Proceedings of the Standing Senate Committee on
Aboriginal Peoples
Issue 15 - Evidence - April 25, 2007
OTTAWA, Wednesday, April 25, 2007
The Standing Senate Committee on Aboriginal Peoples, to which was referred Bill S-216, providing for the Crown's recognition of self-governing First Nations of Canada, met this day at 6:16 p.m. to give consideration to the bill.
Senator Gerry St. Germain (Chairman) in the chair.
[English]
The Chairman: It is my pleasure to welcome you to the Standing Senate Committee on Aboriginal Peoples. I am Senator St. Germain from British Columbia, chair of the committee. Today our committee continues its study of Bill S-216, providing for the Crown's recognition of self-governing First Nations of Canada.
First let me introduce the members of the committee who are here with us. We have Senator Lovelace Nicholas from the province of New Brunswick, Senator Dyck from the province of Saskatchewan, Senator Hubley from the province of Prince Edward Island, Senator Gill from the province of Quebec and Senator Peterson from the province of Saskatchewan.
Bill S-216 proposes a legislative framework for the optional exercise of self-government by First Nation communities seeking an alternative to the Indian Act regime. The bill recognizes the jurisdiction of First Nations to legislate in specified fields and reconciles that jurisdiction with the jurisdiction exercised by the federal and provincial governments. The limits of a First Nation's jurisdiction are set out in its constitution, and its law-making powers are limited by several factors. A referendum must be held on the subject, and the proposal, including a constitution, must be put before the electors. The bill applies only to recognized, land-based indigenous communities and sets forth the relationship between them and the province in which they are situated. It also provides for the management of First Nation land and finances.
Tonight we have with us as a witness Mr. Jerome Slavik, lawyer and negotiator and partner in Ackroyd, Piasta, Roth & Day LLP. Mr. Slavik has done a lot of work on issues involving Aboriginal peoples.
The floor is yours, Mr. Slavik.
Jerome Slavik, Lawyer and Negotiator, Partner, Ackroyd, Piasta, Roth & Day LLP, as an individual: Thank you kindly, senators, for asking me appear before you again. I very much enjoyed my last appearance before you on the specific claims policy. In that regard, I commend honourable senators for producing a very focused, succinct and accurate analysis of both the problems with the claims process and the measures that will be needed to move the claims process out of its currently unacceptable state of affairs. You did a great service on behalf of Aboriginal people, and all the clients that we work for, without exception, are sending letters endorsing that report. Thank you for that excellent work. It is important for all Canadians that this committee shines light on very difficult, intransigent issues. Personally and on behalf of our clients, thank you for your good work.
Today, I have been asked to speak on the topic of First Nation governance in relation to the proposed bill. I have prepared a paper for you, and it is available at the back of the room. I have also attached a supplementary paper that I just delivered at an Aboriginal law conference yesterday. It speaks to the broader issue of reconciliation of Crown-First Nation interests and new strategies and frameworks to approach that issue.
My perspective is not one of self-government theorist or academician. Perhaps there has been much too much focus on the concepts and theory of Aboriginal governance and too little focus on the resources, legislation and approach that it takes to make Aboriginal governments much more effective, not just for their communities but for the country as a whole.
For the last 35 years, I have worked with Aboriginal governments all across Canada, for the last 25 years as legal counsel, and a great deal of that time, almost on a daily basis, concerns governance-related matters. With this background, I want to speak to the issues before you.
We have come at self-government issues from a wide range of approaches over the many years of my practice. There remains a pressing and urgent need for new legislation in this area, much of what the current bill that you are proposing contemplates. This bill has had a long and tortuous history. It has been drafted with very little resources and I know has been the object of some criticism from the Department of Indian Affairs and other parties. However, I want to encourage senators to persist because the need for a new legislative framework for First Nation governments is required for the reasons I will set out herein.
I do not want you to take my comments on Bill S-216 as criticisms but as ways in which, hopefully, the legislation can be improved so that it is more acceptable to your potential critics, both within the government and within First Nation communities.
For the past three and a half years, I have been lead counsel in the negotiations being undertaken by the nine Meadow Lake First Nations in Saskatchewan. They have now all but concluded negotiations with the Government of Canada and the Government of Saskatchewan on the most comprehensive tripartite self-government agreement in Canada. This unique and important agreement was 15 years in negotiation, and I do not want to even indicate the costs. This agreement was negotiated under the inherent right policy and demonstrates the problems of the inherent right policy and the need for a legislative framework instead of an inherent rights misnamed policy.
This agreement, which is a tribute to Canada, Saskatchewan and the First Nations, addresses many of the complex practical, administrative and jurisdictional arrangements that need to be worked out between provinces, the federal government and First Nations. We are hoping that it will be a model and precedent for other First Nations to develop a much more comprehensive and expanded set of jurisdictions. However, careful reading of that agreement may also carefully inform you as to how the current bill needs to be modified to address many of the complex legal issues we had to resolve in negotiating that agreement.
I will say more about that hopefully during our question and answer session, but I want to talk briefly about the content of my paper.
At present, there are three frameworks for First Nations to expand their governance. The first is under the Indian Act, and the second is under a suite of federal legislation relating to First Nation governance, such as the First Nations Land Management Act, the First Nations Commercial and Industrial Development Act, the First Nations Oil and Gas and Moneys Management Act, or FNOGMMA, and a couple others. The third option is to proceed under the government's so-called inherent rights policy.
