Proceedings of the Standing Senate Committee on
Aboriginal Peoples
Issue 32 - Evidence - February 26, 2013
OTTAWA, Tuesday, February 26, 2013
The Standing Senate Committee on Aboriginal Peoples, to which was referred Bill C-27, An Act to enhance the financial accountability and transparency of First Nations, met this day at 9:45 a.m. to give consideration to the bill.
Senator Lillian Dyck (Deputy Chair) in the chair.
[English]
The Deputy Chair: Good morning. I would like to welcome all honourable senators and members of the viewing public who are watching this meeting of the Standing Senate Committee on Aboriginal Peoples on CPAC or on the web. My name is Lillian Dyck. I am the deputy chair of the committee, and this morning I am chairing this particular meeting.
The mandate of this committee is to examine legislation and matters relating to the Aboriginal peoples of Canada generally. Today, we are continuing the examination of Bill C-27, An Act to enhance the financial accountability and transparency of First Nations.
This morning we will hear from three organizations: the Confederacy of Treaty Six First Nations, the Canadian Bar Association, and the Aboriginal Financial Officers Association of Canada.
Before hearing from our witnesses, I would ask the members of the committee who are present today to introduce themselves, starting on my left.
Senator Watt: Charlie Watt.
Senator Wallace: John Wallace from New Brunswick.
Senator Demers: Jacques Demers from Quebec.
Senator Patterson: Dennis Patterson from Nunavut.
Senator Raine: Nancy Greene Raine from B.C.
Senator Seth: Asha Seth from Ontario.
Senator Ataullahjan: Salma Ataullahjan, Toronto, Ontario.
The Deputy Chair: This morning we have two panels of witnesses. On our first panel, we have Chief Craig Makinaw, Chief of the Ermineskin First Nation and Grand Chief of the Confederacy of Treaty Six First Nations. We also have with us from the Canadian Bar Association Mr. Bradley Regehr, Executive Member, National Aboriginal Law Section; and Ms. Marilou Reeve, Member.
We will begin this morning with Chief Makinaw. I ask the presenters to try to do about a five-minute presentation to leave sufficient time for the senators to ask questions.
Sharon Venne is accompanying Craig Makinaw as an adviser.
Please proceed, Chief Makinaw.
Craig Makinaw, Grand Chief, Confederacy of Treaty Six First Nations: Good morning, senators and everybody here this morning. I am honoured to be here this morning to speak on Bill C-27. I have two reports here. One is a statement. The second one is a Treaty 6 Confederacy position paper on Bill C-27 for you to look at. That is from our Treaty 6 organization in Alberta, the 18 bands that I represent. The report is here with all the information on Bill C-27 — our position papers and various meetings that we have had in this last few years.
Honourable senators, I have the responsibility of being the Grand Chief of Treaty No. 6. I am also Chief of the Ermineskin Cree, who entered into treaty with the Crown in right of Great Britain and Ireland through an adhesion to Treaty 6 in 1877. As a chief selected under our traditional law and following our inherent rights as set out in our own laws, we consider the effort to pass the First Nations financial transparency bill to be a violation of our inherent rights that that treaty recognized. Our inherent right to self-government was recognized when the Crown entered into the treaty. If we did not have the right to self-government at the time of treaty, the treaty would not be valid. At no time in the treaty document and at no time in the discussions did we give up our right to self-government. This is too ridiculous to even contemplate. Our right to govern ourselves is recognized and affirmed by section 35 of your Constitution. By accepting that Constitution, Canada — this Parliament — recognized that it did not have any power to interfere with our rights. Through section 52 of the Constitution, Parliament recognized that any law that would interfere with our right is invalid. I ask you to explain where Parliament gets the right to interfere with our right.
On the one hand, we acknowledge that Parliament has a right to account for money that it allocates to us. On the other hand, why has Parliament or the government not provided us with an accounting for all the land, all the resources and all the wealth it has appropriated without paying one cent of compensation?
I believe you can understand why we might be impatient with talk of accountability and transparency when that has never been accorded to us. Essentially, the federal government takes and uses our resources to enrich the state while depriving our nations of sufficient funds to even meet our basic needs.
When this bill was introduced, there was a wave of outcry. According to the Supreme Court of Canada, when rights might be affected there must be consultation for the purpose of accommodation of those rights. Before proceeding with this or any other legislation that might affect our rights, Parliament must assure itself that this consultation and accommodation has taken place, particularly when we are asserting this has not happened. It is not good enough for Parliament to just take someone's word that the duty to consult and accommodate has been completely fulfilled.
In the case of this bill, what happened instead was that the government imposed closure on the bill despite the obvious need for amendment. It is not conducive to the health of our treaty relationship when the federal government and Parliament, both of whom have a duty to uphold the honour of the Crown, act so arbitrarily and summarily.
This bill has been advanced by applied mythology. The myth is that First Nations are corrupt and incapable of maintaining our own affairs. It has been implied in debates in the Senate that all First Nation governments utilize corrupt tactics; that all First Nation leaders need legislation to keep them accountable to our members.
Such statements further perpetrate the colonial narrative that we cannot be relied upon to govern ourselves; yet, within my nation, during the year leading up to our budgets, our staff and program directors discuss needs and prepare a budget, along with an explanation of the needs.
All this information is taken to a meeting of members. The members make the final decisions on spending. During the year our members can come to our administration office and look at the records. We have nothing to hide.
There are many First Nations who operate like our own nation. We account thoroughly for the use of any federal monies; but, with respect, read the Constitution. Parliament has no right to interfere with our practice of self- government.
We have just returned from Geneva where we made two urgent action appeals before the UN Committee on the Elimination of Racial Discrimination. One appeal was to complain about the current tsunami of legislation that has been launched contrary to our treaty relationship and in fact causing great damage to that relationship. As treaty peoples we have the right to be involved in decisions related to our rights, especially as it relates to decisions on our lands and resources.
A second appeal dealt with the failure of the federal government to deal with the responsibilities set out in the international treaties Canada has entered into. Namely, the federal government has a responsibility to take proactive action to deal with the campaign of demonization against us, which has been unleashed by certain sectors of the media.
We went to Geneva because we found no one in Ottawa who was willing to listen to us to discuss these matters. No one has been willing to discuss the fundamental questions that have been raised for years and that I am raising today.
We believe this committee should obtain legal advice from Parliament's own legal advisers as to whether Parliament has satisfied its own obligations to ensure that Bill C-27, if passed, will not interfere with the inherent right, guaranteed by treaty, of First Nations self-government. It cannot rely upon the government lawyers to provide this advice.
This question has been raised for years by members of the Standing Senate Committee on Legal and Constitutional Affairs, but no action has been taken. Parliament continues as if 1982 never happened. This committee, the Standing Senate Committee on Aboriginal Peoples, has a responsibility and an opportunity to deal with this inconsistency.
Thank you for listening to my words.
The Deputy Chair: Thank you, Chief Makinaw. We will now move to the Canadian Bar Association.
Marilou Reeve, Staff Lawyer, Canadian Bar Association: Madam Chair and honourable senators, good morning. My name is Marilou Reeve. I am a legislation and law reform lawyer with the national office of the Canadian Bar Association. On behalf of the Canadian Bar Association, I want to thank you for the invitation to appear today to discuss our submission.
