of our businesses contributes to our social programs because they are all underfunded, and our seniors get benefits from our lease and tax revenues.
We can put it up on the wall, which we do. We have monthly handouts to show where our revenues go and how the success of our businesses touches every segment, from cradle to grave.
Senator Christensen: It is interesting that you just said the social programs are underfunded, even though they are 92 per cent of the funding you get.
Mr. Louie: Yes, they are underfunded. That is just the hundred-year reality, except for, as you mentioned, welfare. If a band spends its entire welfare budget, the government will give them more. However, I just do not fathom how somebody exists on welfare. As a single person, I think you get $180 a month. I guess some people get caught up in that lifestyle. Yes, all the government's social programs are underfunded on every Indian reserve.
Senator Campbell: I am glad we got that hugging stuff out of the way earlier on.
The question I would really like to ask is how do you get to tell people to get a life and keep getting re-elected when I do it once and I am on the front page of The Sun?
I have long admired your First Nation and watched it from afar. I have a couple of questions: Are your economic development officer and CFO from your nation?
Mr. Louie: No. One is non-Native and the CFO is a Native from the Yukon.
Senator Campbell: Are your advisers First Nation people?
Mr. Louie: No, non-Native. That is one of the things I tell these Native groups. I do not care if they like it or not, I always tell them, once you get into business, it is not based on race. You cannot run businesses based on race. You do not hire people based on race and you do not put Natives in charge of million-dollar ships when they do not have the qualifications or the skills. I do not care who they are, band members or not.
Half of our businesses are run by First Nations people. Two of those are Osoyoos Indian Band members, but they had to earn those positions. They had to leave the community, go down to the States and get their degree. Even when they came back, they did not immediately get the job. They had to work under the non-Native manager for "X" number of years before they were promoted.
Senator Campbell: That was my next question. I do not have a lot of argument with the idea that the key reason for education is to have a job, but I do not know whether you are aware of a project called the Chinook program. I do not know whether you have heard of it, but I can send you some information.
Mr. Louie: I have heard of it.
Senator Campbell: I especially like what you said about having small numbers and therefore your talent pool is small. At the end of the day, would it be your aim to have a CFO and economic development officer from your First Nation?
Mr. Louie: That is always the motherhood statement of every First Nation.
Senator Campbell: Is it just a motherhood statement? If it is garbage, then let us call it that.
Mr. Louie: It is mostly garbage, because the only thing most First Nations can offer is the social worker job and all the other government-grant, underfunded jobs.
Senator Campbell: I am not offering that.
Mr. Louie: In our situation, we have the opportunity to offer our people real careers, well-paying, top management positions, and our goal is to have First Nations people, Osoyoos Indian Band members, in every one of those positions when they have stepped up to the plate and proven themselves.
I always tell people you have to look at the facts. We are in the first generation of being business people. On the Osoyoos Indian Reserve, which is probably one of the most economically progressive in Canada, there is not a First Nations person who can put up a hand and say, "I come from a family where my dad or my mom ran a business." Not one. Not one of our people can put up a hand and say, "I ran a business" before the one they are running right now.
Our first business, our vineyard, started in 1968 and is now 250 acres, one of the largest privately owned vineyards in Canada.
The band offices, our governance and administration in our region, in the Okanagan here, did not open until the early 1970s. That is all during my lifetime, and I am not that old. We are in the first era of not only setting up our own governance systems, our own management systems, but also of being business people, and it will take us some time.
However, the exciting, cool thing about it is we are allowed to make our own mistakes now. We do not have Indian Affairs officials coming here and doing it for us. We do not have non-Native government officials saying, "We know what is good for you." When our people went up to Vernon in 1972 and forcibly occupied and shut down the DIA district office, they were sick and tired of the Indian Affairs officials running every Okanagan reserve. When our band offices opened, little by little we started to learn more about how to be business people and how to set up our own governance systems. It will take us some time.
Non-Native people have a hundred-year history of municipal offices, provincial offices, federal offices and so on.
Senator Peterson: Chief Louie, it was a very refreshing and interesting presentation. What is the size of your reserve? You did not indicate that yet.
Mr. Louie: Acreage-wise we are one of the biggest reserves in B.C.; however, it is small compared to some on the Prairies, at 32,000 acres. We are fortunate; we would not be able to do what we are doing if we did not have a relatively large land base, even though we had our best properties taken away. Our reserve was reduced twice.
Senator Peterson: You said there are nine businesses in total. Are they all within the reserve?
Mr. Louie: Yes.
Senator Peterson: Are they diverse?
Mr. Louie: We actually bought land off the reserve. We made our first business acquisition three or four years ago; we bought a cement company off the reserve and moved it on the reserve. We have a Redi-Mix company. We have a championship golf course, a gas station and store. The Osoyoos Indian Reserve stretches from north of Oliver down to Osoyoos, 32,000 acres. We are looking at opening our second gas station and store in the Osoyoos area. We have a 250-acre vineyard, a preschool daycare, a forestry operation, a campground/recreational-vehicle park and a heritage centre.
Let me try to picture the managers who sit around our tables. We have our corporate meetings, our OIBDC meetings, at 7:30 in the morning so they can get back to work by 9:00.
