Bill C-27 (Historical)

First Nations Financial Transparency Act

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

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

The House resumed consideration of Bill C-27, An Act to enhance the financial accountability and transparency of First Nations, as reported (with amendment) from the committee, and of the motions in Group No. 1.

First Nations Financial Transparency Act

[David Wilks, Conservative, Kootenay—Columbia, BC]

Mr. Speaker, I am glad that the games have ceased for a few minutes.

Accountability requires transparency. Not all first nations leaders are willing to release information to the community about how public funds are spent. Some choose also not to divulge this information, which results in their members wondering how much chiefs and councillors receive in remuneration.

First nations members have every right to expect a higher standard. Indeed, they deserve the same measure of accountability and transparency enjoyed by other Canadians, whose assurance of access to information about their government's activities is enshrined in legislation.

As the Minister of Aboriginal Affairs and Northern Development has noted in his remarks to this chamber, this government has ensured that Canadians have ready access to the information they need to judge our actions as parliamentarians. The first legislation we brought to the House back in 2006 was the Federal Accountability Act, which increased public oversight into how Canadian dollars are spent.

Not only do we publish public records about how every dollar is spent at the federal level each year, we also disclose the salaries of members of Parliament through the Parliament of Canada Act and the Salaries Act. These two pieces of legislation also lay out a transparent formula to calculate salaries and to provide the publication of details of both the regular incomes and special allowances added to salaries of MPs who take on extra responsibilities. Disclosure of other income and expense information is also treated under conflict of interest and ethics legislation.

The Government of Canada is not the only jurisdiction that requires the disclosure of audited consolidated financial statements and salaries.

My hon. colleagues from Newfoundland and Labrador will attest that their province has a financial accountability act that commits the provincial legislature to table public accounts each year. The province's transparency and accountability act stipulates that the ministers must account for government entities for which they are responsible each year in an annual report that includes an audited consolidated financial statement that then compares with the funds approved by the legislature's assembly. The Newfoundland and Labrador municipal act also requires that local community leaders make their financial statements and auditor's reports available to the public.

Prince Edward Island and New Brunswick have similar laws. Each has a financial administration act that obliges the two provinces respective legislatures to account for public spending from the previous fiscal year and both have municipal acts that require the specifications of the types of information that must be made available to the public.

Likewise, Ontario, Saskatchewan and Alberta all have legislation governing the duty of municipalities to prepare and publish annual financial statements.

Territorial governments also uphold this high standard. The Government of the Northwest Territories makes its annual financial statements readily available on its website. The Government of Nunavut's financial administration act requires the government to publicly account for its expenditures for the previous year by laying the public accounts before the legislative assembly.

The precise wording of the transparency and accountability legislation obviously varies from province to province, but the fact remains that almost all Canadian taxpayers have a guarantee in law that they can access the basic financial information they require in order to hold their elected representatives accountable for their decisions and actions.

Many governments also disclose the salaries paid to elected officials, from premiers to the legislative backbenchers to mayors and town councillors. Federal employee rates of pay are posted on the Treasury Board of Canada site. The salaries of members of many provincial legislatures are set by legislation and made available to the general public. Disclosure of the income and expense information is often treated under conflict of interest or ethics legislation.

Nova Scotia's act respecting the public disclosure of compensation in the public sector applies to the public sector as well as not-for-profit organizations receiving over $500,000 in public funding. These groups are required to post remuneration information on their websites for employees receiving compensation of $100,000 or more. If they do not have a website, they need to make the information available on a publicly accessible website.

Similarly, in Manitoba the public sector compensation disclosure act requires public sector bodies to disclose to the public the amount of compensation it pays annually to each of its officers as well as employees whose salaries are $50,000 or more. Along with this legislation, the Manitoba legislative assembly act sets out that the remuneration allowances and the retirement benefits of members be established by the commissioner. Furthermore, the regulations require that members post expense reports on the legislative assembly website.