Before commenting on the legislative options, I want to speak to the most frank and candid issue facing First Nation governments, and that is the fiscal framework under which First Nation governments are presently operating. The fundamental barrier to expanding — well, not even expanding, pardon me. The fundamental barrier to the effective, responsible implementation of First Nation government is the current fiscal framework under which it is financed. For years now, funding for First Nation governments has neither kept pace with population growth nor with price and volume increases. As a result, First Nation governments receive less funding on a per capita basis than any other level of government in this country, and yet they face amongst the most challenging legal, socioeconomic, fiscal problems of any community.
I have often said that one of the toughest jobs you can have is to be the chief of an under-resourced First Nation. Anyone who spends a week living with the stresses and strains that a chief has to live with in an under-resourced First Nation community will age quickly. Speaking personally, 90 per cent of our client chiefs have serious health problems directly related to the stress of trying to fulfil their obligations within the mandate and resources they currently have to work with.
That has been the history of Aboriginal leadership for over 20 years. This is a tough job in the best of circumstances.
Senators, before we can hope even hope to enable First Nations to assume the jurisdiction they want to under the existing legislation, much less under new legislation, there must be a new fiscal framework for financing First Nation governments. There needs to be an honest, independent study done of what is called the real cost of government or, in the parlance of the Department of Finance, a gross expenditure base — or GEB — review of the real costs of First Nation governments and an assessment of the underlying premises and assumptions under which Canada currently funds First Nation governments.
You can read my paper on that, but the simple premise is that First Nation governments are equivalent to municipalities. A simple question, senators: Do you think your bill provides jurisdiction comparable to a municipality in your province or your area? I do not know one municipality that comes close to the range of not only jurisdictions but the administrative and political responsibilities of a typical First Nation; yet, the Department of Finance and the Department of Indian Affairs use municipalities as their model for the costing of Aboriginal governments. This is like comparing apples and elephants. This is not what First Nations are doing. This is not the appropriate fiscal model Canada should be using to finance First Nation governments.
When you see allegations of fiscal mismanagement, conflict of interest, alleged fiscal corruption, lack of responsibility and accountability, Canadians need to understand that these are governments operating, for the most part, in poverty-stricken conditions on a shoestring budget, working to address tremendously complex problems. That is the reality, but it has just not penetrated the key central agencies here. I know because I negotiate with them all the time.
Population and price adjusters, a realistic assessment of the actual costs of First Nation governance, and using appropriate comparative models with updated fiscal information is long overdue.
That is enough on money. I will next talk about capacity. We work for over 40 First Nations. The average size of a council is eight, which means we work with roughly 320 chiefs and councils. Less than 5 per cent of those have finished high school; less than 2 per cent have a university education. We are asking people who do not have the same educational or experiential skill set to manage increasingly complex administrative, jurisdictional and fiscal arrangements.
However, to the best of my knowledge, there is no program in the Department of Indian Affairs intended to finance capacity building amongst First Nation governments. There is no educational fund dedicated to leadership or skills training. There is no university program focusing on developing the knowledge and leadership skills required for First Nation leadership actually working in the communities. There are all kinds of university programs on the theory of self-government and lots of books on what Aboriginal self-government should be, but there are no resources to give people the skills and knowledge to even make it work as it is. There is a huge gap between aspiration and capacity and nothing within that gap.
With due respect, senators, this is a problem your legislation will face. Canada can have the best legislation in the world, but if it is an opt-in piece of legislation, as rightly proposed, and there is no capacity or resources or ability to opt in, it will sit there like the Inherent Right of Self-Government Policy sits there.
The inherent right policy has been picked up by less than 10 First Nations in all of the Prairies. The First Nations Land Management Act has been picked up by less than 20 and operationalized by only 2. The First Nations Commercial and Industrial Development Act has been used by one First Nation, and that is because they have $0.5 billion at stake and are willing to spend $2 million or $3 million of their own.
The FNOGMMA legislation was six years in development. Not one First Nation has given a sniff to implementing that first self-government legislation. Even the four First Nations that led the consultation process and designed that legislation are not contemplating using it. Why? Capacity.
The whole fiscal framework the department currently has to enable more competent First Nation government under the Indian Act, much less expanding their jurisdictions, is problematic.
We work for an affluent, progressive First Nation. They took one look at the First Nations Lands Management Act. Everyone will say we want control of our lands. We do not want the Crown telling us how to manage our lands. We want to be able to issue permits. They took one look at that act and said, ``We cannot make this work.''
The Crown would unload all their liabilities, legal responsibilities and risks onto us without telling us whether we can get insurance or what it will cost and without being prepared to enter into effective administrative arrangements that transition the legislation into First Nations.
Our client has lots of money and lots of resources. They are at the top of the food chain. They would not go there. If you have a First Nation of that capacity resisting downloaded administration from the Crown, how about the First Nations that do not have anything? There is no fiscal legal incentive for First Nations to be off-loaded federal jurisdiction under the current fiscal arrangement and policy arrangement. The department persists under the myths driven by the Department of Finance that First Nation governments have more than enough fiscal capacity to not only carry out their existing obligations and responsibilities but to take on new jurisdiction and administrative responsibilities, and why are they not doing it?
Those myths must be addressed because any further designs of self-government are much needed. We need much more effective ways for First Nations to draw down jurisdiction and administrative arrangements, but we need the capacity and the framework in which to do it.
The inherent right policy, for those of you who are clear, is not a rights-based policy. There are no rights involved. It is an administrative arrangement by which the Department of Indian Affairs essentially downloads its federal responsibilities to First Nations. It is a legislative transfer arrangement. The only time the inherent right policy creates rights is when it is attached to a comprehensive land claim such as in the case of Tlicho or Nisga'a or the cases in the Northwest Territories. There you have a self-government arrangement accompanying a land claim and fiscal package, and that then becomes a piece of federal legislation under which elements of that are given constitutional protection.