The Canadian Bar Association is a national association representing 37,000 jurists across Canada. Among the association's primary objectives are seeking improvement in the law and the administration of justice. It is with these objectives in mind that we address you today.
The CBA's written submission, which you have received, was prepared by members of our National Aboriginal Law Section. The section consists of lawyers specializing in Aboriginal law and related issues from across Canada.
I now introduce our spokesperson, Bradley Regehr. Mr. Regehr is a member of the Peter Ballantyne Cree Nation in Saskatchewan. He was called to the Manitoba bar in 1997 and has been practising law with the Winnipeg law firm of D'Arcy & Deacon since 2001. He practices in the area of corporate commercial law, real property law and Aboriginal law. He serves as legal counsel for a wide variety of individuals, corporate clients, First Nations and First Nation organizations, both provincially and federally.
Mr. Regehr has been involved in a wide variety of matters, including natural resource and impact benefit agreements, legislative consultation, all aspects of corporate commercial matters, land claims, negotiations with all levels of government, governance matters and land developments.
Additionally, Mr. Regehr has volunteered extensively with both the Manitoba branch of the CBA, as well as nationally. He is the Immediate Past Chair of the National Aboriginal Law Section of the CBA, and is currently a member of the executive of the National Sections Council.
I now turn to Mr. Regehr. Thank you very much for your attention.
Bradley D. Regehr, Executive Member, National Aboriginal Law Section, Canadian Bar Association: Thank you, Madam Chair. Good morning, senators. Thank you for allowing me to appear this morning. I would like speak to you on behalf of the National Aboriginal Law Section of the Canadian Bar Association in regard to Bill C-27, the First Nations financial transparency bill.
As you will have seen from our submission on February 13, 2013, the CBA is supportive of First Nation governments being accountable and transparent; however, we are not in favour of Bill C-27. Bill C-27 will not improve the capacity of First Nations to assume control over their own affairs, nor does it assist in addressing the larger systemic issues of funding and responsibility for those issues.
The requirements set out in the bill far exceed what is required by many other levels of government. In most provinces and territories the information available is far less than what is being proposed in Bill C-27. As an example, First Nations will be forced to disclose sensitive financial information related to their businesses and economic activities.
Many First Nations are getting involved in resource projects and other economic developments. As a result of Bill C-27, they will be required to disclose the private financial information of their businesses to the public sphere, which would include their competitors — the same competitors who do not have these requirements. This could also cause problems for joint venture parties and other partners who are in partnership with First Nations. They may not want their private financial information being made publicly available, causing a possible chill on First Nation economic development.
In addition, First Nations may be involved in litigation where access to private financial information can be prejudicial to a First Nation party. Disclosure to members of the First Nation is not the same as public disclosure. However, Bill C-27 goes way beyond requiring disclosure to members only.
In terms of dealing with First Nation communities that are experiencing financial difficulties, Aboriginal Affairs and Northern Development Canada already has numerous remedies available to it. Aboriginal Affairs can claw back funding, impose conditions and appoint both co-party and third-party managers to take over the finances of a First Nation. All of this is done currently under the contribution agreements that First Nations signed with Aboriginal Affairs and other federal departments. In addition, First Nations are already required to provide an annual audit to Aboriginal Affairs and to members; and that audit must be done by an independent auditor who is licensed by a province or territory. Failure to do so invites the federal government to exercise its remedies under those agreements.
The practical requirements can also be problematic. Not every First Nation maintains a website, has the technological expertise or even has reliable Internet access. In addition, First Nations are already under an onerous reporting burden. The Auditor General reported in 2002 that, on average, each First Nation was required to submit at least 168 reports annually. These requirements have not improved, as reported by the Auditor General in 2006 and 2011. Confidence that somehow legislating financial reporting will solve problems is misplaced. Financial statements alone do not provide a meaningful measure of performance or a fair reflection of community priorities.
At a time when the government keeps talking about working in partnership with First Nations and collaborating on First Nation issues, Bill C-27 does not lend itself to those principles. Instead, Bill C-27 does not improve reporting or assist with helping those communities in financial distress. Meaningful consultation and dialogue with First Nations will be far more effective than attempting to dictate to First Nations what their financial reporting requirements will be.
Thank you for allowing the Canadian Bar Association to present to the committee this morning.
The Deputy Chair: Thank you for your concise and clear presentations this morning. We will open the floor to questions from senators.
Senator Demers: If the bill is about enhancing transparency to First Nation members, why is it necessary to require financial information to be made available to the public at large and not just to First Nation members?
Mr. Regehr: I would agree with the question in terms of why this information needs to be made publicly available. Why is it not being made available to members only, which is already required under the contribution agreements that the First Nations sign with Canada? I guess you are asking me a question that I cannot really answer and only the drafters of the proposed legislation can answer in terms of why they would seek to require First Nations to post this information publicly so that any person, not just members of the public of Canada but anywhere in the world, who has Internet access can review the private financial information of a First Nation. I do not understand that requirement. I am not sure what it does to instill public confidence other than it may be economically detrimental to a First Nation, particularly in terms of their private economic activities.
Senator Demers: I appreciate your answer to a difficult question. What would you do differently to change this situation? How would you approach this differently?
Mr. Regehr: I think I was clear that I would like the bill to be scrapped in its entirety. There have been numerous calls from the Assembly of First Nations, the Federation of Saskatchewan Indian Nations and some others for an office of an independent ombudsperson where someone who has complaints can go to deal with it. Unfortunately, the bill includes nothing on that. I cannot answer why it does not include that. The AFN and the FSIN and other organizations have been fairly clear in terms of what they were asking for, but the bill does not include that.
Senator Raine: We have heard from individual First Nation members, many from smaller First Nations, who talked about difficulties in obtaining the financial records of their First Nation and about intimidation. We all are well aware that band offices sometimes are very influential in the lives of individuals, and if you are seen to be questioning the leadership, there can be serious ramifications.
You talked about an independent office that could act as an intermediary. Could you explain what you mean by that?
Mr. Regehr: Let us look at the legislative summary of Bill C-27. The authors of the summary noted the calls from the Assembly of First Nations, the Federation of Saskatchewan Indian Nations and the Association of Iroquois and Allied Indians, I believe. Page 9 starts with a commentary about the establishment of this. I do not think it provided all sorts of details in terms of exactly how it would be structured, but an office of an independent ombudsperson would deal with complaints that First Nations may have with the government in terms of funding issues. That has been made clear. The Assembly of First Nations has been calling for this in their resolution, which, I have seen, has been quoted widely by government witnesses. That is only part of what they were calling for. They were also calling for this independent office, which, for reasons unknown to me, has been left out of the testimony. It would be an independent office, from what I can tell, to deal with these complaints. Rather than requiring people to apply to a superior court of the province, which is an expensive, lengthy and time-consuming process, you could have an independent office that arguably could deal with these things on a much more timely basis and be arguably cheaper as well.
