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.

Motions in Amendment

[Françoise Boivin, NDP, Gatineau, QC]

That is an excellent question, Mr. Speaker. Usually I am an optimist, but after that conference, I was not that optimistic because there were too many generalities.

I think the first nations hoped, in good faith, that the government would stick with what it seemed to look like it would do, but the way government members have acted on this legislation toward first nations just proves my point.

There is not an ounce of serious will to definitely respect, and respect is more a question of delivering the real goods than being here and apologizing. The Conservatives can apologize all they want, but if they do not mean that apology and go outside of these doors and do the opposite of what they have apologized for, there is a problem of credibility.

I humbly submit that fundamentally it is the problem of credibility with the government. Government members speak, say words, utter sentences, but nobody believes them.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Speaker, I am pleased to ask a second question which still has to do with double-talk. It is interesting to see the government's way of doing things. This time, I am referring to double-talk regarding red tape.

On the one hand, departments are saying we must eliminate red tape. Ministers tell us they are trying to cut red tape. But then the government turns around and imposes even more red tape on first nations.

Could the hon. member comment on this aspect of the Conservatives' double-talk?

[Françoise Boivin, NDP, Gatineau, QC]

Mr. Speaker, I will be brief because I know I am running out of time. Indeed, this is more double-talk. As far as red tape is concerned, it is a joke.

When I read the bill, when I looked at the notes and listened to the speeches, I thought to myself, there is no way that billions of dollars are being sent to help the first nations serve their members and people who stay on reserve, without any accountability. Agreements and audits are already in place.

All the government is doing is adding layers in order to create obstacles. The truth is that the government does not want more transparency. It wants to humiliate the first nations by introducing this type of bill without consultation, without giving them a chance to say a word about it.

[The Acting Speaker, Barry Devolin]

There are five minutes left before statements by members.

The hon. member for Terrebonne—Blainville.

[Charmaine Borg, NDP, Terrebonne—Blainville, QC]

Mr. Speaker, I rise today to speak to Bill C-27, which requires every first nations community to provide the following: annual consolidated financial statements; a separate schedule of annual remuneration paid by the first nation, and by any entity controlled by the first nation, to its chief and each of its councillors in their professional and personal capacities; the auditor's written report respecting the consolidated financial statements; and the auditor's report respecting the schedule of remuneration.

The Conservatives are trying to teach the first nations a lesson about transparency. He who can, does; he who cannot, teaches. That saying is quite appropriate in my opinion because the government is very closed and not transparent and does not even want to provide crucial information to the Parliamentary Budget Officer, who needs it in order to be transparent with Canadians and tell them what the federal government is spending taxpayers' money on. The Conservatives are not even doing this much and they are asking first nations to do more. The first nations already have to submit more than 200 reports to the federal government, which is huge.

One of the most troubling aspects of this bill is that it directly affects the first nations. As an MP, when working on a bill that affects a certain group, I will consult that group. However, this is something that the government does not seem to understand. What does it mean to consult someone? It is not just listening to witnesses in committee, who do not speak for very long. It means going to see the groups, the first nations, before drafting a bill. In that way, they can say what they would like to see in the bill, what measures do not work and what will disadvantage first nations communities.

Consequently, we are very disappointed because first nations should be consulted and especially because consultations are mandatory under a UN declaration ratified by Canada. It is important that we honour our commitments. It is not just a matter of will; it is about meeting our legal obligations.

Another paradox is that the government wants to reduce the paper burden. Huge cuts were made because the government wants to eliminate red tape and increase efficiency. However, all those measures that the government wants to implement will require huge resources and result in a waste of time and money.

Right now, in our own country, people are living in crises and in appalling conditions. I am thinking of communities such as Attawapiskat, which the hon. member for Timmins—James Bay is defending so well in the House. These communities do not have schools, and they do not have safe housing. It is cold in northern Ontario and people are freezing in houses that are totally inadequate.