In addition to various provincial and territorial legislation, a number of municipalities have passed bylaws requiring the release of information about the remuneration of mayors and councillors as a best practice.

Clearly, what is being asked of first nations leaders is nothing more than what is expected of their counterparts in other jurisdictions across our great country. In fact, in some respects, this legislation demands less. Bill C-27 would focus only on the disclosure of remuneration of elected officials of first nations governments. I remind the House that self-governing first nations, under the terms of their self-government agreements—

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I think there has been a common theme regarding Bill C-27, at least from our perspective in the Liberal Party. The Liberal Party believes that it is absolutely critical that we work with the first nation leadership.

Within that first nation leadership there is a great deal of expertise and experience for dealing with accountability and transparency. We need to enable that leadership to contribute to making good legislation. Without doing that, without having the proper consultation and without enabling the first nation leadership to participation wholly in that process, we would be selling it short.

Would the member agree that the government is making a mistake because of the manner in which it introduced the bill in the first place?

[Mathieu Ravignat, NDP, Pontiac, QC]

Mr. Speaker, Bill C-27 raises a number of issues, of course. As I mentioned in my earlier question, with this bill, the government took for granted many negative and disparaging opinions about first nations in this country. Right from the start, the Conservatives noted that there was a problem with the first nations, and they imposed the view that there was indeed a problem.

There are first nations communities in my riding. For example, there is the Kitigan Zibi reserve, where the chief and the band council make an enormous effort to be accountable and transparent with their members. In order to do so, they publish documentation on their financial statements and their accounts, they use the Internet and they reply to the many questions from their members and the band councillors at public assemblies.

Beginning by identifying a problem, without even doing any research, is inherently problematic. It seems to me that, if you are going to discuss a problem, there must first be evidence of a problem.

With this in mind, I am going to give the House some statistics. First of all, is there a problem with the salaries of chiefs and band councillors? The answer is no. The average annual salary of a chief is $60,000, while that of a councillor is $31,000. Furthermore, 50% of chiefs earn less than $60,000 per year, and only 5% of them earn more than $100,000 per year. So how can anyone talk about abuse?

In comparison, an elected member of Parliament is paid $160,000 per year. Only 5% of first nations officials earn more than $100,000 a year, while every one of the elected members in the House of Commons earns more than $100,000 per year. So where is the problem?

Of course, it all depends on how we see things. Is this a government in the process of negotiating with another government, a nation—whether Quebec or Canada—negotiating with another nation, or is this the daddy of Canada that is continuing with its fault-finding, paternalistic relationship with the first nations? I think that this is the attitude that is the real basis for Bill C-27.

Here are some other statistics: a recent regional survey on the health of first nations members showed that only 51% of first nations families had Internet access at home. Making it mandatory to publish information on a website or on the Internet does not make sense considering that the bill primarily concerns first nations members. The figure drops to 36% for families whose income is lower than $25,000.

In Nova Scotia, the public can consult summaries of ministers' expenditures, for example, at the parliamentary library. The government of the Northwest Territories publishes only ministers' travel-related expenditures. The various levels of government are in fact less accountable than the first nations are. It is a double standard. They are expected to be more accountable than we are.

It should be pointed out that the current Conservative government is probably the least transparent government in Canada's history, in terms of layoffs in the public service, in terms of its spending, in terms of the F-35s and a number of other things. The first nations cannot be asked to be more accountable than we are.

We are opposed to this bill primarily for one basic reason: there has been absolutely no consultation with the first nations on this bill. I myself have done my work and asked the first nations in my riding if they were consulted with regard to Bill C-27; the answer was a resounding no.

How can we expect to have a good relationship with the first nations in this country if we do not even make the effort to convene an assembly of first nations or even to have a telephone conversation with the band councils about Bill C-27?

