AAND Committee Meeting

STANDING COMMITTEE ON ABORIGINAL AFFAIRS AND NORTHERN DEVELOPMENT

COMITÉ PERMANENT DES AFFAIRES AUTOCHTONES ET DU DÉVELOPPEMENT DU GRAND NORD

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, March 11, 1999

• 0912

[Translation]

The Chairman, Mr. Guy St-Julien (Abitibi—Baie James—Nunavik, Lib.)): Good morning everyone. In accordance with our agenda, today we continue our study of Bill C-56, an Act respecting an agreement with the Norway House Cree Nation for the settlement of matters arising from the flooding of land, and respecting the establishment of certain reserves in the province of Manitoba.

To begin with, we will hear from representatives of the Norway House Cree Nation, Mr. Fred Muskego, Councillor, and Mr. Robert F. Roddick, followed by Manitoba Hydro and Government of Manitoba witnesses.

Mr. Roddick and Mr. Muskego, I invite you to make your opening statement.

[English]

You have ten minutes.

Mr. Fred Muskego (Councillor, Norway House Cree Nation): Mr. Chairman, ladies and gentlemen of the committee, first of all, I would like to thank the committee for giving us an opportunity to address the issues that are before us under Bill C-56.

My name is Fred Muskego. I'm the councillor for Norway House Cree Nation, and I represent 5,500 people from the community of Norway House. My portfolio under chief and councillor responsibilities is the MIA, and I was also involved in the TLE negotiations. I'm here representing my colleagues as well, the chief and council. There are couple of them here backing me up.

I'm here to recommend the passage of Bill C-56 for the best interests of our people, for the Norway House Cree Nation. My colleague was our chief negotiator at the time we had the MIA, so we'll let him handle the legal and technical issues.

I want to give you a little history as to why we're here supporting this bill.

I've been involved in the Northern Flood Agreement for eight years, first as an implementation worker, a field worker for the Northern Flood Committee when it was in existence, and also for about four and a half years as a councillor. That has been my portfolio in those two terms.

When I started off as an implementation worker, I didn't even know what the word meant. I had to look it up. Even then, when I finally figured out what I was supposed to do—filling in claims. We filled out about fifty individual claims from Norway House and we took them to Hydro. They were mostly for Hydro. In most cases when we filled out a claim, it was always challenged by Hydro. The people I represented at the time, the claimants, were getting frustrated with the agreement.

• 0915

The Northern Flood Agreement in itself, as great as everybody thinks it is, has its problems. I started to see that when I was working as an implementation worker. Every time we put in a claim, it was always challenged. We were never right. We ended up having to get a lawyer, and when we took it to court, the lawyer would get his consultants. We'd get ex-bureaucrats from the federal government, professors, different experts on the issues we had.

I can see why some other witnesses who have been here, especially the last witnesses, are dead set against passage of this bill. I see it as a personal way of making a little bit more money out of this agreement. On one claim alone, it would take at least a year, maybe a couple of years, just to try to get it through the system. People got frustrated with it. The way I saw the Northern Flood Agreement, it benefited the lawyers and the consultants.

I think the people I represented, the claimants, are also frustrated. Some of them, God rest their souls, didn't even live long enough to get their claims processed and get what was entitled to them. That's why I had a problem with it in those two and half years that I worked as an implementation worker. It wasn't benefiting our people the way it was intended to.

I got in as councillor in 1988. That was the first time they mentioned global compensation. I was involved in it to the extent that I went to meetings. I think the concept was on the right track, but the problem was that some of the chiefs didn't want any trust conditions placed on it. I'm sure Canada wanted them as a part of the conditions, and I looked at it as well from the view that this was the way it should be. Anyway, they dropped that in 1989.

When we had a chance to get back on it, I worked for the Norway House Cree Nation, although I wasn't in council as yet. I worked there for a year as one of the negotiators for the MIA, and Bob here was our chief negotiator. I got in as councillor a year later, and I'm still involved in this about three and a half years later.

I've seen some benefits from this MIA up to this point. We've always had our critics, people always making allegations that it's not a good deal, saying we're losing our treaty rights. There are all kinds of allegations. I notice the witnesses for next week are the same people who took this to court. They made all kinds of allegations on the MIA, but I'll let Bob address that issue.

Since the passing of this MIA we've had two CAP meetings, two committee approval process meetings. Out of those, we have addressed the recreational problems we have on the reserve. We have a state-of-the-art multiplex that was built because of the MIA. We have recreation programs for the young people, and even some of the older people benefit from it.

In terms of some of our social problems, we've had some housing come out of the MIA. In the last three years, I think we've had over a hundred houses—not directly, but a good percentage of them came from the MIA.

• 0920

We have alcohol programs.

Even spiritually, just recently we put some money into the building of a church, a funeral home, and meeting halls. All these things we have now, we wouldn't have if it wasn't for the MIA. If we had approached the government, they would have said there was no money.

Out of these MIA proposals we had...we created about 105 full-time positions from the MIA at last count. Also, indirectly, especially from economic development, we've used some of that money to build a motel. We have a mall, administration buildings, and now we're in the process of getting a high school. Some of these things would probably not have been possible if it weren't for our being able to utilize some of the money from the MIA.

Out of this community approval process, we have accountability. This is something people have always said, that we're not accountable for the money we spend. Each year we have a financial statement. We have a public meeting and we address it to the people. They know exactly where every penny goes out of this MIA, which is why there are always positive outcomes from it.

There's one other thing I want to address briefly before I pass it on to Bob. There was talk about $1,000 per capita. To me it's not an issue, but I would like to clarify some of the allegations that we are getting regarding this money.

The history of per capita came from the chief, but I was in council then as well, in 1988. We had advance money from the three parties. The chief and council at the time wanted a public meeting. We went up there, and he was showing the people how much money we had. It was $3.3 million. When the people asked the chief what the money was for or what it could be used for, he told them it was their money, that they could do whatever they wanted with it. I think that's where the problem started. If it was properly addressed at the time, I think we wouldn't have had this continual request for per capita payments.

The way it happened then, the people said to give it to them if it was their money and they could do anything they wanted. The chief at the time got mad and left the poor, old southern councillors there to address... I think there were about 500 people there at the time. He left, and he left us holding the bag in terms of what we were going to do with it.

In order for us to feel comfortable with what the people wanted, we asked for a petition, for people to sign. At the time, with 50% plus one, I think we needed 805 names or something in that area. We told the people that if they got 805 names, they could get their money. When it comes to money, people will get names in a hurry. In about three hours, they had the 805, and we backed it up with a BCR.

When we brought that up to the three parties, they said we had to be accountable for it, that we had to attach it to some claims. It ended up that we attached that money that went for per capita on certain claims. I think there was recreation, an environmental claim, and a whole bunch of other claims that we had out there. They wanted it credited towards those claims. So that's where this per capita issue came up, and ever since then people have been expecting it.

I think it's written down there that we started again in 1994, when negotiations started. We had advances, and towards those advances there were always claims. There were always credits attached to those claims.

• 0925

On the $1,000, we knew this per capita issue was a problem. We looked at the MIA as an avenue for the future, for our children. We were concerned that if the per capita kept going, year in and year out, there wouldn't be any positive outcomes of the MIA, like the ones I just mentioned.

As part of negotiations, we agreed there would be one last-time payment on a per capita basis. We capped the per capita distribution issue and figured $1,000 was more than enough to compensate people, because directly and indirectly every person in our community has been impacted by the hydro project.

On the $1,000 and the $1,500, Norway House Cree people are sharing people. Traditionally, we've always shared when we killed anything. We talked about giving more to certain people, like trappers and fishermen, who were more affected by the hydro project. But if we gave them more than the next person, it didn't seem fair. So we said, okay, we'll do this right across the board; give everybody $1,000, even the ones who were outside of the reserve.

We gave the elders $1,500 because they were more affected by the hydro project than anybody else. We selected age 55 because we went back 25 years when they would have been approximately 30 years old. There was a lot of fishing and trapping being done 30 years prior to that, and they were more affected by this project than anybody else. That's why we figured they deserved the extra $500. That's the basis for the $1,000 and $1,500.

When people started to say it was a way to pay people off to get their votes, they were misinterpreting it in a way, just to make it sound good. That wasn't the intention of the per capita payment. It was to end the per capita issue so there wouldn't be any more per capita payments. They would make better use of the moneys we were getting from the MIA.

Regarding the vote, there was talk it was a second vote. I'll let Bob address it, but I just want to make a comment on it. On these two issues we have in front of us—the MIA and the TLE—the TLE also went to a second vote and it was by a simple majority as well. We followed the model of the Indian regulations with the TLE and the MIA. That was by request from our band membership through a petition. I think over 1,000 people signed that petition, wanting a second vote after the first one was only five off from the magic number of 50% plus one.

Just to clarify why I think we had the problem with the one, I think there were 1,800 people of voting age on reserve and over 600 people who lived off the reserve. We didn't even know where some of them lived, their addresses, etc.

That briefly addresses some of the issues before you. I'll get Bob to give you more information on it. I just want to let you know that the Norway House Cree Nation is in full support of the bill.

Thank you.

[Translation]

The Chairman: Thank you, Mr. Roddick.

[English]

Mr. Robert F. Roddick (Norway House Cree Nation): Mr. Chairman, there are two matters I'd like to address. First, what is the Northern Flood Agreement, and second, what is the history with regard to challenges to the procedure that was followed by the first nation?

• 0930

Mr. Allmand spoke on Tuesday. I've had the pleasure of knowing Mr. Allmand for many years. I was involved in first nation work for a number of years back when Mr. Allmand was the minister. We found ourselves on the same side of the table sometimes and on opposite sides of the table sometimes.

The Northern Flood Agreement was the result of the Government of Canada agreeing to an expropriation of Indian reserve land. It's section 35 of the Indian Act—expropriation. There's some confusion sometimes because when one says section 35, people tend to think of the provisions in the Constitution dealing with treaty and aboriginal rights.

The history is that there was a decision taken—and this isn't a reflection on the government or politics—that in Manitoba it was necessary for the general good that this hydro project be developed. The first nations opposed the hydro project. The Government of Canada, in its authority under section 35 of the Indian Act, allowed the expropriation. That's what happened.

The Northern Flood Agreement was the compensation part of that expropriation. The dams were being built. The water was coming down the river and the choice that was faced by the Indians—I'm sorry, but I disagree with my friend Mr. Allmand—was not a philosophical choice about an agreement; it was a choice between the agreement that was there and no agreement. That's the history of it. I'm not saying it was right or wrong; that's how the agreement came up.

It's not a very good agreement. There are schedules to that agreement that were never completed. It's the type of agreement that parties went away from with completely different ideas of what it said. It uses words like “provision of potable water”. My friends from hydro are here, and we're in the middle of a multimillion dollar arbitration over what those words mean. That's the general history of the Northern Flood Agreement.

In the mid 1980s, the five northern flood bands took the decision that the implementation process my colleague, Mr. Muskego, has described wasn't working. It was years until claims were being settled. It was a very confrontational project and the benefits weren't getting where they were going. I read Mr. Iftody's remark about the cocktail circuit. It's a remark with which I agree.

A new process had to be found. The first nations brought forward this new process of what is described as comprehensive implementation or global implementation. I became involved in this in 1988 as the negotiator for all five bands. I took over that position from a fellow—I think his name was Jean Chrétien, if my memory is right—who had worked closely with these five first nations in developing this approach. Mr. Chrétien at that point was off doing some other things. They worked very hard to have this approach accepted.