Sharon Venne, Advisor, Confederacy of Treaty Six First Nations: Good morning. I want to refer to the previous speaker in regard to Senator Raine's question related to accountability. The presentation that the chief made relates to treaty rights as recognized under section 35 of the Canadian Constitution. These are collective rights. When we entered into treaty, we entered into treaty as a collective. I do not think it is appropriate for the individual to have a say over what the collective rights are, not that in our nations we open information for them. You are going to have individuals, whose people have been colonized for the last 150 years, coming forward, which is an issue. You have to look at the collective treaty right here that we are talking about. We are asking the committee to consider the constitutional obligations owed to our nations and to examine this proposed legislation in that light. Step back and look at the bill from a legal point of view based on the constitutional obligations owed to us through the treaties. For us, that is the priority so that the individual is protected. Right now, that is not happening.
The Deputy Chair: From your response to Senator Demers' first question, if I understood correctly, it sounds as though the same remedies are available to the government now under policy and regulations if a band for some reason has not allowed its financial records to be shown to its members and information on the consolidated financial statements to be posted. Those remedies are available. What is the difference between what is in Bill C-27 versus what bands already are required to do in order to get contribution agreements? Is there any difference between the two?
Mr. Regehr: One difference is that if the First Nations do not comply with the legislation, the federal government can apply to a superior court for an order compelling them to do so, as can any member.
Currently the federal government does not have to do that. They have a far more effective remedy, it appears, in that they can appoint a co-manager or a third-party manager. It is all under the terms of the agreement. Ultimately, if the Crown wanted to, they could sue in contract, but they do not need to because they can appoint a third-party manager; they can claw back funding; they can impose conditions. They can disclose this information to members who are not getting cooperation.
Again, some of this could be remedied if, as recommended by some First Nation organizations, there were an independent office that could deal with some of these things.
Ms. Venne: If you look at the requirements that First Nations have to meet under contribution agreements within various federal departments, particularly the Indian Affairs department, you will see that there is more than enough information flowing there to make this legislation unnecessary. It is hard to understand what the government is aiming at by introducing this legislation. It seems to me that the government is throwing a wide net over areas of funding to which they do not contribute. How far does the jurisdiction of the federal government extend? They are trying to capture many areas that are outside of their jurisdiction. That is why we are calling on the Senate to exercise sober second thought on the legal ramifications of this legislation. It seems to us to be quite pervasive.
Mr. Makinaw: I will refer to the Ermineskin band financials. Further to what Ms. Venne said, we have our CFA agreement as well as our own money we took out of Ottawa about two years ago, so we will have two separate audits this spring; one on our CFA and one for our trust account money that is separate from the CFA agreement. We are already doing everything that is in Bill C-27, and more.
Senator Munson: I do not think the new Minister of Aboriginal Affairs is familiar with this legislation. Did you have an opportunity to present your case to the previous minister and would you like an opportunity to present your case to the new minister? You have made it very clear that you would like this bill to be completely scrapped. Would a meeting with the minister mean anything to you?
Mr. Regehr: The Canadian Bar Association made a submission to the parliamentary committee. We did not get an opportunity to meet with the previous minister. I do not think the bar association would be opposed to meeting with the minister, but we have never been invited to do so.
Senator Munson: You said that you would like to have this bill completely scrapped. We are almost at a point of no return when it gets to this stage in this committee. In fact, I do not think clause-by-clause consideration is that far away.
What recourse do First Nations governments have if they feel the federal government is not abiding by specific treaty rights? You talked about an independent body, the establishment of which would be highly unlikely, but what other recourse do you have? What do you have left?
Mr. Regehr: I suppose expensive, time-consuming litigation that would go on for years and years as it winds its way through the various appellate courts, which not many First Nations have the resources to fund.
Senator Munson: If this bill becomes law, you will challenge it?
Mr. Regehr: I suppose that individual First Nations or other organizations may challenge it. I would not be surprised if it is challenged. The Canadian Bar Association has not taken a decision on that at this point in time.
Senator Munson: Chief Makinaw, you talked about returning from Geneva and the current tsunami of legislation that has been launched contrary to treaty relationship and causing great damage. You made, as you described them, two urgent action appeals before the UN Committee on the Elimination of Racial Discrimination. It is one thing to go to Geneva and present your case, but what kind of authority or power does this UN committee have in dealing with legislation in our country and your nation?
Ms. Venne: The chief has asked me to answer that question. The Committee on the Elimination of Racial Discrimination, CERD, oversees the Convention on the Elimination of Racial Discrimination, of which Canada is a signatory. Last February, Canada made its periodic review to CERD on the situation in Canada.
CERD also has another procedure called an urgent action request. A number of Treaty 6, Treaty 4 and other First Nations in Canada have submitted a request to CERD for urgent action because of this legislation since there does not seem to be an effective democratic process within Canada for us to voice our concerns, and there is no accommodation of our concerns.
We are asking this committee for something very substantial to be done. Even though it is the eleventh hour, you can still step back from it and review the legislation. It does not seem that Canada has afforded us an effective democratic option, so we have gone to CERD and filed an urgent action asking them to intervene.
In 40 years of going to the United Nations, this is the first time that we have filed such an action, so the committee and the UN know that this is a very serious situation, and they have taken it very seriously. We had a full and frank discussion with a number of members of CERD as well as other entities within the United Nations about the situation in Canada as it relates to our rights.
Senator Munson: Are they aware of the timetable on this?
Ms. Venne: Yes.
Senator Munson: What kind of audience did you receive? Did they give you a timetable in which they may be able to expand on this?
Ms. Venne: Could I take a few seconds to explain how it works?
The Deputy Chair: Yes.
Ms. Venne: The members of the Committee on the Elimination of Racial Discrimination are elected by the General Assembly, which oversees the convention, which is an international treaty to which Canada is a signatory. The committee is mandated to review situations that fall under the convention. They periodically review country reports, and last year they reviewed Canada's record. There is a report going forward to the General Assembly in relation to Canada which will be made public this spring before the General Assembly.
In front of that they have another procedure that allows us to ask for an urgent action, which is what we requested. CERD started meeting on February 11. I imagine that the Senate has similar mechanisms, i.e., committees such as this and then small working groups that have internal discussions about a particular item.
CERD also has similar things. They have five members of an internal working group who are reviewing these urgent actions. Who they are is not made public, but we had a fairly good idea who they are because we spoke to every member of CERD. When we were presenting the documents, they would say they were not a member of that committee or that working group, so we crossed them off the list and said, okay, they are not on that list. When they look at the documents, they will meet.
CERD finishes its meetings on Friday of this week, and the committee as a whole will hear the report from the working group. Our understanding is that a letter may be generated from CERD to Canada requesting them to take positive steps to correct the situation in which we presently find ourselves.
Senator Munson: I have one other question having to do with the disclosure of sensitive financial documents. I think you alluded to that, Mr. Regehr, and we have heard that. Could you give us an example of the overreaching aspect of this legislation and how it would impact a band's disclosure of sensitive financial information? Is this kind of procedure being used in the everyday life of corporations and other governments?
