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

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, it is with pleasure that I rise today to speak to Bill C-27. One of the things that I like about the bill is that it demonstrates very clearly the difference between two governments: a Conservative government and a Liberal government. In the Liberal government we saw a different approach to dealing with the important issues facing our aboriginal and, in particular, first nation communities. In the Conservative government we see an approach that the government knows best and that there is no need to do any sort of genuine consultation.

When I posed the question to the Conservative member on what sort of consultation was done, the member made reference to a previous bill and said that at committee we heard hours of debate. I believe he made reference to the fact that there were chiefs who made presentations at committee. I suspect that many members of the Conservative caucus have received a great deal of feedback on Bill C-27 or the bill that Bill C-27 is replacing because the Prime Minister prorogued Parliament a couple of years ago.

In the answer the government member continuously talked about post-introduction of the bill. Therein lies the difference between a Liberal government and a Conservative government. The Liberal government recognized the importance of working with first nations before we even introduced the legislation. Therein lies the difference.

If we look for leadership within the first nations prior to introducing the legislation or even prior to the drafting of the legislation, it is there. It needs to be emphasized that there is very strong leadership in our first nation communities. If the government chose to capitalize on that leadership, we would have better legislation than we have today. Unfortunately, we have the legislation, but it enables individuals like myself to demonstrate the difference between two ways of governing. One way has demonstrated far more success, that being for example the Paul Martin government in the creation of the Kelowna accord, which I will get to in a few moments.

Transparency and proactive disclosure are something that Canadians love and most politicians talk a great deal about. It is nothing new. It is something that is advocated but it is not only for first nations. I was a provincial MLA for many years and I tried to get to the bottom of how much money the NDP provincial government was paying the chair of the Winnipeg Regional Health Authority. At last count, I tallied over $500,000 for one individual working within the civil service. The numbers we were hearing were well in excess of that. I remember trying to find out how much the provincial government was paying in pensions for that position. If we want to talk about challenges, there are huge challenges in terms of trying to draw out how much money is being allocated for one civil service position. Trust me, I could talk a great deal. The issue is accountability, not just for first nations—

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

Mr. Speaker, we are discussing Bill C-27 today, after it was examined by the Standing Committee on Aboriginal Affairs and Northern Development.

The government says the purpose of this bill is to improve the financial transparency of the first nations. I am going to ignore the irony of the situation, where we have the government talking about financial transparency. Everyone is aware of how grotesque that situation is without any comment being needed.

So this bill is supposed to enhance the financial transparency of the first nations by making it mandatory that their financial statements be prepared and disclosed. The information to be disclosed includes the details of the annual remuneration paid by a first nation, and by any entity that it controls, to its chief and each of its councillors, acting in their professional and personal capacity.

In addition to the obligation to report the salaries paid to chiefs and band councillors, the bill makes it mandatory to disclose complete audit reports and publish those documents on the first nation’s website for 10 years.

On this side of the House, we consider many points in this bill to be problematic, and I think the members who spoke before me have summarized them very well. For that reason, I am instead going to focus not on the content of this bill, but on the administrative burden it represents for many first nations communities.

First, the band councils already submit audited annual financial statements under agreements with the government. This bill therefore serves no purpose other than to make everything even more complicated.

According to the figures in the Auditor General’s 2006 report, a first nation has to produce, on average, 200 reports a year, when some communities have populations of 700 or 800 people—fewer than 1,000 people. This may raise some eyebrows.

If there still is not enough transparency, when first nations communities are being made to write an average of two reports a week, I would venture to suggest that the government perhaps needs to rethink the entire system. That would be more useful and more effective than adding another report on top of all the rest.

I watched the speech the member for Saskatoon—Rosetown—Biggar gave when she introduced the bill; she had introduced the previous version of this bill in the last Parliament. According to her, the communities “go to great lengths to make this information available to community members. They display it on their community websites. They feature it in householder mailings. They post it in band offices.”

So the member is saying that chiefs and band councils are completely aware of the importance of transparency toward the members of their communities, and in fact they are already doing this very well without needing to be reminded by a humiliating and coercive bill.

A number of witnesses, including John Paul, a member of the Membertou First Nation, testified at the committee and also confirmed this. That witness told us: “…transparency, and disclosure of information...is very important to our leadership.... Over decades our community has provided full disclosure of our complete audit, and more recently on our website,...the complete details of compensation to all the members of council.”

I am going to digress for a moment. What about communities that, like those in my area, do not have Internet access at home? They will be forced to disclose information for 10 years on the community's website even though the community does not have Internet access. That is one of my questions that nobody has answered.

What have we learned from my Conservative colleague who introduced the bill in the last Parliament? We have learned that the chiefs and first nations elected officials recognize the value in ensuring the actions and decisions of elected officials are clearly visible to all and to the community. They recognize that their citizens share a fundamental right to know how their money is being spent. In fact, several first nations go to great lengths to make this information available to community members. Therefore, why is there a need for this humiliating and useless bill?

The bill finds its roots and origins in the racist assumption that all first nations are either corrupt or incompetent. I reject both of those assumptions. We need to stop those assumptions for good.

Band councils are already accountable to the government and they get the information out to their members. Why are we debating this bill? Is it because someone in the government decided that a 201st annual report would be amusing?

In the 2006 Auditor General's report, it was mentioned that 96% of first nations file their 200 annual reports on time, without any problem. The Auditor General's report did not include any kind of comment or criticism. Everything was fine. Only 1.7% of all first nations were put into third party management by the government because of financial management problems.

