Thank you very much, Mr. Chair.
My colleague has left off at a great place, because my role here today is to highlight the importance of fostering strong indigenous economic opportunities through programs like the PSIB, the procurement strategy for indigenous business.
For decades, indigenous peoples were intentionally excluded from opportunities to develop local economies and participate more broadly in the national economy. The short-sighted policies of previous governments meant that, whether intentional or as a consequence of exclusionary policy, indigenous businesses and economies have been held back. However, that is short-sighted for indigenous peoples and communities and for Canada's economy alike. Supporting indigenous entrepreneurs, who are job creators, or making access to capital available for major projects is good for people, communities and Canada's overall economy.
Investing in indigenous communities and building up indigenous businesses and entrepreneurs benefit all Canadians. According to the 2022 “National Indigenous Economic Strategy for Canada”, the continued exclusion of indigenous peoples costs the Canadian economy $27.7 billion every year. The National Indigenous Economic Development Board found that closing the existing employment gap could help lift over 150,000 indigenous people out of poverty. There is a real cost to inaction.
Indigenous people are an untapped resource in Canada's market. Since 2015, we've been focused on strengthening self-determination and building capacity so that indigenous peoples have the tools and resources to fully participate in the economy on their own terms. Federal funding for programs like the aboriginal entrepreneurship program managed by the National Aboriginal Capital Corporations Association and Métis capital corporations is creating opportunities for first nations, Inuit and Métis business owners to launch or grow their businesses.
Indigenous financial institutions have existed since the late 1980s. Over the past 35 years, the program has issued approximately 52,000 business loans worth $3.2 billion, with a repayment rate of over 95%. For every $1 million lent by indigenous financial institutions, $3.6 million is produced in total gross domestic product, GDP, for Canada. Successive governments have recognized that access to capital is key to economic reconciliation, and the results of these investments can be seen in communities across the country.
For example, Ulnooweg Development Group Inc., the indigenous financial institution for the Atlantic, has played a key role in supporting indigenous entrepreneurs. To date, it's funded over 1,900 projects worth over $71 million. This funding has supported entrepreneurs in the fishing, aquaculture and marine servicing industries, creating a strong first nations-led industry in the region and boosting the local economy.
Investing in indigenous communities and building up indigenous businesses and entrepreneurs benefit all regions in our country. It's why budget 2024 announced $319.8 million over five years to provide much-needed additional capital for indigenous financial institutions and Métis capital corporations to support the growing needs of entrepreneurs.
While investing in indigenous business is important, it starts with a strong base. Building up communities with new or renovated schools, health care centres, water treatment plants, all-season roads and housing is investing in Canada's productivity and economy overall. A recent report from the AFN found that every dollar invested in infrastructure generates $1.82 in economic output for first nations communities. Since 2015, we've increased funding for education, health, infrastructure and housing by over 1,100%.
We're working with partners on community-led solutions, and we're making progress. For example, to close the housing gap, we've supported 5,300 housing projects in 611 first nations communities since April 2016. More kindergarten to grade 12 schools are being built so that children can access high-quality education without leaving home, including in communities like Tataskweyak Cree Nation in northern Manitoba, Eabametoong First Nation in northern Ontario and Piikani Nation in Alberta.
Strong communities produce strong community members, who in turn are the leaders who will shape the decades to come.
Procurement is another key part of building the indigenous economy. The national indigenous economic strategy, which was developed by over 20 indigenous organizations, sees procurement as a key component of accessing financial capital so that indigenous peoples can achieve economic and social prosperity on their own terms.
The strategy also recommends that all levels of government and industry have mandatory indigenous procurement targets. In 2021, the federal government implemented a 5% indigenous procurement target set for all departments. Tabatha Bull—some of you have heard from her—the CEO of the Canadian Council for Indigenous Business, called it “a pivotal moment in harnessing the potential of the Indigenous economy”.
Since then, the value of contracts going to indigenous businesses has increased to approximately $1.6 billion, and there are tangible economic benefits to companies that for the first time have the Government of Canada as their customer. From experience to system navigation to growth of opportunity, government procurement could be a valuable component in the sales trajectory of an indigenous company.
Now that we're seeing success in bringing indigenous companies into the sphere of government procurement, the federal government is working with partners to transform the procurement strategy. It's clear that this program must be transformed and transferred to the control of partners. To do so respects the principle of self-determination, and it responds to the calls from indigenous leaders themselves.
Central to advancing self-determination and economic reconciliation is ensuring that indigenous peoples participate in and shape the decisions that deeply affect them. It's why I convened with the private sector, indigenous leadership and other government departments two economic reconciliation roundtables to date—and others are planned for 2025—to identify and create solutions to government and corporate barriers to indigenous economic activity. We're using that information as we work with partners on a renewed federal economic policy to support first nations, Inuit and Métis economic development.
I can see by the focus of the members in this committee that we agree that the federal government has a real opportunity and a role to foster indigenous economic prosperity, including by safeguarding the 5% minimum target and the procurement strategy for indigenous businesses. Programs that increase economic activity across Canada are just common sense.
The continued exclusion of indigenous people from the economy costs the Canadian economy, as I said before, $27.7 billion every year, so we can't afford to ignore opportunities to build up this economy. By working together to remove barriers to economic development and to support indigenous businesses, we are making progress towards long-term well-being and prosperity in communities across Canada.
I look forward to answering your questions and further discussing the importance of economic reconciliation.
Thank you.