Mr. Regehr: Concern arises, for example, in the defined term "consolidated financial statements," which means the financial statements of a First Nation, including those entities that are required by those principles to be included. They are presented as those of a single economic entity. That includes any corporations in which the First Nation would be a shareholder, any partnership in which they are a partner and any joint venture to which they are a party, and then it talks about unincorporated associations and organizations. It seems to cover quite a wide gamut of activities that goes beyond any money provided by Aboriginal Affairs or Health Canada or Justice Canada or whomever from the federal government. This would seem to capture all of those activities.
If a First Nation is operating, let us say, a successful gas bar located next to a town and owns the shares in that corporation, the economic activities or the financial statements of that entity, which under the law is seen as a separate legal entity because it is a corporation, will now have to be folded into that First Nation's financial statements and posted on the website, and the neighbouring competitor gas stations will be able to go on there and see what kind of business they are doing. That First Nation likely has invested and created that business from the ground up with its own separate monies, not monies that have come from the federal government. I do not understand why that information has to be made publicly available.
Let us say they have a joint venture. Maybe they are involved in the catering business on a resource project where they have joint ventured with a large multinational organization or company. All of a sudden the business information from that joint venture, which has nothing to do with any federal funding, will have to be disclosed in their consolidated financial statements. Again, I do not understand why, but I am sure that a number of competitors in the same area will be very interested in going on the web and looking that stuff up. Then, when it comes time to bid for another project, they will be able to say, "Okay, this is what these guys are doing on this project; let's undercut them." Those joint venture parties might say, "We would like to do business with you, but we really do not want our private financial information, which we do not want to disclose, put on the Internet."
Mr. Makinaw: Further to my colleague's comments, one of the problems we have in our CFA, as he mentioned, is that different departments run on their own dollars and have nothing to do with CFA dollars or any government funding, and we are required to report on that. It has been our argument for years that we should not be doing that, especially when there is no government funding going into that. That is one example.
We have been at the table with INAC for the last 10 years bringing that same point across. Why should we be reporting on departments or businesses that have no government funding whatsoever and are on their own? We have expressed that concern and will continue to do so. They are on their own, and that is a success.
What really worries me is that when discussions are being held at the table, own-source revenues will be used as a penalty against the band. You wonder why you are trying to get ahead when you are being penalized. That is something I am worried about right now when we sit here and discuss these things at the table.
Senator Seth: Thank you very much for giving us the information. I am a little stuck here. I am not able to understand why you say Bill C-27 is not good enough. Do you not think it gives transparency and accountability to a First Nation and its elected officials? What measures should be taken to keep accountability and transparency of a First Nation's elected officials? What should we do? How should we manage this? I am not sure, and I would like to understand that.
Mr. Makinaw: As the Canadian Bar Association said, there has to be more consultation on Bill C-27 so we can agree on things in this bill and other acts. Many of us are doing what we can, and I am sure we could sit at the table and discuss these things and come up with a good understanding and conclusion on these issues. I think we can come to a good understanding and agree on things. What I look at down the road is trying to come back to the table and come to a good decision that will benefit everyone, instead of disagreeing.
Senator Seth: There should be law and order. As we do our accounting, we submit each year. It is all open to the public or sent out to the tax department. Is it not a good practice to do that?
Mr. Makinaw: Yes, it is, and we do that every year. As I mentioned earlier, we do an audit report on our CFA dollars, and then we will be doing another audit report on our own dollars, our own trust account, to our members, so we will be giving two to our people this year. We are doing our part. Where we stand on Bill C-27 is that there are some parts we are already doing, and I do not see why we should be further penalized if we are trying to do what is there and are abiding by it.
Senator Seth: Did we find any solution for that?
Ms. Venne: One of the things about this legislation is that it was not discussed with us as treaty peoples, and it should have been. There was no clear process of how legislation comes into being when it relates to treaty peoples. All of a sudden, it appears: We get a letter from the minister or we hear it in the news. There should be a clear process when dealing with treaty people.
The way the legislation is constructed now goes way beyond anything required of any other citizen in Canada. Why is that? Why is that being imposed on First Nations people? It is a question of how the government thinks they can impose their will on treaty peoples.
If you look at the CFAs and you understood the contribution agreements and read the conditions of the contribution agreements that Canada brings out, I think most people, if they saw that, would be shocked by the conditions imposed through the contribution agreements. The reporting that is required by First Nations back to the government for the monies is onerous, for the most part, because we have limited resources and have to spend a lot of time writing these reports.
The other thing is that this legislation captures everything, as has already been stated.
Constitutionally, how does the federal government deal with that? The federal government cannot pass legislation that impedes or interferes with the provincial jurisdiction, and yet, if we receive monies from the provincial government — and they give monies based on certain criteria — whatever is there will be part of the net that is being cast now. You are actually putting your net over the provincial government contributions to First Nations. That is why we are asking for the committee to step back and look at it. It seems to me that there needs to be real sober second thought about what is actually ingrained in this legislation and what is behind the legislation. At the end of the day, it does not seem very logical.
Senator Patterson: My questions are to the Treaty 6 Confederacy. I certainly want to say that we acknowledge that many First Nations are working hard to be transparent, and it seems like Treaty 6 nations are exemplary in that regard. I believe that you have significant numbers of your members off reserve, and I am wondering how they might get access to all of the information that you are getting.
We have to be concerned about the First Nations that are not exemplary and are not working hard to be transparent. It is no secret; I am sure you have heard it. We have heard band members say that they cannot get information or that they are even punished for asking for information. Canadians are concerned because this is taxpayers' money. Do you not think that Canadians' perceptions of First Nations would improve if all First Nations were to publish their financial statements and be accountable to their members and the public, as you are?
Mr. Makinaw: Yes, I agree with you. Two years ago, I think it was at the December sitting of the AFN that the chiefs made a motion accepting accountability and transparency. That motion was to tell the government that we are doing that already, and it seemed like that whole motion was turned around and used in different ways. I was sitting in that meeting here in Ottawa, and that was just to show the government that we are doing that. As chiefs, we sat there at that December meeting to make that motion. That was just to tell the government at that time that we are doing that, and we are trying to find ways to improve. I think we were working with the Aboriginal Financial Officers Association of Canada on a lot of these things, so steps have been taken. I hope that things will get better, more bands will improve and, in the end, our reporting will be good for the agreements that we sign.
I agree with your comments, senator. My goal would be to eventually see all bands do the same thing too.
Ms. Venne: I would add that Ermineskin has its own financial act. All the members of Ermineskin have the right, whether they are within or outside their territory, to the information, so I do not think that is an issue. Of course, Aboriginal Affairs has the contribution agreements that the First Nations are only supposed to provide services to the members within their First Nation, so if the government moved to provide the funds that matched all of their members, whether they live within the reserves or outside the reserves, it would be more logical for the government to say that we have to ensure that all of those people have the information. Right now, if you live outside the reserve, the government's financial contribution agreements do not allow First Nations to provide services to you. It is written in the agreements. Therefore, if you want to extend the funding to all members, that would be fantastic.
One little comment I wanted to make was about you saying "Canadian taxpayer dollars." Government monies come from the lands and resources of our nations. We made peace and friendship treaties with the Crown that allowed settlers to access our territories and to use some of our resources. We were supposed to receive benefits at the same time. Actually, it is not taxpayer dollars; it is our money that you are returning to us from our resources.