Are we talking about a chronic lack of transparency on the part of first nations? No, quite the contrary.

If one were to look at numbers and statistics, one would see there is nothing wrong with first nations' financial transparency. Of all first nations in this country, 96% submit their audits on time, without comments or criticism from the auditor. The lack of transparency is so minimal that I wonder why we are discussing this bill.

The truth is that all these reports, most of which are not even used by federal organizations, are a waste of time for first nations band councils, which could use that time to meet their population's needs. Yet, today we find ourselves debating the usefulness of a 201st annual report for our communities. Abitibi-Témiscamingue has five Algonquin First Nation communities, and some of them are seen as models of sound management and leading examples of development.

Take, for example, the Abitibiwinni band on the Pikogan reserve near Amos. Chief Kistabish and the council work very hard to ensure their community's prosperity and sustainability. Incidentally, they recently signed a historic agreement with their neighbours and a mining company. The Abitibiwinni band works in concert with stakeholders in regional development. Getting to this point took years of mutual trust. Now, the government is trying to stir up suspicion and misunderstanding.

Our Algonquin communities in Abitibi-Témiscamingue have nothing to gain from such a bill.

Other examples include Eagle Village from the Anishnabe Nation. Chief Madeleine Paul and her band council work so hard to ensure a healthy and wealthy community for future generations. She has to deal with the opportunities brought by a rare earth mining development and the danger of having Lake Kipawa polluted if things are not done properly. The Timiskaming First Nation and the new chief, Terence McBride, are also striving to seek new partnerships for their development.

I sincerely believe that there are other priorities. As we have seen, the financial transparency of first nations is not an issue in the vast majority of cases. Most are aware of the need for transparency and are already being transparent.

Most of my colleagues who have already spoken mentioned this, but I would like to talk about something that is extremely shocking to us: the lack of consultation with the first nations on this bill.

On a related note, and to conclude my speech, I would like to quote article 4 of the UN Declaration on the Rights of Indigenous Peoples:

Indigenous peoples, in exercising their right to self-determination, have the right to autonomy or self-government in matters relating to their internal and local affairs, as well as ways and means for financing their autonomous functions.

I remind all of my hon. colleagues that it is truly worthwhile to visit the first nations communities to see just how financially transparent they are, how proud we can be of how these communities are managed, and just how interested community members are in what is going on. A great many people go to band council meetings to find out exactly how their money is being spent. If we compare that to attendance at municipal council meetings in non-aboriginal cities and towns, I think that we can be proud of our aboriginal communities. People are interested in what is being done with their money, and these council leaders do their jobs diligently and provide all the information. It makes absolutely no sense to demand a 201st annual report, when they are already doing everything they can.

[Tarik Brahmi, NDP, Saint-Jean, QC]

Mr. Speaker, I thank my colleagues for their enthusiasm. I am honoured to speak today to Bill C-27, An Act to enhance the financial accountability and transparency of First Nations. This long title is quite pompous. The short title is the First Nations Financial Transparency Act. That sort of title should make us wary of the bill’s intent since, as usual, the Conservative government is targeting a specific, well-defined section of the population.

There is one paradoxical reason for my interest in this subject: I represent a riding where there are no first nations communities and no first nations people. According to the official data from the latest census, conducted by Statistics Canada in 2011, only 5 persons in 100,000 reported speaking an aboriginal language. That was 5, not 5,000. In comparison, there were 345 individuals who reported speaking German, for example, which is not traditionally a language that stands out in Statistics Canada’s figures.

That leads me to another remark: we know that, as of the latest census, the Conservative government abolished the long form census, technically known as form 2B. We can question the accuracy of the current figures, in relation to historic Canadian census figures, and of the conclusions based on these figures. The precision is no longer there because, even though the official statistics say that only 5 people in my riding of over 100,000 inhabitants speak an aboriginal language, I do think there are probably more than that.

And that is why I am interested in this issue. In a riding like mine, without any first nations, the perception of first nations communities is even more important, because it forms the basis for the idea of a nation—the Canadian nation—that wants to include various groups and ethnicities.

Canada is still quite young, as it was created in 1867. That is like one year compared to the multi-millennial history of some European nations. It is quite young. One of the important things in creating a nation is to fight prejudice and generalizations, and we must refrain from targeting specific groups and accusing them, with no evidence, of mismanaging public money. That is what we are talking about today at third reading of this bill.

Another aspect that worries me personally is that of the protection of personal information. Over the years in Canada we have been able to build legislation that protects personal privacy. This bill is something new, because it would disclose information—publicly and even on the Internet—that is truly personal. This kind of personal information is not requested of other groups, but will be specifically required from certain chosen, targeted groups. That also reminds me of a private member’s bill, Bill C-377, which similarly targets a specific group, in that case unions. Through such bills the government is trying to increase red tape and create unnecessary work in order to target these groups. That is the complete opposite of being inclusive and giving people a chance, assuming that people are not dishonest and organizations are not out to commit fraud.

If anyone wants to prove that a specific organization or group is committing fraud or misusing funds, it is up to the individual who makes that allegation to do so.

One of the amendments introduced by my NDP colleagues on the committee was to eliminate this additional burden that is being imposed solely on first nations, not on the population at large, as some of my colleagues have said. It is also important to emphasize that, under this act, the minister would be able to eliminate grants made to certain aboriginal groups based solely on speculation that funds had been misused. Once again, a mechanism is being permitted without the minister having to prove that there has been any misuse of public funds. Based solely on suspicion, he could cut grants and money that, as we saw in Attawapiskat, are sorely needed by the various communities.

