Proceedings of the Standing Senate Committee on
Aboriginal Peoples

Issue 1 - Evidence - November 26, 2013

OTTAWA, Tuesday, November 26, 2013

The Standing Senate Committee on Aboriginal Peoples met this day at 9:33 a.m. to examine and report on the federal government's constitutional, treaty, political and legal responsibilities to First Nations, Inuit and Metis peoples, and on other matters generally relating to the Aboriginal Peoples of Canada (topic: housing).

Senator Dennis Glen Patterson (Chair) in the chair.


The Chair: Good morning, ladies and gentlemen. I'd like to welcome all honourable senators and all members of the public who are watching this meeting of the Standing Senate Committee on Aboriginal Peoples on CPAC or on the Web. I am Dennis Patterson, from Nunavut, chair of the committee. Our mandate is to examine legislation and matters relating to the Aboriginal peoples of Canada generally. In order to understand the concerns of our constituents, we regularly invite witnesses who can educate us on the topics that are currently of importance to them. These sessions are invaluable in helping the committee to decide what future studies it will undertake to best serve the Aboriginal community. The witnesses today have been invited to provide general background information on the broad question of financing infrastructure on reserves, which could relate to housing, schools and other capital projects.

This morning, we'll hear from two departments, the Department of Aboriginal Affairs and Northern Development and Canada Mortgage and Housing Corporation, which maybe is not a department. Before hearing from our witnesses, I would like to go around the table and ask the members of the committee to please introduce themselves.

Senator Dyck: Lillian Dyck from Saskatchewan — ``Rider Nation.''

Senator Moore: Wilfred Moore, Liberal senator from Nova Scotia.

Senator Raine: Senator Nancy Greene Raine from B.C.

Senator Tannas: Scott Tannas from Alberta.

Senator Meredith: Don Meredith from Toronto, our lovely Argos fan.

Senator Beyak: Senator Lynn Beyak from northwestern Ontario.

Senator Champagne: Andrée Champagne from Quebec.

Senator Wallace: John Wallace from New Brunswick.

The Chair: Thank you. Members of the committee, let us welcome our witnesses from Aboriginal Affairs and Northern Development Canada: Mr. Karl Carisse, Senior Director, Innovation and Major Policy Transformation Directorate; and Tara Hutchinson, Senior Policy Analyst. They are joined by witnesses from Canada Mortgage and Housing Corporation: Debra Darke, Vice-President, Regional Operations and Assisted Housing; and Jeannie Dempster, Director, Strategic Policy Coordination. I think it has been agreed that the witnesses will present as a panel before we go to questions.

We thank you all for coming today to share your expertise with us, and no doubt the members will have questions for you after your remarks. Please proceed, Mr. Carisse.


Karl Carisse, Senior Director, Innovation and Major Policy Transformation Directorate, Aboriginal Affairs and Northern Development Canada: Mr. Chair, honourable senators, I want to begin by thanking you for the opportunity to speak today on the topic of housing in first nations communities.

Access to safe and affordable housing is essential for improving economic and social outcomes and for supporting healthy, sustainable first nations communities.


The provision and management of housing on reserve lands is under the jurisdiction of First Nations, with support provided by the Government of Canada through various programs and initiatives. The Government of Canada provides an annual investment to support on-reserve housing needs through Canada Mortgage and Housing Corporation and Aboriginal Affairs and Northern Development Canada. The federal government currently invests an estimated $303 million a year to address housing needs on-reserve — $146 million through Aboriginal Affairs and $157 million through CMHC.

Aboriginal Affairs provides funding to communities for a range of housing needs, while CMHC is focused on the delivery of specific housing programs for First Nations.

Between 2006-07 and 2012-13, the Government of Canada provided a total of $2.3 billion in on-reserve housing support to First Nations, including $1.2 billion provided by the Department of Aboriginal Affairs and Northern Development. Based on annual reports submitted by First Nations to the department, Government of Canada funding and First Nations' own investments result in, on average, the construction of 1,750 new residential units and the renovation of more than 3,100 existing units each year.

In addition to annual funding, the Government of Canada has also provided substantial investments in on-reserve housing through one-time funding initiatives. For example, to help address issues of overcrowding and disrepair, $400 million was announced for on-reserve housing between 2009-10 and 2010-11 under Canada's Economic Action Plan.

Close to 500 First Nation communities benefited from this funding. From Aboriginal Affairs' $150-million allocation alone, over 4,400 units were built or renovated.

In addition to capital funding, the government provides financial support to individual First Nation residents through the Income Assistance Program. As part of this program, approximately $125 million is provided each year to eligible recipients as a supplemental support for rent, utilities and other allowable shelter costs. The amounts payable vary according to rent payments, size of family unit and the maximum amounts payable by provinces or territories.

The Government of Canada does not cover the full cost of housing. First Nations and their residents may secure funding from other sources for their housing needs, including shelter charges and private sector loans and investments, as is the case off-reserve.

Aboriginal Affairs provides support through three key programs: the 1996 On-Reserve Housing Support policy, the housing subsidy program, and the Ministerial Loan Guarantee program. Most First Nations fall under the Aboriginal Affairs' 1996 housing policy, which is based on the principle of First Nations' control. First Nations under this policy receive an annual capital allocation from the department based on a formula that takes into account population and remoteness. First Nations can use these funds for a range of housing needs, including construction, renovation, maintenance, insurance, capacity building, debt servicing, and the planning and management of their housing portfolio. This provides First Nations with the flexibility to target funding to the particular housing needs of their community. To opt into this policy, First Nations were provided with additional funding to establish housing policies and a multi-year housing plan.

For First Nations that have not opted into this policy, which includes those in British Columbia as well as a few in Ontario, funding operates on a subsidy basis. First Nations submit proposals to Aboriginal Affairs and, based on priority, subsidies between $20,000 and $40,000 are released for specific construction or renovation projects.


The Ministerial Loan Guarantees program is another means through which Aboriginal Affairs and Northern Development Canada supports first nations housing. The crown ownership of first nations lands makes it difficult for community members to obtain financing for housing construction or purchase. More specifically, subsection 89(1) of the Indian Act protects Indian property from seizure by a non-Indian. That prevents individuals from obtaining a conventional mortgage on reserve lands. To address this issue, Aboriginal Affairs and Northern Development Canada introduced the Ministerial Loan Guarantees program in 1966 as a tool to provide lenders with government-backed security for loans issued on reserve. The department's guarantee authority limit is $2.2 billion, of which $1.82 billion is currently issued. Nearly one third of on-reserve housing is currently under financing that includes a ministerial loan guarantee through Aboriginal Affairs and Northern Development Canada.


Many First Nations communities build or renovate housing through the programs of Canada Mortgage and Housing Corporation. CMHC provides significant support to First Nations to the On-Reserve Non-Profit Housing Program, which assists First Nations in the construction, purchase and rehabilitation, and administration of adequate and affordable rental housing on-reserve. CMHC also offers financial assistance to First Nations to repair substandard homes through their Residential Rehabilitation Assistance Program, as well as a number of other targeted programs and support for Aboriginal capacity and development initiatives.

In 2008, the Government of Canada invested $300 million to create the First Nations Market Housing Fund which was developed to broaden the range of housing options available to First Nations communities. Overseen by a board of trustees, the fund is a credit enhancement vehicle to improve First Nations' access to private financing. In addition, funding is available to eligible communities for capacity development initiatives. The fund has issued approximately 50 loans to date. Take-up of the fund's product has been slower than anticipated due to many factors, such as the financial expertise required by the First Nation, lower-than-anticipated interest in market-based housing, and challenges faced by individual First Nation members in getting approval for a housing loan from a financial institution. Aboriginal Affairs and CMHC are working with the First Nations Market Housing Fund to identify strategies to better meet the needs of First Nations.

Aboriginal Affairs continues to work closely with First Nations stakeholders and other government departments to address issues that arise related to housing on-reserve. For example, Aboriginal Affairs collaborates with the Assembly of First Nations, CMHC and Health Canada on the National Housing Liaison Committee. This committee provides a regular forum for exchanging information on First Nations housing matters and promoting improved housing outcomes on-reserve. For example, committee members are currently working to identify and clarify roles and responsibilities for all parties involved in First Nations housing.

Capacity to build and maintain housing is a challenge facing many First Nations communities. The Government of Canada recognizes that capacity development support is required for some First Nations to effectively construct, maintain and manage housing. For this reason, Aboriginal Affairs, Health Canada, the First Nations Market Housing Fund and CMHC offer First Nations a range of capacity development programs, tools and information related to housing on reserves.


To support the management of on-reserve housing projects, first nations may also choose to draw upon the resources and expertise of a variety of First Nations associations and organizations.

The First Nations National Building Officers Association is one such resource available to first nations. Technical organizations, such as the First Nations Technical Services Advisory Group in Alberta and the Ontario First Nations Technical Services Corporation, also offer training, information and tools to build capacity and improve the management of infrastructure portfolios.


Home ownership and private sector financing are an important component of meeting the demand for housing on- reserve. The First Nations Market Housing Fund and CMHC both offer programs to support increased market housing options on-reserve, while Aboriginal Affairs issues ministerial loan guarantees to support First Nations in accessing loans for home ownership. Private sector lenders, such as the Bank of Montreal and the Royal Bank of Canada, also offer lending programs for home ownership that do not require ministerial loan guarantees.