The Deputy Chair: Senator Patterson was talking about bands that do not comply and do not provide audited information to their band members. We know those bands exist. We already know that, even with the same remedies that are in this bill, the government cannot make those bands comply, so, in your opinion, how will Bill C-27 make them comply? It looks like it has exactly the same remedies. In my view, it does not look like it is any different. Can you see how it will make those bands comply?
Mr. Regehr: It is fairly easy in that the minister can provide that information directly to the member, and my understanding is that they do that under the current contribution agreements. Under the bill, they would have to go to a superior court. I just do not understand the point of it. The minister can already provide that information to the member who is not receiving it directly from the First Nation. If the First Nation is refusing to do that, the minister already has remedies under the contribution agreements — imposing conditions, clawing back funding, appointing third-party managers or co-managers. I hate to phrase it this way, but what is the point? There already are mechanisms for encouraging accountability and transparency.
It goes back to our point that the approach should be discussing and consulting with First Nations on these things. Resources should be put into helping First Nations improve these types of things rather than dictating First Nation financial reporting requirements that in large part do not make sense in light of arrangements that are already in place.
The Deputy Chair: Chief Makinaw or Ms. Venne, would you like to add anything?
Ms. Venne: Let me give one example to the committee about these contribution agreements. There is a lot of material in those contribution agreements that First Nations have questioned over the years, as Chief Makinaw referred to. There have been attempts to negotiate the terms and conditions in those agreements that would suit the First Nation. This is a rollout of a national idea. There was no consultation with the First Nations. There was no discussion. These contribution agreements were rolled out. Aboriginal Affairs basically said, "Sign the agreement or you do not receive funding," so two years ago Ermineskin signed the agreement but wrote underneath, "Signed under duress and threat." Last spring, Aboriginal Affairs wrote a letter to them saying that they had to remove, by resolution, the words "under duress and threat." If they did not remove those words from the document, they would receive no monies through the contribution agreement.
It seems to me that the government already has in its hands the necessary tools if it wants them. We tried to negotiate that and said, "Maybe we can find other wording," but they were adamant that they wanted to have a letter that was followed with a resolution of the chief and council saying that they were signing this agreement but without duress and threat. The threat was that if they did not remove it, they would not receive the funding. That is the way it was operating.
The Deputy Chair: Did you have a supplementary?
Senator Patterson: I asked one question and then you had several supplementary questions, so may I have another question?
The Deputy Chair: Yes, definitely.
Senator Patterson: Thank you.
I wish this bill would deal with the resource revenue sharing issue that we have managed to deal with in Nunavut, but unfortunately it is focused on accountability. My understanding is that the minister does not have the authority to publicly reveal information about salaries and related financial statements now and this bill provides the authority to provide that information publicly.
I want to ask a question of the Treaty 6 confederacy. You speak eloquently about self-government, the inherent right to self-government and section 35, about enhancing what I would think is strong, local accountability. However, you are recommending that we set aside this bill so that First Nation members who cannot access financial information relative to their band will have to keep going to the Minister of Aboriginal Affairs to get that information. I cannot understand how it would enhance self-government and strong local accountability to set aside the bill and leave the paternalistic big brother, colonial minister to be the only recourse for band members who want to get this information. Is the bill not actually going in the direction of enhancing self-government by putting that information in the hands of the members from the band rather than from big brother minister in Ottawa?
Mr. Makinaw: As stated earlier on the CFA agreements, there are reporting mechanisms there, and Indian Affairs does use them. They are there for INAC when they use them in their agreements. If we do not report a certain amount at a certain period of time, we start getting penalized. I believe we have 90 days after the beginning of the budget year to try and report our audits by the end of July. We have certain time periods where we have to report. Every band has to do that in their agreement. That is something that we all follow and we especially follow. A lot of the bands in Treaty 6 follow that.
As far as the self-government agreements, I cannot really comment on self-government. We are treaty, and so I do not want to comment on self-government yet. That might be something to talk about down the road, but not here right now. I do not want to comment on self-government.
Senator Ataullahjan: My question is to the Canadian Bar Association. In your presentation this morning and in your letter of June 2011 to the former minister, you state that the bill will not improve on the capacity of the First Nations to assume control over their own affairs and that the legislation will not increase the capacity to facilitate best practices by the First Nations government. Can you elaborate on this? What do you mean by "capacity"?
Mr. Regehr: What we mean is that some First Nations have large and excellent financial departments because they have the resources to hire people with the necessary training and expertise to do that. Other ones have much smaller budgets. It would seem to me — and this is what the Canadian Bar Association was talking about — that it would make a great deal more sense to put the necessary resources into assisting First Nations develop their own systems of accountability and transparency rather than dictating to them to put all of their information in the public sphere and legislating requirements that they already have under contract, and to engage in dialogue with First Nations about developing these systems of transparency and accountability. That seems to make a great deal more logical sense than putting this bill forward because it does nothing to assist First Nations who are struggling with transparency and accountability in financial reporting. It does absolutely nothing.
Senator Watt: I have been distantly following the argument that is being brought forward on transparency and accountability issues. At times I wonder whether we are really focusing on an issue that needs to be rectified if it is broken. I hear what you have to say in pointing out that Bill C-27 will probably only complicate things further and does not really do anything to help the communities. The communities require a great deal of assistance with the problems they go through.
I also understand quite clearly, and I think you made it absolutely clear, that Bill C-27 will not improve anything that exists today or anything to come in the future. I think you are basically telling us to scrap this bill and start again to try and develop a mechanism between the First Nations and the Government of Canada to go to the table, sit down and negotiate and go through the whole thing thoroughly.
In a sense, Bill C-27 touches upon a very sensitive area, which I believe was quite well explained by the member from the Canadian Bar Association. In hearing that, I can only go as far as saying that I understand you and I support your concern. This requires further development, and it should not be allowed to go through because it will only complicate things in the future.
I really do not have any questions on this issue. I follow your concern and I am with you. This should not go through. I think it should go back to the negotiating table.
Senator Patterson: I have a quick supplementary. The CBA talks about having 37,000 members. I would like to know what mandate you have from the Canadian Bar Association, or from the practising Aboriginal lawyers in Canada, to make the presentations and recommendations you made today. What is the consultative process within the CBA?
The Deputy Chair: We have another panel coming up, so please keep your answers very short. Thank you.
Ms. Reeve: I will just indicate that any submission that comes before any committee is vetted entirely through our national office. This is a letter that has come from the National Aboriginal Law Section. It is distributed to the executive, and then once it is approved it goes through a two-stage approval process at the national Canadian Bar Association office. No submission that comes to this forum is without many, many eyes, including the executive officers and president of the Canadian Bar Association.
The Deputy Chair: Thank you.
I apologize to Senator Raine. We are running out of time and we have another panel. Unfortunately we will not get a chance to have you ask more questions.
I would like to thank our witnesses this morning, Ms. Sharon Venne and Chief Craig Makinaw from Ermineskin First Nation and the Confederacy of Treaty Six First Nations; and from the Canadian Bar Association, Mr. Bradley Regehr and Marilou Reeve. Thank you so much for your presentations.