Consistent with that logic, a number of reports will be required. In her speech this morning, the member for Nanaimo—Cowichan said that some organizations had to prepare more than 200 reports, which vastly increases the amount of work they have to do and artificially creates work for people who could be providing services to the public.

Do people really read all those reports, or are they merely there to generate work artificially? That is the question I would ask. Those communities need schools and drinking water. The people in my riding cannot even imagine what life can be like in an aboriginal community, because they have access to basic services. Consequently, they do not understand this gap within a single nation, where we have, on the one hand, people who have no drinking water or basic services and, on the other, those who enjoy a relatively decent life.

One may indeed wonder whether people really read all these reports and whether they are not the paradox of the Conservative government, which, as we have seen in recent budgets, is making systematic cuts to services. The main argument, if not the only argument, is that they want to reduce the needless workload involved in those services. Paradoxically, the government is creating an additional workload for groups that have been specifically targeted. This is nothing but red tape that few people can understand. In practice, only accountants will be able to understand the actual management implications of figures on certain lines of a financial report, and only they will be able to determine whether those figures are genuinely indicative of mismanagement.

Once again, I still tend to give people the benefit of the doubt, to consider that organizations, by default, are not poor managers. Aboriginal organizations are not fraudulent, and it is up to those who claim the contrary to prove it, not to create an artificial workload for all the communities, associations and entities that manage public funds.

[Ray Boughen, Conservative, Palliser, SK]

Mr. Speaker, I thank you for this opportunity to explain how Bill C-27 would improve sound fiscal management when first nations empower community members to hold their leaders to account.

To begin, I would like to respond to the hon. member's first motion to delete clause 1 of Bill C-27, the first nations financial transparency act. The clause reads: “This Act may be cited as the First Nations Financial Transparency Act.” Essentially, the member's motion goes to the very heart of Bill C-27, so I would like to speak about the purpose of this legislation and why it is necessary.

In accordance with the provisions in their funding agreements, first nation governments are already required to provide to Aboriginal Affairs and Northern Development Canada audited consolidated financial statements and a schedule of remuneration and expenses of all elected officials. These agreements also require that the audited consolidated financial statements be made available to first nations membership in the communities. These agreements do not, however, stipulate the manner or timing of disclosure.

Many first nation governments have put into place sound accounting practices that ensure transparency and help to build confidence among members and other stakeholders. Many prepare annual reports that are distributed to members' homes or made available in board offices or posted on the first nation's website. Many first nations governments strive to be accountable to their communities, their membership and to the federal government for the funds they receive.

Why then is the bill necessary? Some first nations governments have not yet consistently adopted these practices. As a result, questions occasionally emerge about the financial decision of first nations leaders and how first nation moneys are being spent, questions that can undermine the confidence of the public in all first nation governments, including those who are working hard to be transparent in their leadership.

Ensuring the public disclosure of financial information would help clarify the actual situation. By explicitly stating the expectations of first nations in law with respect to accountability for the financial management of their governments and transparency in the remuneration and expenses of their leaders, a minimum standard would be established and many of the aforementioned inconsistencies would disappear. Greater transparency of financial information and remuneration and expenses would remove the speculation that currently exists and dispel the rumours around the management of funds by first nation government and the salaries of first nation leaders.

The bill would ensure that first nation community members have the information necessary to make informed decisions about their leadership and are better prepared to hold their governments to account.

The bill and the easier access to financial information it promotes would also support better policy development as it relates to first nation peoples. As John Graham of Patterson Creek Consulting, one of the witnesses who appeared before committee, pointed out, “public policy is always better if there is essentially good information”. While this information is currently provided to the department, it cannot be shared in any meaningful way to promote this kind of public discussion.

The public disclosure of financial information of first nation governments would also increase the confidence of potential investors. With more complete and accurate information about potential partners, investors would be in a better position to make informed decisions about investment opportunities, possibly contributing to improved economic well-being of first nation communities.

Most of the issues surrounding the bill were aired or debated in the context of private member's Bill C-575 in the previous Parliament. It also echoes the commitments made by the Assembly of First Nations chiefs-in-assembly in their December 2010 resolution. In it, the chiefs say they:

Choose to lead by example and demonstrate to other orders of government processes for accountability, including...Itemizing and publicly disclosing salaries, honoraria and expenses associated with the operations of Chief & Council' [and] Ensuring information about community finances and decision-making is easily accessible, and available via the internet where applicable.

The government is not only confident that the bill will be supported by most first nations members seeking to improve the transparency and accountability of their band governments, but also that first nations' elected officials will welcome the bill as an important tool to demonstrate how they are accountable to their members.

To summarize, Bill C-27 is a necessary piece of legislation and I support it fully. I therefore do not support the motion currently being considered.

This necessary and advantageous legislation fulfills the commitment of the government in the 2011 Speech from the Throne. Not only is this a promise fulfilled, it is also an important step forward strengthening governance at the community level, another in a series of building blocks brought forward by our government to support economic and social development in first nations.

This is indeed a worthy cause and is clearly necessary legislation, deserving of all-party support. I urge my hon. colleagues to back Bill C-27 to ensure that first nations members enjoy the same opportunities as all other Canadians.

