First Nations Financial Transparency Act

An Act to enhance the financial accountability and transparency of First Nations

This bill was last introduced in the 41st Parliament, 1st Session, which ended in September 2013.


John Duncan  Conservative


This bill has received Royal Assent and is now law.


This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment enhances the financial accountability and transparency of First Nations.


All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.


Nov. 27, 2012 Passed That the Bill be now read a third time and do pass.
Nov. 26, 2012 Passed That Bill C-27, An Act to enhance the financial accountability and transparency of First Nations, {as amended}, be concurred in at report stage [with a further amendment/with further amendments] .
Nov. 26, 2012 Failed That Bill C-27 be amended by deleting Clause 13.
Nov. 26, 2012 Failed That Bill C-27 be amended by deleting Clause 11.
Nov. 26, 2012 Failed That Bill C-27 be amended by deleting Clause 1.
Nov. 22, 2012 Passed That, in relation to Bill C-27, An Act to enhance the financial accountability and transparency of First Nations, not more than one further sitting day shall be allotted to the consideration at report stage of the Bill and one sitting day shall be allotted to the consideration at third reading stage of the said Bill; and That, 15 minutes before the expiry of the time provided for Government Orders on the day allotted to the consideration at report stage and on the day allotted to the consideration at third reading stage of the said Bill, any proceedings before the House shall be interrupted, if required for the purpose of this Order, and in turn every question necessary for the disposal of the stage of the Bill then under consideration shall be put forthwith and successively without further debate or amendment.
June 21, 2012 Passed That the Bill be now read a second time and referred to the Standing Committee on Aboriginal Affairs and Northern Development.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:15 a.m.
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Kenora Ontario


Greg Rickford ConservativeParliamentary Secretary to the Minister of Aboriginal Affairs and Northern Development

Mr. Speaker, thank you for this opportunity on behalf of the constituents of the great Kenora riding to speak, hopefully, for the last time to this piece of legislation before it moves on to the other place and receives royal assent.

I am proud to rise today to once again explain the need for Bill C-27 and to talk about its many benefits.

Before I do, as a member of the Standing Committee on Aboriginal Affairs and Northern Development, I want to thank all those who appeared before the committee during recent hearings. Their contributions have made this legislation better and stronger.

The committee heard from a number of witnesses, both aboriginal and non-aboriginal, who spoke to the need for Bill C-27. They recognized that increased transparency and accountability will empower first nation members and their governments.

As do all Canadians, first nation community members want assurances that public funds are being used to improve their communities. They expect and deserve sound management practices from their elected leadership, as well as access to the information necessary to ensure that these leaders are acting in their best interests and priorities. Bill C-27 simply puts in place the same types of rules with respect to financial transparency that already apply to other levels of government in Canada. Why should first nations expect or have anything less?

Further, publicly accessible information will also boost investor confidence and create a better business environment for private sector investment on reserve. This will inevitably lead to increased economic opportunities that will help to create the conditions for healthier and more self-sufficient first nation communities.

Chief Darcy Bear of the Whitecap Dakota First Nation said it best when he stated:

You drive through my community, you'll see all the paved roads, paved streets, the good quality of life that my people, my members enjoy.... That's what good accountability brings to a community.

It is worth noting that the bill is entirely consistent with the resolution passed by first nation leadership at the Assembly of First Nations' Special Chiefs Assembly in December of 2010, where the chiefs committed to “Choose to lead by example and demonstrate to other orders of government processes for accountability”, which included:

Itemizing and publicly disclosing salaries, honoraria and expenses associated with the operations of Chief & Council;

Ensuring information about community finances and decision-making is easily accessible, and available via the internet where applicable.

That sounds a lot like the wording, spirit and intent of the bill.

Currently, there is no legislative requirement for transparency and accountability from first nation leadership. Under current funding agreements, first nation community members can ask for band-related financial information from their elected leaders, but there is no legislated obligation on the part of the administration to release it. We know that many first nations are already making their financial information public voluntarily. We appreciate that. I think it goes to reducing the amount of suspicion and political turmoil at the community level. However, not all first nation communities are doing this.

When individuals are refused information from their band council they often come to the Department of Aboriginal Affairs and Northern Development Canada to ask for the information to be released to them, as we have heard from various witnesses appearing before the standing committee. Some regional offices of the department receive as many as 25 to 30 informal requests each year from first nation members seeking this basic information, which would be readily available to any other constituent or any other Canadian in any other jurisdiction

At committee Phyllis Sutherland, president of the Peguis Accountability Coalition, told committee members about her community. They were unable to access salary and other financial information about their elected band officials. She in fact cited several cases where members were subject to intimidation. She insisted that this type of intimidation must stop and that those in power must be held accountable.