Our next panel is from the Aboriginal Financial Officers Association of Canada. I wish to welcome Mr. Terry Goodtrack, President and Chief Executive Officer; and Daniel Richard, Chairman. We look forward to your presentations, after which we will have a round of questions from senators. Please proceed.
Terry Goodtrack, President and Chief Executive Officer, Aboriginal Financial Officers Association of Canada: Good morning, honourable senators, ladies and gentlemen. Thank you for your invitation to appear before this committee to speak about Bill C-27, An Act to enhance the financial accountability and transparency of First Nations.
The Aboriginal Financial Officers Association of Canada is non-political not-for-profit organization. Our mission is to contribute to Aboriginal social and economic prosperity by building a professional workforce that supports the effective governance and administration.
It is said that to a man with a hammer everything is a nail. Trained in finance as I am, you might say that it is my hammer of choice and that accountability and transparency are my nails. I care very much about the cultivation of financial and management acumen in Aboriginal communities. That is because a body of citizens skilled in finance and management will transform the conditions of First Nation, Metis and Inuit communities across this country. This prospect of thriving Aboriginal governments, institutions and businesses driven by a new generation of trained and educated citizens brings me, by way of contrast, to the deficiencies of this proposed legislation.
I have spoken already to the details of this bill. I told the Standing Committee on Aboriginal Affairs and Northern Development why Bill C-27, in my view, is not only a lost opportunity but also a step backward in promoting strong Aboriginal governments. That presentation is a matter of public record, and you may consult it at your leisure. Today I will speak about the big picture and why, in the big picture of where we are headed, this bill is such a grave disappointment.
Before I do, I note that there is nothing about the principles of accountability and transparency to which Aboriginal leaders or AFOA Canada object. Most of our communities are not lacking in this area, as the government acknowledges. At the second reading of the bill on Wednesday, June 20, 2012, then Minister Duncan said that he has no doubt that most First Nations strive to be accountable to their members and to the federal government. Aboriginal people have long recognized the importance of these principles, and that is why communities have developed and are developing rules and practices and institutions to ensure good governance on behalf of their citizens.
In fact, there is nothing in Bill C-27 that we have not had for 15 years. The accountability framework has existed since the 1980s. The consolidated audits and the schedule of salaries, honoraria and travel have been included in the year-end-reporting handbook since the mid-1990s. There is no shortage of reporting requirements or, for that matter, of reports. I would like to be clear that more reporting does not equal more accountability. Why object to this bill? I will begin by posing two questions: What exactly is a First Nation government as envisioned in Bill C-27? What is the relationship of the Crown and First Nation governments?
If we pursue these questions, as I will do, we see the deficiencies clearly not only of this bill but also of the conventional political wisdom about accountability in Aboriginal communities. What is an Aboriginal government according to this bill? In my view, this bill does not even acknowledge that there is such a thing. Where are the words "First Nation governments?" They do not even appear together in this bill. Bill C-27 holds First Nations to a mishmash of government standards — in some parts to provincial standards, in other parts to federal standards and in other parts to standards inconsistent with every level of Canadian government. Bill C-27 stops short of acknowledging that First Nation governments are governments. That is a telling omission.
What about the relationship of the governments in Canada and Aboriginal governments? Where exactly does Bill C- 27 fall on the continuum leading from the principle of control to the principle of partnership? We are well acquainted with accountability frameworks that issue from a relationship organized around control. They can be characterized by an ever-deepening burden of reporting. They are accompanied by the claim that it is all to the good of Aboriginal people, who have usually had little input into the arrangements imposed upon them and who have to live with the consequences of policies that do not nurture local development and empowerment.
A partnership, by contrast, would be informed by acknowledgment of Aboriginal governments as just that, governments constituted to benefit and to be morally and financially answerable to their citizens. As a consequence of this recognition of a partnership, the accountability framework would necessarily change. You would simply have to go about business in a fundamentally new way. You would have to provide for, in the immediate, medium and long term, community-based and community-driven efforts throughout First Nation, Metis and Inuit communities that advance financial literacy and acumen, that promote reporting that local citizens deem meaningful and that expand authority and jurisdiction to ultimately facilitate thriving and self-determining Aboriginal institutions.
This bill, I suggest, rehearses a familiar and tired script. In keeping to the script, Indian Act-styled solutions have prevailed over the vision of a Crown-First Nation partnership. It is a case once again of a short-sighted provision, not a long-term vision.
Senators, I know that you have the circumspection and acuity to have noticed that we have arrived at a historic moment. It is now our time. This has been stated by our national leader, Shawn Atleo. The Prime Minister, early in his tenure, made a powerful apology for the residential school system and has spoken eloquently of a renewed relationship between Canada and Aboriginal people. All this bill really does, however, is pile on an additional handful of undefined reporting schedules and some inconsistent standards to the existing Indian Act legislation base.
I said earlier that there is nothing in this bill that we have not already had for at least 15 years, and that is the case, but it is going to cost communities time and money figuring how to repackage their reports in a post-Bill C-27 world. Meanwhile, the federal government has axed the tribal council funds which provide this financial guidance.
I look down the road and, let us be clear, this bill keeps us on the road we have been on for far too along already, and I anticipate yet more reports from the Auditor General of Canada highlighting the overall reporting burden but the lack of reporting that is meaningful and empowering to First Nation citizens.
You ask, "What would you have us do?" The answer I would offer is, in short, to redefine the accountability bargain.
First, the relationship of control must yield to a genuine partnership in which First Nations governments are treated as the governments that they are; endowed with authority equal to the responsibilities, rather than as Aboriginal Affairs recipients.
Second, as a partner, Canada must be accountable to Aboriginal governments and not merely the other way around.
Third, the delineation of accountability must be clarified. In other words, who exactly is accountable to whom and for what? As matters stand, there is a mismatch between a First Nation government's responsibility and its authority, and that is because, as I have said, control rather than partnership drives the policy agenda.
Fourth, a truly transparent reporting regime must produce information that is meaningful to the intended audience, in this case Aboriginal citizens. This will require input and engagement from Aboriginal citizens as well as attention to issues like financial literacy.
Fifth, the idea that more reports equals more accountability must yield to an efficient reporting regime. Replace the current bureaucratic arrangements with a one audit, one report approach.
Sixth, the long-term vision of effective and self-directed Aboriginal governments brought about through a process widely felt by Aboriginal people as having legitimacy must guide the legislative agenda.
This, senators and colleagues, is what the times require and clearly this is not the vision of Bill C-27.
The Deputy Chair: Thank you, Mr. Goodtrack.
Senator Raine: Thank you very much for your excellent presentation. I can see that you put much thought into it and you obviously have a vision of where we should go.
The dilemma that I see is that there is such a difference between First Nations. Having one set of legislation to cover the whole spectrum would certainly not be easy.
You said in your presentation "on behalf of its citizens." How do you think First Nations should be accountable to their citizens? Some First Nations are well established with all kinds of own-source revenue and capacity and others are struggling. How does your association deal with those kinds of challenges?