For the hundreds of First Nations who are on the Prairies or in Ontario or in settled treaty areas, this is not a rights- based policy; it is a downloading policy. It is a policy of transferring jurisdiction and administrative responsibility. No section 35 rights are created. In fact, specifically, the agreements refute the notion that it is a rights agreement or that it should be a rights agreement.
As well, very few First Nations are pursuing the inherent rights policy, other than the Meadow Lake Tribal Council. It has pursued this diligently and at great cost for 15 years. No other First Nation in that area is anywhere close to negotiating a new self-government policy. Our clients will not even call it a self-government policy. They call it a governance arrangement.
The inherent rights policy has been in place for 15 years and originally began as a great idea. It is totally devoid of relevance and meaning for most First Nations. It needs to be examined right from the ground up — from its premises through to its implementation. It is simply not a mechanism by which Aboriginal governance, and particularly First Nation governance, can proceed. That is why new legislation is required. The inherent rights policy is in no way a substitute or an excuse for new legislation.
I will elaborate at great length and with more substance on these matters as we proceed, but I first want to say something about Bill S-216. Many of the areas that you contemplate First Nations assuming under Bill S-216 are areas of provincial jurisdiction. I had lunch with an Aboriginal constitutional law professor. We questioned whether it was constitutional for the federal government to give First Nations jurisdiction over areas that are normally under provincial jurisdiction under the Canadian Constitution. We decided there was no case law. We thought that it could probably be done but that if it goes awry, it will most certainly lead to constitutional challenges of the bill.
In our view, the way around this is the way that we did it in Meadow Lake. In areas that were clearly provincial jurisdiction, such as education, child and family services, justice and policing, et cetera, we negotiated arrangements with the Government of Saskatchewan. The Government of Saskatchewan not only endorsed, recognized and accepted federal legislation enabling First Nations to exercise jurisdiction in the area but also worked out all the administrative and cooperative arrangements that are so needed in these areas to prevent any gaps in services and delivery of services, in jurisdiction and in programs.
The Government of Saskatchewan is to be highly commended for its work in this area. They have done work that no other provincial government has even come close to contemplating. This has been a big effort on the part of Saskatchewan, and they should be acknowledged for it.
Senators, if you want to hear from someone who can contribute greatly to this conversation, you might want to have someone from the Government of Saskatchewan speak to you on the role of the provinces in federal legislation for First Nations. They, more than any other government that we have worked with, know this area.
I will leave my comments at that.
The Chairman: Mr. Slavik, your presentation has been enlightening. There is no question that Bill S-216 is not the be-all and end-all with respect to these issues. For those of us who have worked on this proposed legislation for years, I look at it as a first step on a giant journey.
You raised some interesting subjects. We have had major discussions over the concept of provincial jurisdiction and how the bill would impact the provinces and First Nations. Thank you again for your presentation.
Senator Peterson: Mr. Slavik, it is indeed a monumental issue to deal with and I wonder where we should begin. Capacity as it relates to governance is so critical. In the template that you undertook with Meadow Lake, you must have addressed those issues. If you were successful, it took a long time. Could this model be looked at as a benchmark as we move forward?
Mr. Slavik: The Meadow Lake agreement has tremendous value in the way that it tried to resolve federal-provincial First Nations jurisdictional issues — not only for ways to enable First Nations to adopt jurisdiction but also for ways to transition. That is key. Unless you have a transition mechanism, legislation that offers that will not be taken up. That is the lesson of the First Nations Land Management Act. That is the lesson of the First Nations Commercial and Industrial Development Act. I spoke about the FNCIDA in British Columbia about one month ago. There were 30 First Nations and I asked: How many of you have a project that is worth more than $50 million; how many of you have $2 million in a bank account to work under FNCIDA to develop a legislative framework that would enable that to happen; how many of you have a provincial government that is prepared to cooperate fully with you, like in Alberta; and how many of you have an industry partner prepared to go to bat for you? I then requested a show of hands. There was one hand. Being able to transition your legislation to First Nations requires that they have the capacity, the competence and the experience to be able to take it on. In most cases, that is not the case.
Going back to Meadow Lake — and this is where it gets interesting — they have a completed jurisdictional arrangement that has yet to be ratified by the communities and approved by the minister or this government or any Parliament. At this stage, it is simply a negotiated agreement that remains to be initialled, ratified and legislated. It was 15 years of work to resolve some of these issues. Once the agreement comes into effect, it will be an opt-in agreement. We will have to see the extent to which the Meadow Lake First Nations feel they have the capacity and confidence and resources to opt into an agreement that will give them substantially new areas of jurisdiction and administrative responsibilities for their communities. It is an unknown question and that is why I want to come back to the capacity building and current fiscal framework.
Senator Peterson: Has the FSIN commented?
Mr. Slavik: The Meadow Lake Tribal Council, or MLTC, has been meeting informally with the FSIN as we have gone along and has meetings scheduled with them. We are bringing the agreement above the radar very slowly. I received approval from the parties to speak to the agreement to the extent that I could do so tonight. I am not speaking on behalf of Meadow Lake, but I ran this paper by all three negotiating parties. We are now bringing this agreement to relevant third parties, including the FSIN. MLTC did not want to talk about an agreement that, for the most part, had not been negotiated. However, we are satisfied that it is about 90 per cent to 95 per cent finished. When they turn it over to the lawyers, it is pretty well done.
Senator Dyck: Mr. Slavik, your presentation was enlightening and you made some strong points. My question is with regard to the transitioning. From information given to the committee, it appears that in 2005 the recognition and implementation of First Nations government was signed by the Assembly of First Nations and the Government of Canada. It is my understanding that it had a transition element in it as well. Would you know whether the transitioning element you described that will occur in Saskatchewan is similar to other elements?