It then became clear there were enough differences between the communities that having all five together didn't work. The first one to do an implementation agreement was Split Lake. I was in front of this committee in the spring of 1993 when the Split Lake legislation—the first of these—went through. Then York Factory and Nelson House did agreements. There are differences, but in general it's a global implementation agreement. There is legislation for both of those.

We are now here with Norway House. The previous legislation on each case went out of this committee with the unanimous support of all parties. The Norway House legislation is a clone of the previous legislation. The legislation that is before you is an administrative act insofar as it relates to Norway House.

It does two things that are of interest to Norway House. One, it deals with an Indian moneys problem. I'm not going to bore you with the details; it's a complex issue. But we need a designation that these payments are not Indian money so they can go into the trust. It's that simple. If that designation is not made, the money has to be paid to Indian Affairs. That's not anybody's goal.

• 0935

The second part of the legislation that is of significance is that it streamlines and clarifies the claims procedure. That is of benefit to the Norway House Cree Nation.

Mr. Chairman, I'm going to deal with the legal side for a moment, but this is the implementation agreement. This implementation agreement stands whether or not this legislation is passed. It works better if the legislation is passed. But this agreement does not fail if the legislation is not passed.

There have been legal challenges—and I'll take a couple of minutes to go through it—since we started this process. In 1994 the individuals—and it's the same group who have been in court a number of times—sought and obtained an injunction in Manitoba barring the chief and council from going ahead with this process. The motion found that the community meeting and the motion on which it was based were technically flawed. This is a summary of the judgment, but that's what was found.

There was a community meeting held in Norway House, which 705 people attended. They did two things. They passed a motion that met the technical objection, and they basically told the chief and council and these people who were objecting to this to get their act together and get on with it. There was a new agreement reached, the order was set aside by consent, and the negotiations proceeded.

We then came to the questions of the vote. We spent two days in court in front of Justice Muldoon with this group asking for an injunction, asking for a declaration that a second vote was illegal and improper, asking for a declaration that the agreement was null and void. That application was refused.

I wish to quote to you from Justice Muldoon's judgment on three particular points, and they're very brief quotes. The application was for an injunction. The first point I'd make is on page 5 of Mr. Justice Muldoon's judgment, and, Mr. Chairman, if it's of any use, I can surely leave copies of it after.

Justice Muldoon said:

Anyone who would come to this dispute uninformed would think that it is an arbitrary and despotic gambit to hold second [and possible subsequent] referenda on the same question until the desired result, presumably, can be obtained. That, however, is not what the facts reveal.

That was his finding after hearing in excess of two days of argument on affidavits and the history of this.

He then went on in his judgment, and on page 14 he says:

There has been no shortage of democratic expression of the will of the people in this process, initiated by the Chief and Council.

This is after hearing two days of argument about how there weren't meetings and how nobody knows what's going on and all of these things.

The final point in his judgment that I would ask this committee to consider is the point he makes on page 17. Throughout the transcripts I have read from the House of Commons—and I was here Tuesday and heard the evidence that was given, and I have read the affidavits of Ms. Gamblin and some others—there was talk about infringement of treaty rights, non-protection of treaty rights, derogation of treaty rights.

Mr. Justice Muldoon addresses that point specifically. He says:

...this Court is obliged to defend the Constitution, not least of is section 35 which basically recognizes aboriginal and treaty rights. The applicants alleged that the MIA breaches their treaty rights.

He then quotes section 13.13.3 of the agreement, and he says:

The above provision satisfies the Court that section 35 is not going to be breached, and that is sufficient in these circumstances.

He makes a definitive finding that this agreement does not breach treaty rights.

You have a number of people on your witness lists, most of whom I know, a number of whom I've had lengthy discussions with about this point. I always come back to the question. Tell me what it is that's breached. I still don't have an answer to that.

• 0940

Mr. Chairman, this is not a termination agreement. This is an implementation agreement. My friend, Mr. Allmand, spoke about section 25 of the Northern Flood Agreement and how it was to continue for the length of the project. This agreement continues beyond the length of the project. The trust in this agreement, with minimum balances that increase by 15% of the income every year, are guaranteed to exist to the end of the agreement.

My friend, Mr. Muskego, has indicated the types of things they've been able to do in the early years from this agreement. This agreement resulted in the payment of almost $80 million to the first nation over a period of time. It has resulted in the transfer of quantities of land well in excess of what the Northern Flood Agreement called for—and don't anybody nail me on the exact acres. Twelve thousand was the entitlement under the Northern Flood Agreement, and the transfer was 50,000 to 60,000 acres. It has a joint resource management board in it that gives them an interest in the managing of the whole area.

The other provision, Mr. Chairman, in conclusion, that I wish to speak to is the continual reference to the abrogation of hunting and fishing rights. Mr. Chairman, because we couldn't find better words, we took exact words out of the Northern Flood Agreement and put them into this agreement. They are exactly the same words that protect those interests as protect them in the Northern Flood Agreement. I don't mean to be frustrated, but I have trouble wrestling with ghosts without concrete examples.

There are people who are opposed to this agreement. Some of these people have been opposed to the agreement since day one. I respect their right to oppose the agreement. We have done our best to deal with their concerns.

In closing, in terms of my remarks, Mr. Chairman, there is attached to the agreement, as one of the schedules, a community consultation report. It's schedule 13.1. It lists the meetings that were held. It lists who the meetings were held with. It lists, except in a few cases where it wasn't noted, how many people attended those meetings. There is continual reference in the affidavits to a summary of this agreement. I understand those allegations to be that the summary was somehow misleading. This agreement was delivered to every household on the reserve and it was delivered to every household in Winnipeg where we had an address prior to the ratification vote. The summary of the agreement was delivered. There were TV shows. They're all listed in the report. All of these things were done. There was no lack of information.

Mr. Chairman, those are the comments I would make. That's the history of the Northern Flood Agreement in terms of what it is and where it came from, and those are the court challenges that have been held.

With respect, the opponents of this agreement have had their day in court. They had two days in court. They then made an ex parte application in the spring of 1998, in front of Justice Jerome, on a 37-page affidavit of Professor Russell, which he didn't mention to the committee the other day, and they were turfed. They never served those documents. They have had their day in court and the courts have found that this agreement is a proper agreement and it was properly ratified, that it does not infringe on treaty rights, and that now seems to be coming to the committee.

Ladies and gentlemen, you have a responsibility, I appreciate, that is broader than just one bill, but this is legislation that effectively has been before this committee on three previous occasions and has passed and was supported by all parties.

Those are my comments, Mr. Chairman, subject to any questions there might be.

[Translation]

The Chairman: Thank you, gentlemen. We now move to the question period.

Mr. Konrad.

[English]

Mr. Derrek Konrad (Prince Albert, Ref.): Thank you very much for your very informative presentations.

As a comment to begin with, I think, Mr. Muskego, it seems from what you said that basically you were thrown in off the deep end when the first Northern Flood Agreement was signed and not really given any training or any understanding of what you were dealing with, and this might well have lead to a lot of the difficulties and problems that have come to light in the latter years here. Is that correct?

Mr. Fred Muskego: I'm not sure what your question is.

• 0945

Mr. Derrek Konrad: When the first flood agreement was signed and you were given the task of trying to implement this thing, you were given a flood agreement that didn't have enough detail to make it possible to work with. You were given insufficient training. You were left to try to figure this out on your own and this is what has made the implementation agreement necessary.

Mr. Fred Muskego: What they did was they stuck me in an office, threw me the Northern Flood Agreement, told me to read it and told me I had a job. I asked about four different lawyers and they had four different interpretations of what the Northern Flood agreement was all about. I was totally confused, needless to say.

Mr. Derrek Konrad: Thank you. Has there ever been this magnitude of dissent toward an implementation agreement in the other ones that have come forward? Or is this a whole different level of discourse?

Mr. Robert Roddick: If I might, the vote numbers were put before you by the department when they gave their evidence. The third threshold, which was the 51% of the voters, was missed by five votes in the first vote. As a matter of interest, in the second vote the threshold was well passed. The threshold was changed, but they well passed the first one. With regard to discontent, the last number of court actions have been mounted by 17 people out of an adult population of about 2,000. They have been consistently the same people. There's no question about that. There are 17 people who are the plaintiffs in this action. The representations of discontent, if that's the right word, haven't been shown at either the ballot box or in the joining in of these actions.

At Nelson House, as a matter of information, there were two votes. It was not a matter of issue before this committee or, to my knowledge, anyplace else. I was not involved in that negotiation, but I do know there were two votes held at Nelson House. It's not an unusual procedure.

Mr. Derrek Konrad: Okay.

Mr. Fred Muskego: Excuse me, as a matter of interest, even for the TLE, which I thought was a straightforward agreement where we would get back some of the land we were entitled to, one of the 17 is one of the people who appealed the process. And he did win on that one, based on a technicality again.

Mr. Derrek Konrad: I have one more question. Are there any people who want to opt out of the agreement and receive their entitlements outside of the Northern Flood Agreement and the other parts of the agreement?

Mr. Robert Roddick: There's not a provision to opt out.

Mr. Derrek Konrad: I understand that. I'm asking if there's anybody who has requested that as an option.

Mr. Robert Roddick: Not that I'm aware of. It's not a request I've seen. And I'm not trying to play games. There are people who are opposed to the agreement. That could be interpreted as wanting to opt out or wanting to do something else, but no one has come forward that I'm aware of asking if they can opt out and if there is a way for them to opt out. With the structure of the agreement, there are a number of matters that aren't covered by this agreement. There is a water and sewer claim that has been specifically excluded and is being dealt with. Hydro has a continuing liability for personal injury and death, any mercury problems that result, and any unknown and unforeseen adverse effect as of the date of the agreement.

This agreement does not terminate and end the Northern Flood Agreement. It's continued in that way. But in terms of opting out, no, there aren't opting out provisions in here.

Mr. Derrek Konrad: Do you think it would be something that could be considered?

Mr. Robert Roddick: Administratively and practically, it would be very difficult. I don't know the answer to that. It wasn't something we tried to negotiate. It wasn't a position that was put forward.

Mr. Derrek Konrad: Maybe I'll ask Fred.

Mr. Fred Muskego: People keep talking about the democratic process and that's the process we have followed. Granted, for anything you want to pass you're not going to get 100% support on it. What we had was about 75% to 80% support on it. I think Canada has the same problem here with Quebec. They wanted to opt out. Maybe I should direct that to the politicians here. I don't think that's the case with the Northern Flood Agreement as well.

• 0950

The Chairman: Thank you.

[Translation]

Before giving the floor to Mr. Perron, I would like to ask Mr. Muskego, who talked about motels and friendship centres, if he has in hand a breakdown of all the projects completed since the beginning of this accord or agreement. Do you have a breakdown of the amounts of money that the Crees have received? If you do, could we have a copy?

[English]

Mr. Fred Muskego: I have a copy here of two annual plans. It's a breakdown as to how money was spent. If you need a copy, we could make copies of it.

[Translation]

The Chairman: Thank you.

[English]

Can you give us a copy this morning?

Mr. Fred Muskego: Yes.

The Chairman: Thank you.

[Translation]

Mr. Perron.

Mr. Gilles-A. Perron (Rivière-des-Mille-Îles, BQ): Good morning, Mr. Chairman, and thank you very much.

