Indigenous and Northern Affairs Committee on March 9th, 2017

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Under your pillars.

[Paul Thoppil]

Right. As I may have explained in my opening remarks, there are different types of intervention and we try to avoid third party to the extent that we can. It does not necessarily mean that there aren't other forms of lighter intervention, where we're engaging in order to assist that first nation out.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

What level are they at?

[Paul Thoppil]

They are a second-level intervention.

Renetta may want to speak to this.

[Renetta Siemens, Deputy Chief Financial Officer, Corporate Accounting and Material Management, Chief Financial Officer Sector, Department of Indian Affairs and Northern Development]

It's a recipient-appointed adviser, so they themselves engage an adviser to support them in their financial management. It's the second tier of the three tiers that we mentioned.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

How many significantly poor audited statements would it take before you would increase the flags? We don't know how long this recipient designated person has been in place, but I think it would be valuable to know how long before you'd raise the next flag.

Another one—

[Paul Thoppil]

Just to respond to that, with regard to audit opinions, when it's adverse you have to look at what that adverse statement actually is, because it does vary.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Okay. So—

[Paul Thoppil]

It's not a blanket kind of adverse. One has to be fairly nuanced.

[The Chair, Liberal, MaryAnn Mihychuk]

I would ask the respondents to wait until the question is posed.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Obashkaandagaang has had a number of statements where the auditor has indicated that the statements can't be believed. Where are we at there? How long has there been support? I'm glad the community is aware of this issue because of the transparency, because it's posted, and they can actually hold their communities to account, but that's a pretty concerning statement by the auditor. Where are we at?

[The Chair, Liberal, MaryAnn Mihychuk]

You have about two minutes left.

[Renetta Siemens]

Maybe we can provide that off-line. I'll need to look for that and find more information.

Obashkaandagaang is in a recipient-appointed adviser situation as well, the second tier.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

If I were a community member and I had a statement that the auditors were saying couldn't be believed.... Why is that not triggering a much higher level of concern in terms of intervening?

I suppose the other part is that when we have that information tabled, could we also look at the minimum qualifications of the third party managers or the support people who are appointed? Are there minimal qualifications for them in terms of the job they're doing?

[Paul Thoppil]

You're asking all the right questions, Ms. McLeod.

The reason they're not third party is that, as I explained in my opening remarks, we don't want to impose third party. If there is another way that is lighter, whereby the community can take responsibility for themselves to get out of default, that is our go-to option.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Great, but how many years have they had that level of support, and has it made a difference? To go back to my original question—

[Paul Thoppil]

We can provide you with the trends. We can say that over the past couple of years, we have seen movement of 18 in terms of a positive reduction in the levels of intervention. That was over a period of just a year and a half to two years. I think that's pretty good.

As I said in my opening remarks, the most interventionist one.... We started a couple of years ago at 15, and we hope by the end of April to be down to eight. So it's going the right way, but these things take time.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Yes. Well, going the right way is great—

[The Chair, Liberal, MaryAnn Mihychuk]

You need to wrap up.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

—but I hope the statements also reflect that, going in the right direction. Again, if I were a community member, I'd be very concerned about that particular trend.

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you.

The questioning now goes to MP Saganash.

[Romeo Saganash, NDP, Abitibi—Baie-James—Nunavik—Eeyou, QC]

Thank you, Madam Chair.

I usually continue the conversation in the language I was speaking when I went to bed the night before. I'll speak in French this morning.

I'm not sure today's study is the top priority of aboriginal communities. Aboriginal matters were so neglected in the past that everything became a priority in the communities. I'm not sure the topic of this study is a priority.

That said, let me be clear. I've always believed that transparency and accountability are two pillars of all governance in both aboriginal and non-aboriginal communities, especially since we're covering many angles of the default prevention and management policy issue.

A ministerial task force must focus not only on the legislation, but also on the government policies. I suppose this will be one of the topics addressed, or at least I hope so. According to Indigenous and Northern Affairs Canada's 2016-17 report, the plan is to start reviewing the policies on this issue. I'm sure this committee will submit an excellent report, as usual. Obviously, the memorandum of understanding with the Assembly of First Nations will also address this policy. Therefore, I'm not sure we know exactly who will do what within the range of processes related to this topic.

My first question concerns the cost of these processes at the first, second or third level. The communities are responsible for covering the costs. You emphasized the words “who we choose”, but you failed to mention that the communities pay for these processes to be carried out.

As a result, who determines which budget item the money will come from to pay for these third-party managers or to cover the other aspects of the policy?

[Paul Thoppil]

The advisers are paid out of the band support funding, essentially in all cases. This is where, in response to Mr. McLeod's question, we do concur that the level of band support funding there needs to be revisited to make sure it's adequate for their needs.

The advisers are chosen under third party. We have a standing offer that is done nationally, and we choose those who qualify based on their qualifications. This is to respond to Ms. McLeod's question.

The recipient-appointed advisers, where they get to choose, are based on their own choice. We will try to have a conversation with them about the criteria that we think would be adequate in terms of choosing that adviser, but ultimately, it's the recipient, the first nations community, that decides on the adviser.

[Romeo Saganash, NDP, Abitibi—Baie-James—Nunavik—Eeyou, QC]

At the third level, the most serious level, the community must pay.

I wanted to know who determines where the money will come from to pay for this. Do the communities themselves determine where to take the money from?

[Serge Beaudoin, Director General, Sector Operations Branch, Regional Operations Sector, Department of Indian Affairs and Northern Development]

Yes. The first nation determines where to take the money from. We know that the average cost for the first nations at the third level of intervention is about $170,000 a year.