Public Accounts Committee on April 11th, 2024

[The Chair, Conservative, John Williamson]

Good afternoon.

I call this meeting to order.

Welcome to meeting number 114 of the House of Commons Standing Committee on Public Accounts.

Today's meeting is taking place in a hybrid format, although I believe we have all the witnesses in the room today, and all members are in the room.

Pursuant to the Standing Orders, members are attending in person in the room and remotely by using the Zoom application—but alas, they are not, since everyone is here.

I remind everyone that all comments should be addressed to the chair.

Pursuant to Standing Order 108(3)(g), the committee is resuming consideration of report 2 of the 2024 reports 2 to 4 of the Auditor General of Canada, entitled “Housing in First Nations Communities” and referred to the committee on Tuesday, March 19, 2024.

I'd like to welcome our witnesses. We have a full house today.

From the Office of the Auditor General, we have Karen Hogan, Auditor General of Canada. With Ms. Hogan is Glenn Wheeler, principal, and Doreen Deveen, director.

It's nice to see you all today.

From the Canada Mortgage and Housing Corporation, we have Michel Tremblay, acting president and chief executive officer, and Morley Linstead, director, housing solutions—indigenous and the North.

It's nice to have you all here today.

From the Department of Indigenous Services, we have Gina Wilson, deputy minister; Joanne Wilkinson, senior assistant deputy minister, regional operations sector; Nelson Barbosa, director general, regional operations; and Dr. Tom Wong, chief medical officer of public health, first nations and Inuit health branch.

Thank you all for being here.

As is customary, we're going to begin with opening remarks from each of our witnesses.

Ms. Hogan, you will begin with five minutes. Go ahead, please.

[Karen Hogan, Auditor General of Canada, Office of the Auditor General]

Mr. Chair, thank you for giving us the opportunity to discuss our report, “Housing in First Nations Communities,” tabled in Parliament on March 19, 2024.

I want to begin by acknowledging that we are gathered on the traditional unceded territory of the Algonquin Anishinaabe people. This area is also known as Ottawa. I express my gratitude and respect to Indigenous peoples who contributed to shaping and safeguarding the beautiful lands they call home throughout Canada.

Joining me today are Glenn Wheeler, the principal responsible for the audit, and Doreen Deveen, the director who led the audit team.

Many people living in First Nations communities do not have access to housing that is safe and in good condition. Overall, we found that Indigenous Services Canada and the Canada Mortgage and Housing Corporation made little progress in supporting First Nations to improve housing conditions in their communities.

Indigenous Services Canada and the Canada Mortgage and Housing Corporation are responsible for working with First Nations to meet their housing needs by 2030. Although $4 billion was spent over the past five years to build new homes, repair existing ones and increase First Nations’ capacity to manage housing, we found that in 2023, 80% of needs were still not met. The percentage of homes that need major repairs or replacement remains largely unchanged, despite the spending that went into building and repairing homes. In 2021, the Assembly of First Nations estimated that $44 billion was needed to improve housing in First Nations communities, and needs continue to grow.

We found that the Department and the Corporation had not prioritized communities with the greatest needs. First Nations communities with the poorest housing conditions received less funding than communities of the same size with better housing conditions.

Mould in first nations homes is a long-standing health hazard. We found that Indigenous Services Canada and the Canada Mortgage and Housing Corporation still did not know the magnitude of the problem. In fact, the department and the corporation are currently not following the strategy that they developed in 2008 to address this problem, and neither could explain why this strategy is no longer used. There is no plan in place to tackle this issue.

This is the fourth time since 2003 that we are ringing an alarm bell about unsafe and unsuitable housing in first nations communities. Adequate housing is a basic human need. After four audit reports, I can honestly say that I am completely discouraged that so little has changed and that so many first nations individuals and families continue to live in substandard homes.

Time after time, whether in housing, policing, safe drinking water or other critical areas, our audits of federal programs to support Canada's indigenous peoples reveal a distressing and persistent pattern of failure. The lack of progress clearly demonstrates that the government's passive and siloed approach is ineffective and in fact contradicts the spirit of true reconciliation. A fundamental shift is urgently needed to drive significant progress in providing proper support to indigenous families and communities across the country, especially those most in need who are currently too often left behind.

While the government is at the early stages of transferring its responsibilities for housing to first nations, unless the department and corporation tackle meaningful action to address the issues we have identified, it is unclear if the transfer will be successful.

It is important to understand that these are not legacy issues that live in the past; they are ongoing and perpetual, with direct consequences that people experience on a daily basis, and they stand in contradiction to Canada's commitments to truth and reconciliation.