Mould and dampness are health hazards that affect housing in all parts of Canada, including homes on-reserve. Aboriginal Affairs collaborates with the Assembly of First Nations, CMHC and Health Canada on the First Nations Indoor Air Quality Committee to address this issue. In response to the recommendations from the June 2011 Status Report from the Auditor General of Canada, the Government of Canada, in partnership with the AFN, developed a comprehensive national strategy on mould. This strategy promotes a greater awareness of the causes of mould occurrence, while building capacity among First Nation home occupants, communities, institutions and technical service providers to prevent and remediate mould.

Canada Mortgage and Housing Corporation focuses on the transfer of information to support First Nations in identifying and remediating mould-related issues in their housing. They offer workshops, guides, case studies and practical advice for First Nations communities on mould prevention and remediation, home maintenance, improving indoor air quality and building better housing. Health Canada offers public health inspections, raises awareness of the potential health effects of mould and provides guidance for mould prevention and remediation on-reserve.

First Nations may use their annual funding from Aboriginal Affairs to remediate mould-affected housing. In addition, under Canada's Economic Action Plan, Aboriginal Affairs invested over $22.5 million between 2009-10 and 2010-11 to renovate 706 homes that contained mould.

Some First Nations face particular challenges with respect to building and maintaining housing in their communities. The Government of Canada is committed to working closely with them to address their housing needs and to develop sustainable housing solutions for their communities. One such example is Attawapiskat First Nation, located in northern Ontario, which declared a housing crisis in 2011. Since then, Aboriginal Affairs has provided over $6.7 million in funding to the community to address housing issues, including $3.3 million for 22 new modular homes, close to $500,000 for the renovation of 38 homes, as well as additional funding for emergency repairs and remediation to provide access to warm and safe shelter for families living in tents and shacks in the community. Moreover, these funds have been allocated by the First Nation to service 33 lots within the community.

In July of this year, Chief Spence accepted Aboriginal Affair's offer of up to $2.2 million for multi-unit, sustainable housing. In late August Chief Spence notified the department that the First Nation had established a new housing authority and rental regime for the community. Aboriginal Affairs remains engaged with Chief Spence and the First Nation to implement the housing plan developed for the new housing authority, including the construction of semi- detached homes with the $2.2 million provided by the department. The project is progressing and the tentative completion date for the units is fall 2014.

Since August 2012, Aboriginal Affairs has also participated in the Attawapiskat Housing Strategy Working Group along with the First Nation, representatives of the Mushkegowuk Council and Ontario First Nations Technical Services Corporation to support the First Nation in developing its comprehensive community-based housing strategy. Departmental officials are also working closely with the Attawapiskat First Nation and other partners to repair the trailer complex that was damaged in the fire that took place on November 21. On November 23, 69 residents were evacuated to Kapuskasing.

The First Nation and the department are working to address the education needs of the school-aged children until the trailer complex is restored for safe occupancy. Aboriginal Affairs continues to support the First Nation and provincial emergency management counterparts as the community recovers from this incident.


Despite significant investments from Aboriginal Affairs and Canada Mortgage and Housing Corporation, we recognize that access to healthy, safe and affordable housing continues to be a challenge in some first nations communities.

Looking forward, we are committed to continue working in partnership with first nations and other stakeholders to address housing requirements and ensure that sustainable infrastructure is in place to support current needs and future development.


I appreciate the opportunity to speak before the committee today on this important issue. I will now hand things over to my colleague, Debra Darke from CMHC.

Debra Darke, Vice-President, Regional Operations and Assisted Housing, Canada Mortgage and Housing Corporation: Thank you, Mr. Chair and members of the committee. I'm pleased to be here on behalf of Canada Mortgage and Housing Corporation to discuss our role in supporting the housing needs of Aboriginal people living both on- and off-reserve. As Canada's national housing agency, CMHC's mandate is to improve housing quality, affordability and choice for all Canadians. In addition to supporting Canada's market-based housing system through our mortgage loan insurance securitization and market analysis activities, CMHC also works with partners to address gaps in the system to help Canadians access safe and affordable housing.


In fact, a central part of CMHC's mandate is to support affordable housing for low-income Canadians — including aboriginal people. Each year, through CMHC, the Government of Canada provides approximately $2 billion to address the housing needs of low-income Canadians. These investments are provided under various housing programs and initiatives on and off reserve.

On reserve, as you have heard today, CMHC works closely with Aboriginal Affairs and Northern Development Canada and with first nations leaders and organizations to provide a range of supports to assist first nations in addressing their housing needs.

Through AANDC and CMHC, the federal government currently invests an estimated $303 million a year to address housing needs on reserve.


CMHC and Aboriginal Affairs and Northern Development Canada focus on different aspects of housing on- reserve. Aboriginal Affairs and Northern Development Canada largely operates at the community level, by providing funding for housing-related infrastructure and for capacity development to address governance and community-level issues. CMHC, on the other hand, delivers specific housing programs that support construction, renovations, ongoing management of social housing and housing-specific skills development.

For their part, First Nations are responsible for the governance of housing on reserves through the development and enforcement of bylaws and through housing planning, zoning and building regulation. First Nations are also the owners, administrators and property managers of most on-reserve housing.

CMHC's portion of the annual federal investment in housing on reserves is $157 million. This funding is delivered through two main programs. The On-Reserve Non-Profit Housing Program, also known as the section 95 program, assists First Nations in the construction, purchase, rehabilitation and administration of suitable, adequate and affordable rental housing in First Nations communities. Through this program, CMHC provides a subsidy to assist First Nations with the financing and operation of rental housing projects over a period of 15 to 25 years. Housing units supported by the section 95 program, as well as the renovation program I will speak to you about momentarily, are owned, operated, managed and maintained by the First Nation, which is responsible for determining who will receive housing, rents to be paid and so on.

CMHC provides direct loans for up to 100 per cent of the total eligible capital cost of a project. These loans are insured under the National Housing Act and are guaranteed by the Minister of Aboriginal Affairs and Northern Development. Other financial institutions may also provide loans to First Nations for housing projects.

A project operating agreement is signed between CMHC and the First Nation that outlines the conditions under which the project will be operated in order for the First Nation to continue to benefit from the subsidy. The agreement is effective from the date of project completion to the maturity of the loan. The number of units that can be delivered under the section 95 program each year is determined primarily by current and forecasted interest rates, as well as construction costs and the level of equity contributed by First Nations. In 2012-13, the section 95 program supported the construction of 469 new non-profit housing units and provided ongoing subsidies for some 29,300 households living on-reserve.

An example of this program in action is the Birch Narrows First Nation in northwestern Saskatchewan, which built three modest, three-bedroom houses with funding assistance from CMHC. The First Nation secured a $375,000 loan and contributed $54,000 in equity to complete the project. The three homes were built in a subdivision that now includes 34 houses.

The second main program, the Residential Rehabilitation Assistance Program, on reserve, offers financial assistance to repair substandard homes to a minimum level of health and safety and to improve the accessibility of housing for persons with disabilities. In 2012-13, this program supported the repair of 1,144 existing homes on reserves. Assistance is provided to low-income households living in homes that lack basic facilities and are in need of major repairs to correct structural, electrical, plumbing, heating or fire safety deficiencies, or are overcrowded.

First Nations may also receive support from CMHC's Shelter Enhancement Program. This program offers financial assistance for the repair and improvement of existing shelters for victims of family violence and for the acquisition or construction of new shelters and second-stage housing where needed. From 2008 to 2012, the Government of Canada provided close to $5 million in federal funding for shelters for victims of family violence in First Nations communities.

CMHC invests a portion of its funding for housing on-reserve in capacity development. CMHC collaborates with Aboriginal Affairs and Northern Development Canada and First Nations communities across Canada to facilitate training and provide resources to help First Nations achieve their housing objectives and acquire the skills and knowledge to design, build, inspect, manage and maintain housing on reserves. Approximately 90 per cent of CMHC's on-reserve programs and services are delivered through First Nations or Aboriginal organizations.

CMHC works with First Nations to identify issues related to the management of their CMHC-funded housing portfolio and aims to provide capacity development to assist them in resolving issues. By way of example, financial statements and financial management are areas where First Nations have experienced particular challenges in managing their non-profit housing portfolios. CMHC has delivered webinars to explain our expectations and has provided information to clarify the financial reporting requirements in relation to CMHC's programs to housing managers and financial managers at the band level.

Similarly, information sessions were delivered at the Aboriginal Financial Officers Association's annual conference last year to explain CMHC's requirements under the non-profit housing program.

CMHC's commitment to capacity development is also evident in the national mould strategy, which Mr. Carisse has already mentioned. The strategy outlines activities to be undertaken by the three federal partners to help First Nations address mould problems in their housing. CMHC's main focus is ensuring that First Nations have the information they need to identify and remediate mould-related problems. With this in mind, we've developed a range of information products targeted to First Nations communities and households, including guides and case studies, as well as workshops and information sessions on mould in housing. Of special note, CMHC is currently finalizing the development of an app that can be used on mobile devices to help First Nations collect data on mould in their communities. The Assembly of First Nations plans to use this tool, working with other First Nation organizations, to determine the extent of the mould problem in First Nations communities.