To appreciate the importance of this legislation, we first need to acknowledge that the current system fails to meet the transparency test. It is no secret that there have been reports of questionable financial practices in some first nations and that community members cannot get answers to their questions about these practices.

There is also no question that in some instances there appears to be a genuine need for greater scrutiny of how public funds are being spent. We have heard complaints by first nations members who were unable to access information about spending in their communities. They want to know how their chiefs and councillors are spending band funds and the salaries of their elected officials publicly disclosed. The problem is not necessarily what first nations leaders are being paid, but the fact that their community members have no way of knowing what the compensation really is. Neither do community members currently know how such decisions are arrived at.

With any other level of government, a number of factors determine the level of pay and benefits for officials. These include such things as the nature of their responsibilities and duties, the size of the community, the complexity of operating the community and the level of its revenues.

In some situations, first nation budgets are almost entirely reliant on federal tax dollars. As part of the funding allocated to first nations every year, a portion is an unconditional grant known as band support funding. This money is intended to help cover costs such as salaries for elected and non-elected officials, telephones and fax machines and other office equipment.

In addition to federal transfers, a number of first nations generate some of their own revenues through band-owned businesses or funding arrangements with other orders of government. This extra money can be used in a variety of ways, including paying higher salaries for elected officials.

There is no reliable way for first nation members to verify they are getting value for money. That is why Bill C-27 is essential. It will enable first nation citizens to confirm whether the compensation levels of their leaders are reasonable and proportionate to the required duties and responsibilities.

All other Canadians are able to hold their leaders accountable in this way. The same standard should be guaranteed in law to first nations members. If the first nations financial transparency act is passed, it will guarantee these standards.

In conclusion, the first nations financial transparency act will enhance financial accountability and transparency. It will require the proactive disclosure of audited and consolidated financial statements, enabling first nations members to see first hand how funds received by first nations have been spent.

This necessary and advantageous legislation fulfills the commitment by this government in the 2011 Speech from the Throne. Not only is this a promise fulfilled, but it is also an important step forward in strengthening governance at the community level, another in a series of building blocks brought forward by our government to support economic and social development in first nations.

This is a worthy cause, and clearly this is necessary legislation, deserving all-party support. I urge my hon. colleagues to back Bill C-27 to ensure that first nations members enjoy the same opportunities as all other Canadians.

[Kyle Seeback, Conservative, Brampton West, ON]

Mr. Speaker, I have been listening this morning to the debate on the motions brought forward by the NDP members. I am surprised they are trying to delete the important accountability clauses that are contained within the legislation. I am not surprised at the Liberal Party, which goes further. It wants to delete every single clause in the bill. Accountability and the Liberal Party generally do not go hand in hand.

When I went to law school, we were told an old joke. It was: “If you have the law on your side, argue the law. If you have the facts on your side, argue the facts. If you don't the facts and don't have the law, bang your hand on the table and shout louder”. That is what we are hearing from both of the opposition parties today. They do not have the law on their side, they do not have the facts on their side, so they bang their fists on the desk and argue about process. That is what they are left with.

They are going to say there was not enough consultation. That is not true. They know it is not true. In fact, the great member for Saskatoon—Rosetown—Biggar had extensive consultation on her Bill C-575. It was through the consultation with first nations that she brought forward the first incarnation of this legislation on financial transparency. There has been extensive consultation on this legislation.

In fact, it is first nations that want this to happen. I sat in committee and heard the stories from members of our first nations who said that when they had asked for information, it was not produced and they had been subject to intimidation and threats just for asking for the information. That is not acceptable.

By deleting clause 11, which is one of the proposals by the NDP, we would remove a very significant piece of accountability that is in the legislation. Section 11 states:

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.

How can anyone be opposed to that? It is an accountability mechanism that will be there for first nations in order to compel their council to produce information. How is someone against that? If a council is not publishing the salaries and remuneration of chiefs and councils and there is a mechanism here that is going to help them get that information, how can people in that small corner of the House stand and say that they are against it? I do not understand. The purpose of the clause is to ensure that anyone could require a first nation to publish this information. It provides an avenue of redress for first nations.

We have also heard that many first nations have made complaints directly to the minister. The opposition parties say that is a perfect system, that they should just make the complaint to the minister and have the minister answer that question. That is not about transparency or accountability. The accountability has to come from the first nation itself, and a lot do it. I do not want to be accused of standing and saying that none of our first nations communities provide this information. That is not true. Many of them do a fantastic job of providing the information to their members and being accountable to their members for the money that is spent. That is not what the legislation is designed to get at. There are some members, some communities, that are not providing this information and that is what the legislation targets.

First nations residents deserve and expect transparency and accountability from their elected representatives when it comes to these issues. In fact, in December 2010 the Assembly of First Nations passed a resolution at its special chiefs assembly, affirming the need to publicly disclose salaries and expenses to their members. They also agreed to make this financial information available on the Internet, where applicable. Nearly two years later, just over half of the more than 600 first nations have a website. Of those that have a website, less than 20 had posted their salary and remuneration on the website and on the Internet.

This proves in and of itself that voluntary compliance is not the answer. We also know that complaining to the minister is not the answer. We want to give the power back to first nations community members to get this information so they do not have to go down those roads. Bill C-27, the first nations financial transparency act, would guarantee that all first nations members would be able to hold their elected governments to account.