The government should tackle these issues instead. It should ensure that every young person—and I emphasize the term “every” because we are aware of the current situation—living in a first nation community can attend school. Going to school is a basic and essential need. Why are we not debating this issue? It is because this government's first bill on first nations seeks to impose transparency measures on them, without consulting them, without consulting those who will be most affected. The government is not dealing with critical issues such as drinking water and food. Incidentally, food is not available at an affordable price in northern rural communities. People must pay exorbitant prices for fresh food.

The government says it wants to eliminate red tape to increase efficiency. However, when other governments already have to file 200 reports and will have to produce more, the Conservatives do not even take into consideration the fact that this may impair these governments' ability to provide direct services to citizens who really need them.

My time is up. I will continue later.

[The Acting Speaker, Barry Devolin]

The time provided for debate has expired. The hon. member for Terrebonne—Blainville has five minutes left.

We will now proceed to Statements by Members. The hon. member for Etobicoke—Lakeshore.

The House resumed consideration of Bill C-27, An Act to enhance the financial accountability and transparency of First Nations, as reported (with amendments) from the committee, and of motions 1 to 3.

First Nations Financial Transparency Act

[Charmaine Borg, NDP, Terrebonne—Blainville, QC]

Mr. Speaker, as I said earlier, the problem is that first nations communities across Canada must already submit many reports. I want to read some sections related to what is required by AADNC's Year-end Financial Reporting Handbook.

In accordance with section 6.4.1 of that handbook, “The [first nations] must disclose to members of the organization and to INAC compensation earned or accrued by elected or appointed senior officials.”

In accordance with section 6.4.2, the remuneration amounts earned or accrued by elected or appointed officials that are to be disclosed “must be from all sources within the recipient's financial reporting entity including amounts from, but not limited to, economic development and other types of business corporations.”

As you can see, measures and mechanisms are already in place to ensure that this information is disclosed. This bill goes too far. These resources should be allocated for the welfare of the community because we know it is experiencing difficulties.

I would like to emphasize once again that this government has a great deal of work to do with regard to first nations communities. We are not there yet. In some places, there are still no schools, and people still do not have access to drinking water, which is essential for survival. As my colleague pointed out, some communities have had to boil their water for seven years now so that they can drink it. Why not address that before taking a stand on the governance of first nations communities?

I also want to read the recommendations that the Auditor General made to this government on the same subject. Those recommendations have not been respected and are not reflected in this bill. In a report dating back to June 2011, the Auditor General noted that the reporting burden placed on first nations in recent years has increased. The Office of the Auditor General of Canada has recommended on numerous occasions that the reporting burden be reduced and that there be a better understanding of the demands placed on first nations since a number of those reports are not even used by federal government departments.

So we already have a lot of reports; we already demand an enormous amount of resources, time, money and energy that could be better used elsewhere. We are now demanding even more, and the Office of the Auditor General of Canada said that some reports were not even being used. He requested major structural reforms to improve the federal government's policies and practices, including advocating clear and measurable service standards for products and responsibilities; enacting basic statutory measures for key support services, including education, housing and drinking water; and measures respecting delays in issuing grants and funding thus complicating long-term planning. Those are the recommendations that have been made directly to this government.

I see I have little time left, and I will close by saying this. We consulted the first nations communities, which this government completely failed to do. We know where the real problem lies: it does not come from exorbitant salaries, but rather from decades of paternalism which have put first nations chiefs in a position in which they are responsible for implementing decisions made by the federal government, in other words, under the Indian Act. Not only is that clearly inappropriate, but it is still a recipe for poor results.

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

Mr. Speaker, just a short while ago, the member across said that her party had consulted with first nations. I wonder if she consulted with those first nations that have made it very clear that they are concerned with the amount of money that is not being divulged by chiefs and councillors across Canada.

I wonder if she could speak to the people who she did speak to who were concerned about that.

[Charmaine Borg, NDP, Terrebonne—Blainville, QC]

Mr. Speaker, I believe the situation is somewhat exaggerated. The truth is that the average salary of first nations chiefs is $60,000, and the average salary of council members is $31,000. Fifty percent of chiefs earn less than $60,000 and only 5% earn more than $100,000.