CMHC's housing internship initiative for First Nations and Inuit youth, which is delivered with funding from the federal government's Youth Employment Strategy, is another capacity-building effort. This initiative provides work experience and on-the-job training to help out-of-school or unemployed First Nations and Inuit youth between the ages of 15 and 30 gain work experience in the housing industry. Approved sponsors receive financial support toward the wages of youth employed in housing-related projects. Annually, it helps youth in 75 to 85 communities across the country.

In addition to providing direct housing assistance, CMHC encourages market-based housing solutions on-reserve. For example, CMHC offers mortgage loan insurance options to help First Nation members on-reserve buy, build or renovate homes. Since reserve lands cannot be mortgaged, CMHC insures loans for housing on reserves when the loan is guaranteed by Aboriginal Affairs and Northern Development Canada through a ministerial loan guarantee.

The federal government is also encouraging the development of market housing on-reserve without the use of Ministerial Loan Guarantees through the First Nations Market Housing Fund. This fund is an independent trust, created by the Government of Canada in 2008, to give First Nations people greater access to housing loans on reserves and on settlement lands.

The fund establishes the Credit Enhancement Facility for qualified First Nations in the form of a partial financial backing for housing loan guarantees made to financial institutions. The First Nation then uses this backing to negotiate an arrangement with an approved lender or lenders so that their members can apply directly to the lender for financing. The First Nation needs to guarantee the housing loans of its members.

If a borrower defaults on an eligible loan, the lender can seek compensation from the First Nation. Should the First Nation not honour its obligation as guarantor, the lender would turn to the fund for compensation, up to the amount of credit enhancement accumulated by the lender for loans made in the community. The fund has also established the Capacity Development Program to help eligible First Nations develop to the point where they can qualify for the Credit Enhancement Facility.

These are all examples of ongoing initiatives and investments in housing on reserve, but I would be remiss if I didn't mention the significant federal investment for housing on-reserve provided through Canada's Economic Action Plan 2009 and CMHC's role in delivering this funding.

As the committee will recall, the stimulus phase of Canada's Economic Action Plan included a one-time investment of $400 million over two years to support the construction and renovation of on-reserve housing. Of this amount, $250 million was delivered by CMHC, with half of this funding used to create new on-reserve housing and half used to renovate existing on-reserve social housing units. The remaining $150 million was delivered by Aboriginal Affairs and Northern Development Canada for projects in their areas of responsibility.

In total, this funding under Canada's Economic Action Plan supported more than 3,200 projects in close to 500 First Nations communities across Canada. For example, the Batchewana First Nation near Sault Ste. Marie, Ontario, used economic action plan funding of $800,000 to renovate 32 apartment units on reserve, bringing them up to code, addressing health and safety requirements and enhancing their energy efficiency.

Canada's Economic Action Plan also provided $200 million over two years for northern housing to create and retrofit social housing in the three territories. This funding was delivered by the territories through amendments to existing agreements and supported 210 housing projects in the North. I mention this because it is important to note that CMHC also provides housing support for Aboriginal people living off-reserve. In fact, we spend some $123 million to support the housing needs of Aboriginal households living off-reserve.

Aboriginal households living off-reserve also have access to affordable housing funded under a range of other programs, most of which are delivered by the provinces and territories. For example, under the Investment in Affordable Housing, the Government of Canada is providing more than $238 million per year to support new funding commitments to improve the living conditions of Canadians in need. Provinces and territories match federal investments and are responsible for program design, delivery and administration. The Investment in Affordable Housing recognizes that housing needs differ across Canada and the provinces and territories are best positioned to understand and address their local housing needs and priorities. For this reason, they have the flexibility to design programs to address the needs of specific groups, including Aboriginal people. For example, both Ontario and British Columbia are delivering funding under this initiative to increase the supply and improve the quality of existing house through Aboriginal housing programs.

Budget 2013 announced that the Investment in Affordable Housing will be renewed to March 2019. This represents a total federal investment of more than $1.25 billion over five years — funding that will be again matched by the provinces and territories. The government is currently working with provinces and territories to confirm the implementation details of this investment.

Budget 2013 also announced $100 million over two years to support the construction of new affordable housing in Nunavut, a territory that faces unique challenges in providing affordable housing due to its climate, geography and dispersed population, and that has a high incidence of housing need relative to other provinces and territories. This funding is being delivered by the territorial government under its Investment in Affordable Housing agreement with the Government of Canada.

In addition to these federal investments, Aboriginal housing providers off reserve have access to CMHC's Affordable Housing Centre, which works with the private, public and non-profit sectors to develop affordable housing solutions that don't require ongoing federal assistance. As well, CMHC has supported Habitat for Humanity in their efforts to explore ways to make the Habitat home ownership model available to more Aboriginal people. CMHC is the lead and founding national partner for Habitat for Humanity Canada's Aboriginal Housing Program. Close to 60 homes have been built to date under this program.


To summarize, the federal government supports a range of affordable housing solutions for aboriginal people living on and off reserve. CMHC plays an important role in delivering these investments, and we continue to work with our partners, including AANDC and aboriginal communities and organizations, to achieve the best possible housing outcomes.


Thank you again for inviting me here today and for the opportunity to make these opening remarks. I look forward to answering any questions the committee might have today.

The Chair: Thank you very much. I'd like to open the discussion with a general question to Mr. Carisse. I do appreciate the information you've provided to us this morning, which focused on housing, but, as I did say in my opening remarks, the committee is at this point also considering a broader look at infrastructure needs on reserves, including capital needs in such areas as schools. I note that you're a senior director in the Community Infrastructure Branch.

Does that branch where you work also deal with capital infrastructure needs on reserves other than housing? I guess I'm wondering if the committee might, in future, get the kind of excellent overview that you gave us on housing in relation to other capital infrastructure needs such as schools, and there may be other categories that you could mention, please.

Mr. Carisse: Sure thing, yes. On the area where we are, community infrastructure, there's one major program, the Capital Facilities and Maintenance Program. Housing actually falls under that program. The other categories are assets of public infrastructure that the department actually helps to fund. You do have education facilities, roads and bridges, water and waste water. I've been to the committee before to speak about — and it's now an act — the Safe Drinking Water for First Nations Act. There's connectivity, broadband, air strips — anything you can think of within a First Nations community or off-reserve, but for public infrastructure.

Regarding the amount of funding of that program, we've been lucky and quite fortunate the last few years with additional funds that have come through the economic action plan or the First Nations Water and Wastewater Action Plan.

It comes out to about $1 billion a year, and that's split between the different categories of funding, the different assets — housing, water and schools. The major categories are those three. For water, for instance, from the department's A base that goes out under water, there's about $200 million a year. With the First Nations Water and Wastewater Action Plan, an additional sum is added to that. It comes up to about $330 million over two years, with another $165 million a year that's added. That's for major infrastructure — new builds or construction — operations and maintenance, and smaller repairs — minor capital, we call it.

I would be more than happy to come back to speak to infrastructure or if you want to ask some questions now, but that's the breakdown of the program itself. About $400 million of the $1 billion is for operations and maintenance. Major projects are about $320 million, and then you've got another $280 million or so, which is minor capital. This is where housing fits in. As I mentioned earlier, it varies, but about $150 million a year goes out to housing.

The main thing to remember is that these are contributions towards infrastructure in communities. The infrastructure is owned by chief and council. The housing is the responsibility of chief and council. We provide allocations or help out.

It is to different degrees. For schools, for instance, 100 per cent of the actual cost of the building is provided by the department, as well as 100 per cent of the operations and maintenance cost.

For water, its 100 per cent of the major capital and 80 per cent of the operations and maintenance. It's anticipated that the community will come up with the additional 20 per cent, either through utility fees or own-source revenue. It keeps cascading from there under the different asset categories, of which housing is one.

The Chair: Well, that's most helpful, Mr. Carisse. I think I can say with confidence that, notwithstanding your excellent presentation on housing and the focus that we'll have this morning on housing, we can put you all on notice that the committee would be grateful to have you or your colleagues return and give us the broader picture. Thank you for that overview.

I will give the next question to our deputy chair, Senator Dyck.

Senator Dyck: Thank you for your presentations this morning. You provided us with a lot of information, and it actually would have been handy if you had given us some tables to tabulate it. I don't know if we could ask you to send tables later. It's easier to keep track when you see it in a table. Thank you for that.

Of course, when we talk about the money spent, everyone wants to know whether the money has been spent wisely. How many houses are built on reserves in Canada right now? Do we have access to that kind of information? How many houses are out there? How many more need to be built, and how many are in need of repair? You may have alluded to that, but maybe you didn't.

The other question I had is this: Since repair seems to be a big part of the picture, do we know whether or not there's a larger percentage of houses built on-reserve that maybe are built substandard or whatever so that the proportion that need repair is actually higher?

Those are some initial questions.

Mr. Carisse: I'm going to address that. As for the numbers we have in regard to housing on-reserve and all of the public infrastructure, we have a program in the department called Integrated Capital Management System. This is self- reported by communities, but the number comes out to about 100,000 units that are out there in the 633 communities. That's a lot of housing that's out there already. We know that, obviously, there's still a need.