Mr. Slavik: I could not comment. To explain what I mean by good transitioning, I will use the First Nations Land Management Act.
The act assumes that when First Nations take control of their lands, they assume responsibility for administering all third-party interests and leases and take on all environmental responsibilities of the Crown. All those environmental responsibilities of the Crown involve the Canadian Environmental Assessment Act and a whole raft of environmental legislation that they have to somehow take over and administer. That means they have to do the environmental impact assessments, a myriad of environmental responsibilities. In many cases, a federal or provincial government would have difficulty handling that, yet they are downloading this level of legislative and administrative responsibility to a community of 500 people with a budget that is not satisfactory to deliver child care and housing.
The government says: ``You should be able to do that within your existing budget.'' Say what? First Nations as yet do not know whether they can get any insurance to cover any aspects of environmental liability. The Crown is self- insuring, but these First Nations are not self-insuring. None of these arrangements have been worked out. The act contemplates all that downloading. However, with respect to the ``operationalization'' of that, either in terms of drafting environmental legislation, implementing environmental legislation, or insuring the risk, none of those issues have been addressed, which brings the whole transitioning process to a screeching halt for any thoughtful First Nation.
The Chairman: I believe that fourteen First Nations have opted into the First Nations Land Management Act. I have not heard any negative feedback from them. I can think of the First Nations in my province of British Columbia. Can you explain that to us? I am asking to be educated on the issue.
Mr. Slavik: They have opted into it and have been willing to accept those risks. In my view, they are at great risk because not one First Nation has yet entered into what they call the environmental operational agreement to acquire the resources to undertake all the potential risks and costs associated with carrying out environmental responsibilities. It is my understanding that even those who have opted-in are still letting the federal government, through some other arrangement, continue to carry out their environmental responsibilities.
What does it mean to opt-in? There are various degrees by which some people opt-in. Some First Nations are studying it. Some First Nations may have ratified it, but often we find out that those First Nations have only one project or one smaller set of issues to deal with.
For most First Nations who carefully assess this, particularly the environmental risk side of it, are backing off.
The Chairman: No risk, no reward, though.
Mr. Slavik: No unreasonable risk. Senator, I am well aware of the risk. I am taking one showing up here.
Senator Hubley: There are many agreements cited in your presentation that native communities have not endorsed or — and I am not sure of the words you used — have rejected for some reason. I will come back to a question that was asked, that being the transition. Is that something we are finding out as we go along? In other words, we have put together what we think has been negotiated. In this day and age, we negotiate and then there is a problem. Is that what you call the transition?
Do we really know, what are going to be the issues, other than those you have mentioned for us — education, capacity building and the fiscal framework? Are these the only issues that you see so far in making that transition successful?
Mr. Slavik: In terms of transitioning, in the way I have addressed it in my paper, you need to look, first, at the fiscal framework for what is presently there and, second, the fiscal framework for taking on additional administrative jurisdictional responsibilities. That is tied to capacity. Third, it needs to be an opt-in situation. When you say these First Nations have rejected governance, that is not quite right. Most First Nations are trying to cope with what they have got. Taking on more responsibilities from the Crown, whether in relation to lands, assets or other matters, is just not on their radar screen. We hear from clients all time, ``Do you want to negotiate a First Nation governance arrangement?'' They are so busy dealing with housing problems and a myriad of other pressing issues that poor communities have that most of us do not have to deal with, for them to take on expanded roles is not possible.
Let me give you a good example. Fifty per cent of First Nations in Canada are still under the Indian Act election regulations, including some very sophisticated First Nations. Why? Because the time, effort and cost it takes them to design their own customary election regulations is huge, politically complex and legally expensive. We estimate that a good First Nation customary election regulation costs somewhere between $25,000 and $50,000 and takes 12 to 18 months. The Department of Indian Affairs provides the First Nation $5,000 for a one-time shot at doing that. They wonder why 50 per cent of First Nations still go under the Indian Act regulations. That particular regulation is at the heart and soul of why there is a lack of political progress, accountability and integrity in Indian elections. The Indian Act regulations breed — I have to be careful what I say. I have to put on my lawyer's hat here.
The Chairman: Go ahead.
Mr. Slavik: The Indian Act regulations are profoundly problematic, but 50 per cent of the First Nations stay under them because they are not resourced to get out from under them. When you talk about having democratic, accountable, responsible government, that is the first thing we point to when we start working with a First Nation. As long as you are under those Indian Act, two-year regulations, a First Nation will never progress.
Let me give you a quick example. Taking a claim to negotiation takes eight years. During that period of time we can work with as many as four different First Nation councils. Every time a new council comes in, we lose six months to a year in negotiating time while they are brought up to speed. We readjust our mandate, and they get in by criticizing the last council. It is an election cycle designed to keep people underdeveloped.
There is no single greater impediment to First Nation development than the Indian Act election regulations. That is the single biggest impediment. If you want to have a big short-term impact, urge that those regulations be changed and the government make more resources available to First Nations to develop customary election regulations.
In Meadow Lake, as part of developing and implementing this agreement, all the First Nations there are moving out from under the Indian Act Election Regulations into their own customary election regulations. They provide longer terms in office, greater participation in the electoral process, more expeditious low-cost appeal mechanisms, grounds for removal and suspension, grounds for accountability and for conflict of interest, none of which are in the Indian Act Election Regulations. All the things that create accountability and responsibility for First Nation governance are not in the regulatory framework under which they are elected.
I am aware that there is a lot of criticism about the accountability of First Nation governments and their integrity. That is because of the regulatory and fiscal framework under which they have to work. Anyone who has been in the business will tell you that.
