Thank you.
Good morning. My name is Manny Jules. I am the chief commissioner of the First Nations Tax Commission. I'd like to thank the committee for inviting me to speak on income distribution and disparities in Canada. While I'm here to provide a first nations perspective, it is a mistake to try to understand income distribution by studying one group at a time.
There are two big trends that are impacting all of us. First, most developed countries are aging, more people are retiring, and the costs of health and pensions are rising. Second, productivity growth has been flat. When the retired share of the population rises and productivity remains flat, then incomes fall. This is a mathematical certainty.
If both of these trends continue, our living standards will decline. We will have less money available for government programs. There's nothing we can do about an aging population, but we can raise productivity. If we don't have productivity improvements, no amount of tinkering with the programs or the tax system will stop income declines.
First nations are the youngest population group in Canada. We're the fastest growing part of the labour force. The future of Canada's retired people is dependent on the productivity of first nations youth. However, if we don't participate in the economy, our youth will grow up without work experience. They will be disadvantaged for life. Canada will continue to spend hundreds of millions of dollars on our bureaucratic oversight and to spend billions on poverty-driven social programs for us. This is money that could be spent on education and infrastructure on our lands.
We can no longer afford to maintain a system that wastes money and our potential. The problem is that most people see us as a social problem when all governments are fiscally challenged. They see our problems as impossible to solve because it's hard to reach a consensus between first nations and governments. If we keep trying the same failed approaches, it will be like trying to fix a flat tire by yelling at it, as my father would say.
It doesn't have to be that way. We need to implement first nations-led solutions that are optional and that allow us to participate in the economy and raise our productivity. Here are four ideas.
First, Canada should develop and pass the first nations property ownership act. This will allow us to opt out of the Indian Act, which makes us a ward of the state. It will provide us with the same property rights as other Canadians. It will allow us to move at the speed of business and give us access to capital to start businesses. This is hardly radical; even Cuba knows that private property builds economies.
Second, we need to relearn what we were before we became wards of the state. We've spent generations teaching people about bureaucracies, playing the role of victim, and filling out grant applications and meeting reporting requirements. We need to relearn how to build and run a tax system, build infrastructure, facilitate investment, and to be an entrepreneurial people. This is exactly what we are doing at the Tulo Centre of Indigenous Economics.
Third, we need new fiscal arrangements. Transfers to provinces are growing faster than transfers to first nations. The equalization system rewards provinces for having a large, poor first nations population. We need to raise our own money, so we need to be part of the Canadian fiscal family.
Finally, we need to be part of Canada's resource development boom. Resource projects create billions of new revenues for the federal and provincial governments, but not first nations. Canada and the provinces need to create a fiscal benefit sharing arrangement from resource development that includes us. These revenues should be earmarked to reduce our outstanding infrastructure and service deficit. The First Nations Tax Commission can help in this regard.
These ideas will reduce income disparities. First, they mean more first nations youth will grow up with successful employed role models. Second, they will raise productivity of our lands and improve our access to capital. Third, they will increase our support for resource projects. Lastly, we will become partners in the economy and Canada.
As my ancestors said a hundred years ago, we will help each other to be great and good.