That need depends on the source. We know the Assembly of First Nations has a number of around 80,000. From what we have received from First Nations, the number is substantially lower — 35,000 or 40,000. Regardless, the issue is that there is a need for housing out there. We need to figure it out, and we're working with First Nations right now to try different ways to address that gap, either for construction of new housing or for repairs, rehabilitation and renovation of housing. This is part of the funding that we provide between the two departments. As well, shelter allowances are provided to help those communities who have them in place with their rental regimes.

About the standards, the funding agreement states that the housing shall be built to building code standards. It is up to chief and council, at that point, to ensure that. It's to everyone's advantage to ensure that. Is it always being done? You've seen it in the media. There are situations where the housing is not built to standard, which is very similar to where we were at a number of years ago with water and how regulations were for water. It did not exist on reserves. The building codes on-reserve are not enforceable. Again, it's that situation with section 91(24) lands and the building codes. They're done by the National Research Council, as well as CSA. There are building codes, electrical code, energy code, plumbing code. All of these codes are done nationally, but the provinces legislate and regulate these codes within the province. They're not enforced in First Nations communities.

There is a gap there for enforcing codes, but, again, to the advantage of the community and of the housing, built to code means you're respecting fire codes and the building codes. Therefore, you should have fewer mould issues, fewer issues with fires, et cetera. So that's what we anticipate First Nations to be doing when it's time to build or renovate their homes.

Senator Dyck: I'll just follow up on the building codes. I think you said it was up to the chief and council to ensure that the buildings were built according to code, but do chief and council have the training or expertise to do that?

Mr. Carisse: You raise a great point. We know there are some communities out there, especially the smaller communities, where having that capacity within the community is difficult. I can leave it to Ms. Darke to speak to some of the capacity building initiatives that CMHC has.

For the department, the funds that go to the communities can be used for capacity building and training, so if there's a housing manager or technicians within the community, they can get that training. There are also some organizations out there that can provide that assistance to communities, such as the First Nations National Building Officers Association. There are technical organizations in Alberta, and there's the Technical Services Advisory Group and the Ontario First Nations Technical Services Corporation. It makes sense for economies of scale to look at a hub approach to a lot of this. Just like any other infrastructure, it's difficult to see a community — an average community is about 500 people — having the expertise to take care of the water, the schools, the housing, et cetera, et cetera. So I think if we can look at hubs, a hub approach would be well worth it. Some organizations are actually doing that to help the communities with their capacity.

Senator Dyck: Just one final, short question. Is there a concerted effort like for water where they have the circuit training program that trains people on how to test water on different reserves and that travels throughout a region? There's nothing like that for housing?

Mr. Carisse: No. We've looked at that in the past. We're not there yet on how we can expand that circuit rider training program. As you've heard before here, I think one of the successes that the department has working with First Nations and the tribal councils and other groups is the technical associations that are providing that service.

We were looking at possibly expanding that to schools. Is it possible for housing? Again, to me, it would make sense to have that hub approach. Some communities can definitely take care of all their infrastructure needs on their own. Ones that are a bit more urban have the capacity and the people there, but, for others that are smaller and more remote, I think that can really help out.

The Chair: Ms. Darke, I think you wanted to elaborate.

Ms. Darke: Yes. I thought I would answer some of the questions and give a little bit of flavour from the perspective of the CMHC programs.

In your introduction to your question about the quality and application of building codes for housing on-reserve, you asked how many units are in need of repair.

Based on the 2006 Census, we know that around about 38 per cent of the dwellings on-reserve need major repair. That compares to 7.5 per cent off-reserve. So we do know there is a challenge with respect to physical condition on- reserve.

Of the non-profit housing portfolio that CMHC administers, we regularly undertake physical condition reviews of those properties. I said that we have project operating agreements in place with First Nations. We undertake annual reviews of their audited financial statements. We do cyclical client visits and cyclical physical condition reviews. We know from those that for our portfolio, 53 per cent of the units that we funded are in satisfactory or good condition; 36 per cent are in fair condition; and about 10 per cent are in poor condition. That's some background information with respect to the condition of the units.

With respect to code, maybe I could talk to that for a second and just add to Mr. Carisse's remarks. As he indicated, the First Nation is the jurisdiction with authority. That means the First Nation is responsible for the enforcement of codes on-reserve. They would be comparable to a municipality, in effect. For any of the units that CMHC funds, we require, as part of our operating agreement with the First Nation and where we have our loan agreement, that the construction is done according to building codes and standards. Each time we advance money during the construction process, we require that the First Nation provide us with a declaration that basically attests that the construction has been done according to code.

As you point out, in most cases it's unlikely that chief or council would necessarily have the technical expertise to enable them to provide those assurances. Nevertheless, they are, in a sense, the official formal signing authority within that First Nation. CMHC's expectation is that they will seek expert advice to enable them to sign those declarations for us.

Mr. Carisse has talked about how some First Nations access that technical expertise. Sometimes the more sophisticated First Nations have that expertise within the community. At other times, they rely on that from a tribal council. There are various technical service organizations across the country that have that kind of expertise and will provide it to First Nations. As well, they can hire inspectors who work privately. We've seen pretty much all of those different things.

Mr. Carisse talked a little bit as well about some of the capacity development initiatives that CMHC has been involved in. Over the years, we've worked quite closely with the First Nations National Building Officers Association, FNNBOA. They undertake training and certification of First Nations inspectors. We also do workshops and training related to various aspects of building condition, including the very technical related to building code. As well, we provide technical training to occupants so that they can understand how to maintain and keep their homes in good condition. There's a range of different initiatives that we're involved in, including, as well, training for First Nations on things like maintenance planning and capital repair planning.

Senator Dyck: Thank you for that additional information.

The Chair: Senator Meredith, did you have a supplementary on this subject?

Senator Meredith: Yes, I did. It is directed to Mr. Carisse first with respect to disparity in the numbers. You talked about 85,000 units that First Nations indicated that they needed. You said that you needed about 20,000 to 35,000. How has the 50,000 to 65,000 that are sort of missing from this equation impacted on families, especially young families and youth?

Ms. Darke, my other question is with respect to the code. Has there been any consideration for collaboration between Aboriginal Affairs and CMHC to provide a bona fide inspector before? You talked about a declaration to double-check to ensure that the homes are being built to code and that you're not just issuing funds based on a certificate that comes in; but there's no double-checking. Has there been any collaboration to see if we can hire an inspector that would go in and check to ensure? We see the correlation between the deficiencies in these homes that are being built that then create a problem of mould because they're not being built properly and the fact that they're not being fully inspected properly. I'm thinking of somebody who has some experience in construction here. We don't allow that to happen in our cities — in our subdivisions being built in Ottawa or anywhere in the Greater Toronto Area, where I hail from. There are inspectors, and certain requirements have to be met. Why aren't those stringent requirements being placed in collaboration between your department and CMHC? Several questions there, because I want to see this thing get done right. It's important if we're going to dish out $2.3 billion — $1.8 billion has been spent already and more money at Attawapiskat — that we build these homes properly so the lives of these people are not put in peril. Clearly, there has to be some comprehensive way to go about this.

That is my first round of questions, chair.

The Chair: Two questions, one being about the need. Mr. Carisse, that was directed to you.

Mr. Carisse: Yes. I agree with what was requested earlier: to give tables for the numbers. We'll provide that so it's a bit clearer for everyone. For the numbers from 85,000 or 35,000, I look at it as a great need for housing, and we can all agree whether the number is somewhere in the middle.

Is there an impact to youth? Obviously there is an impact to youth and families that are in communities, on-reserve or off-reserve. There are some social housing needs in the middle of Toronto just as there are in the middle of Ottawa. How best do we address that need?

We look at the funding provided for the Capital Facilities and Maintenance (CFM) Program — $1 billion as I mentioned earlier. There's only so many ways that we can cut that pie to address the need. Do you just focus on housing? You can't. You need to focus on water, housing, schools, roads, bridges, connecting communities, and making sure that roads are properly maintained. There's so much that needs to be done. We do the best we can with the funds that are available.

With regard to housing specifically, the government doesn't provide 100 per cent of the cost of homes. You anticipate that the community will put some money towards that as well; right? Therefore, be it from own-source revenue if they can, or shelter allowance, rental regimes, the private market to look for mortgages, or the possibilities with the Market Housing Fund, there's a great need out there. We're trying to address that as best we can.

We're also looking at different ways of financing infrastructure. For instance for water, we're looking at major public-private partnership with the Atlantic Policy Congress for the 33 communities in the Atlantic region, and at a public-private partnership in northern Manitoba for four communities' schools. P3s are not a panacea — they may work and they may not work. They work in certain instances. What we need, and it's a cliché, is more tools in the tool box to go into communities.

For the longest time for housing in communities, we're trying to achieve single family homes with quite a frontage. With the needs out there now, we need to expand that and to see what exists off-reserve and on-reserve. You need to have multi-unit homes, single family homes and, in some communities, homes for the elderly. We're trying to build that.

To get to the issue that there is a need out there, I agree that we definitely need to do more for housing and working with the communities. For example, in Quebec there's an Aboriginal financial institution that we've worked with there. It's the Aboriginal Savings Corporation of Canada, I think they're called, ABSCAN. We've helped them out to raise a bond for $5 million that they've used to actually do housing without the need of MLGs. This was specific more for the community of Wendake out of Quebec City, but now they're looking to expand to see if they can work with other communities to do something similar. We're looking at that to see if this can be replicated across Canada.