Similar concerns were raised in testimony by Joseph Quesnel, a policy analyst with the Frontier Centre for Public Policy. He presented research data culled from the Aboriginal Governance Index developed by the centre, which revealed that 77% of the first nation members surveyed agreed that salary information for elected officials should be made public and be accessible. However, 25% say this information is not available to their band members.

In addition to the requests for documents, the department also receives allegations and complaints regarding potential mismanagement or the misappropriation of band funds and remuneration of its elected officials. Since January 2011, there have been 1,450 such complaints.

The important point is not how many requests the department receives each year for salary information—although there are many—it is the fact that from this government’s perspective, even one request is one too many. Members must go to the department for information that should be coming directly from their own first nation. The minister would prefer not to be involved in issues that should be resolved by the community itself.

Bill C-27 removes the minister from the equation by ensuring this financial information is easily accessible to everyone who wants it. It creates a direct line of accountability between first nation leaders and their members.

The concern about accountability extends beyond government and first nation members to investors who might be deterred by a lack of reliable financial data. Bill C-27 would help address this problem by requiring first nation governments to publish annual audited consolidated financial statements, as well as a schedule of chiefs' and councillors' salaries, remunerations and expenses. Clear and consistent publication under Bill C-27 would provide potential investors with a snapshot of a community's financial situation and may lead to further opportunities for partnership and investment.

There has been misinformation spread about the bill by the opposition who opposes our government's efforts to support economic growth, investment and job creation through more accountable and transparent government. I would like to take this opportunity to clear up the misconceptions and explain what Bill C-27 would do.

First, the legislation would not set salary levels for chiefs and councillors. It would remain the first nation's responsibility to set the appropriate level of remuneration for its elected officials. The proposed act would simply ensure that financial information is disclosed to the public. This would provide band members with the information they need to hold their leadership to account. They can then use that information to determine whether funds are being spent for the benefit of the community and whether compensation levels are reasonable and appropriate.

Second, I want to make clear that the act would not require individual businesses owned by the band to publish their detailed financial statements. Rather, Bill C-27 would only require the publication of the first nation's audited consolidated financial statements. These financial statements would include any entities that, according to generally accepted accounting principles or GAP, are to be consolidated with the first nation in its financial statements, including most band-owned businesses. However, information relating to government business enterprises would be highly aggregated and would not be revealing any details that would undermine the competitiveness of their businesses.

I want to underline that this is a standard accounting principle. This rule applies to all other government-owned businesses across Canada. We are not asking anything different of first nation communities than we do of any other business or community in Canada.

As members of Parliament, we all fully disclose our salaries and special allowances to the public, as required by the Parliament of Canada Act and the Salaries Act. Not only that, but the Federal Accountability Act of 2006 has also increased the public's access to information about its government's activities and those of its members. Anyone interested in any of this data can find it without even asking. Similar laws are in place at the provincial and territorial level and most of those governments have adopted legislation requiring municipal governments to make these documents public as well.

Equally important, there is nothing in this legislation that would create any additional paperwork for first nation governments. They already produce consolidated financial statements each year, which are audited by independent accredited professional auditors. It is a requirement of their funding agreements with Aboriginal Affairs and Northern Development Canada.

The legislation simply ensures that some of the critical documents which are already submitted to the department as part of a first nation’s funding agreement are made publicly available. This bill does not ask for anything new, except greater transparency to members.

To be clear, all that Bill C-27 would do is to require first nation governments to meet the same standards. They are the only governments in Canada that do not currently provide this basic level of information to the public, and this bill would fill that legislative gap.

As members can see, we are not proposing radical measures, nor are they onerous in terms of their additional reporting requirements. We have made every effort to make it easy for first nations to comply with this law.

It has been pointed out, for example, that not all first nations have websites. However, the bill fully addresses this point. A first nation will not be required to have its own website as a result of the legislation. If a first nation is not able to publish the information electronically itself, it can ask another organization it is a member of to post it on the community's behalf. Alternatively, the first nation could ask Aboriginal Affairs and Northern Development Canada to post the information on its behalf.

Of course, it is important to recognize that having these documents published on a website does not fulfill a first nation government's obligation to make copies of financial statements available to its members. Again, many of them already do this by either distributing printed copies to households or making information available in band offices. We heard at committee instances of where a number of communities actually host a forum, somewhat akin to an annual general assembly of its members, where they review these documents.