It is all well and good to generalize, to create stereotypes by saying that so and so made a mistake, but Conservative members have also made mistakes. Will stereotypes be created based on that? No. We must examine cases individually and assess the matter properly. In view or those figures, this is not a big problem.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, I listened attentively to my hon. colleague. There appear to be certain patterns among the Conservatives, and that is what I want to talk about.

First of all, I just about choked on the title, because it seems to me that even though the bill is called the financial transparency act, this is not something we have come to expect from the Conservatives. So why demand that others provide what we cannot get here in the House? That is a problem for me. I also think that this bill is a response to one unfortunate exception that has been taken as a general rule and that this bill is somewhat out of proportion and much broader than the problem it is intended to solve.

Does the hon. member agree with me that this kind of pattern has been repeated many times by the Conservative government?

[Charmaine Borg, NDP, Terrebonne—Blainville, QC]

Mr. Speaker, as my colleague pointed out during his remarks, someone who is not transparent is asking the first nations to be transparent. The Conservatives themselves are not providing the Parliamentary Budget Officer with the required information. He needs the information. It is his mandate to obtain the data, and he is having to go to court to get them.

I think it is illogical and rather paradoxical that the government is asking for such data and such transparency, when it is incapable of achieving that level of transparency.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Mr. Speaker, I thank my colleague for her speech.

I would like her opinion on one point. Very rarely in some aboriginal communities do we see that community members do not have access to certain documents. It is very rare. According to the Conservatives, the solution is to publish the information on a website for everyone to see. We know that the Internet is available across the world. It is possible to give this information to everyone in the world, which might not be to the advantage of some business people. I spoke about that earlier today.

Is that the solution? Of course, there must be a way to make this information available to all members of the first nation community, but this is not necessarily an effective method and it will be bad for aboriginal communities.

[Charmaine Borg, NDP, Terrebonne—Blainville, QC]

Mr. Speaker, I thank my colleague for his question. Obviously, that would be worrisome for businesses. I also want to point out that this bill could create problems under the Privacy Act and the Access to Information Act, two legislative measures that we promote and adhere to, here in Canada.

If a business has to disclose all of its expenses and financial information, it will be at a great disadvantage compared to other businesses. If I were to start a business, I would not be bound by the same laws. The result is to further disadvantage a population that is already severely handicapped. That is simply not fair.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Mr. Speaker, I am very pleased to join in this debate today.

I want to speak directly to the motions that were brought forward. First of all, the clause under debate is clause 11 of Bill C-27, first nations financial transparency act. This clause reads:

If a First Nation fails to publish any document under section 8, any person, including the Minister, may apply to a superior court for an order requiring the council to carry out the duties under that section within the period specified by the court.

The purpose of this clause in the bill is to ensure that anyone, including the minister, could ask a court to require a first nation to publish its consolidated financial statements and schedules of remuneration and expenses, if the first nation government failed to act in accordance with the provisions of Bill C-27. This clause is necessary, as it would provide an avenue of redress when a first nation fails to comply with the proposed act by failing to publish its financial documents.

As we all know, governments in Canada, whether they be the federal government, provincial governments or municipal governments, must adhere to legislation, which ensures that the financial statements of the government and its entities and the remuneration paid and expenses reimbursed to its elected leaders are shared with the public. There are different means of achieving this, but the end result is the same. The financial information relating to governments at every level in Canada are available to the general public; that is, governments with the exception of first nation governments operating under the Indian Act.

Bill C-27 would simply address this gap. In doing so, the bill would also address a situation that blurs the lines of accountability between first nation councils and their own members.

As we have heard, if a first nation member cannot access the financial information relating to his or her band, he or she can ask the Department of Aboriginal Affairs and Northern Development to release the information. Each year, AANDC receives many such requests from first nation individuals looking for basic financial information relating to their community, which they should be able to access directly from their band. In addition to these informal requests for information, the department also receives formal complaints regarding the potential mismanagement or misappropriation of band funds and remuneration of officials.

Legislation that ensures this information is easily accessible to everyone would remove the minister from the equation in many of these cases, thereby promoting more direct lines of accountability of a first nation leader to its members. In short, the bill aims to shift the accountability bargain between first nation governments and their communities.