In addition to the informal requests from the members to the minister to get the information, the department also receives formal complaints regarding the potential mismanagement or misappropriation of band funds and remuneration of officials. This legislation would ensure that the information would be easily accessible to everyone and it would remove the minister from the equation in many of these cases. That would promote direct lines of communication and accountability from first nation leaders to its members because it would take the minister out of the equation. It should not be a triangular approach where a first nation member complains to the minister's office, which then goes down and asks the first nation to produce it and the first nation then moves it across to the member. It should be a direct approach from a member directly to band council.

I want to make this clear as well. This is not to suggest that first nations are mismanaging their finances or are not accountable to their members because in many cases there are many examples of first nations that are doing exactly that. With the greater transparency that is offered here, many of the complaints to the minister would actually not continue because they would have the necessary information.

I listened to the member for Nanaimo—Cowichan. She suggested that producing a financial statement was not the answer because it would not state how many houses were built or what progress was made on the school, and that is true. The financial statement will not say that. However, imagine trying to understand what is happening with the finances in a community without the financial statement, the salary, remuneration and benefits of the chief and council. It is a logic first step. Once people have the financial statement and know the remuneration, they can question where all the money went. For instance, if all this money had been received, why were houses not built?

It is false for the New Democrats to suggest that this is not the answer. It is the first logical step toward putting the power back into the hands of the people. That is what good accountable government is all about. We have that kind of accountability at the federal level. Our public finances are absolutely disclosed. Individuals can make all kinds of requests for information. However, that is not what is happening with our first nations.

I am proud to stand today in support of this legislation, not only because it is good legislation but because I personally heard the stories at committee of community members saying that enough was enough, that they needed help and they needed the problem solved.

[Carolyn Bennett, Liberal, St. Paul's, ON]

Mr. Speaker, I am pleased to rise today in response to the last minute report stage amendments by the member for Nanaimo—Cowichan. What the member is trying to do is admirable in attempting to delete clauses 1, 11 and 13. I would also propose that we delete clauses 2, 3, 4, 5, 6, 7, 8, 9, 10 and 12 as well. Bill C-27 is a bad bill from a bad place.

The minister went to the Whitecap Dakota First Nation to announce the legislation, but shortly thereafter Chief Darcy Bear had to write a letter to all members of committee, particularly the member whose bill this was based on, to express his complete dismay at being misled about what the bill was really all about.

Chief Darcy Bear, and all first nations, totally support the principles of financial transparency and accountability. That is the main objective of Bill C-27. However it is totally unacceptable for the bill to have come forward without any consultation with first nations. On that basis alone the Liberal Party has been very clear that it does not want to discuss in this chamber anything that has not already been subject to full consultations with first nations. The minister was clear that no consultation took place on this legislation. There was perhaps some consultation on the concerns raised by the private member's bill that preceded this legislation, but as the government has learned the hard way, this legislation goes way beyond the private member's bill. Therefore, Chief Darcy Bear was quite surprised to see in Bill C-27 the kinds of things that have necessitated the government amendments. Unfortunately, the government has refused to accept any opposition amendments dealing with some of the other concerns expressed by first nations.

Deleting clauses 1, 11 and 13 would at least remove the bill's draconian punishment of first nations that do not adhere to its provisions, and the situation would revert to one in which the minister could use his existing powers regarding compliance with contribution agreements and future funding based on that. First nations have been concerned about this kind of consequence being written into the bill. It removes the minister's discretion in the very complex and difficult issues raised by the bill.

On the Liberal side, we are still very concerned about what Chief Darcy Bear thought was the intention of making mandatory the release of the budgets and revenues and expenditures of first nations to their members.

This bill codifies the paternalism of the Indian Act in an even worse way. The minister already has the power to compel a first nation to release its documents to its band members. The minister has been totally unable to explain to us how often this happens or any commitment that this has been measured in a real way. The problem the bill is trying to fix has been very poorly articulated by the government. We know it is the responsibility of the chief and council to report to their people. When it is a democratically elected chief and council, then it is up to their people to turf out a government or a chief and council who are not complying with the need for transparency and fiscal accountability.

It is again with sadness that we continue to hear from first nations across this country that it has not even been a year since the Crown-first nations gathering, where the Prime Minister promised to reset the relationship. When the government signed the UN Declaration on the Rights of Indigenous Peoples, it agreed to free, prior and informed consent, yet this bill and so many others have come before the House without any consultation with first nations.

We in the Liberal Party believe that the principle of consultation is inherent to a government-to-government relationship. The government has no idea and is still treating first nations like little children that need a governess. It is totally insulting that the government has yet again refused to consult and is insisting on this kind of legislation and did not even have the courtesy of explaining the far-reaching nature of this legislation compared to the previous private member's bill to the very chief whose first nation they announced this legislation to.

We are grateful that the government has tried to improve this bad bill by clarifying the difference between salaries and expenses. We are pleased that it has tried to rectify the issue of band owned enterprises, but we still think that this is a bad bill and we hope that the government will at least support the initiative of the New Democratic Party by deleting clauses that impose draconian and insulting measures on first nations.

I look forward to debating the bill in full later, but the Liberal Party will support the last minute report stage amendments by the New Democratic Party.

[Greg Rickford, Conservative, Parliamentary Secretary to the Minister of Aboriginal Affairs and Northern Development]

Mr. Speaker, I appreciate this opportunity to represent the concerns of my constituents from the great Kenora riding. That includes 42 first nations, 25 of which are isolated or not accessible by road.

I want to speak on just two things for the purposes of my 10 minutes.

First, on Motion No. 1, that Bill C-27 be amended by deleting clause 1,

If I have time, I will address the reporting requirements, the second issue raised by the opposition member.