We know that in Vancouver a P3 was done for social housing off-reserve, but we're looking at that and seeing what are the opportunities that we can help out and what kind of tools we can bring to communities. For First Nations, as well as ourselves as public officials, we want to see that number go down. We want to address this, but we have to use the tools that are there, maybe some new tools, to stretch the financing we have as much as we can.

The Chair: Thank you. I think you're pointing in the direction that the committee may end up wanting to go, which is creative ways of meeting these tremendous needs.

The second question was directed to you both, and that is about the inspection issue. I believe the committee is going to hear from one of the organizations that is assisting with this. Could you address Senator Meredith's concern?

Ms. Darke: Perhaps I can start on this one and then Mr. Carisse can add some additional flavour.

Our requirement in the CMHC programs is that the First Nations hire an inspector or use an inspector who has the necessary qualifications to be able to undertake the inspection. It's not that just anybody can inspect the units and advise the First Nation and council that code requirements have been met. There are specific requirements that are needed, specific qualifications. You cite a municipal example. Absolutely. That's the same on- as well as off-reserve. In order to provide assurances of code compliance, an inspector needs to have certain qualifications. It is our expectation that a First Nation, in declaring to us that code has been met, will do so on the basis of the advice they've received from a qualified inspector.

The costs associated with having inspections done are eligible costs under our program, so we do understand that it's necessary for a First Nation likely to procure those services, so that is an eligible cost, for sure.

This is an area that both CMHC and Aboriginal Affairs and Northern Development have identified as being really important. From our perspective, one thing that really needs to be done is some training, and there needs to be a better understanding of the qualifications, for example, that those inspectors need to have. CMHC is in the process right now of implementing some changes to our process whereby, at the same time that a First Nation provides us with assurances or their declaration with respect to code, they also provide us with some certification that they have received from an inspector who has the necessary qualifications. That will provide us with the assurance not only that an inspection has been done, but also that it's been done by an individual who has the necessary qualifications.

Those are some of the things we're doing. CMHC does work together quite closely with Aboriginal Affairs and Northern Development. This is an area we have had discussions on and we'll continue to do so going forward. There probably is more that we can and should do with respect to capacity development and training, and CMHC will certainly be working with AANDC in that regard.

I would just like to end by clarifying that because the First Nation is like a municipality and is the jurisdiction with authority, we have tried to work very closely with them and make sure that the necessary expertise is being brought to bear, but not going as far as the federal government in checking up, if I can put it that way, because it is the First Nation that owns, operates, develops and is the authority that has responsibility for that housing.

Senator Meredith: If I may, chair, just a quick question: With respect to that, clearly there are those who issue declarations, but who is basically almost double-checking those declarations? Because we see the deficiencies that still continue to exist with the substandard homes that are being built, not to call anyone out and say, ``Listen, these declarations are not 100 per cent bona fide.'' However, there has to be some sort of checks and balances, clearly, in terms of just holding those individuals to a higher standard. What kind of independent body? That's where the collaboration between Aboriginal Affairs and CMHC is what I was getting at, just a double-checking. Just to say you're bona fide, you've certified that this was actually done, but we see in six months there are severe deficiencies in these homes causing health concerns to the occupants. That's where I was getting at with that question, and I think there absolutely need to be some more checks in terms of without the inspection from the federal government, so to speak. There has to be some sort of collaboration. Otherwise, we will see consistently the substandard homes being built and the health and the lives of these people being put at risk.

Ms. Darke: I talked about two checks, I suppose, from the perspective of the CMHC programs. One is a requirement that we will be putting in place going forward that we get certification from the qualified inspector. The second one I mentioned a couple of minutes ago, and that is that we do regular inspections, physical condition reviews, of the projects that we have funded. We do this on a sample basis, and we do it over time. When we identify issues with respect to the condition of the unit, we work with the First Nation to both identify those, tell them what we believe they are, and work with them to help them figure out how they can best address those.

Senator Sibbeston: I'm interested in the way that houses are built for First Nations. I know that there are communities that are in good standing, well organized, that build their own homes, and they have the skills and trades and the contractors to do the work. The least organized and dysfunctional communities would be something like Attawapiskat, where modular homes and trailers are brought into the communities. Basically, everything is provided for the local people. The people in the communities maybe don't have the skills and the training, and there's not the opportunity for training and labour. I wonder if you could say something about that. Is it true that that is the situation in our country with a lot of Aboriginal communities? Housing is such a problem because they don't know how to build the houses?

From the government side, like in the case of Attawapiskat, I notice that you spent $3.3 million on building or bringing in 22 modular homes. That's $150,000 per house. I know that $150,000 does not buy much of a place when you consider the transportation costs, the setting-up costs and hooking up and so forth. So is it the situation that, in the less functional, maybe remote communities, people just simply don't have the skills and everything is basically brought in so that you don't really have good-quality houses for people?

Ms. Darke: I can only really talk to that question from the perspective of the CMHC-funded houses. As I mentioned in my introductory remarks, in 2012-13, for example, about 469 houses were built under the section 95 or the non- profit housing program. Those primarily, for the CMHC-funded homes, are newly constructed. They're not the sort of modular homes that you mentioned in the context of Attawapiskat.

The First Nation will have those homes constructed in a variety of different ways. If it's a more sophisticated First Nation, they may in fact have their own construction firm and they will do it themselves. If it's a less sophisticated First Nation, they're likely to hire somebody to undertake the development and provide the contracting services. Oftentimes they'll hire other Aboriginal organizations.

There are some interesting examples where there are sophisticated First Nations who have their own construction companies and they hire First Nations members from other communities. My understanding is there's a really interesting example of that in Alberta, where the Fort McKay First Nation is bringing people from the Blood Tribe in southern Alberta, some youth, to learn construction trades and work on building homes in their First Nation. There's quite a range. You're absolutely right; it does depend somewhat on the level of sophistication of the First Nation. But for our programs, for those communities that don't have that expertise in-house, they would purchase that externally and, again, the costs that are associated with the construction are eligible program costs under the section 95 program.

Mr. Carisse: I could add to what Ms. Darke was saying with another good example, the Mohawks of the Bay of Quinte. We're big in training and utilizing them for carpenters, electricians, et cetera, to promote that within the community.

Regarding the Blood Tribe — and this goes towards the prefabricated or modular homes — the idea there is what are the needs, how can you address the needs in a sustainable way and how quickly we can do it? With prefabs, for instance, the Blood Tribe has their own building establishment there. It's an economic development venture in Alberta and they're doing a great job. They're building houses to standard that are ready to go. You don't just see this on- reserve. I come from a small community — it's bigger now — Orleans, which is east of here. In a lot of the older parts of Orleans, there were prefab homes. If they're done well and to standard, they're good homes, but they have to be maintained, obviously. There are certainly instances where there are either emergencies or situations where we need to address the housing need quickly, and sometimes it has to be not on a long-term basis but you need to get shelter for community members. This is where modular homes can be put in there, et cetera. However, for the long term, there are different opportunities to look at. It doesn't need necessarily to be right from scratch. You need to look at what are the possibilities and, at the same time, what are the benefits to the community, and how we can do the training within the community.

It's the same when we do our major infrastructure projects. For any bid, we're looking for companies that will utilize any types of services that already exist in the community or train the community members in carpentry or electricity.

Senator Sibbeston: Are there any programs in the department to train people in building houses? From my own experience in the North, housing is an important part of life for everybody. We went through a whole process of training people to build their own houses. Over the course of 20, 30, 40 years in the North now, we have the capacity within the communities where people are carpenters and electricians and can now build their own houses and work on houses. There's been that development and progress, but the government has put in a lot of training funds so that people can get to this stage.

Are there any programs within your department to help people and communities learn to build houses so that eventually they can build good, sound houses?

Mr. Carisse: Within Aboriginal Affairs there's not that program specifically for training for housing. However, the funding that is provided can be used toward training for the communities. We help fund those First Nation organizations that do provide training and capacity, as we mentioned before. HRSDC has programs to promote that capacity building and training. I'd have to go to CMHC with their programs that are there for capacity.

Ms. Darke: CMHC doesn't have any programs per se that are specifically related to building skills with respect to home building for Aboriginals. It's my understanding that ESDC does have some Aboriginal skills training programs, but I'm not familiar with them. They may have something that would be of relevance.

I would note that while we don't have any formal program of that nature, as I said, we do have some capacity development, and CMHC has also undertaken some research projects over time. In the last number of years, we've done four different demonstration homes in the North. I think a couple of them were in the Yukon, in collaboration with both the province and with the First Nation — one in Arviat and one in Inuvik, I think — four of them. They're all quite innovative in that they incorporate sustainable and energy efficiency designs. They're all specifically to address some of the challenges in the North. We've worked quite closely with other organizations, both to design and build those homes and then, subsequent to their construction, to monitor their energy efficiency and performance. Again, while not specifically aimed at training, I must say that there has certainly been learning as a part of those exercises.

I mentioned in my opening remarks as well that we have a housing internship initiative that's funded through the federal Youth Employment Strategy. Again, that's not specifically aimed at formal skills training for home building. Nevertheless, that would be an eligible use of the funding. A youth could be hired to work on residential job sites and get training in building in that context.

The Chair: Ms. Darke, could you elaborate on the pilots that you mentioned? Could you provide that information to the committee, please? You mentioned there were demonstration homes.