There are a number of reasons why I am personally opposed to this bill. For instance, it imposes tougher standards than those imposed on the elected representatives in other levels of government. I have already mentioned this. There is also the minister's power to withhold the payment of any sum due to a first nation or to terminate any agreement respecting any grant or contribution payable to the first nation, in the event of failure to comply with any obligation. This is an excessively harsh penalty, especially when we know that many first nations depend on these transfers for their health and well-being. In some cases, these transfers are a matter of life and death. We absolutely must take an approach that is smarter than simply punishing first nations if they do not comply with this new bill.

We want to see the government working in co-operation with first nations on improving their governance. That is true. Instead, we have noted that the Conservatives have eliminated funding for institutions supporting governance, such as the First Nations Statistical Institute and the National Centre for First Nations Governance. Once again, it is completely wrong, if not hypocritical, to expect supposedly better governance by the first nations while cutting budgets for institutions that support the development of governing institutions.

We also believe that changes to the way in which audited financial statements are presented to the first nations do not require legislation. Such changes can be included in the requirements for the funding agreements that the minister had each first nation sign. Understanding the context would allow for a more personal approach to negotiating and co-operating with each of the first nations involved.

I am also concerned, as my party is, that this bill overlaps and breaches other legislation, including the Privacy Act and the Access to Information Act, both of which, let us remember, exist to protect Canadians.

The legislative summary provided by the Library of Parliament describes the legal requirements to which band councils are already subject. The Conservatives have not proven to us that these legal requirements are problematic: there has been no conversation and no facts have been presented. Why do these requirements cause a problem? I have come full circle in my speech: we have to identify and prove that there is a problem before we can find a solution to it.

I must say that my position—my party's position—is supported by a number of first nations groups. The Assembly of First Nations, for instance, has profound concerns about this bill.

The Association of Iroquois and Allied Indians issued a press release on November 24.

I am pleased, therefore, to rise in this House to oppose this bill together with the first nations in my riding.

[Kellie Leitch, Conservative, Simcoe—Grey, ON]

Mr. Speaker, the member opposite knows that the Minister of Aboriginal Affairs and Northern Development has spent countless hours meeting and speaking with individuals who are part of first nations governments.

In addition to that, the committee has reviewed at length what the language should be in this bill and has come forward with this, striking a balance, as I mentioned in my speech. We all need to know that the committee took thoughtful time and came up with excellent language that is acceptable.

The transparency provided in Bill C-27 would stop any speculation or dispel any rumours about the salaries around first nations leaders and allow Canadians to see the reality of how well first nations governments are being funded. In addition, this would ensure that the same standards that apply to businesses owned by their governments in Canada would also apply to first nations governments in precisely the same way.

This is good legislation. I look forward to the opposition supporting it.

[Kellie Leitch, Conservative, Simcoe—Grey, ON]

Mr. Speaker, I think we all know that there are many examples of first nations that are only meeting these basic transparency requirements and expectations of a government but actually exceeding them. We should applaud those first nations for doing so.

However, the movement forward with Bill C-27 is about the governments. We want to ensure that governments are fair and transparent with the individuals they deal with, just like every other government, including the Government of Canada. We expect the same of provincial governments.

As I said before, there are many examples of first nations that not only meet these basic requirements but actually exceed them. We should applaud those first nations and encourage them to all meet that same bar.

[Kellie Leitch, Conservative, Parliamentary Secretary to the Minister of Human Resources and Skills Development and to the Minister of Labour]

Mr. Speaker, Bill C-27 would strengthen transparency and accountability by requiring that the audited consolidated financial statements and schedules of remuneration and expenses of a first nation be shared with the members of each first nation community, as well as the general public.

I know the committee made amendments to the bill, which helped to clarify this point. However, I feel it is important to discuss the motivations behind the specific reference to band entities in Bill C-27.

The consolidated financial statements of a first nation include the financial statements of the entity that, according to generally accepted accounting principles, are required to be consolidated with the first nation and to be presented as a single economic entity. It is, therefore, necessary to ensure clarity around what constitutes an entity for the purposes of this act. “Entity”, for the purposes of this bill, is defined as a corporation or partnership, a joint venture or any other unincorporated association or organization. As an example, a band-owned business would be considered an entity under the proposed act.