Mr. Goodtrack: There are vast differences between First Nations. The question becomes "how many?" How many First Nations are actually well governed and how many are in this pool that you are referring to per the legislation? I have tried to get that information. I thought that audit opinions would be some indicator, although not giving the full picture. I have asked the Government of Canada what the current audit opinions are of First Nation governments across the country. I made that request in a letter. I made the request through access to information, and then I asked again. The only answer I received is that it is difficult to push a button and receive that information. I challenge that. I challenge it because in 1993 and 1994 I worked for the Government of Canada. This was my job. I was the manager of financial accountability. In 1993-94, 78 per cent of the audits were unqualified, 17.7 per cent were qualified and 3.5 per cent were denied.
Bill C-27 puts everybody in one boat. The only statistic that was made available at the Standing Committee on Aboriginal Affairs was that there were 250 complaints. It was asked whether those complaints all came from one individual or from one community. That was not clarified.
For the sake of argument let us say that it is 250 individuals. There are over 700,000 First Nations people in Canada, so 250 is less than 1 per cent. It is interesting that the government is creating legislation for a policy problem perceived by less than 1 per cent.
I will go on to accountability of citizens. That is a great question. Accountability is like electricity. It is hard to define, but if it is not there, you can really tell. Our conference a couple of weeks ago in Toronto was on relationship building between First Nations and governments, the First Nations corporate world and so forth. On the second day we talked about the notion of changing the accountability bargain. On that panel were Chief Tammy Cook-Searson from the Lac La Ronge Indian Band, Grand Chief Mike Mitchell from Akwesasne, former Prime Minister Paul Martin and myself. We discussed this very issue of accountability of citizens.
Finance is not the only issue here. We do believe in transparency, as I believe that every person who has appeared before you has said. The question is how it is exacted. I argue that it is exacted in four dimensions. One is the dimensions of what I call public service. Transparency, meaning that the method of operation is known, disclosure of information and redress make up one dimension. The second dimension is that of performance; blending financial information and performance information to make it meaningful to the citizens with regard to what they want. The third obviously is financial, and the fourth is professional. At AFOA Canada we have established the notion of a certified Aboriginal financial manager, and a core part of that is ethics.
Coming back to why Bill C-27 exists, it is a policy instrument choice for a perceived policy problem. The policy problem is really undefined, but the policy instrument choice is legislation. Could it not be education? Could it not be funding organizations like ours? Community-based organizations are another policy instrument choice.
I hope I have answered your question, senator.
Senator Raine: Not really. If I am a band member, and I want to know what is going on with the leadership and the finances in my band, how do I get that information?
Mr. Goodtrack: Right now, those mechanisms exist, as outlined previously by the Canadian Bar Association.
Senator Raine: Do I have to write to Ottawa?
Mr. Goodtrack: Again, they exist currently through the contribution agreement. They have to be disclosed at the First Nation. Otherwise, it is withheld. The funding between the federal government and the First Nation is withheld.
Senator Raine: How is it disclosed at the band office?
Mr. Goodtrack: It is put in what they call a conspicuous place. It is disclosed. From there, if the First Nation member cannot get it, it can be provided by the federal government under the Sawridge decision. Those mechanisms are already there. That is the point we are trying to make. This does not add anything. These things have been in existence for some time.
Senator Raine: In your opinion, are there cases where a band member would be intimidated to go and look at that information? I suppose you would have to stand there looking at it for quite a while because it is probably quite complicated.
Mr. Goodtrack: That is a good point, which is that audit financial statements are very complicated. It is to a point now that you need a professional accountant to be able to interpret it. I am a CGA by profession. Mr. Richard is a chartered accountant by profession. You need someone with our qualifications to be able to do that. What we are saying is that the better opportunity is to take information that is more meaningful to the citizens.
As an example, we are now working with SEDI out of Toronto and the Martin Aboriginal Educational Initiative to try to do that. How can you interpret financial and performance information to community members? The chief of the Mathias Colomb Cree Nation had that concern. The interesting thing is that it is his choice. It is his community's choice. It is not imposed by another level of government. That is what I am trying to convey here.
Initially, I was going down the line on the schedule of salaries talking about comparability, because they are all different. Saskatchewan is $50,000, Ontario is over $100,000 and so forth. The question is, why are they actually all different? Then you realize the reason it is different. It was that government's choice, with their citizens, to make it at that standard. This is now imposed by another level of government. To what percentage? We do not know what percentage we are talking about here.
When you refer to citizens, I guess I would ask, how many are we talking about? What individual First Nation is that? Is it all 633? Is it one and two?
Senator Munson: This is not meant to be a mean question. I always ask questions like this. For example, with the Canadian Taxpayers Federation, I always wonder who they are and who pays their salaries and why they have so much to say about different things when they take on politicians and/or others. There is a Canadian Taxpayers Federation out there. In your own association, who pays your salaries and how does this work within the Aboriginal community? I am just curious about the background on that.
Mr. Goodtrack: We received 41 per cent of our funding last year from the federal government. We also received money from memberships. We have 1671 members across the country, made up of individual members and finance, management, even elected officials, students, elders and so forth. We also have funds that come in from our workshops and courses on line that we provide to Aboriginal communities, both on reserve and off reserve. We have our national conference that, as I mentioned, was a couple of weeks ago in Toronto. Our next conference is February 25 to 27, 2014, in Halifax, Nova Scotia. I certainly invite all senators to attend. We are thinking of our new theme being on citizen engagement. I would certainly like to see you there.
Senator Munson: For background, I just like to know those things. On Bill C-27, you talked about it being a disappointment and a step backwards, I think you said. What kind of impact will it have on the services you provide? Has the government approached your organization to provide any additional services?
Mr. Goodtrack: It is interesting. I guess the question to that is our premise, as I mentioned earlier, is the notion of we provide training to individuals in finance and management. We do receive funding from the Government of Canada, as I mentioned, 41 per cent of our budget. We try to give courses in financial services, financial management and in our new designation, which is the Certified Aboriginal Professional Administrator, on different areas of management, which is certainly values and ethnics, communications, financial oversight and human resource management. The premise is to build the individual. What we do not do is tell them what to do. We are not an advisory body. We train individuals.
The Government of Canada have certainly approached me just recently to talk about financial literacy projects. I think that came out of the Standing Committee on Aboriginal Affairs and the emphasis on that, and that is certainly something we do. We have a number of projects in that area.
Senator Munson: I have been a senator for about eight or nine years now. At this stage of the game with these kinds of hearings, we are just perhaps days or a few weeks away from clause-by-clause consideration. When we get to this point, you get to have your hearing, and there are political and philosophical differences on both sides of this table. The die, in my opinion, has been cast already that this bill will get passed. How do you feel when you come to a committee like this — I will gently but firmly pound the table — and the witnesses before were saying the same thing, but not very much is going to change? I know we are supposed to be your chamber of sober second thought and hopefully try to amend or put forward observations and get it that way, but as time goes on we can see where philosophically we differ in the approach to Bill C-27.