Ms. Darke: Yes.

The Chair: I don't mean now; subsequently is fine.

Ms. Darke: Sure. There are some write-ups, some short profiles, that have been prepared on those particular demonstrations, and we'd be happy to follow up with the committee.

The Chair: Through the clerk, please. Thank you very much.

Senator Tannas: Thank you for your attendance here today.

I have a couple of questions for Ms. Darke. First, you mentioned your portfolio. Can you tell me how many units you have in your CMHC portfolio?

Could you maybe contrast what I'm looking at as two different segments of your portfolio? One is loans to bands, if you will. You've talked about that, namely that the band is the borrower. You're funding these units. Are they actually loans? Do they actually pay off? Does somebody actually write you a cheque at the end? Who is it that typically would write the cheque at the end to pay off the loan? Maybe give any kind of colour that you could on default rates, and that sort of thing, around those particular loans.

The Chair: Shall we just stop there? Could you respond, Ms. Darke, please?

Ms. Darke: Thank you.

The Chair: Not to cut you off, senator.

Ms. Darke: I have a feeling there are more questions coming, but let me try to answer the first set.

Regarding units in the portfolio, there are 29,300 units in the CMHC-funded portfolio. I'm not quite sure how to answer your question about contrasting the different parts of the portfolio, so let me try to do a better job of explaining how it works.

I don't know off the top of my head what proportion of that 29,300 have loans that are directly made from CMHC, but it's a very significant proportion. CMHC, for most of the portfolio, has provided a direct loan to the First Nation, and then, on an ongoing basis — so that's for a period of 25 years or so — we provide an ongoing subsidy to the First Nation. It's the First Nation that owns that project.

Who writes the cheque? The First Nation writes the cheque to CMHC for the loans that we have in place. Is anybody checking up to make sure that they pay them off? Yes, absolutely. Our direct lending operation is run like any other lending operation. I guess the difference between ourselves and a private sector lender is that we run our direct lending on a planned break-even basis. Because of that, we're able to offer lower interest rates to the First Nations.

They absolutely are paying off their loans, and we have a Ministerial Loan Guarantee in place, of course, so that, if there is an account in arrears, CMHC will work with the First Nation and with Aboriginal Affairs and Northern Development to figure out how we can fix the arrears and get the project back on track. If it were to turn out that there were a default, then CMHC would consult with Aboriginal Affairs and Northern Development. If we were to call the loan, we would be, in essence, calling the Ministerial Loan Guarantee. We would get paid, and Aboriginal Affairs and Northern Development would go after repayment. They would go to the First Nation to get repaid.

Arrears are very low. I don't have an exact number in front of me, but the last time I looked, it was about 1 per cent. First Nations keep their loans in good standing, and they absolutely do pay them off.

Senator Tannas: Terrific. I have a supplemental question. You've got loans to people now through the First Nations Market Housing Fund. Can you tell me, of your roughly 30,000 units, how many would be loans to people through this fund or, for that matter, any other funds or programs that you have where you're actually loaning money to the people living in these places?

Ms. Darke: Firstly, just to clarify, the First Nations Market Housing Fund is a separate entity. It was established as a trust. From that perspective, it isn't part of CMHC, nor is it part of Aboriginal Affairs and Northern Development. The trustees of the First Nations Market Housing Fund are appointed by the ministers of CMHC and AANDC, but it is separate. CMHC's minister, under the indenture of trust, is responsible for providing some high-level oversight. That is a little bit of context on the fund.

The way the fund works is that the loans are provided by a private-sector-approved lender. A First Nation will apply and be qualified by the First Nations Market Housing Fund for credit enhancement. They have to meet a number of criteria in order to be approved, and then the fund will establish a value of the credit enhancement guarantee.

Individual members on-reserve will then go to an approved lender for a loan — the Royal Bank or the Bank of Montreal. Approved lenders, by the way, also have to be approved by the fund. There will be an agreement in place between the lender and the First Nation, as well as an agreement in place between the First Nation and the fund.

If the individual defaults on their loan, the lender will go to the First Nation first, who will pay them. If the First Nation does not pay them, then the fund kicks in. Maximums and whatnot are established.

To give you a sense, the number of loans in place right now — and these would be to individuals that have been backed by the fund — is about 52 in total. There's about $61 million in credit guaranteed right now by the fund.

Senator Tannas: Did you say 52 loans and $60 million of guarantees? Expensive houses.

Ms. Darke: No, no. Those aren't guarantees in place for those loans. There are 53 First Nations that have been approved for credit enhancement. Over time, their members will go to the bank to get a loan to construct, to renovate or to purchase a home. A First Nation will have a credit enhancement guarantee amount in place, and, over time, their members will be able to go and put loans in place with that behind them.

Senator Tannas: So we don't know how many people are actually individual owners. We know there are 62 larger entities, but we don't know how many actual people there are living in houses.

Ms. Darke: Right. We know there are 53 First Nations in total that have credit enhancement guarantees that have been approved, and we know that, on some of those First Nations, there have been loans made to date — and there are 52 of those in total — and those would be to individuals.

Senator Tannas: Thank you.

Ms. Darke: Does that help?

Senator Tannas: It does; thank you.

Senator Moore: I'm new to this committee, so I'm trying to get a grip on the relationships. Some of my questions might be naive, but I want to understand the fundamentals here.

I'm looking at the brief provided by the Library of Parliament. It states that in 2011 the Assembly of First Nations estimated the on-reserve housing shortage to be approximately 85,000 units. In the same period, Mr. Carisse, your department estimated approximately 20,000 to 35,000. Within that range, there's a 75 per cent swing. I don't understand that huge swing within your own department's numbers and the wide variation between the Assembly of First Nations number and your department's number. Can you address those two things, please?

Mr. Carisse: There's a big discrepancy. I can't speak to the one from the AFN. You'd have to ask somebody from the Assembly of First Nations to come in to talk about that. I know that, for the 20,000 to 35,000, an evaluation was made of housing needs from the department, and that's where it came from. Where do we stand on that? As I mentioned before, it can be anywhere in between. It could be the higher or the lower number. For my sake, even if it is 35,000, it's still a big number that we need to address.

The numbers, with infrastructure, are always a struggle. We had a similar situation when we were dealing with water and did a national assessment of the need for water across the country. The number came back in the billions. I think it did justice there to just say that we're not talking about a problem of a million or a few hundred million. For water and waste water, it's in the billions of dollars.

Again, with housing, we're looking at a major issue that we need to work together on as the federal family or the different departments, as well as with First Nations and their organizations, to try to address this need. We can look into it a bit more, but that's where those numbers are coming from.

Senator Moore: Is your department the place where the accurate numbers are supposed to be housed? Are you the ultimate determiner? As a funder and overseer, wouldn't you be the one that would know the most accurate numbers?

Mr. Carisse: We hold a set of numbers provided by First Nations. There's an evaluation. In our capital systems, First Nations will provide numbers on what their needs are, and we roll that up to get a number.

Senator Moore: What does that mean, you roll that up? They're talking 85,000; you're talking 20,000 to 35,000. What are the determinants here? I don't understand this. I really don't understand this. This didn't start last year. We've been in the relationship with the First Nations for centuries. Why are we still not clear on what the needs are?

Mr. Carisse: I guess the need is high. I can't say more about the numbers. They are what they are at this point. I'd love to say we had more accurate numbers, but we'd have to go into every community and have a look. The way the department looks at it, First Nations are their governments. They know what they need. They report back on their needs. We have two sets of different numbers right now that we have to work with. We can keep working on that to try to pinpoint what the exact need is. I would personally rather spend time on trying to address the need regardless of what the number is.

Senator Moore: That's very noble, but at the same time, to me, everything starts with one. Once you accept that, you can make big progress. I don't know why you would not go from one coast to the other and work with the leaders and First Nations to get some hard numbers so we can do some accurate planning and budgeting. I just don't understand that.

The Chair: Senator Moore, maybe I can tell you that we have issued an invitation to the housing officials from AFN, and we expect that they will appear. I'm also told that the department's evaluation of housing needs, dated August 2011, is available and public. We could circulate that to members of the committee.

Senator Moore: This was also contained in a report that was tabled in the House of Commons in the pre-budget discussions in 2011. We can look at that brief from the Library of Parliament.

Ms. Darke, you mentioned the board of trustees in response to Senator Tannas's question about this fund. Are there any members of any First Nation on that board of trustees?

Ms. Darke: Yes, there are. The trustees include representatives from First Nations, absolutely. I don't know off the top of my head how many there are, but I can tell you for sure that the chair of the trustees is from the First Nations community, as is the co-chair.

Senator Moore: Maybe you could send to the clerk the makeup of that board of trustees, please.

Ms. Darke: Sure.

Senator Moore: Senator Meredith asked some very interesting questions about the building code and the adherence of construction to it. I think, Ms. Darke, you said that you're now realizing that you've got to make sure this happens.

How long has this relationship been in place between CMHC and the funding of housing units on reserves so that we're just now, in 2013, realizing that we should be insisting on adherence to the code? How is it that we're just now realizing that we should be doing that and that we might have let stuff go through such that there will be mould and improper housing? How is it we're just coming around to that now?