We made eight recommendations to improve the government's delivery of housing programs to first nations communities. We are concerned that Indigenous Services Canada and the Canada Mortgage and Housing Corporation only partially agreed with our recommendation that they work with communities with the poorest housing conditions to ensure that they receive the support they need to improve their housing conditions.

Mr. Chair, this concludes my opening remarks. We would be pleased to answer any questions the committee members may have.

Thank you.

[The Chair, Conservative, John Williamson]

Thank you, Ms. Hogan, for those comments.

I'll now turn it over to the Canada Mortgage and Housing Corporation.

Mr. Tremblay, you have the floor for about five minutes.

[Michel Tremblay, Acting President and Chief Executive Officer, Canada Mortgage and Housing Corporation]

Thank you, Mr. Chair.

Before I begin, I would like to acknowledge that we're meeting on the traditional unceded territory of the Algonquin Anishinabe people.

For over 75 years, the Canada Mortgage and Housing Corporation has been helping Canadians to meet their housing needs and improve their quality of life. We've seen first-hand that having a safe and affordable home is essential for first nations people to build the lives that they want for themselves, their families and their communities. It's a key step in a journey towards reconciliation.

We know there's more work to be done to achieve this, and we're committed to working with partners to make this a reality. That's why we welcome the “Housing in First Nations Communities” report. It reinforces the importance of prioritizing first nations housing. It guides us to concentrate on the crucial issues that will help us effectively tackle this persistent issue by working closely with first nations.

We agree with the recommendations in the report. They are closely aligned with work already underway, and we have responded with clear plans on how to address them.

Since 2016, the Government of Canada has significantly invested in housing stock and repairs.

This includes the long-standing CMHC programs mentioned in the Auditor General’s report, specifically the Residential Rehabilitation Assistance Program and the On‑Reserve Non-Profit Rental Housing Program, also known as Section 95. These provide funding assistance to renovate and construct homes for First Nations living on reserve.

The federal funding also includes on‑reserve investments made through National Housing Strategy programs that CMHC delivers, such as the Rapid Housing Initiative, The Affordable Housing Fund and the Housing Accelerator Fund, among others. As of December 31, 2023, funding through the National Housing Strategy has helped First Nations to build, renovate and retrofit close to 34,000 homes on reserves, with 22,000 of them already completed.

In addition, we’re delivering on the Indigenous Shelters and Transitional Housing Initiative. For this program, we collaborated with Indigenous Services Canada and Indigenous partners to help First Nations communities to build safe shelter spaces for survivors of gender-based violence.

We recognize that significant strides have been made but that, as the Auditor General of Canada’s report notes, there is still a lot more work to do.

There remain major disparities between the housing conditions of indigenous and non-indigenous communities in Canada, especially on reserve. Historical treatment of indigenous peoples, persistent racism, decades of underinvestment, rising construction costs, climate change, and overcrowding and population growth: These are all factors that have led to the current housing gap for first nations living on reserve.

While we are committing to doing more, we also recognize that solving the housing challenges of first nation communities is not something that the federal government can or should do on its own. First nations communities are diverse, and so are their housing needs. Their leadership, communities and organizations understand those needs best and how best to meet them. That's why we are changing the way we address housing when it comes to first nations communities.

As you may know, the Assembly of First Nations, the chiefs committee on housing and infrastructure, Indigenous Services Canada, CMHC and Infrastructure Canada all worked together to develop the national first nations housing and related infrastructure strategy. This distinction-based strategy includes funding for new construction and repairs, but it also addresses the need for sufficient, predictable and sustainable funding so that care, control and management of housing can transition to first nations.

We have also been working with indigenous partners on an urban, rural and northern indigenous housing strategy that is set to be implemented in 2024-25.

As we carry out our plans to address the Auditor General's report, we will continue to work closely with Indigenous Services Canada and other federal partners, first nations partners, home builders, financiers and community housing providers.

Thank you for the opportunity to speak on this matter, Mr. Chair. We are happy to take any questions from the committee.

[The Chair, Conservative, John Williamson]

Thank you, Mr. Tremblay.

Last but not least, we have the Department of Indigenous Services. Ms. Wilson, you have the floor for about five minutes.

[Gina Wilson, Deputy Minister, Department of Indigenous Services]

Kwey. Hello. Bonjour.

I'm pleased to be gathered here on the traditional territory of the Algonquin Anishinabe people—the land of my ancestors, the land of current-day relatives—along with colleagues who are from the Office of the Auditor General, CMHC and here at ISC.