I also want to reinforce that there have been numerous opportunities to discuss and improve this legislation, first in the context of private member's Bill C-575 introduced in the previous Parliament, and now in the context of Bill C-27.

Over the course of the committee's review of the bill, we heard concerns about how certain sectors of the text might be interpreted. These concerns focused on the language of the bill in two key areas: first, the need to report information relating to remuneration and reimbursement of expenses separately; and second, the treatment of band-controlled entities. I am pleased to say that we have listened to the concerns raised by first nations and have introduced amendments to clarify the relevant language of the bill to address these concerns. That is a process that took place at committee.

With respect to the reporting of remuneration and expenses, the original text of the bill combined the concepts of salaries and expenses into a single definition of remuneration. Although it was not the intention of the bill, we heard from witnesses that this could be interpreted to suggest that these two amounts could be reported and disclosed to the public as one aggregate figure. To make things clearer and for greater certainty, the amendments split these two concepts into two separate definitions for the purposes of the legislation, and the schedule of remuneration has been re-named in the text of the bill to “schedule of remuneration and expenses”.

As it relates to the treatment of band-owned businesses, the intention of the bill has always been to put into legislation the same practices with respect to the treatment of band entities as are currently in place in the funding agreements. We believe it is important for the users of financial statements, especially first nation members, to see summary statements that capture the activities of their government and elected officials.

The entities to be included and the manner in which their financial information is presented will be determined by the standards set out by the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants. This will ensure that the standards applying to businesses owned by other governments in Canada will also apply to first nation governments in precisely the same way.

The government worked hard to find language that strikes a balance between the need for precision and certainty in legislative drafting and complex accounting concepts. At committee we adopted an amended definition of consolidated financial statements that makes these points clear. These improvements resulted in some other small amendments but do not detract from the original intent of the bill. The only thing that has changed is the wording, which has been adjusted for clarity, greater certainty and to eliminate any confusion.

First nations people have been waiting a long time for the measures proposed in Bill C-27. They should not be asked to wait any longer for this bill to come into effect.

It was first introduced on November 23, 2011, and there has been ample time devoted to discussing views and concerns regarding this legislation. It was debated for almost six hours during second reading debate before being referred to committee, which met seven times to study and discuss Bill C-27.

During that time the committee heard from 21 witnesses from 13 different organizations. These witnesses came from a variety of organizations including the Assembly of First Nations, the Canadian Taxpayers Federation, the Aboriginal Financial Officers Association of Canada, and representatives from individual first nations communities.

During report stage, the House spent over six hours of debate on this bill. The NDP has had no less than 20 speakers, yet we heard no new issues raised by the opposition in all that time. In fact, one thing that we did hear was one member from across the way saying that he wanted to see one rule for all. It is great news that a member from the NDP would say that, because that is exactly what this bill strives to accomplish.

For this legislation to apply in the next fiscal year, it must come into force on or before March 31, 2013. This legislation is long overdue and will bring first nation governments in line with virtually all other governments in Canada. Our government believes that first nations people have waited long enough. We think this legislation should apply to the next fiscal year, 2013-14. This means that the publication of first nations' financial statements and salaries and expenses could occur as early as July 2014.

I am very proud of this legislation. I believe firmly that first nations deserve and expect the same level of transparency and accountability as all Canadians. The first nations financial transparency act would make that happen.

Bill C-27 will also reassure potential investors that they can safely enter into joint financial agreements, joint ventures and business undertakings with first nations. The resulting jobs and economic growth will contribute to social and economic improvements in the lives, the livelihoods and the communities of first nation members.

In short, Bill C-27 is a landmark bill that is worthy of the support of all parties. I urge all members of the House to give it their full support and vote unanimously in support of this bill.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:35 a.m.
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Jean Crowder NDP Nanaimo—Cowichan, BC

Mr. Speaker, I think it is a bit of a stretch to say that simply by posting audited statements or consolidated financial statements, economic development and autonomy will occur in a community. We already know that many first nations already post that information and are not thriving economically.

As the parliamentary secretary pointed out in his speech, there is already a requirement for first nations to produce this information if they have financial agreements with the federal government. Moreover, if they have a band-owned entity that is incorporated or is in a partnership, there are requirements for audits for them as well. In short, many first nations already produce this information.

Why did the government choose this adversarial, non-consultative approach when it could instead have worked with first nations that are having difficulty complying with the rules already in place? Why did the government not take this latter approach?