[Translation]
Senator Gill: I would like to begin by congratulating you on your presentation. I think that people whose experience with Aboriginal peoples goes back a long way hold convictions very much like yours. People have to understand, study and think about the situation to reach the conclusions you have arrived at. I congratulate you for taking the time to do so and I think that your comments concerning the governance of band councils, inter alia, will resonate with many people.
In the 1970s, I was the chief of a community in northern Quebec. At that time, there were two options open to us for taking charge, that is, try and convince Indian Affairs to accept our rules or accept the programs as managed by Indian Affairs. We chose the second option since we wanted to make some progress.
I wish to corroborate what you said earlier, namely that the problem is that the first program that was decentralized, if you like, that Aboriginal people took charge of, was social assistance. Indian Affairs was unable to manage this file. They were embarrassed by this program; it was a mess. So the first program transferred to the band council was social assistance.
Which leads me to say that, in general, Indians assume First Nation responsibilities, but without the fiscal framework to do the job right. I am afraid that, if they waited until they had an adequate fiscal framework, the communities would not yet be managing their own business.
I would like to know why, according to you, First Nation chiefs have so little credibility? Why are the abilities, the management talents and the difficulties Aboriginal representatives have to deal with not appreciated as they should be? Why is it like that? I imagine that it is because of history, but what do we have to do to fix the situation?
[English]
Mr. Slavik: Senator, I do not have a quick or easy answer to that question. There are a lot of myths and misunderstandings about the reality of First Nation governments and leadership in the country. They are perpetuated by some in the media and perpetuated by some for short-term political gain.
This conversation — that is, the adversarial conversation, the cynical conversation, the suspicious conversation — is damaging relations between Aboriginal people and Canadians. We need a much more engaged, compassionate, fact- based discussion around First Nation governance. We need fewer ideologues on both sides of this conversation.
There is an element within the Aboriginal community that is sovereignist and nothing less than some sort of sovereignty nationhood, with whatever that means, is acceptable to them. On the other hand, there are those within the non-Aboriginal community who believe First Nation governments are undemocratic, irresponsible, corrupt and not representative of their people. Neither of these are representative of the core of their respective constituencies. We need to have a much more informed dialogue about the fiscal, political and jurisdictional realities of First Nations, and the work you are doing is casting an important light on that.
I speak all the time to people who want to know about Aboriginal communities, and most of them have never had to deal with an Aboriginal leader. Almost without exception, when they meet the chiefs and people I work with, they are favourably impressed. Their opinion changes and they understand situations differently.
We need to have that dialogue and we need to have it in Ottawa, because within Ottawa there persists in key central agencies a number of myths and misunderstandings about what First Nation government is, what it is trying accomplish and what it needs to achieve not only its goals but the goals of all Canadians for First Nations.
Those are my thoughts on your question. I am perhaps repeating myself, but that is the dialogue that needs to happen. We have to cut to the chase.
[Translation]
Senator Gill: Furthermore, things are getting subtler all the time. Before, the programs were decentralized by department, by compartment — education, housing, social services, and so on. Nowadays, many communities have agreed to decentralization of the global budget. That means — for my colleagues' information — that when things were decentralized by department, by activity, there were also rules that required the band councils and others to follow the same rules as their neighbours; there were standards. It cost a certain amount to send a child to school, to university, so these rules were followed. Today they have overall funding. If a band council is short of money for education, too bad. Now you have to be responsible. People take the money from other services and eliminate or reduce education services and then they say people do not know how to administer. But the money is not there. People do not know about these subtleties.
[English]
Mr. Slavik: Let me give you an example. One of our clients, a tribal chief, is a former school principal. They were negotiating funding for the operation of their on-reserve school, an area where they had taken over administration of this program. They are from an area in Western Canada where teachers' salaries have increased immensely as a result of inflation, higher costs and new negotiated teaching arrangements.
The average teaching salary off reserve rose a considerable percentage. Their budget for on-reserve education flat- lined. What happened? They lost all their good teachers who could get better paying jobs elsewhere. The result was that they were required to hire first- and second-year teachers to work in some of the toughest schools in the country, and we wonder why educational outcomes are not good.
First Nation funding arrangements are based on national inflation rates and national growth rates, so if you have an area of high growth, high inflation and high wages, First Nations are left even further behind in light of the facts of their regional economy.
We just had three clients lose top-notch fiscal administrators to the private sector. They could make 50 per cent more money. I am speaking of Alberta now. How can First Nations possibly maintain the quality of administrative services they require in that environment when their budget has been flat-lined for five years and has not kept up with either inflation or population increases? I know it is a different question than the question your bill is addressing, but you cannot expect First Nations to expand in new areas of jurisdiction when they cannot handle what they have.
I want to make a final point. There is a myth out there perpetuated by the Department of Finance. If I could name names, I would. I do not know the names; I just know the department. It is the myth that First Nations are not paying their way for government services. Therefore, any own-source revenue — that is, revenue they raise from taxing third parties, bingos, commercial activities — should be deducted on an escalating scale from funds they are already receiving.
Let me see if I understand this right. They are already being hugely under-funded. They are being asked to go out and raise money for their schools, money for their post-secondary education, money to cover the cost of their administration, and what does Canada want to do? Start slipping it away on this side of the table.
No other relationship between a junior and senior level of government has those clawback provisions. If the City of Edmonton, through EPCOR, makes tens of millions of dollars to supplement municipal services in Edmonton, the province does not claw it back; but if a First Nation makes $8 million and enters into a self-government agreement with an OSR provision, it drains out the back side. Where is the incentive for First Nation governments to enter into self-government agreements if the fiscal effect is that Canada claws back its already limited resources? No one will go under the inherent rights policy with that kind of fiscal arrangement.