This is not to suggest that first nations are mismanaging their finances or are not accountable to their members. In fact, there are many examples of first nations that are not only meeting the basic expectations of a government but are exceeding them. Unfortunately, there remain many that are not, as these requests and complaints to the department demonstrate.

However, with the greater transparency that would be provided by the bill, many of these requests and complaints would likely not be necessary, as information would be publicly available. Furthermore, with the greater transparency around publication of remuneration and expenses, the speculation that currently exists on these issues would be removed, which would dispel the rumours around the salaries of first nation leaders.

All first nation leaders should be applauding this, as there are many whose reputations are unfairly tarnished by the actions or inactions of others.

Perhaps even more importantly, Bill C-27 would also mean that first nation individuals would no longer feel intimidated when they ask for financial information relating to their bands, and intimidation does indeed occur, as was described to the committee by representatives of the Peguis Accountability Coalition and others, just for challenging their governments about how their money is being spent or simply asking for copies of the band's financial statements.

Without clause 11 in the bill, first nation members who are unable access basic financial information relating to their own band would still need to challenge their chief and council for this information through the courts, creating a tense situation for many people. However, this is not the only reason why clause 11 of the bill is required.

An adequate enforcement mechanism would ensure that these documents are made available to all Canadians. Making sure this information is available to everyone would mean that all Canadians would see the reality of how first nations governments are funded.

During her appearance before the committee, Jody Wilson-Raybould of the AFN stated:

...having consolidated financial statements and disclosing revenue or investments does...actually recognize and expose the reality of what our first nations are having to bear in terms of supporting our own governments beyond the federal transfers....

Bill C-27 is a necessary piece of legislation. A key part of how this legislation would be successful is clause 11.

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

The clause under debate is clause 13 of Bill C-27, the first nations financial transparency act. This clause provides for administrative measures if a first nation fails to prepare and publish its consolidated financial statements, auditor reports and schedule of remuneration and expenses. In other words, this provision encourages first nations to comply with the act so as to avoid these measures being imposed.

Although we believe that all first nations governments will comply with this legislation, as it strengthens their accountability to their members, in the event of the refusal of a first nation's leadership to publish its audited consolidated financial statements, the first nations financial transparency act provides the Minister of Aboriginal Affairs and Northern Development three options.

The minister may require the council of the affected first nation to develop an appropriate action plan, ensuring the release of the financial information in a timely and organized fashion.

The minister may also withhold funding that would normally go to the first nation under active grant and contribution agreements. These withheld funds would be released immediately upon the publication of the first nation's audited consolidated financial statements.

Finally, the minister may completely terminate active grant and contribution agreements should a first nation refuse to provide AANDC with its audited consolidated financial statements.

There is nothing new here. First nations are already required to produce annual consolidated financial statements, which are audited by independent accredited professional auditors, and report the remuneration and expenses, in separate categories, paid to chiefs and councillors as part of their funding agreements with AANDC. Also, the measures being proposed in clause 13 of Bill C-27 are already available to the minister under the grants and contribution agreements.

As for clause 13(2), this clause provides that any monies the minister has withheld from a first nation for non-compliance of this act are considered a charge under the Financial Administration Act. This provision simply provides the mechanism by which funds withheld from a first nation can be paid to the first nation once compliance is achieved, even if the payment occurs in a subsequent year.

Section 37.1(1) of the Financial Administration Act states:

Subject to such directions as the Treasury Board may make, a debt incurred by Her Majesty for work performed, goods received or services rendered before the end of a fiscal year, and any amount due or owing under a contract, contribution or other similar arrangement entered into before the end of the fiscal year that remains unpaid at the end of the fiscal year, shall be recorded as a charge against the appropriation to which it relates.

Clause 13(2) of the bill is a technical administrative measure that allows for any funds that have been withheld under this act to be repaid, yet NDP Motion No. 3 proposes to remove all of these administrative measures. Without this clause, first nations individuals could continue to be subject to intimidation when they ask for financial information relating to their bands.

In conclusion, Bill C-27 is a necessary piece of legislation. A key part of how this legislation would be successful would be the provisions outlined in the clauses I have mentioned during this debate.