To begin, I’d like to thank the Auditor General of Canada for her report, “Housing in First Nations Communities.” We all agree that safe and suitable housing is foundational to ensuring First Nations are able to thrive. We are currently working to address and implement the recommendations made in the spirit of true partnership and self-determination that First Nations people want.

Indigenous Services Canada is aware of the substantial housing gap in First Nations communities, and is working to address the ongoing and profound impact of a lack of suitable housing. This is a complex issue that has spanned generations.

As the audit points out, in 2021 the Assembly of First Nations estimated the cost of closing this gap at $44 billion. It’s a daunting number, but the first step to meeting needs is to understand them. In line with this, ISC is working in close collaboration with first nations to better understand their priorities.

The government cannot and should not do this work without the partnership of first nations. With the UN Declaration on the Rights of Indigenous Peoples Act, we committed to not repeating the wrongs of the past—to not dictate what should be done in first nations communities but rather to listen to and support their leadership in advancing the vision and priorities they set for themselves.

Since 2016, almost $4 billion has been committed through our department. With this funding, and additional funding from CMHC, first nations are incrementally building and renovating nearly 34,000 homes. However, we know there is still more work to be done.

My colleague referred to the First Nations National Housing and Related Infrastructure Strategy.

This strategy was formed with input from rights holders from coast to coast to coast, who told us that a flexible funding model was a priority. This strategy serves as the foundation of ISC’s housing policy and has shaped how we support rights holders and self-determination.

Currently, we have a housing program that is not prescriptive: Communities can use funds to build homes, renovate spaces, clear mould, service lots and create new subdivisions as they see fit. Communities choose what their priorities are and how to spend funding in the ways that work best for them. This is a key step toward our goal of transferring housing and infrastructure services.

There are transfers like the recent framework agreement signed with the Confederacy of Mainland Mi'kmaq, or CMM. Once the transfer is complete, participating communities, in partnership with the CMM, will assume control of the design, management, provision and delivery of all housing and infrastructure programs and services currently under ISC’s capital facilities and maintenance program.

These are markers of progress on the path to reconciliation. Partnerships like these are now helping us map a clear path forward to support the transfer of care and control of housing to where it belongs—with first nation governments.

To close, I would like to note that my department will work with the first nations on these recommendations from the Auditor General's report. We have already started work to address them with our partners. We'll start through our preliminary action plan. We are calling it “preliminary” because of the importance we place on working with first nations. We intend to co-develop a final action plan with them, especially with the Assembly of First Nations. This work will be embedded in our broader multi-year planning exercises with them.

Indigenous Services Canada will continue to support First Nations as they undertake the complex and generational work of building homes that meet the needs of their growing communities.

Thank you for having me. I'm happy to take your questions.

Meegwetch.

[The Chair, Conservative, John Williamson]

Thank you very much.

We'll turn now to our first round of questions. Four members will each have a six-minute slot.

Mr. McCauley, it's good to see you back. You have the floor for six minutes, please.

[Kelly McCauley, Conservative, Edmonton West, AB]

Thanks, Chair.

AG Hogan, thank you for another depressing and dismal report.

I want to start by quoting the AG's opening comments from the emergency services report, which was equally as dismal.

She stated that Sheila Fraser, the former AG, “summed up her impression of the [indigenous services department]'s actions after 10 years of audits [as]...'unacceptable'”. Keep in mind that this was in 2011. She continued, referring to the Auditor General at the time and to 15 years after the original audit: “Five years later, my predecessor, Michael Ferguson, used the words 'beyond unacceptable'”. AG Hogan herself then said, “We are now into decades of audits of programs and government commitments that have repeatedly failed to effectively serve Canada's indigenous peoples.”

With regard to this report, the AG says, “This is the fourth time since 2003 that we have raised concerns about housing...and—20 years later—many of these concerns persist.” Indigenous Services and CMHC “have made little progress” on improving first nations housing conditions.

When you were here with us, Ms. Wilson, for the emergency services disgrace— and I will use those words—I asked this question: Why should we not be calling for the termination of you and all the other executives from your department? There were repeated failures, repeated failures, and all we hear back is, “There's much more to do”.

[Gina Wilson]

First nation housing shortages and overcrowding have been widely publicized for many years by me—

[Kelly McCauley, Conservative, Edmonton West, AB]

Do you take any accountability for this?

[Gina Wilson]

We take responsibility for this program.