The other myth out there is that First Nations do not finance their government. The reality is that First Nations, at least in Western Canada, pour hundreds of millions of dollars of their own money into housing, job creation, social services and recreational services that is never recognized in the accounting arrangements. There is a view out there that First Nation governments are being entirely financed by the federal government and that this has to change, and that leads to their lack of accountability. That is a myth, senators, yet that is the myth that drives the fiscal framework that the Department of Finance insists that the Department of Indian Affairs follow. There needs to be a careful exploration of the fiscal realities of First Nation governments and the myths that are perpetuating the current, unacceptable fiscal framework.
The Chairman: Thank you, Mr. Slavik. You have entered into some very contentious and controversial areas this evening. I know that you bring with you a vast experience.
Mr. Slavik: I do not mean to cause you grief.
The Chairman: You have not caused us grief. You have brought forward the realities that exist out there.
Just this week I met with six Aboriginal leaders in my office. They were from a remote area with 10,000 people, and no airport, no railway, no roads in. The only thing of any prominence in the area is a dialysis machine to deal with the severe diabetes situation that exists in the communities. I can tell you that the more I sit on this committee, the more I am encouraged by the membership of my committee and the strengths of you people, each and every one of you, in working on issues such as this.
Mr. Slavik, as far as the self-government legislation is concerned, as you know, I am the proponent of it. We are looking for ways as to how our Aboriginal peoples can take control of their own destiny in a manner whereby they can share the wealth and the success of our great country.
I want to thank you for coming here tonight and sharing with us your views. I look forward to working with you because I know you have many files.
Mr. Slavik: Thank you, senator.
The Chairman: Before we begin with Professor Morse, I would like to read a letter to my colleagues because I think it should be on the record. It is a letter that I received as Chair of the Standing Senate Committee on Aboriginal Peoples. It reads:
Dear Senator St. Germain:
I write today to thank you and the Members of your Committee, for your special study on the Federal Specific Claims Process entitled Negotiation or Confrontation: It's Canada's Choice.
This is an excellent report from the way you characterize the choice facing Canada in the title through to your recommendations. The forward sets out in simple terms the dilemma facing First Nations within the current policy and structures. I hope it will help interested Canadians understand this difficult challenge.
I also want to thank you personally for your efforts to publicize the Report, particularly your Op Ed in the Citizen of February 16, 2007. If you have any further thoughts on raising awareness of the Report and its findings, I would be happy to discuss them with you.
In closing, I would ask you and the Committee to urge the Government to respond in an expeditious manner.
It is signed by Phil Fontaine, National Chief.
I want to thank each and every one of the members of the committee who worked on this report because without all of us working together as a team, we would not have been able to accomplish that and gain the recognition that we have as a committee.
Professor Morse, welcome. I have had the privilege of listening to your testimony in the past. I look forward to hearing what you have to say this evening, as are my colleagues.
Bradford W. Morse, Professor, Faculty of Law, Common Law Section, Ottawa University, as an individual: Thank you very much, Senator St. Germain. I do appreciate the invitation and honour to be here today to have an opportunity to share some ideas and experience from the 30 plus years I have been involved in Aboriginal legal issues on all sides of the table, working for First Nations and Metis organizations, the federal government, provincial governments, and various foreign governments and indigenous peoples organizations in other countries. It is a delight to be in this absolutely beautiful room, one that all Canadians should appreciate. This is a particularly appropriate room being on Algonquin territory as well.
I congratulate you and echo the words of National Chief Phil Fontaine on that report as well as your economic development report and, frankly, the work of this committee overall. In terms of the first nations self-government recognition bill we are discussing this evening, but also in general, this committee has provided a unique opportunity for Aboriginal and non-Aboriginal Canadians to come together around issues of mutual concern. One of our challenges in Canada today is we have too few places where that dialogue and discussion can occur and where we can fulfil our objectives of reconciliation.
I will quote from Mr. Justice Binnie speaking on behalf of the Supreme Court of Canada in the Mikisew Cree First Nation case from December of 2005, a dispute between the Mikisew Cree First Nation from Northern Alberta and Heritage Canada. Mr. Justice Binnie said:
The fundamental objective of the modern law of aboriginal and treaty rights is the reconciliation of aboriginal peoples and non-aboriginal peoples and their respective claims, interests and ambitions. The management of these relationships takes place in the shadow of a long history of grievances and misunderstanding. The multitude of smaller grievances created by the indifference of some government officials to aboriginal people's concerns, and the lack of respect inherent in that indifference has been as destructive of the process of reconciliation as some of the larger and more explosive controversies. And so it is in this case.
Mr. Justice Binnie was speaking not only to the pattern of unfortunate relationships occurring far too often between government departments, in that case federal departments. It can also be provincial departments or municipal governments and the private sector as well, from time to time, with Aboriginal peoples. He was speaking to all Canadians when he attempted to articulate for a unanimous court the fundamental objective of the modern law in Aboriginal and treaty rights, and I suggest for Canadian law in general, which is the reconciliation of Aboriginal and non-Aboriginal peoples. He also stressed something too little understood. When he speaks in terms of ``their respective claims, interests and ambitions,'' it is not the claims, interests and ambitions just of First Nations, Metis and Inuit peoples that the court was speaking to. It was also the claims, interests and ambitions of non-Aboriginal peoples. He was suggesting it is a reconciliation requiring both parties to this marriage, if you will, to appreciate the respective interests of each other, which is where we are at today. It is not just claims of First Nations or Inuit or Metis peoples against non-Aboriginal governments or non-Aboriginal Canadians. It is the claims of all on this territory and claims to the interests and ambitions we all have to flourish in this territory together.