Our biggest income producer is our land-lease division. We lease out over 1,200 acres of prime vineyard lands to Mission Hill, Vincor International and Burrowing Owl. Vincor has their Canada west operations, their big commercial winery, on the north end of our reserve. We own the building and we lease it to them. We make hundreds of thousands of dollars from that lease because we own the building and the lands. We have a taxation division and we tax all the non-Native users of our property. We have residential leases, commercial leases, and now we are working on an industrial park north of Oliver.
Oh, I forgot our winery, our joint venture with Jackson-Triggs. We have a hotel lease with Spirit Ridge, out of Alberta. It is halfway through first-phase construction of 90 units. I think they are currently at about 20, 30 units. I am proud to announce they received the South Okanagan's only four-star classification. That was cool. We have had federal government representatives stay in those units. We are hosting the Indian Affairs economic development staff at our winery in Spirit Ridge at the end of November, and we have another golf course down there that we do not own, but we lease out the property.
Senator Peterson: So you have been very successful without having to go off-reserve with your enterprises.
Mr. Louie: That is another fantasy, when I hear the Progressive Conservatives or Liberals say you have to get rid of reserves. It has been a 150-year direction of the federal and provincial governments to get rid of reserves. They blame the reserves for the poverty. It ain't the reserves that cause the poverty. It ain't communal land ownership that causes the poverty. Look at that graph. What does it say? Of the $8 billion that a lot of non-Natives complain about, they spend 92 per cent on social programs, and have for the last 100 years. If they had at least got economic development funding into the double digits, a lot of First Nations would be able to create their own jobs and their own wealth and they would not have spend so much money on health care and welfare. We would have more educated people because they would see the opportunities.
Senator Peterson: I think you have been partially blessed, though, with your location.
Mr. Louie: Oh, exactly. I would be the first to admit that.
Senator Peterson: How have you been successful on the education side? Have you done this all just within your own reserve or have you dealt with the provincial government? How have you given incentives to your people, other than by showing them what they can get through your success?
Mr. Louie: You have to realize that most First Nations people come from a background of residential schools, alcoholism and family breakdown. That was still happening in our community in the 1960s until our vineyard opened. That was the first time I ever heard of or saw with my own eyes people working outside the band office, when they started working in our vineyards in the 1970s. We as young kids had to get out there and work, which was great. I would like to see every one of our youth start working at 12. I hate these stupid provincial and federal labour laws.
Most of you who come from farms, you get out there and start working when you are able to pick up a shovel or a rake and pull a bale of hay, right?
Senator St. Germain: Hear, hear!
Mr. Louie: As I mentioned, part of our success is we ignore these government rules. Go ahead and sue us if you want. We will have our people start working at 12 years old, and those who want to take us to court, go ahead.
It is getting back that work ethic. The biggest problem amongst Aboriginal people is that all of these programs over the last 100 years, residential schools and so on, took away the work ethic of many. That work ethic is the foundation of every Canadian family. You have to have that. What I read in the paper about the hang-out crowd or what happens in Vancouver, the boy culture, is due to that missing work ethic. The entire school system has gone too left-wing. You cannot grade people any more, you might hurt their feelings.
For example, you cannot even grade the kids in physical education; you might hurt people's feelings because they cannot pass the running test or whatever, and I could go on and on about the Young Offenders Act. We have to get back to the old way of our grandparents, when if you broke the law, you got your butt kicked right away. Punishment was something that happened because you offended. There was no touchy-feely punishment, either. The same was true in the school systems.
Therefore, at our school on the reserve, we are trying to get back to the tough love; you work or you do not eat. That is the way it should be.
We have a hang-out crowd on our reserve. Nobody on our reserve should be unemployed, but the biggest issue we are dealing with right now — and I think I talked to you about it — is we want to put together programs. I was on the phone with a community way up North that has a pre-treatment program where they try to deal with these guys who do not want to work. I do not care if you give them $20-, $50-an-hour jobs, they will still get fired. They hang out, they drink; they do drugs. They just want to get out of bed when they feel like it and go to work when they feel like it. The only job they want is one they create themselves or whatever.
My mom had a concept, and she said, "You know what we should do with all these young, lazy bums on the reserve?" It is mostly young guys, not girls. It is the girls I see that will be kicking butt. Every reserve I went to and said this agreed with me. It is the girls who are graduating, attending the powwows and dancing, attending the ceremonies. It is the girls who are pitching in at community events; and you have this hang-out boy-culture crowd, the Nintendo generation.
In 20 years from now, you will find in most First Nation communities the women in the leadership roles, which is fine, because the guys have dropped the ball. My mom comes from the old school too, old-school thinking. She said, "You know what we should do with all these lazy bums on the reserve, all these young guys? The band should charter a plane, throw them all on there, fly them to Iraq and drop them off and the ones that make it back are the keepers."
The Chairman: It has been a real pleasure listening to you, and your inspiration will, I am sure, help us to be bold. I cannot help but think that you should write a textbook.
Mr. Louie: That comment you made earlier, I have heard that before: "How do you keep getting re-elected when you say things that should be said?" I keep telling people I am not a politician.
Senator Campbell: That is what I keep saying.
Mr. Louie: I am a worker, not a politician. If you do not like it, do not vote for me.
The Chairman: Thank you very much.
The committee adjourned.