Members of first nations are ultimately the owners of any businesses owned by their band and, as a result, should have a right to know what the values and activities of those businesses are. Although some first nations may be reluctant to provide the full picture of their financial results for competitive reasons, it is important for the users of financial statements, especially first nations members, to see summary statements that capture the range of activities of their government.

Bill C-27 would require that an aggregate summary of the values and activities of the businesses that are consolidated into the financial statements of the first nations be published. This does not mean, however, that each individual business owned by the band would need to be publishing its own detailed set of financial statements. Instead, it is only the consolidated financial statements of the first nation to which the bill would apply. Any information concerning businesses would be highly aggregated and, in most cases, should not reveal any proprietary information.

AFN regional chief, Jody Wilson-Raybould, raised concerns about the inclusion of band entities in Bill C-27. She said during her appearance at the committee that was studying this bill:

...while public sector accounting standards do deal with government business enterprises, Bill C-27 seems to go further by adding definitions of “consolidated financial statements” and “entity”, as well as its own interpretation of what it means for an entity to be controlled by a first nations government under subclause 2(2). It is not clear what the intention is here. Why not just make the public sector accounting standards apply? We would like clarity, and we need to ensure that this bill does not inappropriately modify the rules that currently apply to other governments in Canada with respect to government business enterprises.

Once again, I know that the committee made amendments to the bill that address this point and improve the language. However, I want to be clear and bring to the attention of the House that the bill does not intend to seek to put into place the same rules that apply to businesses owned by other governments in Canada. These rules are developed not by the government but by the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants, which are referred to in the bill.

The new language used to define “consolidated financial statements” reads as follows:

“consolidated financial statements” means the financial statements of a First Nation—prepared in accordance with generally accepted accounting principles—in which the assets, liabilities, equity, income, expenses and cash flows of the First Nation and of those entities that are required by those principles to be included are presented as those of a single economic entity, as if the First Nation were a government reporting on its financial information.

This definition includes a specific reference to the fact that the preparation of financial statements is to be done, not in accordance with the rules established by the government but by generally accepted accounting principles. These principles include the public sector accounting standards demanded by Ms. Wilson-Raybould. This would ensure that the same standards that apply to businesses owned by other governments in Canada would apply to first nations governments in precisely the same way. Furthermore, this definition also makes it clear that first nations are to be treated as governments in the manner in which their financial information is presented.

The intention of this bill has always been to put into legislation the same practices with respect to the treatment of band entities that are currently in place in the funding agreements. It is important for the users of financial statements, especially first nations members as owners of those businesses but other users as well, to see summary statements that capture the activities of their government.

While we would encourage first nations to provide as much detail as possible to their memberships about the specifics of band-owned entities, the overall objective of this bill does not require it. The financial information for those entities that are considered to be part of the first nations overall economic activities would be aggregated. We believe this will be enough, albeit a minimum.

Bill C-27 may be seen by many progressive first nations as an opportunity to put into place or expand upon their own practices that aim to enhance the overall accountability of their government. In this way, the bill would serve as a catalyst for change in many communities which would lead to greater confidence in many first nations governments.

The challenge has been to find language that balances both the need for precision in the legislative drafting with accounting concepts that are both complex and constantly evolving. I congratulate the committee on finding solutions that skilfully strike a balance.

[Carol Hughes, NDP, Algoma—Manitoulin—Kapuskasing, ON]

Mr. Speaker, I know my colleague from Nanaimo—Cowichan is a very hard worker and understands the first nations issues.

If the bill does pass, there will be a major impact on our first nations with those cuts. It will impact on the ability of first nations to comply with the legislation that the government is putting forward.