Welcome, gentlemen. You represent the bright side of the coin, of history. There is certainly another side that other people could tell us about.

What I remember primarily is that the problem seems to be mainly a question of money, a great deal of money. I wonder whether the Norway House Cree Nation was properly informed and consulted. We know that, whoever the people involved, whether they are francophones or the Norway House Cree Nation, not everyone has the same level of understanding of things. I would like you to tell me whether the members of the Norway House Cree Nation were really well informed.

My second question, which makes me somewhat uncomfortable, concerns the democracy of the two referendums. You know that, in Quebec, we are used to referendums. When two referendums are held within a few days or a few months, is it possible to be sure that democracy prevails? According to two witnesses who appeared here last week, and to whom you referred, Mr. Allmand and Mr. Russell, your referendums were fairly chaotic. For example, there was the matter of a $1,000 payment for a favourable vote.

I would like you to clarify your thoughts on this matter, Mr. Muskego or Mr. Roddick.

[English]

Mr. Robert Roddick: Mr. Chairman, first, dealing with the question of information, there is in the agreement a community consultation report. It's schedule 13.1. It lists the date, the location, the type of meeting held, and, with four or five exceptions, the number of people who attended the meeting.

I'm going on memory now, but there were in excess of 55 meetings held, general meetings, meetings with interest groups. There were TV presentations made that were played repeatedly on the local TV station in Norway House.

Prior to the vote, this book was delivered to every household in Norway House. We held meetings in the band offices up there for a number of days where people could come in to discuss this agreement, to ask questions about the agreement.

When it was negotiated, it was an ongoing process of going back to the community with ideas, with positions, getting the input of the community and then going back to the table.

There are two significant parts to the agreement dealing with the trappers and the fishermen. Both of those sections in the agreement were approved by the trappers and the fishermen before they were put on the table and before they became part of this agreement. So there was significant consultation.

With regard to the $1,000, there was no difference in the money that was going to be paid between the first vote and the second vote. This was not an idea that, gee, we lost the first vote so we'll kick $1,000 in for the second vote.

Mr. Gilles Perron: That's what it looks like.

• 0955

Mr. Robert Roddick: No. But in the process this money had been approved and was laid out before the first vote. Had this been successful on the first vote, they'd have got exactly the same amount of money as they got, because it was successful on the second vote. There was no more money added. There were no new conditions added. It's exactly the same amount of money. It was pre-approved, months before, at a community process. The only thing is that the money was paid subject to the thing being ratified. That was the first term; that was the second term. That didn't change.

Somebody did not come in between the first vote and the second vote and say, oh, and by the way, if you vote the right way this time, there's $1,000 in it for you. That money was always there. It's set out in the agreement. There was no money added. There was compensation paid to individuals. It was anticipated at the time of the first vote, it was anticipated at the time of the second vote, and it was exactly the same amount of money.

[Translation]

Mr. Gilles Perron: It seems to me that the largest problems are Parts 1 and 2 of the Bill: the first deals with flooded land, the second with reserve establishment. These are the two subjects we are to debate today. Were the members of your Nation consulted about these two parts?

[English]

Mr. Robert Roddick: Yes, I believe they were, Mr. Perron. There's a list of all the meetings that were held. There's a summary of what was discussed at the meetings. There was significant consultation on these matters.

It was a requirement that there be significant consultation by the other parties. They wanted to be sure that the decision taken by the people was an informed decision and they were certain of the opportunity to be informed. I'm satisfied that there was.

Mr. Fred Muskego: In the TLE, the treaty land entitlement agreement, we had a committee in place. Two elders—one is a fisherman, or I guess both of them are fishermen and trappers—were involved in it. We had two youths represented there, and one in-between, middle aged. They were involved in the information part of the TLE agreement, and they'll be further involved in the selection of the treaty land entitlement areas as well.

The Chairman: Thank you.

[Translation]

Thank you, Mr. Perron.

Mr. Iftody.

[English]

Mr. David Iftody (Provencher, Lib.): I want to thank Councillor Muskego and Mr. Roddick for their presentations.

I think what I've heard from you, certainly in the last few minutes, is generally the focus of the discussion in the last sitting of the hearing that we had with respect to a couple of contentious issues, the most important one being that there was something very untoward about the process. But you've cited the Federal Court ruling of Justice Muldoon and others, and I think it's becoming reasonably clear that due process was followed.

But I want to ask a question on a couple of points of fact, Councillor Muskego. Could you tell me the outcome, the numbers for the first and second vote on the referendum? Do you have those available?

Mr. Robert Roddick: Mr. Iftody, I can find them for you. I don't have them with me, but they're in the transcript from the first day's hearing. They were put in by Indian Affairs. If you give me a moment, I'll find them for you.

Mr. David Iftody: Yes, I'd appreciate that.

Okay. I have the results of the first vote: eligible voters, 2,872; number of eligible voters who voted, 1,922; number of members ordinarily resident on reserve, 1,930; number of members ordinarily on reserve who voted, 1,517; number of votes cast by members ordinarily resident on reserve for the ballot question is 961, and against, 551. Those, nonetheless, seem like significant numbers. It's a clear majority, even in the first vote.

Councillor Muskego, I don't know if you know these numbers, but when the chief was elected in Norway House, do you remember what the numbers were from the last election?

• 1000

Mr. Fred Muskego: In the first one, I think he had over 650-odd votes. The last one was basically the same, with between 600 and 700 votes or somewhere around there. It was a clear majority.

Mr. David Iftody: It was a clear majority, but even the chief received less votes as chief than on the first ballot.

The point I'm making about this is that it would be quite extraordinary to call into question, for example, the vote of the community when it's choosing the chief, but to get 600 votes in the community and then have somebody say it's not enough and call into question the democratic right of the first nation people of Norway House even to elect their own chief.... So even in the first referendum vote, in my impression, while the numbers were not enough to satisfy the community standards, they still are much higher than you would normally find on the reserve for a vote for the chief. In fact, there was a great deal of participation here.

I just wanted to put that on the record, Mr. Chairman, in terms of contrasting the votes in the community. We did have a discussion about the democratic process on the reserve communities. In fact, I've learned in my years in working with the first nations that sometimes voter turnout is quite low. Nonetheless, those are the folks who show up to the polls on that day; the chief becomes the chief and that's pretty well the end of the story. All of us as Canadians respect and honour that process, as do the community people.

Thank you.

[Translation]

The Chairman: Thank you.

Mr. Keddy.

[English]

Mr. Gerald Keddy (South Shore, PC): Thank you, Mr. Chairman. Like the rest of the members at the meeting today, I'd like to also welcome our presenters.

Mr. Muskego, I'd like to state that I think you've explained very well the process that the vote took place in, and what's happened there, the fact that it came to the first vote and that perhaps the chief may not have explained it very well. I'm sure we're also going to hear another side to that story before these hearings are completed. That's certainly understandable, and I think it explains it quite well. If you explain to people that the possibility is there, that the money is theirs versus belonging to the community, individuals will always look for it. That's just a fact. It's very difficult to get away from that.

I have a couple of questions. You stated that claims against Manitoba Hydro were always challenged and that these challenges are unfortunately quite often simply a way of doing business for big businesses. They never accept a claim; they just automatically challenge it because they have the legal expertise and the money to back that up. However, could you give me some idea—although perhaps Mr. Roddick would be better qualified to do this—about what the average claim was?

Mr. Robert Roddick: I'm sorry, I can't answer what the average claim was because there were basically two types of claims. One would be a personal type of claim made when someone was either injured, lost a prop off a motor, or this type of thing. I think those types of claims would perhaps average a few hundred to a few thousand dollars. There were then the larger claims, like loss of recreation activity or ability. They would be claims that would be much more significant. The water and sewer claim that's presently under dispute is somewhere between $50 million to $100 million.

The claims vary considerably, Mr. Keddy, and to try to average them is probably not a useful exercise. First of all, I haven't done it. Secondly, there were those two types of claims: the individual and what I'm describing as group claims, and there were significant differences between them.

Mr. Gerald Keddy: Will this bill change that legal process for those water and sewer claims, or will they still be ongoing?

Mr. Robert Roddick: The water and sewer claim was excepted from this agreement. The individual claims are now dealt with under this agreement in a streamlined process.

Mr. Gerald Keddy: Okay.

I have a couple more questions. There was a community meeting held in Norway House, and I assume this is the original community meeting or the second community meeting, which 705 people attended.

Mr. Robert Roddick: Yes.

Mr. Gerald Keddy: Was it the second or the first?

• 1005

Mr. Robert Roddick: That was the second meeting. There were a number of meetings in-between, but there had been a meeting authorizing the negotiation. Then there was this court challenge and the ruling given. Then there was a further community meeting to discuss whether or not to continue with this process.

Mr. Gerald Keddy: At that community meeting—I realize it's difficult to give exact numbers—roughly how many people were opposed to the process?

Mr. Fred Muskego: Seventeen.

Mr. Gerald Keddy: There were 17.

Mr. Fred Muskego: Well, I don't know offhand, but there weren't that many. I could probably get the numbers.

Mr. Gerald Keddy: But there was a clear majority at that meeting to proceed.

Mr. Fred Muskego: Yes, there was.

Mr. Gerald Keddy: In the transfer of land from the original Northern Flood Agreement, you stated—I'm just looking for rough numbers; we can find the exact figures—there were 12,000 acres.

Mr. Robert Roddick: The Northern Flood Agreement replaced flooded land on a 4:1 basis. So about 3,000 acres of Norway House Cree land—and I'm using a round number—were flooded. That made an entitlement under the agreement of about 12,000 acres. The amount of land agreed to be transferred by the province and now in the process of being transferred is in the area of about 50,000 acres.

Mr. Gerald Keddy: Will that go to the four communities?

Mr. Robert Roddick: No, that is for Norway House.

The Province of Manitoba, as part of the negotiations, significantly increased the amount of land they were prepared to see transferred to the first nations as part of a compensation package.

Mr. Gerald Keddy: Okay. Thank you very much.

Mr. Fred Muskego: Just to clarify the land issue, Molson Lake is about 40 miles east of Norway House, and there were a lot of questions about Hydro building a dam there and everything else. To address those concerns, we selected land at the southern end of Molson Lake for a reserve. The north end of it will all be TLE land selection and won't have any easements on it, like the other ones. That's just for general information.

Mr. Gerald Keddy: Can I ask a question on that?

[Translation]

The Chairman: Yes, go ahead.

[English]

Mr. Gerald Keddy: Is there potential in Molson Lake for further hydro development?

Mr. Fred Muskego: I don't know. I'm not the expert. We were just taking precautions—

Mr. Gerald Keddy: —to avoid that.

Mr. Fred Muskego: That's not the main reason we selected it. It's a good lake. It's a clear lake with fishing and there's a lodge there. We're presently in negotiations trying to buy that lodge and get some economic development spinoffs out of it.

Mr. Gerald Keddy: I appreciate that. I guess where I was leading with my question is would you look at economic development out of Molson Lake? If it ended up being hydro development, it would be hydro development under Norway House stewardship. Would that possibility be held out?

Mr. Robert Roddick: There were land selections made at Norway House with a view to assuring that if there were future hydro development in the area, Norway House Cree would be a player in that development.

Mr. Gerald Keddy: Thank you.

Mr. Robert Roddick: One of the other first nations, the Split Lake Cree, is in ongoing negotiations with Manitoba Hydro, looking at the possibility of a joint venture or a business relationship of some sort on the building of a further dam on the Nelson. So those matters certainly are there.