[Kelly McCauley, Conservative, Edmonton West, AB]

Do you take any accountability or responsibility for this?

[Gina Wilson]

I take responsibility for this, yes.

[Kelly McCauley, Conservative, Edmonton West, AB]

Let me ask you. I'm looking at your departmental results from last year and, to quote from the government site, departmental results “inform parliamentarians and Canadians of the results achieved by government organizations for Canadians.”

Your department achieved 16.9% of your targets, and yet 94% of your executives, and I assume you, received an average of $18,000 in bonuses for achieving less than 17% and two disastrous audits.

I'm looking at your DRRs, the results for percentage of first nations housing that is adequate as assessed and reported annually by first nations. You set a target of 75%. What was achieved is unspecified. The date to achieve that unspecified goal was March of last year, but no target was set.

Under “self-determined services”, the target percentage of first nations housing that is adequate as assessed and reported by first nations is to be determined, but there is no target set. What is actually achieved is unspecified and the date to achieve the unspecified untargeted number is unspecified.

Under the housing program, the target for the percentage of first nations housing that is adequate as assessed and reported annually by first nations is 75%. What did we actually achieve? From your own department, reported through Treasury Board, it is unspecified. At least you set a date of March 2023 to achieve your unspecified results.

These are from your department's own targets set in your departmental plans, which I will read to you: The departmental plans “describe departmental priorities, strategic outcomes, programs, expected results and associated resource requirements.”

You come to this committee and present estimates justifying the money that you're looking for based on these targets, yet you've set no targets, and you can't even measure the targets that you haven't set. Somehow, everyone got a bonus of $18,000 when we have probably the two worst audits I've seen, and I've been through maybe 30 or 40 audits.

How do you sit here and not offer anything to us? When are we actually going to see that action? This goes back to 2001. I realize there is a minister responsible, but you are deputy minister. You could actually set results, and yet we don't even have targets.

How are we going to move forward with you still in this position? I don't have confidence that we're going to achieve anything that the AG is putting out with the current team here or the current minister either. How are we going to achieve this?

[Gina Wilson]

Mr. Chair, if I can, I'd like to talk about this for the next two hours and explain some of the context around this and actually explain some of the context around indicators and how we develop those indicators and co-develop them with first nation partners.

[Kelly McCauley, Conservative, Edmonton West, AB]

Start with how you set those targets and achievables.

[Gina Wilson]

Actually—

[Chad Collins, Liberal, Hamilton East—Stoney Creek, ON]

Mr. Chair, on a point of order, I get the fact that there's a question that's being asked, but I can't hear a word because the person who's asking the question keeps talking over the witness.

[The Chair, Conservative, John Williamson]

Thank you. I can hear. I think there's going to be some give-and-take here. Let's not get to the point where it's unruly yet.

Mr. McCauley, do you want the floor back?

[Kelly McCauley, Conservative, Edmonton West, AB]

I do want to take the floor back. It is my time.

[The Chair, Conservative, John Williamson]

Okay, hold on.

Having said that, I do expect that there's going to be a bit of back-and-forth today. Members, of course, it is your time. You can use all that time, but if you do pose questions, if you're able to provide some time for responses, of course you will want to police that they are not answers that take too much of your time. I do appreciate that as well.

Mr. McCauley, you have 50 seconds left.

[Kelly McCauley, Conservative, Edmonton West, AB]

I have two quick questions.

Justify to Canadians and this committee how 94% of the executives in your department received bonuses despite achieving 17%.

Tell us how it is that you have a departmental plan going forward without targets set or dates set on how you're going to achieve it, and you don't even know what you've achieved for the past year.

[Gina Wilson]

I can talk about executive bonuses.

Departmental plans set out broad, high-level program targets, and individual employees use specific criteria to provide individual commitments and key commitments. To draw a parallel between a broad departmental target not being met and an executive bonus just doesn't apply actually to the Treasury Board policy of how bonuses are provided. It doesn't.

I follow those policies of the employer, and others may have views about those policies.

[The Chair, Conservative, John Williamson]

Thank you. That is your time.

We'll turn now to Ms. Yip. You have the floor for six minutes, please.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

I'd like to thank the Auditor General and her team for this very thorough work on this audit.

It is very tragic that it is the fourth time since 2003 that your office has raised these same issues. It's no longer enough to accept recommendations; we need to see real action and accountability take place.

My first question is for Ms. Wilson. Mr. Tremblay, you can jump in as well.

Why were the formulas used by ISC and CMHC to allocate funding to regional offices based on 2001 census data?