I just received a copy of a newsletter from one of my first nations indicating that “The Resound is now going into its 11th year of production. Our paper is sent to citizens of our community living away from home, as well as our local residents. We have grown support for our paper today, and our paper enjoys 90% approval rating from our citizens when it comes to receiving timely information from the administration and council. We are a very transparent and accountable community. This is something Minister Duncan will be happy to hear”.

They do not support Bill C-27. This is from Chief Shining Turtle. I know the minister is very well aware of Chief Shining Turtle.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, does the member see problems ahead for the tribal councils and other national aboriginal organizations with the funding cuts if Bill C-27 gets passed, and the kinds of supports offered to tribal councils, in particular, and first nations governments in terms of reporting?

[Carol Hughes, NDP, Algoma—Manitoulin—Kapuskasing, ON]

Mr. Speaker, it is evident there has not been enough consultation done on this legislation or any legislation for that matter that the government has introduced that would impact first nations.

We believe there are already sufficient reporting processes in place, talking about Bill C-27, and funding agreements could be modified to address any worst case scenarios that arise. The government should have drawn up Bill C-27, as the member says, with full consultation with first nations, which would have made the bill more complete and legitimate than it is. It should have consulted, reflected on the advice of the Auditor General and kept the pressing needs of Canada's first nations communities in mind as it determined its legislative priorities. That would have served all involved much better.

The House resumed from November 20 consideration of Bill C-27, An Act to enhance the financial accountability and transparency of First Nations, as reported (with amendment) from the committee, and of the motions in Group No. 1.

Aboriginal Affairs

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, I am rising again on a question I raised a number of weeks ago with regard to funding cuts to key aboriginal organizations.

I am going to read into the record a letter dated November 22 to the Minister of Aboriginal Affairs and Northern Development. It says:

Dear Minister,

We are writing to express our dismay over unprecedentedly deep funding cuts for Canada's Aboriginal Representative Organizations, including the Assembly of Manitoba Chiefs, the Federation of Saskatchewan Indian Nations and tribal councils across the country. This follows the forced closure of the National Aboriginal Health Organization.

As researchers, we work with these organizations and others in research partnerships to tackle some of the most pressing issues Canada faces. Grant funding agencies supported by your government consistently identify Aboriginal research as one of the top priorities for research in Canada. They also make it clear that this research can only be done in partnership with First Nations, Métis and Inuit communities.

As minister, you are well aware of the health, education and infrastructure issues that are preventing Canadian First Nations, Métis and Inuit communities from reaching their full potential. Innovative research partnerships between the people affected and the brightest minds at Canadian universities offer hope for resolving these issues in an effective and fiscally responsible way. In many cases, these bright young minds are First Nations citizens themselves.

We partner with the organizations whose funding you have cut on practical issues such as clean drinking water and community planning. We also partner with individual First Nations that rely on these umbrella organizations for training and support that enables them to engage meaningfully in research. Dedicated staff at these larger organizations, with whom we have developed relationships over years, are named as co-applicants and collaborators on our research grants. However, these people may not be able to carry through on their commitments because they may lose their jobs.

The potential loss of expertise is staggering and could take a generation to recover. Canada cannot afford to wait another generation for solid research on urgent issues. We urge you to rethink these ill-advised cuts to organizations that have been doing excellent work in their communities that benefits Canada as a whole.

This letter is signed by 121 different individuals at universities and organizations that are supporting this research.

Concerns are being raised from coast to coast to coast on these cuts. I just need to quote once again the UN Declaration on the Rights of Indigenous Peoples, which Canada endorsed in November 2010. Article 19 states:

States shall consult and cooperate in good faith with indigenous peoples concerned through their own representative institutions in order to obtain their free, prior and informed consent before adopting and implementing legislative or administrative measures that may affect them.

These cuts are seriously hampering organizations that are offering support, particularly to some of the smaller bands. The government is actually forcing cuts right at the time we are seeing crises in things like housing, water and education.

The Conservative government has a legislative agenda that actually requires some of the services that were formerly provided by, for example, tribal councils, to help with the implementation of that legislative agenda—for example, Bill C-27, the financial transparency and accountability act.