Ms. Darke: I would disagree with that statement. CMHC is not just coming around now to realizing that codes need to be complied with. We've had the requirement that housing built with our funding comply to codes since the very beginning. We've had in place the requirement for First Nations to declare that that's the case. In fact, the policy is not new that we require they sign those declarations on the basis of advice from qualified professionals. None of that is new. It's been in place all along.

The only thing that we have done newly is to require some formal documentation to support that. We know when we look at the condition of the stock that we have funded over the years that only 10 per cent of it is in poor condition. I would say compliance to code has been an important part of our program since its origin. We have worked with First Nations over time to make sure that that is understood and to provide training and capacity development. We've worked with organizations like FNNBOA for years.

As I said, we undertake cyclical condition reviews, and in general, the condition of our stock is pretty good. Recently we implemented some additional checks and balances, if I can put it that way.

Senator Moore: You mentioned in your remarks earlier that in a 2006 survey, seven years ago, 10 per cent were in poor condition. You also said that 36 per cent were in fair condition, which to me means some work would be needed. You've got 46 per cent that would need some work. Is that not right?

Ms. Darke: I should clarify.

Senator Moore: Do you have more current figures than 2006?

Ms. Darke: I will clarify where those come from. The 2006 numbers relate to the census and to all dwelling units on- reserve, and not all dwelling units on-reserve are CMHC-funded. That percentage comes from the 2006 Census; and I believe that's the most recent information available from that source.

The other numbers that I referenced to you, the 53 per cent satisfactory or good and the 36 per cent in fair condition, are specifically related to the CMHC-funded stock, which is the 29,300 units that we have provided funding to.

Senator Moore: Yes, I understand that.

Ms. Darke: I think Mr. Carisse said that on reserves now there are about 108,000 dwelling units. The CMHC- funded stock is just one proportion of the overall stock on-reserve.

Senator Moore: Could I have a final quick supplement, chair?

The Chair: Yes.

Senator Moore: Ms. Dark, it's for you as well. In your remarks, you said that each year through CMHC, the Government of Canada provides $2 billion to address the housing needs of lower-income Canadians. Does that include everybody who is a lower-income Canadian? Are you talking about on- and off-reserve persons only?

Ms. Darke: Perhaps I can clarify. The $2 billion relates to all of the funding for housing that CMHC provides in a year. That would be both on and off.

Senator Moore: Does ``on and off'' mean that the people who are off are natives and non-natives?

Ms. Darke: Correct.

Senator Moore: All Canadians.

Ms. Darke: Yes.

Senator Wallace: The chair began by saying that we've asked you to come here today to provide us with background information so we would be better able to decide where we should focus our attention as we go forward with this. I have to say that what you have provided has been very helpful; and we appreciate that.

Mr. Carisse, as you pointed out, there certainly seems to be a shortfall in the number of housing units on reserves. I suspect that availability of funding is a major part of that, but I'm wondering, aside from that, if you could identify for us any significant underlying impediment other than simply ``we don't have enough money'' that would account for this shortfall in the number of housing units available. Is there some basic non-monetary impediment that you would recommend we focus our attentions on to make a difference when we finish this work?

Mr. Carisse: Good question. We touched on some of the issues with regard to capacity within the community and the needed tools out there, even with the funding that's available, if it's easier for communities to use certain tools to go to a private or market housing fund to at least address those needs.

The way we fund infrastructure, just to broaden so it's not just housing, most often it is cash-based funding. If it's a $10-million school, you take the first six to twelve months to do the design and the next ten years to finish it. Then you pay off that school over the next two years at $5 million a year and it's done. In one way, that makes a little bit of sense. If we could all pay off our mortgages within two years, it would be to our advantage; but at the same time, you're not really stretching those dollars as much as you could.

In this situation, especially with housing on-reserve, the land is still under section 91(24) of the Constitution Act, 1867; and there's still section 89(1) of the Indian Act that prohibits seizure of assets. It's difficult for any community member without certain tools like this to go out and get their own mortgages, those that actually want to build their own homes that could help address the need.

Within every community, be it remote, rural or more urban, you should have social housing and market housing, rental regimes, rental housing to a different extent depending on the location, but that's not possible in every community. There are some communities that could actually take advantage of that, especially going back to the discussion on individuals. There are individuals in communities that I believe would really want to go off and to get a mortgage to build a house that they want for their own needs but, because of the land situation, I think there's an issue there. I think there's an issue with the land situation, and some initiatives have been promoted recently or proposed that I think could help address that.

I also think about the discussion we had about codes. We ask for infrastructure codes and building codes, so it is in funding agreements. It has been part of CMHC programming for a number of years now for housing to be built to code, but, as we saw with water a number of years ago, and the Auditor General told us to fix the situation, there was a regulatory gap with water and waste water regulations. We face the same situation right now with housing that building codes are not regulated. There isn't that certainty of regulations that is there right now for building codes.

Again, the land, looking at the codes, I think, and keep building on certain tools that First Nations could access would help a great deal, because I don't think government will just be able to come up with the extra billions of dollars that are needed to address that need right away.

Senator Wallace: Yes. I was just wondering. We all go through this at times. You wake up in the middle of the night, and you've been involved in issues, and all of a sudden, with clarity, gee, there's one big one. There is what would break the logjam. I just wondered if there was anything like that. I know you've got a number of programs, a number of issues, and they all need tweaking, but I accept what you've had to say, unless there is something more, if there was that major, fundamental issue that we should focus our attention on. We can leave your answer where it is, if you wish.

Mr. Carisse: I think those are the big ones.

Senator Wallace: Great. One other question, if I could: You've mentioned that dealing with these on-reserve issues, the housing issues and other issues involves a partnership of the federal and provincial and territorial governments and the First Nations chiefs and councils. I'm wondering to what extent, if any, difficulties with the actual workings of that partnership have created impediments to meeting the housing needs of the Aboriginal people.

Mr. Carisse: There are those situations. I think some of it is starting to break down, and I especially see it working with provincial governments and industry, not for housing per se. I'm looking at a project we did in northern Ontario with the Nishnawbe Aski Nation. We have 26 communities there who pulled together to do a broadband project to bring fibre to these 26 communities. I think we're almost up to $90 million for this project. It was a great partnership that you saw between the province, between Bell Alliance and industry, between the First Nation communities, and there were various ministries in the province and within various departments in the federal family to pool all that money together to actually get this project off and going. There was no way that any one group could have pulled this off. That approach can definitely be applied to other pieces of infrastructure, including housing. How can we best work together between the departments, with the province? You never know. There may be certain ways to do with it industry. As I mentioned earlier, it was Deloitte that worked for housing P3 in Vancouver. So there may be some appetite out there to look at doing something similar for on-reserve.

Senator Wallace: I suspect that with those partnerships there are successes and less than success in certain projects. That really wasn't the focus of my question.

I am wondering, generally speaking, about the working relationship of the three parties to that partnership. Do they work together effectively? Again, I realize it's a project-to-project determination, actually. Are there rivalries and everybody has their own turf they want to protect so things don't come together? Is that something we should focus on, the working relationship of that partnership? That is what I'm asking.

Mr. Carisse: I think it can't hurt, obviously. One thing that helps is knowing what everybody's roles and responsibilities are, and if that's always clear, be it for housing, water, schools or infrastructure, that always helps out because when you have that lack of clarity, people get confused and there's misinformation. Then a certain approach somewhere may be different in how we approach a situation in Quebec than how we'd approach it in Alberta. Somebody would say, how come? There are good reasons why, depending on the organizations that are there. There is the issue of everybody's vying for that same dollar. If we're doing a project somewhere and somewhere else at the same time, it's nice to be able to able to go off and try things. I mentioned P3s or what we did with ABSCAN to try things somewhere and say we're doing this — let's call it a pilot, for lack of a better word — but if we can actually replicate that somewhere, then we have to start somewhere, and I think there's possibilities. We're on the cusp of doing things really differently, which is good, so we'll be able to start addressing the need not just on housing but on the other infrastructure that's out there.

Senator Greene Raine: Thank you very much. I really appreciate what you've been telling us today. One of the nice things about being one of the last people to ask questions is that most of my questions are already asked, but I would like a little bit of clarification, if you don't mind, Mr. Carisse. You mentioned that for First Nations that have not opted into the 1996 housing policy, which includes those in British Columbia and a few in Ontario, funding operates on a subsidy basis. Could you elaborate on that a little bit? Why haven't they opted in? Now we have two different systems, one where it's First Nations controlled, basically, and the other, which is a subsidy from the department.

Mr. Carisse: That's right. In 1996, that policy that was put together did give a lot more flexibility and control into the hands of First Nations, as chief and council receiving that allocation of funding and deciding where to apply it and what to do with it. The situation is basically numbers. In British Columbia, for the 200 communities that are there, a vast number of them are very small communities, so to try to do a formula-based funding for their community of 35 or 40 people, the numbers just weren't there. With the amount of money that you would have received, the community would not have been able to do much with that funding, so it was pretty much a collective decision at that point to just have a project proposal based in British Columbia. It made it a lot easier for those communities to get a bigger pool of funds, although it's not on an annual basis obviously, but when you get that pool of funds, you can actually do something with it, more than just a few thousand dollars that wouldn't have accomplished anything. So grosso modo, that's why they decided to just stick to the subsidy the way it was done in the past.