[Translation]

The Chairman: Thank you.

Mr. Wilfert.

[English]

Mr. Bryon Wilfert (Oak Ridges, Lib.): I'd like to thank you gentlemen for your presentation today, although I must say that in listening to your presentation and in listening to the presentation on Tuesday, I wonder if we're all talking about the same issue.

I would certainly like to have a copy of Justice Muldoon's decision. I think the difference between the two presentations today and on Tuesday, from my perspective, is you certainly presented the facts in terms of the materials that were distributed, the study, and certainly the clarification on the referendums, the $1,000 and all of that. I think that's very important. From that perspective I'm pleased to hear that. It would seem there's some consistency, both in terms of those who have supported the process and those who have opposed it.

• 1010

You mentioned that if Bill C-56 didn't pass, the process would continue in terms of the implementation. On a concrete basis, how does Bill C-56 assist the very people who presumably will benefit from the passage of the legislation?

Mr. Robert Roddick: It does so in two ways. First is the payment of compensation under this agreement. Some of those moneys are what are known as Indian moneys under the Indian Act. There is a trust set up in this agreement. There are five Norway House trustees and a corporate trustee, Royal Trust. There are some very strict rules in the trust. If this legislation does not pass, the final payments to be made by Manitoba Hydro in particular, instead of going to the trust, have to go to Canada, because they're Indian moneys.

I believe the trust has very good rules for preservation of capital on these types of things, but it also has a flexibility in investment and return for the benefit of the Norway House Cree that the Government of Canada in its consolidated revenue fund does not have. So there is that aspect to it.

The second aspect is that under the claims process under the Northern Flood Agreement, claims are made against Hydro or Manitoba or Canada. This legislation directs those claims to the claims fund that's been set up, such that for a claim made against Hydro today, Hydro has to deal with the claim, then they have to deal with us, and we have to deal with the claim fund. It streamlines that.

Those are the two significant parts, in my view, of the legislation and what it does with regard to the Norway House Cree and the administration and further working with this agreement.

Mr. Bryon Wilfert: That's helpful. Sometimes we can't see the forest for the trees. I guess looking at the bigger picture, at the end, if we are interested in making sure that those who have been directly affected because of the expropriation and the flooding at the time.... Given the passage of time that has gone by, I think we're looking at some kind of closure. I think closure is also very healing for all parties concerned.

Your comments today.... I was much more impressed by getting it from the document. I certainly will read the decision with some interest. I thank you for that.

[Translation]

The Chairman: Thank you, Mr. Wilfert. No further questions? Thank you very much.

Mr. Perron.

Mr. Gilles Perron: I would like to comment on David's statement and Mr. Muskego's assertion concerning percent participation in the vote and similar matters.

There is an Aboriginal territory not far from where I live, in Oka, with a population of approximately 1,000. When a chief is elected, about one third of the citizens of the territory go out to vote; at the time of the most recent referendum, two thirds of them voted. My point is that, in a referendum, the vote is usually larger. In Quebec, 98% of people voted in the 1995 referendum, compared to 72% in the last election. So, there is no reason to play games or make broad statements about percent vote. It's different when they are voting for their chief.

In provincial elections, not more than 100 or 125 of the 1,000 residents of Oka go out and vote. This is the maximum in an election that is hotly contested. In the referendum, 250 of them went out to vote. Mr. Iftody, when you and I stand for an election, fewer people cast ballots than when a referendum or a vote on a question as important as the establishment of reserves or the flooding of land is in question.

That was the comment I wanted to make, Mr. Chairman, so that it would be in the record of our session. Thank you.

The Chairman: Thank you, Mr. Perron. Any other comments? Thank you.

Mr. Muskego.

[English]

Mr. Fred Muskego: I have some closing comments on the Northern Flood Agreement.

• 1015

When the Northern Flood Agreement was signed in 1977, everybody had high hopes for getting compensation and eradicating mass poverty, as it states in schedule E. We had high expectations coming out of it. I think people came to expect that the Northern Flood Agreement was the answer to all our social problems in Norway House. Far be it that it would address all our social problems.

With the MIA and the way it's structured, considering the future of our children and the way we're using interest moneys every year—approximately $3 million a year—we're slowly addressing some of our social problems. It's also helping us with our economic problems. I'm not saying this will be the answer to all our problems, but it will address some of them.

If people have the misconception that the Northern Flood Agreement is the answer to all our prayers, I think they're barking up the wrong tree. I just want to make sure it's on record that the Northern Flood Agreement had good intentions, but it's the implementation that's the problem. With the MIA, we are the masters of our own destiny. We have accountability, and we let people decide as to how this money is spent. I think that's the way all money should be addressed in any society, regardless of whether it's a reserve or a municipality.

I think it's very important even for the people who are going to be here next week to realize that it's not the answer to all our problems, but it sure as hell puts a dent in some of the problems we do have.

There's one other thing. We thought today was the last day for presentations, and we noticed that some band members who have taken this to court are addressing the committee next week. I don't know if there's a procedure in place that would let us come back here again on Thursday for closing remarks, because if there are any further allegations, we'd like to be here to address those allegations if they are different from the ones they've been making for the last four and a half years.

So I'm just wondering, Mr. Chairman, if it's possible for us to be on the agenda for next Thursday.

Mr. David Iftody: I have a point of order, Mr. Chairman.

[Translation]

The Chairman: Yes, Mr. Iftody.

[English]

Mr. David Iftody: I just wanted to point out that when we were having the steering committee meetings to make a determination about witnesses who would come before the committee, one of the things that troubled me—I've been on record as saying this in the committee, and I had an argument with my very delightful opposition colleagues on this one—was a concern that the makeup of the structure of the witnesses, at least as it stands right now, seems to be weighted towards those who would oppose the agreement. I share the view that we want to give everyone ample time to get all the facts and the stories straight and on the table, so that all the members can make an informed decision, particularly the members for the Reform party. They need to be informed with lots of facts.

Councillor Muskego, I'll tell you one of the things I'd like to do, because I think it helps. Many of the witnesses who are coming are band members on reserve, but some are primarily off reserve, living in Winnipeg. I've met with some of them; I've had lunch with some of them. They've complained to me and they've made their cases. But I would like to hear from band members both on reserve and off reserve—maybe some in Winnipeg and Norway House—who supported or voted for it. We would like to hear their side of the story as well. I don't know if it's possible for you to submit to the committee the names of some individuals, or as the Reform party says, average, grassroots Norway House people who supported the bill, so that they could come before the committee to state their case.

I appreciate the great presentation that both of you made. Mr. Roddick has been particularly articulate with the facts and points, but I would like to hear from some of these other folks as well.

• 1020

Derrek is gearing up for a rebuttal, but I like to tease him once in a while just to keep him alert.

[Translation]

The Chairman: Thank you, Mr. Iftody. For the sake of democracy, I give the floor to Mr. Konrad.

[English]

Mr. Derrek Konrad: As a matter of fact, we had a list of people—and I think Mr. Iftody knows this—who requested to appear. None of those other people requested to appear, so of course we had no names we could select from, did we?

On the other hand, I am not quite as unfair and unbiased as Mr. Iftody would have you believe. I want to judge this bill on its merits. I may have some ideas from a philosophical viewpoint, and I believe that's the purpose of a committee. So we do not all sit on that side. And you're welcome right here.

We are not the United Alternative yet, but we are still the only alternative.

[Translation]

The Chairman: Thank you very much.

[English]

Mr. Robert Roddick: We would be pleased to suggest some individuals from off-reserve. I understand that if you don't have names before you, you can't make a selection. We will help you out with some names.

I'm pleased to see that the committee hasn't changed and that shots do go back and forth occasionally. But we will supply you with some names, and perhaps we could discuss that afterwards.

The Chairman: Thank you very much for your statement.

[Translation]

Thank you very much. You will send us the breakdown of expenses for the completed projects.

I now invite the representative of Manitoba Hydro to speak. Mr. R. D. Bettner.

[English]

Assistant Corporate Counsel and Senior Counsel.

Do you have a statement?

Mr. R.D. Bettner (Assistant Corporate Counsel and Senior Counsel, Manitoba Hydro): Thank you, Mr. Chairman.

[Translation]

The Chairman: Would you introduce the people accompanying you?

[English]

Mr. R.D. Bettner: Of course, Mr. Chairman. With me is Mr. Robert Adkins of the Winnipeg law firm of Thompson Dorfman Sweatman, who were legal advisers to Manitoba Hydro for the negotiation of the implementation agreement with the Norway House Cree. In fact, they have functioned as legal advisers to Manitoba Hydro with respect to all of the implementation negotiations with Split Lake, Nelson House, York Factory, and, as I indicated, with the Norway House Cree.

• 1025

I'll be making a short statement, and then both Mr. Adkins and I will be pleased to receive whatever questions the committee wishes to put to us.

Mr. Chairman and members of the committee, Manitoba Hydro is pleased to have the opportunity to address the committee in support of Bill C-56. As members will be aware, part 1, dealing with the Norway House Cree Nation, is the fourth such piece of legislation to come before Parliament and this committee. Previous legislation has been brought forward in respect of agreements with the Split Lake Cree Nation, Nelson House First Nation, and York Factory First Nation.

As Mr. Roddick indicated, insofar as part 1 is concerned, this legislation is a virtual clone of the other three pieces. The agreement that it supports represents the culmination of almost three years of discussions and negotiations among Canada, Manitoba, Norway House Cree Nation, and Manitoba Hydro to resolve issues arising out of the development of hydroelectric resources of northern Manitoba and the Northern Flood Agreement.

From Manitoba Hydro's perspective, the agreement and this legislation provide a number of positive benefits for all parties. First and foremost, they provide the parties with the opportunity to build a new and effective relationship by resolving issues that have, over the years, resulted in anger, mistrust, uncertainty, adversarial arbitration, and delays in delivering the compensation and benefits addressed in the Northern Flood Agreement. They provide certainty for the past, the present, and the future. They provide the Norway House Cree Nation with significant moneys, which with the passage of this legislation they can manage themselves in accordance with the procedures of this agreement, and significant lands—both of which are crucial to the survival and development of Norway House—along with the opportunity to manage those lands and moneys in Norway House for the benefit of Norway House Cree Nation members.

In looking at the legislation and the agreement it supports, the first thing that might strike one is the fact that an agreement of about 130 pages, being the Northern Flood Agreement, is being resolved by an implementation agreement of several hundred pages. The size of the implementation agreement document underscores the shortcomings of the Northern Flood Agreement. In considering these shortcomings, it would be easy to be critical of the Northern Flood Agreement, but one must remember that we are viewing resource development, events, their processes and consequences, with the benefit of our contemporary standards, science, and awareness.

The Northern Flood Agreement provided the parties with what one might best describe as an outline of some obligations and guidance on issues that parties might have to consider as hydroelectric projects were developed and brought into service. This lack of precision, compounded by staggering changes in the dynamics of formerly isolated northern aboriginal communities, has led to an almost insurmountable problem of the parties attempting to deal with the needs of burgeoning communities on one hand and a determination of which issues or portions of issues are referable to project development.

Where the Northern Flood Agreement was clear—some may say unfortunately so—was in its terms pertaining to dispute resolution by the arbitrator appointed pursuant to the agreement. Rightly or wrongly, this became the major focus of the parties as they sought to resolve Northern Flood Agreement matters on an issue-by-issue basis.