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:35 a.m.
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Greg Rickford Conservative Kenora, ON

Mr. Speaker, I appreciate and respect the hon. member's contributions to this debate and all of the work that we do at committee. Nonetheless, I am interested in the evolving narrative from the other side.

Here is what we have heard so far as the bill has come through. One member for the NDP has said there should be one rule for all. Bill C-27 actually takes us in that direction. It makes a level playing field for constituents in first nation communities, as would exist in other communities in other jurisdictions.

Second, another member of the NDP said that government is about decision-making and emphasized the ability and right of a given community to participate in that. Having access to financial documents allows community members to exercise their participation in the decisions their elected officials are making.

Now the current member has just said and recognized that this is not an onerous exercise, since they already produce these documents. Indeed, it is not a redundant exercise; it simply means that they have to post the documents on an accessible website or be able to supply them to a community member on request.

We have these three approaches coming from the NDP. We are encouraged that their signals are strong and that they agree with the central tenets of and practical implementation issues regarding the bill. We look forward to today's vote so that we can move forward and send the bill to the other place.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:40 a.m.
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Greg Rickford Conservative Kenora, ON

Mr. Speaker, I also appreciate this member's important work on the Standing Committee on Aboriginal Affairs and Northern Development.

The legislation would apply to first nations' first complete financial year following royal assent. To the extent that the royal assent is received before the end of March 2013, it would apply to fiscal year 2013-14. First nations would have 120 days following the end of the financial year to publish their audited consolidated financial statements and the schedules and/or notes I referred to in my speech.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:40 a.m.
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Pierre-Luc Dusseault NDP Sherbrooke, QC

Mr. Speaker, I am pleased to be able to ask a question.

The parliamentary secretary is saying that the department is already obligated to disclose this information. The information is therefore already available to first nations members who request it.

Based on the speech he just gave, I am having a very difficult time understanding why this bill is useful today.

I would like him to explain a specific sentence in his speech. He said that this was going to promote economic growth and job creation. Can he explain to me how putting this information on a website is going to promote job creation and the economic prosperity of first nations?

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:40 a.m.
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Greg Rickford Conservative Kenora, ON

Mr. Speaker, I appreciate the hon. member's question, because it gives me an opportunity to do two things. First, I would point out that the publication of these documents will also give greater investor confidence to prospective businesses wanting to enter into joint ventures with first nations. This is happening. We are opening small business centres on reserve, with a couple just opening in the great Kenora riding not too long ago. We believe that access by the members of those communities to the documents will help them to participate and talk with their elected leaderships about new business priorities moving forward.

Second, self-governing first nation communities, those that have already entered into agreements, already disclose this. As another member asked in a previous question, there are still some bands that do not do this. We want to bring them all onboard to create transparency and accountability and improve investor confidence.

The only thing I would compare it to is the kind of transparency we would like to see from the other side in telling folks and explaining to them more clearly what their carbon tax is really all about.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:40 a.m.
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Kyle Seeback Conservative Brampton West, ON

Mr. Speaker, I want to thank my colleague for his speech. He knows the issue in depth.

We keep hearing about a couple of things, and “non-consultation” seems to be the mantra from the New Democrats. However, there was significant consultation in the genesis of this legislation, which was from the member for Saskatoon—Rosetown—Biggar.

More importantly, what we forget are the people who came to committee to testify about this legislation. Could the member comment on why individual first nations members came to the committee to say why this legislation is so important?

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:40 a.m.
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Greg Rickford Conservative Kenora, ON

Mr. Speaker, I appreciate this member's contributions to the aboriginal affairs standing committee.

He is right, and he is fleshing out an issue that I feel very strongly about. Consultation takes several forms. When this bill was a piece of private member's business, there was extensive consultation. However, consultation takes on several different forms. When grassroots community members come to their elected officials to consult with them about an issue or a problem, we are talking about a consultation. Nobody who sits on that committee can deny that we have heard from coalition associations, and that “coalition” word still m'a traumatisé un petit peu.

However, these are organizations that have come together and have said they have concerns. They are consulting the government, and another organization, about what steps they can take to get the government to help them respond to this important and substantial concern that they have.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:45 a.m.
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Craig Scott NDP Toronto—Danforth, ON

Mr. Speaker, I would like to ask the hon. member about the unfairness of how this act has been written. It is written in a way to serve as a type of disciplining device for first nations communities, almost turning them into compliant actors who are subject to largely unaccountable ministerial sanctions.