Under debate is clause 1 of Bill C-27, first nations financial transparency act. The clause reads:

1. This Act may be cited as the First Nations Financial Transparency Act.

Essentially, Motion No. 1 goes to the very heart of Bill C-27 and so I would like to speak about the purpose of this legislation and why this is necessary and therefore its title.

In accordance with provisions in their funding agreements, first nation governments are already required to provide Aboriginal Affairs and Northern Development Canada audited consolidated financial statements and a schedule of remuneration and expenses for all elected officials. That deals with the redundancy piece that the member opposite keeps raising.

It is also a provision of these agreements that the audited consolidated financial statements be made available to the first nation membership in the community. On a large scale, this has not occurred. However, these agreements do not stipulate the manner and timing of disclosure. Many first nation governments have put into place sound accountability practices that ensure transparency and help to build confidence among members and other stakeholders.

I have said repeatedly at committee that, as often may be the case, the simple process of making these documents publicly accessible, in my respectful and humble view, will demonstrate that a great number of chiefs and councils are actually in full compliance and very competently managing their financial affairs, despite any challenges we hear. However, this bill is necessary because some first nations have not yet consistently developed and adopted these practices.

We have heard from first nations' constituency members and organizations with substantive and substantial concerns. As a result, questions have emerged about the financial decisions of first nations leaders and how first nations' monies are being spent; questions that can undermine the confidence of the public in all first nation governments, including those who are working to be transparent in their leadership. Indeed, at committee we heard from several witnesses who strive for that.

Ensuring the public disclosure of financial information would help to clarify the actual situation by explicitly stating the expectations of first nations in law with respect to accountability for the financial management of their governments and transparency in the remuneration and expenses that they incur in their roles as chief in council and any other activities with which they are involved. Greater transparency of financial information, including these notes for remuneration and expenses, would remove the speculation that currently exists and dispel rumours around the management of funds by first nation governments and the salaries of their leaders.

The bill would ensure that first nation community members have the information necessary to make informed decisions about their leadership and are better prepared to hold their government to account. The bill, and the easier access to financial information it promotes, would also support better policy development as it relates to first nation people.

One of the witnesses who appeared before the committee, John Graham of Patterson Creek Consulting, pointed out, “...public policy is always better if there is essentially good information”.

However, while this information is currently provided to the department, it cannot be shared in any meaningful way to promote this kind of public discussion. We want that conversation to occur between community members and their government. We, as a department or a minister, would prefer not to get involved in it. This goes to the very essence of self-governance, that conversation taking place between those two constituents and not having the department and/or minister involved in it.

The public disclosure of financial information of first nations governments has another benefit of increasing the confidence of potential investments. That level of transparency, with more complete and accurate information about potential partners, joint ventures that we are hearing about and exciting business development on reserve can flourish when these kinds of building blocks are put in place in the first nation people around the concepts of governance in an effort to put it out there to their community members and to the public.

In particular, I am thinking of the potential for business parties to engage in what we know has the potential to be flourishing new relationships in all kinds of first nations communities, particularly in the isolated communities of the great Kenora riding and Timmins—James Bay. Some of these communities are landlocked by good economic opportunities. They are finding ways to do that. We are working in partnership with them, with small business centres across our vast region. We look forward to a more integrated level of participation by first nations communities in our resource sector and the likes. These kinds of businesses want to understand what the financial positions of their first nations governments are and build on the strength of that relationship, from things like that.

We see this as an opportunity to further develop relationships with the private sector in addition to strengthening the relationship with the private sector to strengthen their economy.

The second thing I would like to say on the subject of reporting requirements, which was mentioned earlier, is that there is no mention in this bill of the burden currently facing first nations when it comes to reporting. First nations already have to produce consolidated financial statements each year, which are audited by an independent, accredited professional auditor as a requirement of their funding agreements with Aboriginal Affairs and Northern Development Canada, or AANDC.

The bill's objective is to increase transparency and accountability, requiring that these financial statements be disclosed to members of the first nations community as well as the general public. Once these practices become the norm, first nations will be in a much better position to prove that they deserve to benefit from more flexible funding arrangements. The purpose of the bill is to increase the financial transparency of first nations government, although we do expect this to reduce the reporting burden for many first nations in the medium and long term. This is not an immediate priority.

Bill C-27 is going to deal with the residual issues we have heard from some important stakeholders. We have heard from grassroots citizens across the country, the Peguis First Nation, first nations communities out in Nova Scotia and community members from the great Kenora riding, to name a few.

The private sector is excited about new relationships with first nations communities. We appreciate the critical mass of first nations communities that have chosen to lead by example and demonstrate to other orders of government processes for accountability. This includes furnishing these documents by way of public access, typically on the Internet for their members, disclosing salaries, honoraria and expenses associated with the operations of the chief and council specifically and ensuring information about community infrastructure and decision making would be easily accessible and available via the Internet and elsewhere as applicable.

Our government is not only confident that the bill will be supported by most first nations members seeking to improve the transparency and accountability of their band governments, but we also believe that first nations elected officials will welcome this opportunity, through the bill, to demonstrate that they are already operating as accountable governments. The next important step is simply to supply that information to their constituent members.

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

moved:

Motion No. 1

That Bill C-27 be amended by deleting Clause 1.

Motion No. 2

That Bill C-27 be amended by deleting Clause 11.

Motion No. 3

That Bill C-27 be amended by deleting Clause 13.