I am just asking the parliamentary secretary if the government has reviewed the impact of these cuts and what it will mean for these organizations to be able to deliver services that are essential in these communities.

Business of the House

[Peter Van Loan, Conservative, Leader of the Government in the House of Commons]

Mr. Speaker, it is true that we have experienced some disruptions yesterday and today as a result of efforts by the Liberal Party to disrupt our agenda. I was puzzled as to why it was happening right now at this time. However, a news story just broke, which gave me some insight into it, where the young member for Papineau said that:

Canada isn't doing well right now because it's Albertans who control our community and socio-democratic agenda. It doesn't work....

When he was asked if Canada would be better served if Quebeckers were in charge rather than Albertans, he said:

I'm a Liberal, so of course I think so.... Certainly when we look at the great prime ministers of the 20th century, those that really stood the test of time, they were MPs from Quebec... This country--Canada--it belongs to us.

Obviously, the Liberals do not want to see the Conservatives governing, advancing our agenda or advancing our budgetary agenda. Therefore, I think that answers the NDP House leader's question as to why we are facing these delays right now in the House. However, we will carry on, Albertans and all, and the rest of the country, with Conservatives from coast to coast in this government trying to advance the agenda that Canadians believe in.

We will resume the second reading debate on Bill S-2, the family homes on reserves and matrimonial interests or rights act, this afternoon. Tomorrow we will conclude report stage of Bill C-27, the first nations financial transparency act, and third reading will take place on Tuesday. We will start second reading debate of Bill C-47, the northern jobs and growth act, on Monday and the debate will continue on Wednesday.

The finance committee is working very hard to go through Bill C-45, the jobs and growth act. I commend them for their efforts. Our budget implementation legislation contains important measures, such as extending the hiring credit for small businesses, expanding tax relief for investment and clean energy, helping Canadians save for retirement with pooled registered pension plans and improving the registered disability savings plan.

However, I do confess that it does not include the NDP's carbon tax or its proposal for a 1% GST increase. Perhaps that is why its members are opposing it. In any event, we hope to start report stage consideration of Bill C-45 on Thursday, if at some point the Liberals give up on their disruptive delay objective and agree to allow someone other than the member for Papineau to have some say in running the country.

[Nathan Cullen, NDP, Skeena—Bulkley Valley, BC]

Mr. Speaker, I am honoured to rise on behalf of the official opposition to ask the government what it has planned for the House for the remainder of this week and next week.

The government seems to have lost control of the legislative wheel this week. I will review for Canadians. The Conservatives tried unsuccessfully to ram Bill C-27 through. Thankfully, the official opposition took a principled stand against this and forced them to step back from shutting down the debate. The finance committee has rewritten its own ridiculous rules on how to deal with the Conservatives' monster budget bill, Bill C-45. The committee is now sitting around the clock to deal with this sham of a process, which the Conservative government has set up.

Yesterday, instead of standing up for victims of bullying, most government members shamefully decided to side with the aggressors who bully and torment Canada's most vulnerable young people.

It was a shameful demonstration of the importance the Conservatives attach to their partisan principles, at the expense of common sense.

I guess the only question I have for the government today is the following: How many more abuses of our democratic processes does the government have planned for this week and the one to follow?

Safe Drinking Water for First Nations Act

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it was only a matter of minutes ago that we had time allocation put on Bill C-27. That, in essence, said that the members of the House would have limits on our abilities to contribute to the debate on a very important issue with regard to our first nations.

Now we are talking about the importance of water on our reserves and other areas and we have a government member moving a motion that would again prevent debate on a critically important issue. The Conservatives will not allow members, whether it is members of the Liberal Party, the New Democratic Party or even the Green Party, the opportunity to address important issues.

When the member talks about consultation, why will he not be very specific and tell us what first nations leaders the Conservatives consulted prior to the drafting of either Bill S-8 or Bill C-27?