Indigenous and Northern Affairs Committee on March 9th, 2017

[Paul Thoppil]

In every case there is a management action plan. Each situation is different and depends on how they got to that situation in the first place. For some, as I said, it's just in getting quorum. There is a division within the community, and they just can't get together to have a proper governance board in order to manage themselves. That's one reason.

Another one is financial management. They don't have any financial bylaws. They don't have a technical capacity in finance, so they need to go through that process.

Another reason is that they've been in default with lenders. That is where we, through the adviser, need to get that debt down so that they can actually go into that third pillar of our policy, sustainability. Then we move away because the debt that they have accumulated over the years has been repaid.

It depends upon every situation. We monitor progress, and as we see progress, we move from third party to the lighter interventions, eventually getting out. That's part of that dashboard review of how they are doing: are they getting out or are they still stuck? If they're still stuck, why? Why aren't we getting them up to the next lighter intervention level so that we can get them out?

[David Yurdiga, Conservative, Fort McMurray—Cold Lake, AB]

I understand that INAC is currently, or potentially, looking at reviewing the third party management policy. Has the department begun its review?

[Paul Thoppil]

Yes, we've been doing some review over the past half-year in order to be helpful in those technical conversations with the Assembly of First Nations.

[David Yurdiga, Conservative, Fort McMurray—Cold Lake, AB]

What is the anticipated duration of the review? Is it going to be a multi-year thing? Is it going to be a year? What are the timelines?

[Paul Thoppil]

We are bringing that work into the Assembly of First Nations relationship, and as I informed Mr. Massé, we have a deadline under the MOU for the end of the calendar year. What we're looking for is to take advantage of your work, as well, for that review.

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you.

The questioning goes to MP Anandasangaree.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Thank you very much for joining us today.

I'm just wondering if you could give an outline with respect to the numbers. You indicated that 142 communities are currently under some form of intervention. The term used was that they are self...62 of them are able to appoint their own co-manager, I guess. What is the difference between the pool of organizations that can be self-appointed versus the panel that you would use for the 10 that are currently under third party management?

[Paul Thoppil]

The pool is the same, but the issue is who gets to select, right? That's because we're trying to avoid dictating. We don't want to do that. The pool is essentially the same, but sometimes they will choose to even go beyond the pool. Then we have a conversation about that. Quite frankly, in the end if they are adamant about it and if we feel that there are adequate qualifications, that's fine. The issue is not the adviser but getting them to deal with the management action plan that is to address the default in the first place.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

What I'm trying to get at is with respect to capacity building. One way to build capacity is to make sure that organizations that are on the panel adequately reflect the communities, or have members of the community who are trained, or that there's an obligation for them to train individuals to be able to undertake some form of management.

How does the panel look right now, and are those considerations incorporated into your selection of the panel?

[Paul Thoppil]

Do you mean in terms of the advisory pool?

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Yes.

[Paul Thoppil]

It is one of the remits of the advisers for doing capacity development. That being said, if there are no underlying capacity development dollars, as Mr. McLeod rightly said, then there's only so much they can do in terms of level of training and so on. The two come hand in hand.

We try to do what we can by way of supplements through the professional institutional development budget that we have and try to prioritize funding according to the management action plans, but it's somewhat limited.

Sometimes the third party managers, to be fair to them, are so engrossed in just doing the management of the funding that the element related to the training and development is, without any tools, somewhat limited.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

In fairness, some of them are fairly large organizations. Some of them are international and have international scope—I don't want to name individual ones. There is a business case to be made for their having advisers who represent the communities and are from the communities.

I guess my question is, how do we have a culture in which there's an expectation, when your department deals with third party vendors, that they have an obligation, regardless of the dollars you have put on the table for training, to uplift and empower the communities?

[Paul Thoppil]

That's a very good question. Each has its own ways of engagement. The first nations having difficulties are, as you know, those in remote and isolated communities that don't have own source revenues. This is where they have a technical capacity issue.

Some accounting firms try to say that you can never find enough adequate people who will want to live there; even their own staff have issues about living there. In this area, they've come up with innovative solutions, such as a remote bookkeeping service using technology—like telemedicine, in another area—to see whether they can keep the payroll going and do the set of books with minimal engagement, and start that as the journey to financial accountability and sustainability.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Isn't that the type of task, at an early starting point, to undertake to build capacity within the communities to do these things?

[Paul Thoppil]

Yes.

[Gary Anandasangaree, Liberal, Scarborough—Rouge Park, ON]

Should the obligation not be with the third party managers to deliver longer-term sustainability and capacity for the communities?

[Paul Thoppil]

They can. They try to do so where they can. Some are not so focused on that as on just trying to get the job done.

There is also the Aboriginal Finance Officers Association, which is also involved in trying to help where they can.

[The Chair, Liberal, MaryAnn Mihychuk]

I'm going to ask the committee whether you'd like to continue the questioning, so that we finish the full round, or cut it short to 60 minutes. I believe we started at about 9:00, but we have time, because we don't have a second panel.

Shall we continue the questioning?

[Some hon. members]

Agreed.

[The Chair, Liberal, MaryAnn Mihychuk]

All right, that's what we'll do.

The questioning goes to MP Viersen.

[Arnold Viersen, Conservative, Peace River—Westlock, AB]

Thank you to our guests for being here this morning; it's much appreciated.

In your opening comments you said the study is very timely. I was a bit confused as to why we're doing this particular study. Could you elaborate on why you think this is timely? There were a number of other things I was hoping we were going to study first.

Why is this timely? How would you like to see the third party management or the levels changed? If you're saying it's timely, you must have some recommendations for this, or directions for us to go in. Perhaps you could point us in the direction of one of the big issues you see with all of this policy, about which you could say, “if you could look into this particular area, there may be a gap in the policy that we need to deal with”.

[Paul Thoppil]

I think it's timely because I don't believe there is any one place where all the good ideas are in order to address the issues related to the policy. We want to take advantage of the expertise that this committee will bring to bear in dealing with witnesses and have a report that we can use in our conversations on establishing this new fiscal relationship with first nations.

We don't profess to know it all. We think this robust, noble body will be able to do some excellent work that we can take advantage of. We say it's timely because we're in the middle of these conversations now. We're very anxious to take the outcome of your findings and incorporate them in our conversation with the Assembly of First Nations.

[Arnold Viersen, Conservative, Peace River—Westlock, AB]

You're the organization that has to deal with this on a daily basis; 142 different organizations are currently in some level. It looks like most of them are in this self-appointed.... I was just looking through the list.

Is there an area that you would like us to look at in particular? Perhaps I can make a suggestion, and you can corroborate that. Is the lack of movement in a positive direction, in terms of going from third party management backwards, an area that needs some addressing, or is it something else?

[Paul Thoppil]

We don't profess to doing this right. There are a number of things that can be examined. As we said, the policy is based on trying to avoid intervention, the most intervention on the third party. Are we doing it right? I don't know. We would like the outside reflection to be, “No, you're not being proactive enough in getting them out.” We're willing to accept that criticism along with solutions to do that.

Our minister is very focused on indigenous-led institutions rather than INAC in order to do that work. Is that potentially a road to avoid this whole situation whereby we're out of that business and an indigenous-led institution is part of that? We would be consistent with the minister's direction. We'd be interested to know whether the committee feels a culturally centric institution should be doing it rather than INAC.

I take Mr. McLeod's point again on band support funding and capacity development and whether our budget, our professional and institutional development, is adequate, given the needs, given the number of communities that don't have own source revenues, that are remote and isolated communities, and whether that's sufficient. It's really hard to get qualified, technical people in those communities to begin with, across any level of competency.