However, what really worries me is that the bill would allow, in clause 11, “any person”, not just a first nation member, to apply for disclosure of statements. This kind of standing, or locus standi, before a court is a recipe, and it looks like a deliberate recipe, for harassment by crusading organizations or individuals to go after first nations. Why would any person in the country have that right written into the bill?

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:45 a.m.
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Greg Rickford Conservative Kenora, ON

Mr. Speaker, with respect, obviously the member's previous life was as a person who was fully vested in teaching and practising the law. I respect his observations, but I do not agree with them. Under current funding agreements there are instances where ministerial sanctions could take place, but they remotely or rarely ever occur. We do not see this legislation as taking us any farther down that path.

However, with respect to disclosure, any constituents in Canada can go to a given website of their respective government to access these financial documents, except for first nations communities. With respect, that is a substantive element about fairness.

In what appeared to be a rather declivitous trajectory in the narrative of a New Democratic member, that member actually made statements to support our legislation, if you will, simply saying that as a matter of fairness it should be one rule for all and everybody should have access to those documents. It is important for decision-making, prioritizing in the community and the conversation that should occur between a member of a community and its elected officials.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 10:45 a.m.
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Jean Crowder NDP Nanaimo—Cowichan, BC

Mr. Speaker, before I launch into my speech, there are a couple of points that the parliamentary secretary raised that I have to comment on. First of all, part of the problem the House is facing is that the Conservative government fails to recognize a government-to-government relationship. That is a fundamental principle underlying the opposition to this particular piece of legislation.

The member talked about consultation. However, if the Conservatives truly support the UN Declaration on the Rights of Indigenous Peoples, which they claim they do, they would look at section 19 that talks about free, prior and informed consent. First nations from coast to coast to coast are saying there has not been free, prior and informed consent on this piece of legislation.

There is another point around this. I would absolutely agree, everyone in the House agrees and first nations agree, that there does need to be accountability and transparency. However, it is how it happens that is critical to this conversation. We have seen the government, once again, unilaterally impose its vision of what accountability and transparency looks like.

The parliamentary secretary quoted a 2010 resolution from the Assembly of First Nations. I want to quote from a paper from 2006, where the Assembly of First Nations was calling on the Conservative government to work with first nations from coast to coast to coast in developing this kind of accountability and transparency. The Assembly of First Nations had a detailed position paper, which also included the suggestion that:

[First nations-led and first nations-specific institutions] will be needed, as First Nation citizens must be empowered to hold both their local governments and the Government of Canada to account. Such institutions include an Ombudsperson's office, so that individuals have a trusted venue to pursue accountability concerns outside of either the local or federal governments. They would also include a First Nations Auditor General who could both provide ongoing advice to assist FN governments in providing accountability and, at the same time, improve accountability by exposing problems and recommending solutions.

In 2006, first nations had a solution to deal with this. Six years later, we do not have to be dealing with a piece of legislation that is being unilaterally imposed by the Conservative government.

I am not going to go over the full details of the bill because we have now spoken about it a number of times in the House. However, the bill would essentially require audited annual consolidated financial statements; a separate annual schedule of remuneration which would include what is paid to the first nations, and any entity controlled by the first nations, its chief and each of its councillors; an auditor's written report respecting the consolidated financial statements; and an auditor's report respecting the schedule of remuneration.

Also, as members have already pointed out, there are some punishments if there is a failure by the first nation to comply, such that any first nation member may apply for a court order to the Superior Court; any person, including the minister, may apply for a court order to the Superior Court; and, the minister may develop an appropriate action plan to remedy the breach, which could include withholding funds or terminating a funding agreement.

I neglected to say at the outset that we will continue to oppose the bill rigorously. We did propose a number of amendments to try to improve the bill, including deleting some of the more egregious clauses, but those amendments were not supported.

In an article from iPolitics entitled “...the government's hollow embrace of transparency” the author says that “...its call for greater financial disclosure rings hollow coming from a government which is failing the transparency test itself”. Of course, it was welcomed to hear the parliamentary secretary talk about embracing the one rule for all. Perhaps the government will now cough up details on some of these following items that have been identified.

The article goes on to say:

Unfortunately, back in Ottawa, the federal government is also proving to be far more opaque than accountable.

In 2011...the interim auditor general, blasted the Conservatives for spending on the 2010 G8/G20 summit. Quoted in the National Post, [he] said: “Rules were broken. Lawyers could have an interesting debate as to whether any laws were broken.” [He] criticized the government for having no supporting documentation for the selection of 32 projects in the [gazebo] riding.