It should be noted that certain of the issues lent themselves to resolution by the parties without recourse to the arbitration process. Land compensation issues were resolved. Settlements were put in place for commercial fishing, commercial trapping, domestic trapping. Individual claims for personal property damage were resolved. But other more complex issues were questions of responsibility and attribution. These were significant issues that remained beyond the scope of the parties to resolve on an issue-by-issue basis.

The implementation agreement and this legislation represent the products of the four parties bargaining as equals in all respects. Each of the parties was supported by legal counsel and expert advisers in a number of fields. An extensive community consultation process, which Mr. Roddick has spoken of, was established in order that the people of Norway House would have the opportunity to become informed about the negotiations and the content of the agreement. Similar processes were followed by the other parties within their own organizations in order to keep them informed and obtain necessary approvals.

• 1030

This implementation agreement is not without its detractors. There have been people in Norway House who have challenged the agreement, as it is their right to do. It would have been strange indeed if the implementation agreement were embraced wholeheartedly by each and every member of the Norway House Cree Nation. Such dissent is healthy and will likely serve the long-term best interests by ensuring that the accountability and control mechanisms built into the implementation agreement are followed. It would also be fair to say that each of the other parties to the implementation agreement had persons within their organizations who were opposed to some or all of the agreement. Ultimately, each party invoked its own rule sets and processes to achieve the necessary approvals and internal consensus.

The implementation agreement substitutes new mechanisms for individuals to access compensation funds for personal losses. There is a locally administered process that will see the Norway House Cree—who would be in the best position to know the facts—make determinations at first instance on individual compensation matters.

The implementation agreement, as Mr. Roddick indicated, does not end or terminate the Northern Flood Agreement. The Northern Flood Agreement remains the ultimate backstop for the agreement and the parties to it. While the implementation agreement resolves issues arising from developments to date, there are exceptions that can still be dealt with under the Northern Flood Agreement processes.

In respect of future developments, the implementation agreement provides an extensive mechanism that will hopefully allow us to reach a pre-development compensation agreement, and this includes a dispute resolution mechanism. If at all possible, future development will not occur without such an agreement in place.

Manitoba Hydro has not negotiated and signed this implementation agreement with a view that it can walk away from Norway House, or for that matter any other community in northern Manitoba. Manitoba Hydro has and will continue to have an ongoing presence and relationship with Norway House and others. This relationship exists and will continue by virtue of our development to date, provision of day-to-day electric service, and our hope to further develop the energy potential of Manitoba. Our ability to move forward in that regard will be judged in part by our past, both in terms of our mistakes, but more importantly by how those mistakes have been rectified and how we respond today and in the future to the ever changing expectations placed on resource developers.

Before concluding, I'd like to turn briefly to part 2 of Bill C-56, pertaining to the establishment of reserves. As a resource developer with significant and ongoing presence in northern Manitoba in its own right, as well as being interested in promoting the development of northern Manitoba, we're also pleased to indicate our support for part 2. Given the significant amounts of land to be transferred under various treaty land entitlement agreements or as part of Northern Flood Agreement implementation agreements, it is important that Canada and the various first nations have the ability to deal with reserve lands prospectively in order to accommodate existing and potential third-party interests in land.

Part 2 provides a relatively seamless framework for developers or other land users and will hopefully forestall the loss of opportunities where the need to resolve land use issues is an early and paramount consideration. Part 2 will be of benefit to Manitoba Hydro in its ongoing dealings with first nations in respect of its existing Water Power Act licences, transmission and distribution lines, and other physical works, in that it will provide the ability to resolve the ongoing land interests in a timely manner.

In conclusion, Manitoba Hydro would commend this bill to the committee, and Mr. Adkins and I would be pleased to take any questions the committee may have.

[Translation]

The Chairman: Thank you, Mr. Bettner.

Mr. Konrad.

[English]

Mr. Derrek Konrad: Just going to page 3 of the brief you submitted...oh, I'm sorry, that's not yours. Still, I'll ask you the question because I'm sure you'll have an answer.

It says in here that the implementation agreement provides for an enhanced land compensation package. Can you tell me what the original Northern Flood Agreement had as a land compensation package and how it's enhanced?

Mr. R.D. Bettner: Article 3 of the original Northern Flood Agreement set a compensation ratio of four acres of compensation land for every acre of land taken up or encumbered by easement, to be granted to the corporation. In the final analysis, I think that package was enhanced to approximately 16 or 17 acres for every acre, as opposed to the four mandated in the agreement.

• 1035

Mr. Derrek Konrad: Really? I wonder why everybody wasn't happy about it. How is that land made available to the Norway House Cree Nation?

Mr. R.D. Bettner: I believe my colleague from the Government of Manitoba, the party that will be providing the land, might be better able to speak on that. In brief, however, my understanding would be that the land will move from Manitoba to Canada and will ultimately be set apart as reserved. I believe there are two or three parcels that are to be held in fee simple—that is, not to be reserved—but the bulk of it is to be reserve land.

Mr. Robert J. Adkins (Manitoba Hydro External Counsel; Partner, Thompson Dorfman Sweatman): Excuse me, but if I could respond to that as well, as counsel, I was present during the negotiation and conclusion of all of the comprehensive agreements. The land packages in each of those has been significantly enhanced. They're something in the same order. The information, I believe, had been provided by representatives of Canada when they appeared.

The amount of land to become reserve land is 16:1, just as indicated. It was all reviewed from an environmental perspective. There were reports prepared. If you want, we can file a copy of the reports that were done. The land was all selected by first nations. The costs of going out to look at the land, carry out an environmental review of the land, and take those necessary steps were funded by Canada, Manitoba, and Manitoba Hydro, so that these selections effectively would be lands that the first nation wanted to receive.

Mr. Derrek Konrad: I'm going to pass for now while I think that over.

[Translation]

The Chairman: Thank you. I would like to ask, Mr. Bettner, if you have a breakdown of all the amounts of money allocated for various projects since signing.

[English]

Mr. R.D. Bettner: We have an in-part summary, and certainly that information can be put together. Some of it comes under individual claims that were payments to individuals, and some of it was advanced under the arbitration claims process, meaning that even though the claim was filed, the settlement was arrived at. We don't have anything available that I could leave with the committee today, but I believe something could be made available to show that.

[Translation]

The Chairman: I would appreciate it. Thank you very much.

[English]

Mr. Robert Adkins: In terms of the agreement, one of the things that was looked at during the course of the negotiations was the past payments. In fact, in the agreement—and I'm assuming all members have copies of the agreement, because it is quite clear on a lot of these issues—there are indications of exactly the amounts of money that each of the three parties—Canada, Manitoba, and Manitoba Hydro—had funded in the past, and they are contained in article 1.

The Chairman: Thank you.

Mr. Iftody.

Mr. David Iftody: Thank you, Mr. Chairman.

I have two questions. One relates to the TLE framework, some comments made by Chief Thunder, and the whole issue of third-party interests with Manitoba Hydro. Before I get to that specific question, I wanted to raise a point, since Hydro is here and we don't often have an opportunity to question them.

The last time this committee sat, we heard from the former Minister of Indian Affairs and from Peter Russell, a well-known constitutional lawyer. Both of them attacked the agreement, but in one particular instance—and I believe it was Mr. Allmand who said it, but perhaps I'm wrong—they suggested that the beneficiaries of the flooded lands and the whole undertaking, this whole complicated process with Manitoba Hydro and the Northern Flood Agreement, were as follows. I believe somebody said there have been literally billions of dollars made by Manitoba Hydro through these flooded lands, but that the Indian first nations received very little ultimately in comparison. In other words, this has been a small pot of gold for Manitoba Hydro, and the compensation they've paid in this process has been little and scant.

• 1040

How do you respond to those comments?

Mr. R.D. Bettner: Mr. Allmand and Mr. Russell are entitled to their opinions, as is anyone else. Unfortunately, the facts would suggest otherwise.

The Northern Flood Agreement arose for the most part out of the Lake Winnipeg regulation projects and the Churchill River diversion projects. Both of those projects were designed to enhance the capabilities of the Nelson River to generate hydroelectric power. That capability was already there. These projects enhanced it and made it more efficient.

In terms of being able to ascribe a portion of benefit to each of those, that would be difficult. I would say revenues are generated every year from the sale of electricity, both within Manitoba and outside Manitoba. Manitoba Hydro is a crown corporation and its mandate is to produce electricity and be a lowest-cost producer. Those benefits flow through to the entire population of Manitoba.

The use of lands and resources is being dealt with by these implementation agreements and the Northern Flood Agreement. Whether the payment is enough or too much, everyone will have their own opinion. Manitoba Hydro pays royalties to the government for the use of water to generate electricity. It pays fees to the government for the use of certain lands, and the disposition of those moneys is up to the government.

Mr. David Iftody: Do you have a schedule of revenue paid yearly for the last five to twenty years? What kind of revenue flowed out of the project in the Northern Flood Agreement? Was it $1 billion in revenue over 10 years? Do you even have any aggregate numbers? If you don't have that, do you have a ratio of return on investment? What kinds of numbers do you have on that?

Mr. R.D. Bettner: We're not regulated on a return-on-investment basis; we're regulated on a cost-of-service basis, unlike a private corporation that is expected to generate a rate of return.

Our financial performance, of course, is indicated every year in the corporation's annual report. We have three generation sources basically. We have generation along the Winnipeg River, which is in the southern part of Manitoba. We have generation at Grand Rapids. We have a couple of small thermal installations, and then the bulk of the hydraulic generation comes from the Nelson River system.

In terms of revenue over the years, it's variable. The majority of revenue would be generated presumably from the Nelson River by virtue of the size of the plants, but it's variable based on water conditions. Some years when there are high flows we have significant amounts of energy we can make available for sale to help defray other costs and keep rates at a reasonable level. In other years, when water flows are not sufficient, we may end up importing electricity.

Mr. David Iftody: These are important questions, Mr. Chairman, because we've heard these kinds of discussions with respect to even Hydro Quebec and the Cree of northern Quebec.

I note just parenthetically, as a point of interest, that I live on the Winnipeg River to which you've just referred, and there are five small dams between Pointe du Bois, Seven Sisters, Great Falls, McArthur Falls, and others. I was born and raised on that river and my hydro bill keeps going up. I'd like to show you my heating bills, Mr. Bettner, from the last couple of years. I don't know why I live near five dams. I'd like to table these as public documents because my hydro bill just keeps going up and up.

• 1045

Mr. R.D. Bettner: Be thankful, Mr. Iftody, you don't live in Ontario.

Mr. David Iftody: Yes, I'm always thankful I don't live in Ontario.

Mr. Gilles Perron: You should move to Quebec. It's cheaper.

Mr. David Iftody: Moving to the second question about the third-party interests and the treaty land entitlement framework agreement, how do you feel that's going? Chief Thunder is of the view that all the concerns of all the parties have been pretty well satisfied, and you've been categorized as a third-party interest in this whole equation. I find that unusual. Nonetheless, could you comment on that relationship under the TLE agreement and Manitoba Hydro's position?

Mr. R.D. Bettner: The first nations agreement, as you'll be aware and as the representative from Manitoba will doubtless indicate, concerns a significant amount of land. The schedule to part 2 also covers lands that are to be provided under the implementation agreements under the Northern Flood Agreement.