Mr. Goodtrack: When you extended the invitation, I sat there and had a discussion with our chair and our past chair on this. I thought we could just sit there and just discount it and say it is going to go through anyway, but it is a matter for us to put on public record our beliefs and probably hope that the Canadian public will hear us, because it is on public record and someone will hear what we have to say. I recognize it is going through. I fully recognize it. In fact, I approached the Aboriginal Affairs Department, saying we need to provide some guidance on this thing and some options so we are not fumbling with it in communities and creating something worse that happens in the communities in terms of confusion and so forth and further withholding of funds and that kind of stuff. If it is going to go forward, which it will, we have to have some type of guidance.
Senator Munson: There is a bill, but regulations follow. There could be that kind of process. Could something still happen that would satisfy your organization and other organizations or groups within the Aboriginal community?
Mr. Goodtrack: I am not sure, given everybody's concern. It is one of those things. It will happen. Now we have to get on and deal with it, I guess. We have said what we have to say. Now we are just going to have to figure out how to deal with it in a post-Bill C-27 world.
Senator Demers: Mr. Goodtrack, I like people who are organized and you are very organized. A self-governing First Nation is already required to disclose their financial information. We have talked about that. In the three-and-a-half years I have been on this committee, this is one of the most controversial bills. It is a tough bill. Would Bill C-27 help other First Nations acquire autonomy and achieve self-government?
Mr. Goodtrack: My opinion is this does very little in that area. What I tried to convey with the previous senator's question was four dimensions of accountability. This is based on research. I wrote my thesis on the case studies of four First Nations that were in the 78 per cent that I referred to back in 1992-93. I do not come at this lightly. That is where I constructed this idea of four dimensions of accountability.
We are picking on one small item which is already in existence. I, too, question the need for this, especially with the statistics that have been provided so far. How many are we really talking about here? The one approach we know does not work from years ago. One approach is dealing with all the First Nation governments. The other part is that you have to look at this within the perspective of the relationship. I was trying to convey that it is a relationship of control versus a relationship of partnership.
Once you look at where you see Bill C-27 falling — that is imposed by another level of government — is it control or partnership? That is probably the philosophical discussion that we are grappling with. I believe it is still along the line of control and you are not allowing the First Nation to develop those accountability mechanisms by themselves. If you allow that to happen and outline broad principles, is that more legitimate in the eyes of those citizens? When I get back to our conference next year, which you are all invited to, that is why the topic of citizen engagement and what it really means would be timely.
Senator Patterson: This bill is not about self-government, as you have indicated, although maybe you would like it to be. In fact, it refers to self-government in the interpretation section and says it does not apply to self-governing nations. It may be an incentive to self-governing nations or to bands to become self-governing nations.
Mr. Goodtrack, I cannot get you straight here. In your presentation, you talk about more reporting. You say more reporting does not equal more accountability. You said there would be time and money for First Nations to figure out how to meet the requirements in this bill. Then you said that there is nothing in this bill that is doing anything they do not already have to do.
We hear that the reports required are already required. The difference is that the bill requires that they be public. Why do you suggest there is an added reporting requirement or burden?
Mr. Goodtrack: There are a couple of reasons. As I mentioned, the consolidated schedule of salary, honoraria and travel has been around since 1995. It has existed since that time. There is also a companion document called the Year End Financial Reporting Handbook, as amended from time to time, which is in the agreements that the Government of Canada has with First Nations. Through this companion document, a number of schedules are added almost every year. In fact, the last batch of schedules was added last May, retroactive to the previous year. That was done again without the involvement of AFOA Canada. In June, I had to go with some of our members to the Department of Aboriginal Affairs and Northern Development and say, "What does this even mean now? How do these schedules relate to what accounting standard?"
The topic of consolidated audits is already defined in generally accepted accounting principles. That is a requirement of the Canadian Institute of Chartered Accountants, CICA. However, the added schedules — which the salary, honoraria and travel are part of — emanate from this document and there are added schedules that keep going almost every year. That is without review by our members.
When I approached the government on that point and asked who was actually involved in this, they went to the eight national accounting firms. I said, "Are we not missing some person or body in this if you are going directly to the accounting firms? Should we not be part of outlining what those schedules should be?" The notion of consolidated audits is a good question. They are asking for the financial position and the income statement, but then you have all these wonderful schedules that come later and those are the ones that really add to what I will call the administrative burden.
Senator Patterson: We hear from officials that they are making efforts to reduce and consolidate the reporting requirements. Are you telling us that is not what is happening?
Mr. Goodtrack: I worked in government for over 10 years. Back in the 1990s we said it was to reduce reporting. This is a long discussion that is been going on. On reducing reports, yes, I have seen the numbers. You go from 8,000 down to a certain amount.
It is interesting, in my first job in the Government of Canada, I worked for Employment and Immigration and I was the forms review coordinator. We went through and tried to reduce the paper burden and get the number forms down to a certain amount. However, what happened a lot of times was that we lengthened the form. We did not change the information required. When you change the accountability bargain and the notion that you are trying to strengthen the relationship between First Nation governments and its citizens, it should change. It does not lessen, but it should change the accountability between the First Nation governments and the Crown. What information is really required? It is not the numerous reports, but the information required.
Senator Patterson: I guess you would agree that if the bill proceeds it would be possible and recommended that administratively the department should streamline the reporting requirements, if it has not done so already.
Mr. Goodtrack: Definitely, it should. I think that is what you are always hearing, and what the Auditor General has provided.
Senator Ataullahjan: Referring to Senator Raine's previous question, if mechanisms of disclosure are already in place, what is the harm of having that information readily available to the public? Does that not put the responsibility on First Nations themselves and eliminate the role of the department as an intermediary?
Mr. Goodtrack: You have to step back; that is what I am saying. You have to look at it from the notion that the First Nation should be just like the province of Saskatchewan or Manitoba. They should be allowed to create their own accountability mechanisms that their citizens want. Right now, Muskeg Lake Cree Nation posts their audited financial statement on their website. That was their choice. As I tried to convey earlier, the reason the salary disclosures are different by province and the federal government is because it was the choice of the government and their citizens. Why do not allow those First Nations to make that same choice if we believe that we are operating in a relationship of partnership?
As I mentioned in my presentation, the Prime Minister said at the time of the settlement agreement — the apology — that it is time for a renewed relationship. When you look at mechanisms likes this being introduced, where does it fall on that spectrum? That is my question.
The Deputy Chair: I will end with one quick question, if you could answer "yes/no" or "maybe" or "I do not know."
Do you think Bill C-27 will actually make bands that do not comply with the current regulations comply by posting the information somewhere that a band member can actually get consolidated financial statements or schedules of chief and council salaries? Will this bill actually make those non-compliant bands comply?
Mr. Goodtrack: No.
The Deputy Chair: Thank you.
We have run out of time. We have a minute if Senator Greene Raine wants to ask a second question.
Senator Raine: No, that is fine. My question was asked.
Thank you very much. I enjoyed the presentation.
The Deputy Chair: On behalf of all honourable senators, I would like to thank Mr. Terry Goodtrack and Mr. Daniel Richard from the Aboriginal Financial Officers Association of Canada for their very clear and concise presentation this morning.
(The committee adjourned.)