Mr. Speaker, for the public watching, Bill C-27 would:

...[provide] a legislative basis for the preparation and public disclosure of First Nations' audited consolidated financial statements and of remuneration, including salaries and expenses, that a First Nation or any entity that it controls pays to its elected officials.

Also, it would require that this information is published “...on a website maintained by or for the First Nation,...”. This is from the legislative summary prepared for this House.

I have proposed three amendments to this bill and I will speak specifically to those three amendments. One of them would delete the short title because, as always, the titles are often misleading. When we are talking about financial accountability and transparency, one would expect that the government would provide resources so first nations would have the ability to do some of the things that are being requested of them, and that there would have been adequate consultation before this bill was put forward.

The two sections of the bill that I propose deleting include clause 11. This clause of the bill allows “...any person...may apply to a superior court for an order requiring the council to carry out the duties under that section...”. Through the bill, an additional burden is being placed on first nations by allowing members of the general public to take a first nation to court if they do not feel that the information is published as required under the legislation. Nobody would argue that leadership in first nations should not be accountable to their own members but the bigger concern is having anybody being able to put this additional burden on first nations.

The third clause that I suggest we delete is the administrative measures clause. It would vest far too much power with the minister. This would allow the minister to “...withhold moneys payable as a grant or contribution to the First Nation...” if they are in breach of the legislation, and that the minister would be able to “...terminate any agreement referred to in paragraph (b)“. We would see more power being vested in the minister, which is a dangerous trend that we see throughout the current government.

I will touch on where this legislation came from and why we as New Democrats have some serious problems with it. In the legislative summary, it is pointed out that currently first nations communities have an estimated average of 168 reports and that in some communities that goes up to 200 reports that are required by the federal government. In December 2006, the Auditor General pointed out that “...AANDC alone obtains more than 60,000 reports a year from over 600 First Nations, [and the Auditor General] concluded that the resources devoted to the current reporting system could be better used to provide direct support to communities”.

Any of us who have first nations communities in our ridings can attest to the fact that we have serious problems in many communities, whether it is housing, drinking water or education, and we continue to see these problems grow. The government has not committed the resources, the attention or the building of the relationship to ensure some of these problems are dealt with.

The reporting burden on first nations is not new information. In 1996, the Auditor General issued a report dealing about the reporting, and that has gone on report after report. It is not just first nations and the Auditor General who are talking about the problems. We also have a Conservative blue ribbon panel from December 2006 which wrote a report entitled, “From Red Tape to Clear Results”. In that report, the panel devoted a special section to the first nations, Inuit, Métis and other aboriginal organizations.

The report states:

The panel is of the view that mechanisms other than grants or contributions for the funding of essential services such as health, education and social assistance in reserve communities are needed....

It went on to say:

[W]e were reminded that the current practice of treating these kinds of transfers to First Nations, Inuit, Métis and Aboriginal organizations as more or less standard contribution arrangements is fraught with problems and leads to a costly and often unnecessary reporting burden on recipients.

That was the Conservatives' own panel and we have not seen the kind of action needed to deal with these reporting requirements. The assistant auditor general appeared at committee with a prepared statement on October 29, 2012. He stated:

At that time, we met with first nations and were told that they were willing to explore ways to ensure that the information needs of Parliament were met, and they stressed the importance of internal accountability. From their perspective, accountability is non-hierarchical and is based on shared objectives. They stated that the reporting framework was of limited value to them, was onerous, and did little to enhance accountability to the community.

That is a very important point because the bill is being sold as enhancing accountability in communities. If I have an opportunity, I am going to read a statement by the Canadian Bar Association about why simply posting numbers on a website does not necessarily enhance reporting accountability within communities. I am sure many people in the House could speak to the fact that we also need resources provided to communities so that community members actually have the knowledge to interpret the financial statements.

Financial statements, in and of themselves, do not speak to whether people are getting good results for their dollars. They are not talking about benchmarking the number of houses built, the number of children attending school or the number of people who now have access to clean drinking water. A financial statement does not provide that information. People say that by putting numbers on a website, accountability is somehow miraculously going to occur.

First nation leadership and community members would all agree that it is important to have accountability between chiefs and councils and their membership. The Assembly of First Nations back in 2006 produced a position paper entitled, “Accountability for Results”, which contains numerous suggestions about how accountability could be improved both from the federal government to first nations, because that is one accountability measure that is currently not in place, and second, from chiefs and councils to their memberships. It was an amendment the NDP proposed, but of course, it was voted down.

One of the proposals that the Assembly of First Nations made was that there should be an ombudsperson. The proposal stated:

[First Nations]-led and [First Nations]-specific institutions will be needed, as First Nation citizens must be empowered to hold both their local government 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 [First Nations] governments in providing accountability and, at the same time, improve accountability by exposing problems and recommending solutions.

First nation leadership across this country has been at the table consistently proposing solutions to the government and the government has failed to act on any of them. One of the big sticking points about this piece of legislation is the fact that there was not appropriate consultation. I would be remiss if I did not quote from the UN Declaration on the Rights of Indigenous Peoples. Article 19 states:

States shall consult and cooperate in good faith with the 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.

Once again there is a piece of legislation before the House that does not have that free, prior and informed consent. One would think, given that the government almost a year ago committed to a new relationship, that it would have that free, prior and informed consent before bringing legislation forward. We are seeing bill after bill being introduced in the House without that kind of consent.

