Thank you, Mr. Chair.
My name is Clarence Manny Jules. I'm a former chief of the Kamloops Indian Band, and currently I'm chair of the First Nations Tax Commission. I want to thank all of you for this opportunity to make this presentation.
As you are undoubtedly aware, one of the areas that I am promoting is the first nations property ownership initiative, which this committee had supported and which was in the last budget announcement in March.
As a chief, obviously I'm very familiar with a lot of the issues that have been discussed here this evening, but what I want to focus on is the fact that first nations have to be an integral part of the economy. The sustainability of Canada's living standards, pensions, and social programs depends upon improving the productivity of first nations.
The failure of our investment market means that first nations do not share in the full benefits of resource development. Generally, about 10% of the total economic and fiscal benefit of resource development is provided through royalties. The remainder is paid out as salaries, wages, and profits, and corporate taxes paid by resource companies and their suppliers.
The inability of first nations to share in investment makes it more difficult to reach agreement on many issues and projects. First nations simply do not receive the benefit, only the costs.
We proposed solutions to this committee to address these issues: develop and pass the first nations property ownership act and develop and implement the first nations fiscal relationship.
Supporters of the first nations property ownership initiative mostly believe that the federal government's proposal to streamline the environmental assessment process will help address market failure on reserves. Parallel systems make it difficult to hire professionals, and they create the need to duplicate many procedures. They lack single points of accountability. Consequently, they often add to the administrative and compliance costs, and they may actually result in reduced standards of environmental protection and oversight.
An improved first nations fiscal relationship would amplify the benefits of FNPO. In a typical government setting, investment creates jobs, business opportunity, and government revenues. This creates capacity for improving local services and infrastructure. Improved local services and infrastructure support further improvements in the investment.
The current fiscal relationship for first nations cuts short this cycle. We can fix this short-circuit by creating clear and exclusive revenue authorities and expenditure responsibilities for all governments towards first nations. First nations need more revenue authorities that are tied to local investment successes, such as my proposal for a property transfer tax. These need to be linked to service responsibilities. Transfers need a transparent formula linked to a national standard.
I believe very strongly that if first nations are not involved in the Canadian, and therefore global, economy, you will see in the future many more “conflicts”, I guess, over resource development and expansion in the country. First nations, in order to be part and parcel of the economy, need to be part of the solution.
Thank you very much.