I would like to make six key points and suggestions on the bill itself. First is the cost of inaction. The reality is that the direct process costs of First Nation interactions with federal and provincial governments are immense. They are not just the direct financial outlay costs of budgets and funding for discussions; it is the lost economic opportunities. It is the waste of human hopes, the compounding of frustration for First Nations day after day by operating within a thoroughly unacceptable circumstance. I do not think any Canadians would relish the current reality as one that we should have next week, next year, next decade or next century.
By virtue of the status quo, we unfortunately tend to foster the perception among many non-Aboriginal peoples that the present is the only possible future, and that it is because of the inability of First Nations to manage their own affairs that they continue to be restricted in the severe ways that they are.
That is not the official position of the federal or provincial governments. The official position of those governments generally is to seek to negotiate new self-government arrangements, but that leads to my second point. The pace of those negotiations, as this committee knows all too well, is ridiculously slow. How could anyone design a scheme to get us from where we are to where we want to be if we design it on a basis in which it will take, on the current rate, somewhere in the order of 200 years to achieve our objective? That is simply not effective.
It was not the hope behind the federal inherent right policy of 1995 that in 2007 we would have achieved as little as we have, but the current management of that policy bears only a tangential relationship to what the policy itself suggested would occur.
One of the achievements of Bill S-216 is its emphasis upon its optionality, that nothing here is being imposed upon any community; it is purely an option. That, in my view, is absolutely essential in order to obtain political support both from First Nations and other Canadians. Also, it underlies what I think is the spirit of the bill itself, which is respect for the freedom of First Nations to choose their own future. How could a piece of legislation respect that freedom if it was mandatory in nature?
My next point is really the thrust of the bill itself. As its own title suggests, it is about recognition. Recognition should be the fundamental principle of the relationship between first peoples and the newcomers, no matter how many generations our ancestors might have been here. That is a fundamental principle that underlies the experience just south of the border. It has been particularly evident in legislation emanating from Congress over the past 30 years and in federal policies.
I know Senator St. Germain and others have been south of the border to see the operations of tribal governments firsthand. If there are Canadians who are fearful of what this bill might mean if enacted, we should take comfort from the experience in the United States. ``Sovereignty'' is a word that we have some difficulty with in Canada for a variety of reasons, but tribal sovereignty has long since been recognized from the founding days prior to the establishment of the United States and continues to be a recognized principle in the United States as a foundational aspect of the decisions of the United States Supreme Court and the U.S. government. The 1823, 1831 and 1832 decisions of the United States Supreme Court have been embraced by Canadian courts, including the Supreme Court of Canada. Just last week, those decisions were discussed by members of our court and members of the U.S. Supreme Court in the U.S. Supreme Court building.
U.S. tribes handle over $25 billion U.S. per year. Their tribal court system handles well over 500,000 cases per year. They are involved in domestic and international trade arrangements, in all kinds of industrial activity and recreational affairs, et cetera. It is not a perfect history, by any means, or a perfect record for all tribes, but we can readily see in the U.S., as in some successes in Canada, that there is no question about the capacity of the indigenous peoples of Turtle Island or North America, when having the opportunity and recognition of that opportunity, to be highly successful in a way that benefits their own communities as well as the countries that surround them.
As my final opening point, I would like to congratulate the committee on the bill and, in particular, a number of aspects of it. I congratulate you on your willingness and nerve to address one of the issues that has perplexed many non-Aboriginal governments and caused concern: addressing the question of the administration of justice in clause 11 of the bill. Federal and provincial governments have great difficulty in coming to grips with that issue. The legal profession has had concerns about this from time to time over the years. As I indicated, in the United States, where we have well over 150 tribes with functioning tribal court systems handling half a million cases each year, it can be done readily. The U.S. legal system has not collapsed. It is readily addressable.
In dealing with jurisdictional questions in clause 9(3), you propose a kind of restoration of jurisdiction, such as tribes in the United States had before the U.S. Supreme Court started clawing it back in 1978. If the bill passes, you will have solved an existing black hole for the overwhelming majority of First Nations reserves in Canada in relation to matrimonial real property. The report on the issue was released last week and the government might move forward on it. This has been a reality for men, women and children of matrimonial relationships on reserves across Canada, except for those who already have self-government agreements and for a handful under the First Nations Land Management Act. The reality is that matrimonial real property regimes established under provincial matrimonial property regimes do not apply when it comes to reserve lands when dealing with land issues regarding matrimonial property.
Similarly, you have addressed another black hole — environmental law. There, for the same reason, our scheme in Canada is to rely primarily on provincial legislation that deals with environmental land issues and environmental contamination of lands. Those provincial statutes do not apply on reserves because they cannot extend to the lands themselves. No federal legislation fills that gap. As a result, we have a minuscule and thoroughly ineffective regime under the Indian Act and its regulations with ridiculously low penalties and an extremely narrow scope, such that most environmental issues on reserve lands have no legislative management regime in place. We have been fortunate in Canada to date that we have not had significantly larger problems on reserve lands. That speaks to the effectiveness of First Nations in managing those lands. There simply is no environmental law regime in place on the vast majority of reserves in Canada.
In terms of some suggestions on the bill, I would recommend that you include an express clause to empower First Nations to enter into intergovernmental agreements. The bill speaks to this as a law-making power under Schedule 2, but there is not a provision within the bill that enables agreements more generally. It seems to me that the reality in Canada is that most intergovernmental agreements are not grounded in legislation but are grounded purely in the arrangements between governments. It is important to recognize clearly, so there is no doubt in this regard, the full capacity of any First Nations that were to opt in under this bill to negotiate such arrangements and not just to pass laws in that regard.