In 2012, Auditor General Michael Ferguson took the government to task over its failure to disclose the true cost of purchasing 65 F-35 fighter jets. According to Ferguson, the cost of acquiring the planes over their 20-year life cycle was not $15 billion, as the government claimed, but $25 billion.

That estimate was closer to one made in 2011 by Parliamentary Budget Officer Kevin Page. After Ferguson's report, Page told CBC Radio’s Evan Solomon that it appeared that one set of books was available inside the Department of National Defense, while another was presented publicly by the government “for communication purposes.”..

Page, of course, made more headlines this week when he filed a reference application with the Federal Court of Canada to gain access to details of the federal government's austerity measures, which have so far been denied to his office.

This is the context we are working in. On the one hand, the government is saying to first nations chiefs and councils that they must be more accountable than almost any other government in the country. On the other hand, it will not produce basic fundamental documents to tell the Canadian public how it is spending its money. It seems to me that this inconsistency needs to be addressed before we move forward with Bill C-27.

I want to quote a law professor. I know many will be interested in this because she is not just a law professor, but former chief Judith Sayers. She is the national aboriginal economic development chair and the assistant professor of business and law at the University of Victoria. Also, she was formerly a chief of her nation. Therefore, she has a very good grasp of the situation that is facing first nations.

In her letter to the standing committee of November 20, 2012, she says:

To ensure First Nations members get copies of financial statements, provisions to do that could be placed into these funding agreements between AANCD and the First Nation.

She is proposing a solution instead of Bill C-27. She is proposing that this clause be inserted into these agreements. She also said:

There could also be a process put in place that if a First Nation did not provide their members with Financial Statements within 120 days of the year end, that the members could go to the auditor’s office and receive copies. The First Nation would be required to put this in the letter of engagement with the auditor and compensate the auditor for costs of making copies of the audit. Legislation is not required to do this when agreements have dictated First Nation/AANDC fiscal relationships and this can continue to be the tool that can accomplish this.

She goes on to say that passing the law to make first nations provide their financial statements to their members is “not a step toward self governing Nations nor does it make them accountable, it only makes them compliant”. This is a key point because the government continues to claim that there will be a miracle that will occur when first nations are required to post their consolidated financial statements, that all of a sudden economic development will occur and there will be lots of accountability. That is simply not the case.

Ms. Sayers goes on to say that part of the problem with the bill is that it is not just money from the federal government, but from the first nations own source revenues, such as grants from organizations, provincial governments and any other entities.

The Federal Government does not have jurisdiction over moneys received from other sources and cannot compel the First Nation to be providing this information to the public.

She is outlining a legislative authority regarding providing financial statements and legal entities to the public. She says:

It is my submission that the federal government does not have authority to legislate with respect to any corporation, society or other legal body incorporated under provincial laws to provide financial statements to members of the First Nation and more problematically, to the public at large.

Then she quotes section 91(24) of the Constitution Act, which gives authority to the federal government over Indians and lands reserved for Indians.

The proposed Bill C-27 claims authority over an “entity” which means a corporation or a partnership, a Joint Venture of any other unincorporated association or organization. Any “entity” that is incorporated under provincial laws whether it is a Corporations Act or Societies act or Cooperative becomes a legal entity, an entity that cannot be considered an “Indian” over which the federal government has no jurisdiction.

That is an important point because the government is now stepping into territory that many first nations feel they have absolutely no authority over. She continues:

If First Nations are incorporating their businesses using provincial law as most do, the Federal government cannot then override the provisions of the provincial law.

Provincial Laws do not require that financial statements go to anyone other than the Directors and Shareholders of the corporation. In BC shareholders access to financial information is subject to the terms and conditions of what is set out in the articles of incorporation of the company. So in the instance where the members are shareholders, or have a trustee that holds the shares for them, the financial statements will be available to the members to see by virtue of provincial law.

It would be my submission that the Federal Government cannot define consolidated financial statements of the First Nation as “those of any entity that it controls that are presented as those of a single economic entity” if those entities are a legally incorporated society/corporation/cooperative, partnership, joint venture under provincial law.

I reiterate the fact that the government is now requiring the chiefs and councils to provide any income from these entities and that these entities would be aggregated in the consolidated financial statement. This associate professor of law is claiming that it is overstepping its jurisdiction.

In her conclusion, Ms. Sayers says:

I respectfully submit to this committee that Bill C-27 is not needed and if it does proceed to law, must be fully overhauled to narrow it to areas where the federal government has jurisdiction. First Nations will be challenging this legislation in court regarding this issue and since AANDC spends more than any other federal department on legal fees, this does not seem like a desirable course of action.