Senator Greene Raine: Thank you very much. I've always wondered why the houses that are built on reserves, I guess mostly designed by CMHC or by somebody, are all the same, and why they are all kind of plain Jane. Who designed them? Were they designed by the people who were actually living there? Were they designed all across the country the same, or do they take into consideration climate? I guess I would really like some clarification on that going backwards but also moving forwards. Can we do it better so that the people who live in their communities have a real ownership of their dwelling units?

Ms. Darke: I can answer the question for CMHC's funded programs. CMHC does not design the houses. The homes themselves are designed and built and managed by the First Nations themselves. We don't have a standard design. We don't have standard requirements in that respect that are in place.

Mr. Carisse: I can add for the department: It's a bad term, but I guess what a lot of people call them in communities is INAC houses, and those are dating from the 1960s and so on. There was one point, and I'd have to look back in the history where the design came from, but it was pretty much that same design that was applied everywhere. We're going away from that. Since 1996 with the policy, it's up to chief and council to look at that and address the need for multi- housing and different sizes of housing so that individuals have more of an opportunity to build housing that meets their needs.

Obviously these are some of the examples and it's not like this everywhere, but if you drive into Wendake or Westbank, you're going to notice that it's not the same design everywhere. There's some really nice housing going on there. That would be nice to see in other communities.

It will be different. Obviously, in some rural remote communities, economic development is not there as you would see in a more urban reserve, but I still think you can't have that same type house. If you're a single person, you don't need a three-bedroom home; if you're a family, you may need something different. There has to be a variation of housing in communities, which makes sense — like you would see off-reserve — as well as the variations on how to finance and fund that housing, which includes social housing, rental housing and market housing. That's what I think the end state would be.

Tara Hutchinson, Senior Policy Analyst, Aboriginal Affairs and Northern Development Canada: If I could add one thing, we received $150 million through Canada's Economic Action Plan. One of our key funding categories was multi- units because we are seeing a lot of interest among First Nations for housing that meets the needs of elders and of people starting out for the first time on their own. As a result of this funding, we were able to construct many multi- units across the country. I think we'll see that area expanding as we continue.

Senator Greene Raine: Modular homes and trailers, portable homes, are also valuable in the housing mix. In the residential development on First Nations communities, are there trailer courts with pads that you can rent so that you could have a motorhome or a mobile home and, if you get a job up north somewhere, you could take it with you and come back for the winter? Is this kind of planning happening in First Nations communities now?

Maybe we could hear from Ms. Jeannie Dempster, who is involved in strategic policy coordination. Is that something your department gets involved in?

Jeannie Dempster, Director, Strategic Policy Coordination, Canada Mortgage and Housing Corporation: I can't speak specifically to that last idea about the transport of a mobile home from a policy perspective. However, that's an interesting idea that we could take back and explore from a research perspective as well.

In the North, for example when you're talking about housing design, there are different applications of design to address climate, durability of the home, the harsher climate there and sustainability of products because of the transportation cost — that is, looking at reducing costs, but again in a sustainable way. CMHC has researchers who specifically focus on the North and on more rural remote climates for that purpose. Certainly, there are a variety of research projects and initiatives that have occurred and continue to occur. They are experts on heating systems and that sort of approach.

I don't think that's really answering your question on the latter part, but from a policy perspective and in terms of design, I would reaffirm what Debra Darke said earlier, namely that there are some interesting examples of sustainable housing and sustainable communities and approaches there that CMHC has taken and is continuing to take. We have some published research on that as well.

Senator Greene Raine: I think we, as a group, look forward to calling on people in the industry of prefab and mobile housing to come forward and let us know what's happening. The door is open for every kind of housing, I understand.

The Chair: Would you kindly make those papers and those examples available to our committee through the clerk, please?

We are on the second round now and I've got two people on the list, Senator Moore and Senator Meredith.

Senator Moore: I want to ask a question with regard to the Attawapiskat situation raised by Senator Sibbeston. The news report on that situation yesterday said that the people were living in interconnected construction trailers and that the fire was caused by candles used for lighting after the storms knocked out electricity.

Mr. Carisse, I presume that your department would have been the one that provided the construction trailers that these people were living in. When that happened, would you also provide generators? Given where the location is, and that storms are prevalent at this time of the year until spring, would generators be provided so they would not have the loss of electricity and heat?

Mr. Carisse: The trailer unit itself was provided by De Beers.

Senator Moore: Provided by whom?

Mr. Carisse: De Beers mines. That was for the people who were there working for the mines. We refurbished them and helped with that. I know some renovations were needed and, as you saw in the media, there was a housing crisis in Attawapiskat. We tried to put some people in there. The fire happened. From what I know, it was an issue with a candle. It's on the west wing. They still have the smell of smoke in the common area, in the middle. It's U-shape and on the east side there is some smoke. They're cleaning that out. The idea is to get people back there as soon as possible. Is that a permanent solution? No, obviously, but it's something that's there in the community right now.

Senator Moore: What about the generators?

Mr. Carisse: For the generators, I don't know the specifics of what was knocked out in the community, if it was a line just going right to that specific unit or if it was more general. I'd have to get back to you on that.

For electricity, as much as possible we try to get communities on the grid. As you know, power gets knocked off every once in a while. Some communities are on diesel for generation, but if you're on diesel you get some wires going to the infrastructure in the community so that can be knocked out, too.

Senator Moore: Can you check on that and let us know whether adequate generating power was provided when those units were installed there?

Mr. Carisse: Yes; definitely. I'll get back to you.

The Chair: Thank you, Mr. Carisse.

Senator Meredith: Senator Wallace kind of asked my question before I stepped out of the room. I was asking about the challenges, but I always get back to the leadership, the chief and council and their true commitment to ensure that they're collaborating with Aboriginal Affairs to get these homes erected quickly, given the shortages on these reserves.

What kind of commitment has been given? How can this committee work with or encourage the chiefs so that we can say in our report, which will be provided, ``Here are some things that we've uncovered in terms of collaboration''? How can we quickly do that?

My other question to Ms. Darke is with respect to technology and collaboration of new technologies around mould to ensure that there is less resistance to mould, which is causing health issues. Have there been any discussions around the construction materials that are used? For example, looking at construction materials that are non-combustible or in terms of steel in construction rather than wood so that it doesn't absorb any moisture, and so forth? Has there been any talk about that?

Going forward, we see that the problems exist currently. We see that there are deficiencies in the construction of some of homes that are being built. How are we looking at best practices to move forward with the new homes that are going to be constructed so that they last longer and so that we don't consistently have this need to repair going forward?

The Chair: Could the answer be shorter than the question, please?

Mr. Carisse: In regard to commitment by leadership, I know you've had many representatives here from leadership, from First Nations themselves or from organizations to talk about various issues such as water, education, et cetera. From my travels, I think housing is probably the number one issue all the time. There are many issues, but housing always comes up with leadership. I think there is commitment from leadership to actually address this issue. I think the leadership is looking for some of the tools they can use.

I think certain things are not being utilized as much as they could, for instance, rental regimes in First Nation communities. In comparison to off-reserve, there aren't many communities that have adequate rental regimes, although the department provides for shelter allowances. It's up to chief and council — their government — to decide where their priorities lie, but I think it's that mindset to know if the shelter allowance is being used for shelter and if the rental regimes are there and in place and people are paying rent.

That is, for the homeowner to feel ownership and pride in the home that they're in, it's not just a house that was given by the chief and council, but it's your home. Take pride in that. I think you get a big shift in the mindset for the operations and maintenance of that house, as well as in the mindset of chief and council for that. You will be hearing from representatives — it will definitely come up — about treaty rights to housing. I'm not going to open up Pandora's box. I'll leave it to other officials from the Department of Justice to go into that. It's an issue that is present, but I think to wait for the government to come up to address the 35,000 or 85,000 units based on a treaty right, there's just not enough of the funds there. If we can put that issue aside, we need to work together with the communities and to get that commitment, that buy-in. Also, if you push that down the line, the way I see it, housing off-reserve is an economic driver everywhere you go. On-reserve, it's a cost driver. It's completely different. If you can switch that to become an economic driver, if you can get private home ownership so that somebody can start their own business and use that as their own asset, I think you can start to see a lot of change in communities. To me, if it's a dartboard, housing is in the centre. You work on housing, and I think everything else can start to get fixed. It's the home, the unit, that needs to be addressed. We're doing a lot of good stuff and getting there, but there will definitely be commitment from leadership to try to address this issue.

Ms. Darke: I'll go as quickly as I can. To answer your question about mould, CMHC is currently working on a resource document that will provide information on design and construction details to help First Nations build homes that will not have mould problems. Information transfer is one of the main things we're doing in this area, and, as I said, that will provide them with some good technical design advice. It will include things like construction materials, heating and cooling systems and the technology that is part of a home.

We also do best practice case studies. We have a mould resource tool kit that helps people to identify mould, to address mould-related issues and to avoid mould. CMHC has a series of different products in this area.

The Chair: Thank you. We have a quick yes or no question from Senator Dyck before we break.

Senator Dyck: Does the 2 per cent cap that was applied to federal funding in 1996 apply to funding for on-reserve housing? Has that been lifted from housing?

Mr. Carisse: The cap is on our A base, which would include housing. I'll go back and make sure on that, but it's on the full A base of the department, so that would include housing.

The Chair: Thank you very much to everyone. Meeting adjourned.

(The committee adjourned.)