In fact, an official from the department yesterday talked about omnibus Bill C-45, clauses 206 to 209 in division 8, and said that it was fine for the government to go ahead without that free, prior and informed consent because, after all, they were just technical amendments. That is simply not good enough in this day and age. If the government is committed to a new relationship, it should make sure that it goes beyond engagement and consults with first nation communities across this country and ensures that legislation is what first nations are asking for.

Speaker's Ruling

[The Speaker, Conservative, Andrew Scheer]

There are three motions in amendment standing on the notice paper for the report stage of Bill C-27. Motions Nos. 1 to 3 will be grouped for debate and voted upon according to the voting pattern available at the Table.

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

Business of the House

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

Mr. Speaker, this afternoon, before we depart to our constituencies and events for Remembrance Day where most of us will be participating in remembrance services in our ridings, we will resume third reading debate on Bill C-28, the financial literacy leader act.

The week of November 19 will continue to see a lot of important action at the House committee level, where we are looking at the budget implementation act, Bill C-45, the jobs and growth act, as it advances through the legislative process. The finance committee is supported by 10 other committees looking at it and all together they will conclude the review of this very important bill and the very important job creation and economic measures that are laid out, measures that were first put before Parliament back in our March budget.

Meanwhile, on Monday the House will continue the third reading debate of Bill C-44, the helping families in need act, which we started this morning. Given support for the bill from all corners of the House, I hope it will pass that day so the Senate can pass it before the end of the year.

After Bill C-44, it is our intention to take up the report stage and third reading of Bill S-11, the safe food for Canadians act, which was reported back from the agriculture committee yesterday. I hope we will see strong interest in passing that bill quickly, just as we did for second reading.

Once that bill passes on Monday, the House will return to third reading of Bill C-28, the Financial Literacy Leader Act, if we do not finish the debate today.

That will be followed by second reading of Bill S-8, the Safe Drinking Water for First Nations Act. On Tuesday, Wednesday and Friday, the chamber will consider report stage and third reading of Bill C-27, the First Nations Financial Transparency Act, which was also reported back from committee yesterday.

I should also advise the House that on Tuesday when we return from the Remembrance Day week, immediately after question period I will call ways and means Motion No. 14 respecting some technical amendments to tax laws. Let me assure the House that there should be no doubt about this, but the opposition will no doubt be disappointed. This motion will definitely not implement the New Democrats' $21.5 billion job-killing carbon tax.

Finally, on Thursday before question period, the House will resume second reading debate of Bill S-8 and after question period we will take up Bill S-2, the family homes on reserves and matrimonial interests or rights act, also at second reading.

Aboriginal Affairs and Northern Development

[Chris Warkentin, Conservative, Peace River, AB]

Mr. Speaker, I have the honour to present, in both official languages, the fourth report of the Standing Committee on Aboriginal Affairs and Northern Development in relation to Bill C-27, entitled “First Nations Financial Transparency Act”. The committee has studied the report and has decided to make amendments to this report. Therefore, I report the bill back to the House with amendments.

[The Chair, Conservative, Chris Warkentin]

It is so moved, and unfortunately, we may not see.... It may be less predictable, because I have a ruling on this particular motion.

Bill C-27 enhances the financial accountability and transparency of first nations. This amendment proposes to restrict public access to certain disclosures to members of the first nations only.

As the House of Commons Procedure and Practice, second edition, states on page 766:

An amendment to a bill that was referred to committee after second reading is out of order if it is beyond the scope and the principle of the bill.

In the opinion of the chair, the creation of a restriction to the act is contrary to the public principle of the Bill C-27; therefore, it is inadmissible.

Amendment NDP-13 is the next that we'll consider.

[The Chair, Conservative, Chris Warkentin]

Thank you, Ms. Crowder.

NDP-8 and LIB-7, colleagues, are pretty well identical. As a result, I have a ruling that relates to both of them.

Bill C-27 enhances the financial accountability and transparency of first nations. This amendment proposes to create an exemption in the application of the act. As House of Commons Procedure and Practice, second edition, states on page 766:

An amendment to a bill that is referred to committee after second reading is out of order if it is beyond the scope and principle of the bill.

In my opinion as the chair, the amendment would create an exemption in the application of the act where it does not currently exist and is contrary to the principles of Bill C-27. The act should apply to all first nations. It is, therefore, inadmissible.

That deals with both NDP-8 and LIB-7.

There being no additional amendments to clause 4, I will call the vote.

(Clause 4 agreed to [SeeMinutes of Proceedings])

Colleagues, it would be helpful in the future if you'd indicate by showing your hand if you are in fact in favour or opposed.

(On clause 5—Accounts and consolidated financial statements)

[The Chair, Conservative, Chris Warkentin]

Well, if there's willingness to work together in this way to consider all three together, I then can make a ruling, and that will save us some time.

Seeing that generally everyone is willing to move forward in that direction, here is my ruling.

Bill C-27 enhances the financial accountability and transparency of first nations. The amendment seeks to create the office of the first nation ombudsman. According to House of Commons Procedure and Practice, second edition, as stated on pages 767 and 768:Since an amendment may not infringe upon the financial initiative of the Crown, it is inadmissible if it imposes a charge on the public treasury, or if it extends the objects or purposes or relaxes the conditions and qualifications specified in the royal recommendation.

In my opinion as the chair, in seeking to create the new office of first nations ombudsman, this amendment would certainly infringe on the financial initiative of the crown, and therefore I rule that this amendment is inadmissible. There certainly would be a financial consideration to it.

That is my ruling.