Indigenous and Northern Affairs Committee on March 12th, 2015

[Jonathan Genest-Jourdain, NDP, Manicouagan, QC]

That explains things, Mr. Calla. Thank you very much.

The documents submitted to my attention refer to superior internal governance standards in relation to the program you are promoting today. Do those superior internal governance standards for First Nations also include the redistribution of monetary benefits from resource development to band members?

Does your plan ensure that each member of the community will benefit from that, not just the few elected under the Indian Act? Is that part of the superior standards?

[Harold Calla]

The process that we engage in with the community is for them to develop a financial administration law, which is not dissimilar to your Financial Administration Act. We also measure financial performance. In order to get to the borrowing pool, you have to submit five years of financial statements to the financial management board. They have to meet certain tests. The most fundamental piece, the most important building block and the most work is developing a full-blown financial management system which deals with a lot of the systems of governance. We do not pretend to make the decisions for the community. What we insist on is that processes be put in place in which the community is involved in the decisions that are being made, and that those decisions are accountable and transparent. It's up to them to decide, but what we have found is that when you have an opportunity early to begin the process of looking at how you want your community to develop, those things will evolve in time. Part of our role is to help develop that capacity with those communities and bring communities together.

Last week we had 37 different communities from seven provinces in Vancouver at a financial management systems seminar. Some were big communities. Some were small communities. What we started to see in that process is the sharing of knowledge among communities, which is far better than somebody like me coming and telling them what to do. That's the kind of support we're getting and we need to continue to have, that sharing of experience among communities, not just the good, but some of the challenges as well.

[The Chair, Conservative, Blake Richards]

Thank you very much.

Next we have Mr. Seeback.

[Kyle Seeback, Conservative, Brampton West, ON]

I wish I had 20 minutes, but I'll try to deal with it in five.

What are the revenue streams you can currently leverage a borrowing member? My understanding would be property tax, some own source revenue, and resource revenue if you have it. Are there any other types of revenue a first nation could use as part of getting into the borrowing pool?

[Ernie Daniels]

There are government transfers, business revenue, contracts, leases, municipal transfers.

[Kyle Seeback, Conservative, Brampton West, ON]

It's really any steady, reliable stream of income.

[Ernie Daniels]

Yes, it just has to be legal.

[Voices]

Oh, oh!

[Kyle Seeback, Conservative, Brampton West, ON]

Yes, I assumed that.

[Ernie Daniels]

When I first started, they told me, “Just make sure it's legal.”

One of the revenue streams that's not allowed is the GST revenue. Some first nations actually have arrangements with provinces and Canada about the GST. That's not an eligible revenue stream.

[Kyle Seeback, Conservative, Brampton West, ON]

Do any of the amendments that you're putting forward expand the types of revenue streams that are going to be available for leverage? Do they deal with any of that at all?

[C.T. (Manny) Jules]

Yes.

[Harold Calla]

They do?

[C.T. (Manny) Jules]

Fees and permits, and grants in lieu, so those formerly weren't part of the eligibility criteria.

[Kyle Seeback, Conservative, Brampton West, ON]

They may not be huge amounts of money, but when you can leverage it tenfold and take it over 10 years, that actually makes a big difference.

[C.T. (Manny) Jules]

Exactly.

[Kyle Seeback, Conservative, Brampton West, ON]

What are the impediments right now to a first nation becoming a member?

[Harold Calla]

I'll take a run at it. We're the gatekeeper. The financial management board is required to certify before they can get to borrow, before the tax commission can approve a borrowing law. Part of the impediments are history. The fact that you need to have five years of financial statements, that you need to meet certain performance ratios, and the legacy of managing poverty has created an inability for many to get to those qualifications.

[Kyle Seeback, Conservative, Brampton West, ON]

Do you help a first nation get there? Do you have the resources if a first nation approaches and says, “We want to get here. Can you help give us the tools to move along the path”?

[Harold Calla]

Yes, we do. I'm pleased to say that many communities are now coming forward to us because they would eventually like to tax and they would eventually like to borrow, but with their current circumstances, they can see, when they look on our website, that they're not going to meet the ratios, but they say they have to start somewhere.

Yes, they are starting, but one of the biggest impediments is that legacy. The other thing is that this is a paradigm shift for many communities. We're moving now to say that we recognize that where we have an opportunity to take care of ourselves, we're going to, and we need systems to be put in place. Part of the good work that's been done by Regional Chief Jody Wilson-Raybould in British Columbia is a governance guide, which is several binders and is a road map for those who want to become a self-governing first nation and be accountable and transparent and do all those things.

We have financial management systems. We have sample policies. We go out to communities and say, “Here it is.” The biggest challenge we're going to face is that we're all going to have to invest in it. It's easy to say, “Here it is, now go and do it,” but where are the person-years and where's the money to make it happen? That's the challenge we're going to come to.

[Kyle Seeback, Conservative, Brampton West, ON]

That was where I was going to go next. It's never enough. We know that across all government departments. There's never enough money to do everything.

Is that your challenge for what you're trying to do? How does that translate for you?

[Harold Calla]

We look to creating partnerships, both with government and industry. If we're going to have major economic development in this country, and there are going to be impact benefit agreements resulting from that.... The question that was asked earlier was about what should be in those provisions. I think investment in capacity development at the first nation community level is an important element of what could be in an impact benefit agreement.

As you say, there will never be enough, but we have to start looking for ways in which we can stack different bundles of money to be able to support the overall objective.

[The Chair, Conservative, Blake Richards]

Thank you.

That concludes the time on questions. That's the end of my list of questioners.

We do have some committee business to take care of this morning. I'm going to suspend for the next few minutes so we can clear the room and move in camera for our committee business.

I want to thank all of our witnesses today. It was a very productive discussion. We appreciate your time today. Thanks for being with us.

[Proceedings continue in camera]