That is an opinion that the legislation is not required and oversteps federal jurisdiction.

I want to make a couple points about the testimony in the committee meeting of Wednesday, October 24, of Mr. Harold Calla, the chair of the First Nations Financial Management Board. He raised a point about audits, which is important. He says:

First of all, an audit is a look at history. It's a reactive statement, and it's not designed to be proactive in informing and supporting future decisions. While an audit is a necessary and important part of the overall financial management system, there are many other elements of a financial management system that should not be lost in this discussion.

All orders of government are accountable. Within the federal system, the need for an increased emphasis on oversight within budgeting and forecasting has been recognized as a best practice with the establishment of a parliamentary budget officer. This is an example of an evolving world and perspective of what practices and standards should become as part of the overall financial management system. Good financial management practices should not be defined solely by political objectives. Good financial management should be driven by the needs of all stakeholders and should inform them.

In the case of first nations, this should include the financial results of the transaction activity it undertakes for the delivery of programs and services that a first nation is mandated to deliver. Although an audit does contain notes, these notes are generally a clarification of financial facts. An audit does not make qualitative observations or recommendations, nor does it give a clear indication of future direction.

Mr. Calla went on to talk about an annual report. As he has pointed out, a consolidated financial statement is a retrospective. It talks about the money that has been spent in a bunch of different categories, but does not talk about the results that have been achieved with that expenditure of money. The government claims that it will open up economic opportunities, but that kind of analysis must be done about where money is spent and what results are achieved in order to get that financial snapshot.

One of the issues absent in the bill, and has been absent largely in the discussion, is what kinds of resources the federal government is providing to first nations in order to help them with capacity building. We have recently seen cuts to tribal councils and other aboriginal organizations, which are the very organizations that provide some of the capacity building and support. On the one hand, first nations would be required to do something in addition to what they already do. On the other hand, the government has cut the very services and program supports that could help them develop the economic capacity, which everybody knows is a step toward lifting first nations out of poverty.

Mr. Calla further says:

The purpose of measures that support financial reporting or being accountable and transparent should create confidence in all stakeholder groups in the financial...capacity of the entity and give an indication of their fiscal capacity. It is always better when stakeholder groups, in this case our communities, are able to establish the accountability and transparency framework that they wish to establish for their community...

It is best if communities pass their own laws and agree to independent oversight by third parties. This is the concept developed by the First Nations Fiscal and Statistical Management Act, and it is currently being explored by 58 of the approximately 100 first nations that have become scheduled under the act.

Once again, there are first nations that do an exemplary job and there are organizations that support this.

I want to quote Jean Paul from the Membertou First Nation who attended the same meeting. He says:

All the information required by the new act is already being provided by the first nations in Canada to AANDC, as per their existing funding agreements over years and decades. Only last year the issue was pushed to the forefront, and now a bill will require all first nations to comply or...AANDC will release the information, and as a last resort, all funding will be stopped.

Mr. Paul raises the question about whether anybody has examined the implications of taking funding away when many first nations are delivering essential services to their communities, which include water, housing, education and so on. That question also has not been addressed.

In an email from AFOA Canada, which again provides support to the financial officer, it says:

Having said all this, the overriding issue here is that only by stating the words “First Nations” within the proposed Bill C-27 and defining these words as per the Indian Act, the government is signaling out a specific group of Canadians. This is of concern because of the increased financial level of reporting and accountability required which includes the schedule of salaries, honoraria, travel and other remuneration. More is being asked of First Nations than other groups of Canadians. If First Nations are not recognized as governments, why are we even comparing them to other governments? And even if they were recognized as Governments in legislation (which they are not), there is a higher standard required upon First Nations within this Bill.

It is interesting because the parliamentary secretary and others have talked about the fact that this is the same standard that is applied to everybody. I will quote from the conflict of interest code for members of the House of Commons. Although we do have to declare if we have an interest or if we receive remuneration from another organization, under the content of our disclosure, it says “the source and nature, but not the value, of the income, assets and liabilities referred to in the Member’s statement filed under section 20”.

When it comes to contracts or subcontracts, it describes the subject matter and nature. It says, “The following shall not be set out in the summary: a source of income of less than $10,000 during the 12 months before the relevant date”. Once again we have a situation where first nations will be asked to report in a way that members of the House of Commons are not asked to report.

In an analysis that the Assembly of First Nations did on Bill C-27, it indicated that there were several provincial governments in Canada that did not have the same kind of reporting requirements.