In respect of those lands, where for instance a first nation selects land where we have existing transmission facilities, we still need to be able to maintain access to those lands in order to meet our requirements to continue service. Being able to put the matters of access and conditions of access and continue to use those lands for the limited purpose for which we require them, and deal with them in a timely way as lands are being selected and the selections are being resolved before the transferring takes place—which can take a considerable amount of time—is important. It gives everybody certainty, allows for planning, and allows the parties some time to work out their differences before the land suddenly becomes reserve and we have to resolve the terms of our ongoing use.

Mr. David Iftody: Are you reasonably satisfied that most of your concerns with respect to right of way of access have been satisfied and there are no hidden explosions between the affected parties? Do you think anybody will say, we didn't agree to that at all in the framework agreement?

Mr. R.D. Bettner: We don't anticipate that at all. We welcome a process that allows us to deal in a timely way with these things; otherwise you have to keep overlaying the interests each time something happens. This process allows the first nations to make the appropriate arrangements. It allows Canada to be involved in a timely way, so there are no gaps in your authorities or approvals.

Mr. David Iftody: Thank you, Mr. Chairman.

[Translation]

The Chairman: Thank you. Mr. Perron.

Mr. Gilles Perron: Mr. Chairman, I will try to limit myself to two questions.

Good day, gentlemen. Thank you for coming to testify. We have learned that, under the Northern Flood Agreement, requests for arbitration have practically been legal currency. I would like to know what Manitoba Hydro's experience in this regard has been. For example, one hears of requests for arbitration concerning land.

[English]

Mr. R.D. Bettner: I think it's important, Monsieur Perron, to understand that a significant number of the arbitration claims were filed in the 1982 to 1984 period. That was in part driven by a limitation clause in the Northern Flood Agreement requiring people who wanted to make a claim under the arbitration process to file that claim with the arbitrator within five years of the date of the signing of the agreement, or within four years of the cause of claim or the damage, if you will, becoming apparent to the claimant.

• 1050

So there was a flood of claims during that period of time, and for the most part they sat there.

Mr. Gilles Perron: Why?

Mr. R.D. Bettner: The claims sat there in part because nobody knew how to deal with some of them. Some of them were exceedingly complicated in terms of the issues they raised. They weren't particular to an alleged damage that was easily determined as flowing from the project. Others were much easier, sir.

There were claims for commercial fishing disruptions. Those were relatively easy to deal with. You needed some information; you may have needed significant information. It may have taken some time to negotiate and develop a program, but ultimately those were resolved by agreement, not by imposition.

On the economic issues of trapping, for instance, for the residents of communities there would be an arbitration claim sitting on the books, but it would be negotiated and settled. That happened in a number of communities.

The claims framework, however, channelled the parties' thinking, and in many instances probably inappropriately. For instance, a specific claim may have been for impacts on culture, but what is culture made up of? Culture is made up of all the pursuits of a particular community. It has recreational, spiritual, and resource harvesting aspects to it. There are a number of other pursuits that may be part of it. But when you get locked into that claims process you lose that larger picture at times. That's to some extent why the claims process never worked and a lot of things got done.

The easy things, such as direct resource damages, physical damage, or loss of chattels, were easy to deal with. Those were dealt with, by and large. Someone indicated that 3,000 arbitration claims were filed. Well, that's not entirely correct. There were probably about 125 to 130 that involved the NFA first nations.

There were over 3,000 individual claims brought by persons who might have lost props or nets or had broken motors that never saw arbitration. Those were dealt with directly by Manitoba Hydro with the individuals who experienced the losses. I think the statistics are something in the order that 3,200 of those individual claims were filed in total, approximately 100 were withdrawn, another 100 or so were rejected, and more than 2,900 were settled and paid.

[Translation]

Mr. Gilles Perron: I would like to ask you a secondary question. You always speak in the past. Can what you say be transposed to the present? Do requests for arbitration continue to be made and, if they do, what is the volume of these requests?

[English]

Mr. R.D. Bettner: There are still arbitration claims alive on the books from the Cross Lake First Nation. The implementation agreements have resolved the outstanding arbitration claims of the other four first nations. There are as well some continuing arbitration claims for matters arising out of personal injury or fatality. There are arbitration claims on the books arising from a number of persons who were formerly resident at the community of South Indian Lake.

[Translation]

Mr. Gilles Perron: My second question is very brief. We are talking today about the main agreement. Will it be less problematic as regards requests for arbitration and, if so, why?

[English]

Mr. R.D. Bettner: Do you mean this agreement?

Mr. Gilles Perron: Yes.

• 1055

Mr. R.D. Bettner: This agreement will put an end to those existing arbitration claims that are currently on the books before the arbitrator. I don't believe there are any outstanding arbitration claims for personal injuries or fatalities pending with respect to Norway House members.

So arbitration claims, for instance, dealing with things such as culture, recreation, trapping, fishing, hunting, waterfowl, a whole host of things—those claims for the existing development are resolved as part of this agreement.

Mr. Robert Adkins: I think in part answer to your question as well, in each of these comprehensive agreements we sat down and spent actually several months in most instances speaking with the community representatives as to how they would best feel about dealing with their own claims. In other words, the idea would be to establish a fund of money that would be sufficient to deal with all of these individual claims of $3,300 over the 21 years, which annually is not a lot of money, but it is a lot of process. Each of the first nations has something slightly different in that process, and each of the comprehensive agreements, three of which you've looked at and this one that you're now considering, sets forth a process that this first nation feels is appropriate.

The thing the other parties, Manitoba Hydro and Canada, wanted to ensure is that the claims process they selected and put forward as the way we'd like to deal with it was at least as favourable to the party making the claim as the Northern Flood Agreement process was. I think without exception—in fact I'm certain because I've been involved in the drafting of each of those. With no exception whatsoever, they are as favourable to the person making the claim as the Northern Flood Agreement was. The nice thing is that now the claim can actually be presented locally to members of their own community who review it, and if they approve it they can then pay the money expeditiously and cover off the claim. If they do not think it's appropriate and they're not prepared to recommend it be paid, there is an appeal process that actually is exactly the same as the Northern Flood Agreement appeal process, with an arbitrator, funding of costs, funding of lawyers, reverse onuses—everything of that nature is there.

So the effort here was to try to craft something that would be supportable into the future and not leave people in a situation where they lost what they had before. That's not what has happened, and a great deal of care and effort was put into the document to ensure that this didn't happen.

The Chairman: Thank you.

Mr. Keddy.

Mr. Gerald Keddy: Thank you, Mr. Chairman. My question is on the finality of this agreement, because I'm getting some mixed messages on the finality of this agreement, and I think you would be in agreement that every agreement must have some type of a process whereby there is some end to it. There may be ongoing obligations, legal responsibilities, but particularly in terms of the claims process, does this end the claims process or does the claims process go on?

Mr. Robert Adkins: There will continue to be a claims process. At the present point in time, the claims process under the agreement and in the absence of the legislation would be dual. The people could make their claim against the fund locally if they wanted to or they could continue, because no one has taken away that right at this point in time, to go against Manitoba Hydro. So that claims process would continue.

Mr. Gerald Keddy: But is it the claim that is in existence now or is it a claim in the future?

Mr. Robert Adkins: All of the claims of the Norway House Cree Nation that were brought as a nation are finished. They're settled and resolved. For any individual claims that were there, and I think there have been settlements for most of them, but if there are any individual ones that aren't resolved, they could continue under the NFA now, in which case if they ultimately got a decision against Manitoba Hydro, or Manitoba or Canada, then under the agreement they would go back to the first nation and say, here is the claim, and the first nation would then have to pay out of the fund that's there to reimburse or to indemnify Manitoba Hydro, Manitoba, or Canada. What this legislation is intended to do is simply say when you have the two choices, take the one that is direct rather than indirect.

Mr. Gerald Keddy: Understood, but are there any additional claims that are going to be looked at prior to what are on the books now? In the future, because the claims have been made, we're not going to be down the road next year with a broken prop or with loss of fishing habitat. Is that so?

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Mr. Robert Adkins: If a person is out and they hit a log and break their prop, they will bring a claim. They will bring their claim under the local process and they will get reimbursed from the fund of money.

Mr. Gerald Keddy: I understand that, but I'm having some difficulty. I guess the process has gone through and I'm sure we don't want to enter upon it again, but....

Mr. R.D. Bettner: If your question, Mr. Keddy, is do we expect to see another claim brought, say, by the fishermen's association or the Norway House Cree Nation for impacts to commercial fishing, that answer would be likely not. It is unforeseen or unanticipated at this time. It would have to be something extraordinary.

Mr. Gerald Keddy: But there are certain hazards involved in the pursuit of fishing.

Mr. R.D. Bettner: Agreed.

Mr. Gerald Keddy: Some of those certain hazards would be submerged logs, tree tops, stones, rocky outcropping. I can see at the beginning of the agreement where all that would be compensated without question, but in perpetuity, I have a little bit of difficulty with it, as I suspect Manitoba Hydro did as well. But that's established. That's the process and you are pursuing that.

Mr. R.D. Bettner: I understand what your point is now. You're looking at a situation where once, if you will, the post-project regime becomes firmly established and everyone is aware, is there an expectation that we'll—

Mr. Gerald Keddy: In 25 years' time, are you programmed to deal with some—

Mr. R.D. Bettner: You're still hitting the same rock, in other words.

Mr. Gerald Keddy: Exactly.

Mr. R.D. Bettner: Under this process, that will be a decision, at first instance, that will be in the control of the Norway House Cree Nation. They will know. Was this a situation where there had been some untoward or unforeseen circumstance that might have caused this, or was somebody just forgetful, careless?

Mr. Gerald Keddy: But Norway House will carry that process on.

Mr. R.D. Bettner: Yes.

Mr. Gerald Keddy: You will pay a lump sum.

Mr. R.D. Bettner: The money has already been paid.

Mr. Gerald Keddy: Okay. That is to cover it for perpetuity.

Mr. R.D. Bettner: Yes.

Mr. Gerald Keddy: So at some stage in the game, Norway House may consider not to accept claims on that type of thing, but it would be Norway House's decision.

Mr. Robert Adkins: That's correct.

Mr. Gerald Keddy: Thank you, gentlemen. It's an important clarification.

[Translation]

The Chairman: Thank you. No further questions? Thank you, Mr. Bettner and Mr. Adkins.

We will now turn to the representative of the Government of Manitoba.

[English]

Mr. Hannon, you have a statement.

Mr. Gord Hannon (Crown Counsel, Civil Legal Services, Manitoba Department of Justice, Government of Manitoba): Thank you, Mr. Chairman.

I'm pleased to have an opportunity to make a brief opening statement to this committee on behalf of the Manitoba Department of Northern Affairs. Manitoba Northern Affairs is the lead Manitoba government agency for both Northern Flood Agreement and treaty land entitlement matters in Manitoba. I've had the pleasure of acting as principal counsel to Manitoba Northern Affairs on matters relating to the Northern Flood Agreement and treaty land entitlement for over 13 years now. I've acted as counsel to Manitoba during the negotiation of the treaty land entitlement framework agreement, which has been discussed at some length in this committee, and continue to act as counsel to Manitoba Northern Affairs in respect of the Northern Flood Agreement and treaty land entitlement matters.