In the U.S., the bulk of the activity in recent decades has been between tribes and states entering into compacts on a huge array of things — automobile licence plates, tax collection, essential court services, dealing with the $20-billion gaming industry, cross-deputization of police officers, transferring of prisoners from on-reservation courts to off- reservation facilities, on-reservation prison operations for offenders from state and district county courts. There is a huge array of state-tribal compacts. I anticipate that this will be the future for First Nations in Canada. We will see more and more of that between First Nations and municipal and provincial governments. It is important that there be no doubt about the legitimacy or enforceability of those agreements.
As an addition to clause 16 of the bill, as in previous bills, I would suggest declaring that Aboriginal lands remain within section 91(24) of the Constitution Act, 1867. In previous bills, there would still be some question about the status of lands if that were not addressed.
I am uncertain about the implications of your rewrite of the current section 88 of the Indian Act. As you know, section 88 of the Indian Act applies laws of general application from time to time in force in any province to Indian people on reserve subject to a number of limitations. You have those limitations in your clause, but you extend those provincial laws of general application not only to the members of First Nations but also to First Nation lands. I am uncertain about what the full ramifications will be to provide a general extension of all provincial land-related laws to First Nation lands. At the very least, I would suggest that that needs to be considered carefully. We do not have the case law foundation of that because it has not been there. Section 88 appeared only in the 1951 act. There has been a great deal of litigation on it but in the context of whether a provincial laws apply to reserve lands. The answer today is no. Does it apply to the people? The answer is yes, subject to the Indian Act, other federal statutes, treaty provisions or First Nation laws.
I would suggest also that it would be beneficial to include a definition of ``alienation.'' Clause 17 sets forth rigorous rules around the ability of First Nations to alienate land but does not define ``alienation.'' There is an implicit definition in an indirect way through section 28 of Schedule 1 of the model Constitution that can suggest what will not be included in that definition of ``alienation'' for those First Nations that adopt that model constitution. For First Nations who do not adopt the model, the question will be: What exactly does clause 17 cover? The intent of the drafters of the bill is that it cover alienation in the context of a conveyance of the full First Nations' interest in those lands. That is often how the term ``alienation'' is used in common law. However, when using it in the statute, if you do not define it, as I read the bill, it will be left up to a court to determine in the future whether it means that when a First Nation wishes to lease some of its lands, it has to go through the 80 per cent hurdle of all electors. That could be an extraordinarily difficult task for any First Nation to achieve, particularly given the growing number of non-resident members. I suggest that the committee consider that point.
Another small point arises in clause 21(2)(a) and whether you want to limit additional lands to ``contiguous'' lands. I can understand the objective in this provision that you are opening it up to include non-reserve lands as additional lands, and that is a positive objective. However, I am not sure whether you want to limit it to contiguous lands. For example, lands across the road are not contiguous, but they will be seen as a natural addition to the reserve. I am not sure that you want to limit it quite this much.
A second small point is under clause 22. You suggest that as soon as the First Nation opts in, all of its current trust accounts held by the Crown after a suitable accounting must be transferred. It seems to me that this should be something that a First Nation should have the ability to regard as optional; that is, the First Nation can request and Canada must transfer on request, but this creates an added burden. It will be quite a challenge for a First Nation community to make a decision it wants to opt into this bill and all of a sudden transfer all those trust accounts. If the dollar amounts are small, it may not be much of an issue, but for some communities it might be significant. The First Nation may prefer to leave them with the Crown for a period of time while they ramp up. I would suggest that this be left as optional rather than automatic.
Thank you very much for the opportunity to be here and make those remarks.
The Chairman: You have obviously gone over the bill in detail, and we thank you for that. I thank you for the ongoing support.
I think that you hit the nail right on the head: The cost of doing nothing is much more costly than doing something.
Senator Peterson: You talked about tribes in the United States and what they are doing regarding their economic development. It is my understanding that they own a lot of their land and are able to make fiscal arrangements much more easily than up here. Is that the case? Here there are so many hoops to go through to do something.
Mr. Morse: The experience for most of the tribes in the U.S. is that they do not own lands in the sense of fee simple title or freehold title the way most Canadians would own the land where their home is, let us say, in the city of Ottawa. Most reservation lands are still trust lands held by the U.S. government. The difference is, and it is an important difference that you flag, the capacity to manage the lands. The difference in Canada is, particularly under the Indian Act, that the regime restrains the capacity of First Nations to manage those lands. By and large, the First Nation is required to go through the Department of Indian Affairs. Unless the lands have been designated to the First Nation — under section 53, the First Nation already has a power that has been delegated to it in relation to designated lands — everything goes through the Department of Indian Affairs. Formally, the Crown would be the lessee rather than the First Nation. It is the management regime imposed under Indian Act that restrains that capacity. It is not the ownership; it is the authority of the community to manage versus the restrained power of the government. In our case, we have opted for that. In the United States, by and large, they have moved in the other direction. It is very clear that the tribes manage the lands, although the ultimate title is generally with the U.S. government, held in trust for them.
The Chairman: You have done such an excellent job, professor. You have answered all the questions. We will look at your recommendations, the six points, your suggestions and look at them seriously. My capable assistant will work on it. I want to thank you again for coming this evening and presenting to us.
Senators, we now have before us some housekeeping business, an examination of the committee's draft budget for legislation. You all have a copy. It is a very small budget: $8,000 is not an onerous amount of money.
Are there any questions in regard to the budget? It is basically to deal with legislation that will be coming before us and the legislation that is before us now.
If there are no questions, could I have a motion to adopt?
Senator Peterson: I so move.
The Chairman: All those in favour?
Hon. Senators: Agreed.
The Chairman: Carried. It is unanimous.
The committee adjourned.