Hard times are ahead for over 80 First Nation bands that haven’t handed over their financial records under Canada’s First Nations Financial Transparency Act. If documents aren’t received by December 12, Ottawa says federal funding will be cut off.
Aboriginal Affairs and Northern Development Canada (AANDC) issued an ultimatum, threatening to take action if the required financial documents weren’t received by November 26, 2014. Steps could include a plan on how the holdout bands would provide the financial statements as soon as possible. If this isn’t done the AANDC could withhold funding for non-essential programs, services and activities.
Even scarier is that AANDC is waving the possibility of withholding funds for essential programs or even terminating funding agreements by December 12. The AANDC have also said they might publish the names of non-compliant First Nations bands on the web and inform other federal departments who provide funding to the bands. Court action is also being considered.
A major problem many of those bands have is that the Act calls for them to disclose financial information from their economic ventures. It raises the question of why this is being required. How many businesses in Canada would do this? It would interfere with their ability to make money. I would love financial information on my competition. Many of the bands believe, and rightly so, that this information should be available to only band members and not the general public.
AANDC Minister Bernard Valcourt says the disclosure laws under the Act were put in place to ensure band members have access to all financial information about their respective bands.
Yet, while the feds are calling for financial management, transparency and accountability on the part of First Nations, they themselves don’t respect those same standards. New information on AANDC financial practices show the department has taken $500 million in the past six years from infrastructure programs to cover budget shortfalls elsewhere.
Chief Franklin Paibomsai of the Whitefish River First Nation in northern Ontario, said First Nations communities are feeling the impacts. Two hot infrastructure issues – schools and safe drinking water – are affected by these decisions, he said. Liberal MP Carolyn Bennett said the document shows First Nations communities are not getting the funding they need. “Mr. Harper’s government can no longer hide their severe and chronic underfunding of critical needs like housing, clean water and education on reserve,” she stated.
The document itself says shifting infrastructure money elsewhere results in an “inability to provide provincial-like services on reserve.” The feds have admitted they don’t have a clue on how AANDC’s spending compares to provincial spending for the rest of Canada.
Given how many First Nations are under third-party management for mismanaging their financial budgets by AANDC, perhaps it is time to put them under third-party management themselves? After all there is some story about glass houses and a few stones.