• 1105

In that context, Mr. Chairman, I've been asked to make a few comments in respect of Bill C-56. At the outset I'd like to say that Manitoba Northern Affairs and the Government of Manitoba express their support for both parts of Bill C-56. We believe this bill is an important part of the implementation of the Norway House Master Implementation Agreement for the Northern Flood Agreement, and also for the implementation of treaty land entitlement in Manitoba.

As Mr. Roddick mentioned, Bill C-56 is not required for either the Manitoba Treaty Land Entitlement Framework Agreement or the Norway House Master Implementation Agreement to be legally valid. They are valid and binding agreements in force right now. Bill C-56 is being proposed because it makes those agreements work better, and I agree fully with Mr. Roddick's comments in that regard.

The parties in the negotiations of both the Treaty Land Entitlement Framework Agreement and the various implementation agreements for the Northern Flood Agreement recognized during the negotiation process that in some cases it may be desirable to seek some targeted amendments to legislation to assist in the implementation of the agreements resulting from those processes, and as a result, in this case, we have Bill C-56.

I suggest to the committee that it's important to recognize that Bill C-56 does not create broad general changes in the law. They are very much targeted to the specific agreements in question. In fact, in respect of part 2, relating to reserve establishment, the changes only apply where the council of a first nation agrees that the changes will apply.

I should point out as well that legislative changes don't occur only in Parliament. There has been legislation introduced and passed in the legislature of Manitoba relating to both treaty land entitlement and to the Northern Flood Agreement. There have been three previous pieces of legislation in Manitoba relating to the three previous implementation agreements under the Northern Flood Agreement involving Split Lake, York Factory, and Nelson House. They are companion pieces of legislation to the legislation that was introduced and passed in Parliament, and the legislation relating to Norway House was introduced and passed in the Manitoba legislature in June 1998.

I should point out as well that both parts of Bill C-56 were the subject of consultation with Manitoba. Part 1, relating to Norway House, was the subject of consultation with Manitoba, Manitoba Hydro, and the Norway House Cree. Part 2 was the subject of consultation with Manitoba and the treaty land entitlement committee, the parties to both of those agreements.

I had the pleasure personally of being involved in the consultation process, and I can say that although there were some differences in the preparation of drafting of the legislation, ultimately, after the consultation process, the Government of Manitoba is pleased to support Bill C-56. We understand that Norway House supports part 1, and the treaty land entitlement committee supports part 2 of Bill C-56.

I'd like to take a couple of minutes to make some general comments—and I apologize if I'm a little bit repetitive about the situation relating to the Norway House implementation agreement. At the outset, I do want to say on behalf of Manitoba that Manitoba considers the implementation agreement to be a fair and honourable way to address the implementation obligations of Manitoba, and indeed the other parties under the Northern Flood Agreement at Norway House.

One of the reasons for that is because it addresses issues in a more specific and substantive way than the 1997 Northern Flood Agreement does. By and large, the 1977 NFA sets outs general principles relating to the determination of compensation for those five first nations whose lands were affected by the Lake Winnipeg regulation and Churchill River diversion projects. As Mr. Roddick pointed out this morning, the effective way of authorizing the use of lands from those first nations was by way of expropriation under section 35 of the Indian Act, consented to by the Government of Canada.

• 1110

However, one of the difficulties with a general agreement providing general statements of principle is that over time it became increasingly evident to all parties that there wasn't sufficient specificity in the NFA to provide for specific implementation measures. Some of these were because the principles were very broad; some of them were because of, frankly, obvious deficiencies in the agreement.

One example Mr. Roddick referred to was schedules that were not completed in the NFA. There's a specific schedule that is intended, in the 1977 NFA, to set out areas of land as hold areas, and those schedules are not in fact attached to the agreement.

The way the parties to the 1977 NFA contemplated addressing disputes or disagreements was through binding arbitration, and that has its effectiveness, but it has also resulted in there being, as was discussed with our last presenters, a large number of complicated arbitration claims filed with the Northern Flood Agreement arbitrator. In effect, virtually all provisions of the NFA have been subject to a claim or a series of claims that have been filed with the arbitrator. Those claims are very difficult to resolve because of their complexities and uncertainties.

As a result of that, the parties—and I submit it's really all of the parties—looked at a process for comprehensive implementation of the Northern Flood Agreement, and now four of the first nations have chosen and approved implementation agreements, the most recent of which is the Norway House Master Implementation Agreement.

From a Government of Manitoba perspective, there are a number of aspects of the agreement that are particularly important. First, there is a specific amount and specific area of land described as compensation. It's an amount significantly greater than contemplated under the 1977 NFA. We had some discussion about that earlier. The value is not just in the amount but in the fact that the location of the land is specifically identified in the agreement. The 1977 Northern Flood Agreement set out the principle for there being four acres of land in compensation for every acre of land affected, but it didn't determine where that land would be, nor did it determine exactly how much land was affected in each community.

Well, the implementation agreements specifically identify which land will be provided in compensation. Councillor Muskego referred to the land at Molson Lake as being of particular importance to Norway House. The Government of Manitoba, during the negotiation process, was able to determine that land at Norway House would be available and was able to ensure that the land is transferred to Canada to become reserve for the benefit of Norway House.

Another important aspect to the Government of Manitoba is the development of a land and resource co-management regime set out in detail in the implementation agreement. This provides for cooperative management of the resource area as defined in the agreement. As Mr. Roddick pointed out, some of the principles of the Northern Flood Agreement are transported directly into the new provisions relating to resource management, but we think there is a lot more structure and a lot more opportunity for positive development of resource management opportunities and land use opportunities in the resource area.

What that brings me to is a couple of observations on the very specific aspects of part 1 of Bill C-56. At the risk of being somewhat repetitive, I would point out, firstly, that the first main aspect of part 1 is the Indian moneys issue, which Mr. Roddick spoke of a short time ago. Simply put, this is a very targeted amendment, in effect, to the Indian Act to allow that compensation funds that are to be paid and will be paid under this agreement may be paid where all the parties think they belong, and that is into the trust rather than through the Government of Canada to be dealt with under the Indian moneys provisions of the Indian Act, which were not developed to deal with this kind of situation. All of the parties to the negotiations agree that this is a legitimate and appropriate thing to do in this case.

• 1115

The second aspect of it relates to claims under the implementation agreement. I won't repeat what Mr. Roddick, Mr. Adkins and Mr. Bettner said, but it is an important aspect and a very targeted aspect of Bill C-56 that claims be allowed to be dealt with locally in the community, from the claims fund under the trust, rather than being dealt with in a different way. This is clearly an objective that all of the parties wish to achieve, and that's the point behind that aspect of Bill C-56.

I pointed out just a few minutes ago that companion Manitoba legislation was introduced and passed in the Manitoba legislature in June 1998. I would also like to note that in addition to support from all four parties for the implementation agreement, all parties in the Manitoba legislature supported the legislation, as was the case with the three previous pieces of legislation relating to the three previous implementation agreements.

The last point on part 1 of Bill C-56 from our perspective is that treaty and aboriginal rights of aboriginal persons are not affected by this agreement. Mr. Roddick said it more eloquently than I can—or perhaps Justice Muldoon did when quoted by Mr. Roddick—but it is an expressed provision of the agreement that treaty and aboriginal rights will be protected. In addition, this implementation agreement and the other implementation agreements that have already been signed and are being implemented, do not affect rights of other first nations people, including very specifically the people at Cross Lake.

We recognize that Cross Lake is not right now pursuing a comprehensive implementation approach. That's their choice, and Manitoba respects that choice. A working group, for example, has been established among the four parties to determine implementation priorities at Cross Lake, and we are hopeful that this approach will be productive. But that is their choice. Norway House and the other Northern Flood Agreement communities have made their choices, and we respect their choices as well.

In respect of part 2, relating to reserve establishment, like part 1, the proposed legislation is designed to give effect to the agreement that is already in force. It is designed to make the reserve establishment for treaty land and other purposes easier. It doesn't affect the validity of the framework agreement or the specific agreements contemplated by the framework agreement. It just makes them work better.

As I know the committee has already heard—but I think it's worth repeating—the framework agreement provides for up to 1.1 million acres of land to be set apart as reserve land for 19 specific first nations in Manitoba, and we are looking at a timeframe of three to five years to complete that. The legislation is designed to make it easier to accomplish that objective sooner rather than later.

We should point out as well that there are seven other first nations with treaty land entitlement settlements in addition to the 19 represented by Chief Thunder's treaty land entitlement committee, and we can anticipate up to another 155,000 acres of land to be set apart as reserve under those seven agreements. This is an important thing from Manitoba's perspective. Manitoba has a constitutional obligation, under the Manitoba Natural Resources Transfer Act, to return land to Canada to enable Canada to fulfil the terms of the treaties. It is an important priority to Manitoba that these constitutional obligations are implemented in a timely and effective way. We believe we have, through the negotiations process, designed the framework agreement in a way that will assist all parties to achieve that important objective.

Very specifically, there are aspects of the Indian Act that make it difficult to establish reserves in circumstances in which there are third-party interests on land. This is a very important aspect of the framework agreement. It took up a great deal of table time in the negotiations in terms of how to accommodate existing, legitimate interests of third parties in circumstances in which all of the parties wish to have the land become reserve, but also in terms of how to protect the interests of the third party.

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In the written brief that I have submitted, we have attached an excerpt from article 10 of the framework agreement. It shows that there are a large number of different ways in which third-party interests can be accommodated. They are to be applied based on the specific facts of the case and the interests of the parties in question, but are designed to make it as easy as possible to allow reserves to be created while protecting third-party interests. Bill C-56 is part of this process. It is specifically contemplated in article 10 of the framework agreement, and in certain cases will allow for land to be set apart as reserve while protecting third-party interests by allowing for first nations to designate land for lease or other purposes before the land is set apart as reserve.

Another aspect of Bill C-56 authorizes the Minister of Indian Affairs and Northern Development, on behalf of Canada, to set land apart as reserve. We believe this will reduce the amount of time in reserve creation by a period of months, simply by eliminating the step that requires an order of the Governor in Council. In fact, there's nothing in the Indian Act that says an order of the Governor in Council is required to set land apart as reserve, but I understand this has been the practice that has been adopted.

In short, we think Bill C-56 is a legitimate and appropriate way to allow the parties to achieve the objectives they sought under both the framework agreement for treaty land entitlement and the implementation agreement for Norway House Northern Flood Agreement.

I just want to make one last point, Mr. Chairman, because I think it is the source of some pride personally and on behalf of all of the parties to the framework agreement in particular. There is a more detailed and more creative approach to dispute resolution built right into the agreement, and it includes a formal implementation monitoring committee that consists of representatives of each of the three parties to the agreement: the Government of Canada, the Government of Manitoba, and the treaty land entitlement committee. The objectives of the implementation monitoring committee are to provide a mechanism to resolve disputes by consensus, to allow for discussion and consideration of what are sometimes very complicated fact and legal situations, and then to find a solution. Recognizing that this is not always possible, the implementation monitoring committee is backstopped with more formal methods of dispute resolution, including a senior advisory committee consisting of senior representatives of each of the three parties. If that doesn't work, there is then a formal dispute resolution process involving fact-finding mediation, non-binding arbitration, or binding arbitration.

I'll wrap up there, Mr. Chairman. In short, to repeat, the Manitoba Department of Northern Affairs, on behalf of the Government of Manitoba, supports Bill C-56 and encourages this committee to recommend it.

Thank you, Mr. Chairman.

[Translation]

The Chairman: Thank you for your statement, Mr. Hannon. We now move on to the question period.