Nova Scotia's summaries of expenses of ministers are located at the Legislative Library for public viewing. The Government of Northwest Territories only publishes travel expenses of ministers and does not require salary disclosure of elected officials or senior public servants. Neither Yukon nor Prince Edward Island disclose salaries of elected officials.

The claim that first nations would have to comply with what every other level of government in Canada does is simply not true.

There have been issues raised around privacy. When the privacy commissioner came to the aboriginal affairs committee on October 31, she raised four key questions that needed to be answered. One was the measure demonstrably necessary to meet a specific need? Two was it likely to be effective in meeting that need? Three was the loss of privacy proportional to the need? Four was there less a privacy invasive way of achieving the same end?

This is a serious matter because we are asking first nations chiefs and councils to report in a way that many other entities are not required to report. Those four fundamental questions around privacy were never effectively dealt with. It was outside the scope for the privacy commissioner to make comments on particular legislation before the aboriginal affairs committee, but those are very serious issues that need to be addressed.

The fact that there has not been an appropriate consultation, that there are some serious questions that the consolidated financial statement, by including entities that are band owned, oversteps the authority of the government, that the privacy issues have not yet been adequately addressed and that the issues around the capacity building are not addressed in helping first nations ensure that they have the capacity to provide this information to their members, none of these issues are addressed adequately. Based on this, the New Democrats will oppose the bill at third reading.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 11:05 a.m.
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Carolyn Bennett Liberal St. Paul's, ON

Mr. Speaker, my colleague provided an excellent overview, particularly her reference to the fact that there was an accountability framework that was suggested six years ago. Would she speak a little about that?

Also, would there be unanimous consent to table the excellent letter of former chief Judith Sayers that the member referenced many times during her speech? I think it would be very good reading for all Canadians and particular for the members on the opposite side.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 11:05 a.m.
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Jean Crowder NDP Nanaimo—Cowichan, BC

Mr. Speaker, I know the member has done a tremendous amount of work on this legislation.

Back to the January 2006 accountability for results position paper that was put forward by the Assembly of First Nations, this paper not only set forward a framework for moving forward around accountability for first nations, but it also talked about the challenges that first nations chiefs and councils faced in the burden of reporting that was already required by the government.

Many nations produce 168 to 200 reports every year. When the Auditor General looked at the overall reporting, there were 60,000 reports produced by first nations on an annual basis. It is shocking how much time and energy has to go into reporting.

The other piece that was really important in this position paper was about accountability and relationship for the first nations chiefs and councils to the first nations members who elected them, which everybody would agree is rightly so. There was also the relationship of the government being accountable to first nations for how it spent its money and for the results that the government achieved in spending its money. That accountability relationship is simply absent.

With regard to Judith Sayers' letter, I am happy to share it with any members who wish it since we were denied the ability to table it in the House.

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 11:05 a.m.
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Pierre-Luc Dusseault NDP Sherbrooke, QC

Mr. Speaker, I would like to take this opportunity to thank my colleague, who is doing great work in this area. She really explained in detail the bill currently before the House. I do not necessarily want her to go into even more detail since she already did such a good job, so instead, my question is about the process.

We know that this bill was introduced, that it is now at third reading, and that it is subject to time allocation. We thus have only one day at third reading to debate this bill, which, in my opinion, will have a significant impact on first nations communities.

Can the hon. member comment on the Conservatives' approach, which always involves introducing bills and then imposing time allocations on them—if I am not mistaken this is the 30th time they have done this—so that there is as little debate as possible?

First Nations Financial Transparency ActGovernment Orders

November 27th, 2012 / 11:10 a.m.
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Jean Crowder NDP Nanaimo—Cowichan, BC

Mr. Speaker, the member for Sherbrooke is absolutely correct. I believe it is the 30th time we have had some form of shutting down debate in the House of Commons.

It is interesting that it is in the context of openness, transparency and accountability. Surely part of our responsibility as members of Parliament, if members want to talk about accountability, is to be accountable to our constituents, the people we represent across the country, to ensure we do not pass legislation that is flawed.

It is our responsibility, as the official opposition, to take that position very seriously. Because it links into consultation, one of the things I heard the parliamentary secretary say was that consultation in the context of first nations' rights constituted talking to constituents. That flies in the face of any number of Supreme Court decisions that talk about what constitutes consultation.

Consultation is not just talking to constituents. Consultation is not just simply having people appear as witnesses before the aboriginal affairs committee. That is a very narrow look at what constitutes consultation and is simply not a widely recognized mechanism for consultation.