Mr. Konrad.

[English]

Mr. Derrek Konrad: Thank you very much for your presentation. I have more questions than I'm going to have time to ask.

Looking at the presentation that was handed out here, it says there will be about 2,000 square miles of land set aside for reserve land. That's about 55 townships. That's a lot of land. There must also be an equivalent amount of money, because you're not going to find that much land that is going to be selected, I'm sure. If there is, how much? Can you make it very quick? I have another couple of questions I want to get in.

Mr. Gord Hannon: Yes, Mr. Konrad, there is actually a schedule set right out in the back of the agreement that would answer the question quite quickly. However, most of the land in Manitoba—and it is unlike Saskatchewan; that's one of the advantages we have in Manitoba—will be selected in northern Manitoba, which is not the agricultural belt, which is not settled land. We are anticipating—and it's in schedule 8 of the framework agreement—that nearly 986,000 acres of the 1.1 million will be taken from crown land. Only 114,000 acres will be from private land sources, and there's a land acquisition payment paid under the agreement of $24,461,745 and it applies only to six of the first nations under the framework agreement, who are located in southern Manitoba mostly.

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Mr. Derrek Konrad: Thank you. My next question is this. We seem to get a fair amount of unhappiness expressed by people who are C-31 Indians. In fact, I took a call from outside my riding yesterday from someone who wants to take their entitlement and not be a part of a treaty land entitlement process. Was there any consideration given to putting in place such a process, where people could take their entitlement either as cash or in fee simple? Was that considered? If it was considered and rejected, why? If it wasn't considered at all, why not?

Mr. Gord Hannon: I'll try to deal with that based on memory of discussion. It was not really considered, but issues relating, for example, to off-reserve or C-31 Indians are included in the consideration in a couple of ways. One is that in the community approval process, which is a ratification process and community consultation, all members of the first nation are entitled to vote on the individual agreements that apply to each of the first nations.

In addition, the argument that had been made by the treaty land entitlement committee during the negotiations is that by having additional lands, that will assist C-31 Indians and other off-reserve persons from perhaps, if they wished, being entitled to reside on reserve.

I guess the third aspect is that there is what's called a federal payment component of the agreement, which is provided not expressly for the purpose of acquiring land, but to be used by a first nation for matters of general benefit to the first nation.

Mr. Derrek Konrad: Okay. I just want to say that many of these people don't care to live on reserve, and that's the point. They may have a benefit coming, but to exercise it they're tied to a geographic location, which kind of inhibits their freedoms even under the mobility rights of the Constitution. I think that's something that needs to be looked at.

Do I have a few more minutes?

The Chairman: No.

[Translation]

However, because it is an important topic, we will allow you another two minutes, Mr. Konrad.

[English]

Mr. Derrek Konrad: Thank you. Tax revenue and zoning are two concerns that have come up in Saskatchewan, where rural municipalities seem to be under the gun in providing zoning amendments that are not in accordance with what has been their historical practice, and loss of tax revenue. Could you address those two issues?

Mr. Gord Hannon: Yes, Mr. Konrad. There are provisions. Specifically, it goes on for a page and a half relating to selection or acquisition of land in a municipality. It's article 3.07 of the framework agreement.

Simply put, before land is set apart as reserve where the land is either selected, which means taken from crown land, or acquired, which means purchased from private sources, there is a consultation process with the municipality that is designed to address reasonable concerns of the municipality relating to the very concerns you mentioned, sir, such as zoning, taxation, and the provision of services. The preferred method of addressing the concerns that arise is through what is called in the framework agreement a municipal development and services agreement, which is designed to try to make the on-reserve and neighbouring municipal legal and service delivery regimes as compatible as possible.

[Translation]

The Chairman: Mr. Iftody, followed by Mr. Perron.

[English]

Mr. David Iftody: Thank you, Mr. Chairman. Mr. Hannon, you mentioned in part of your presentation that, in your view, the implementation agreement did not abridge or abrogate or affect in any way at all treaty and aboriginal rights. That's your position.

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I wanted you to flesh that out a little bit. Would that mean then that, in signing this, the MIA had to be connected to, or could possibly be connected to, an existing treaty, an aboriginal right with the affected first nations? If that is true, and I'm assuming it is because you're saying there is no effect there, would it be possible then that the original agreement, the Northern Flood Agreement itself in some way, somehow, has at least a shadow of a protection, as a treaty protection under section 35, as you understand it?

Mr. Gord Hannon: That is, simply put, a complicated legal question. I know that when the master implementation agreements were being negotiated, the parties felt it was not something they could answer definitively even if they wanted to. So the objective was to develop an implementation agreement that would be fair and legitimate and effective, whether or not the original 1977 NFA is ultimately determined to be a treaty within the meaning of section 35 of the Constitution Act. That is, it applies and it's effective because it achieves the objectives of the Northern Flood Agreement. There are very serious questions about the status of the Northern Flood Agreement as a treaty.

Obviously in 1977 it was less significant when the agreement was signed in the first place, because it predates the 1982 constitutional amendments. The significance of the characterization of the document as a treaty would not have been, I understand, something the parties necessarily thought about, because it didn't have that constitutional implication at that time. But the master implementation agreement is intended and, I think the parties believe, is effective, regardless of the status of the 1977 NFA.

Mr. David Iftody: I appreciate what you're saying, but if the position of all the parties, and in this case we're talking to you here this morning, is that it doesn't affect treaty rights in any way at all—as a legal object out there that's signed and agreed upon, we're saying it doesn't affect treaty rights at all—wouldn't the first pathway to relationship of that treaty right be the Northern Flood Agreement, which gave birth to the MIA? There's a clear connection between the two.

If it's the position of the Manitoba government that you're protecting a treaty right, and you're signing that in that agreement and saying that categorically in the agreement, isn't the first logical place of connection of that treaty right and the first pathway that's going to lead you beyond the MIA the Northern Flood Agreement?

Mr. Gord Hannon: Well, I think the MIA expressly recognizes the development over time from the Northern Flood Agreement to a more detailed and specific agreement, which is designed to implement those particular objectives of the Northern Flood Agreement.

The Northern Flood Agreement itself recognizes in its preamble, I believe, that the first nations have certain rights or benefits arising from Treaty 5—all of the Northern Flood Agreement first nations are descendants of the signatories to Treaty 5, which covers northern Manitoba. So there is some recognition in the Northern Flood Agreement itself.

I hope I'm not being repetitive. The point behind the implementation agreement is that it achieves, the parties believe, the objectives of the NFA in a way that does not affect treaty or aboriginal rights at all, and is valid and effective regardless of any later determination as to the status of the Northern Flood Agreement, whether or not it's a treaty under the Constitution.

Mr. David Iftody: So the signing of this agreement then in no way affects the treaty rights within the Northern Flood Agreement or, more broadly speaking, Treaty 5, but there is some awkward, as you say, legally complex relationship between the three of those.

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Mr. Gord Hannon: I guess the difficulty is that I am resisting describing the Northern Flood Agreement as a treaty. I know there are differences of opinion on that subject and the issue hasn't been resolved. But the main point of article 13.13.3 of the implementation agreement, as I understand it, is that it's not intended to affect.... I'll read it. It says:

Nothing in this Agreement is intended to alter the aboriginal or treaty rights of Norway House Cree Nation or other aboriginal peoples recognized and affirmed under section 35 of the Constitution Act, 1982.

It's not intended to do that, and I think the parties believe it does not do that.

[Translation]

The Chairman: Mr. Perron.

Mr. Gilles Perron: Welcome, Mr. Hannon.

Under the terms of the Northern Flood Agreement, the Government of Manitoba and the federal government committed themselves to providing resources to enable the Five Nations to draw up a plan of comprehensive common values. We know that, under Article 16 of and Schedule E to the Agreement, the plan was aimed at drawing up a joint program of action in the areas of education, poverty, chronic unemployment, improvement of material, social and economic conditions, and so on. Has any progress been made to fulfill this obligation, Mr. Hannon?

[English]

Mr. Gord Hannon: We believe the implementation agreement achieves those very same objectives. Article 16 and schedule E are, I think it's fair to say, difficult provisions to fully interpret and understand in terms of what specifically can be done. But the provisions of the implementation agreement with the trust arrangements, with the resource management commitments, the additional land provisions the Government of Manitoba has committed to, and the ongoing relationship with Norway House and the other parties, we believe addresses those provisions of the Northern Flood Agreement.

An important part of article 16 and schedule E, and one of the very difficult things to understand, I confess, under the 1977 NFA, is the relationship with article 14, which expressly acknowledges that those kinds of matters involve government policy, the policy of the governments of Canada and Manitoba. The intention, as I understand it, of the MIA is to provide for specific definable things that can achieve those objectives.

[Translation]

Mr. Gilles Perron: You believe that Article 16 is included in the new Agreement, in the Bill we are discussing this morning, and that it is feasible?

[English]

Mr. Gord Hannon: Yes, that's right.

[Translation]

Mr. Gilles Perron: It talks about transfer to the federal government of territories and lands owned by Manitoba, with a view to retransforming them into reserves. In the Bill under discussion, no mechanism is specified for these transfers. Should this be done? Does Manitoba have legislation that specifies how to do it, with the exception of allowing for satisfying the interests of third parties?

[English]

Mr. Gord Hannon: We have in the framework agreement, and it's article 10 particularly, which is attached to our brief, an identification of a number of ways of addressing or resolving third-party interests for treaty land entitlement, which we think helps the parties determine the best way to accommodate those third-party interests. The basic principle is that if some third party, someone other than the governments and the first nation has an interest in land, they will be able to maintain that interest in land. But there are lots of ways of addressing it that allow the land to become reserve. We have these identified here.

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In our opinion, if there is a need for any change in legislation provincially, there is the possibility of accommodating it. We have not considered to date that there is a need to change any provincial legislation to address the processes identified in article 10. We have identified the value of making the changes to federal legislation contemplated in Bill C-56 relating to establishing reserves. That's expressly identified in article 10.02(3) of the framework agreement.

[Translation]

Mr. Gilles Perron: I would like to ask whether you have checked that the agreement between the federal government and the First Nations was acceptable. I could write all kinds of high-flown words on a piece of paper, and leave it at that. Is this a test that is feasible considering conflict of interest, other conflicts and never-ending battles? Wouldn't it be better to start from scratch because no solution has been found to any problem?

[English]

Mr. Gord Hannon: If I understand, sir, there have been consultations among the parties during the negotiation of the agreement, but there has also been a process that Manitoba Northern Affairs, on behalf of the Manitoba government, has been involved with in terms of dealing with other interests in Manitoba. I've participated in some of those processes, which have involved dealing with, for example, the mining industry, the forest industry, Manitoba Hydro, and municipalities. The Union of Manitoba Municipalities is very interested in this. We've had consultations with them throughout. We have discussed some of these principles with them.

So I think it's fair to say that there has been a high level of general consultation in Manitoba, and I hope and believe a high level of understanding of the objectives in the framework agreement.

[Translation]

Mr. Gilles Perron: Thank you.

The Chairman: Thank you, Mr. Perron.

Mr. Keddy.

[English]

Mr. Gerald Keddy: I don't think I have any questions, Mr. Chairman, thank you.

[Translation]

The Chairman: Thank you. No further questions? Thank you very much.

[English]

Thank you very much, Mr. Hannon.

[Translation]

We appreciate your coming to testify.

The session is adjourned until next week.