AANR Committee Meeting

STANDING COMMITTEE ON ABORIGINAL AFFAIRS, NORTHERN DEVELOPMENT AND NATURAL RESOURCES

COMITÉ PERMANENT DES AFFAIRES AUTOCHTONES, DU DÉVELOPPEMENT DU GRAND NORD ET DES RESSOURCES NATURELLES

EVIDENCE

[Recorded by Electronic Apparatus]

Wednesday, November 28, 2001

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[English]

The Chair (Mr. Raymond Bonin (Nickel Belt, Lib.)): I call the meeting to order.

Pursuant to the committee's order of reference of Thursday, November 1, 2001, that the supplementary estimates (A) for the fiscal year ending March 31, 2002: votes 1a, 5a, 15a, L20a, 35a, 40a, 45a, and 50a under Aboriginal Affairs, laid upon the table on November 1, 2001, be referred to the Standing Committee on Aboriginal Affairs, Northern Development and Natural Resources, we are pleased and honoured to have with us today the Honourable Robert Nault, minister, and Mr. Gordon Shanks, assistant deputy minister, economic development and special initiatives.

Mr. Minister, first of all, I'd like to share with my colleagues that you have directed me to table Bill C-37 and Bill C-39. That has been done. I'm anxious to table the supplementary estimates on your behalf, at which time we will have completed our work for this session. I commend you for the fine work you have done.

Mr. Minister, your committee has returned to the House four bills and will be returning the estimates of two departments. I would like to say to you that as chair, it has been a privilege to do this work, because of the quality of the members, the work they do, and the seriousness they apply to their work on all sides of the House. I'm very proud to be their chair.

Mr. Minister, we invite you to make opening statements, after which we will do rounds of questions and answers. The first round at least will be five minutes, and that includes the question and the answer. We will be completing at 5 o'clock sharp or before.

Mr. Minister.

Hon. Robert Nault (Minister of Indian Affairs and Northern Development): Thank you very much, Mr. Chairman. I appreciate very much this opportunity to be here to discuss the supplementary estimates.

Before I start with my prepared text for some fifteen minutes or maybe a little less, I just want to thank you for the invitation to come and defend my department's estimates. I personally believe very strongly that ministers have a responsibility to Parliament and the democratic process to be here and available to defend the estimates and the supplementary estimates. It is one of the most important democratic principles that drives the process of Parliament. You will find me extremely easy to convince to come and make these presentations, because that's one of the fundamentals I strongly believe in. I look forward to our discussions.

As you've said, Mr. Shanks is here. He has by far the longest history in the department and is sort of my ADM of everything, in the sense that he has gone practically through the whole department over the last number of years. So I'm sure he'll be able to answer any question I don't know, because he does have that recollection of the history of how the different programs and the cost estimates of the different initiatives have been arrived at.

I hope you'll feel comfortable to ask us those questions, and if we do not know the answer, we will certainly make every effort to get back to you. I have yet to see Gordon get stumped, but I'm looking forward to that today. If you do find that opportunity, then I suppose, Mr. Chairman, I'll owe you all a beer.

I want to say thank you to you, Mr. Chair, for inviting me to appear before your committee. I welcome this opportunity to bring committee members up to date on our department's recent achievements and our plans for progress in the coming year.

Your contributions enable us to fulfill the commitments of the Speech from the Throne, in which our government committed to build a higher quality of life for aboriginal people.

In that speech, we acknowledged that too many aboriginal people continue to live in poverty without the tools they need to build a better future for themselves or their communities. We pledged to create and share opportunity with aboriginal people. We know there is a still a long way to go before aboriginal people can enjoy the same standard of living as other Canadians, but there is a vision we can build on.

The Government of Canada is working in partnership with aboriginal people and northerners to improve their quality of life. In the coming year, you may expect some interesting changes. The most high-profile initiative we have under way is the first nations governance initiative.

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We just completed the first wave of consultations, and over 8,000 first nations people and their leaders have participated through face-to-face consultations, the Internet, telephone, and regular mail. I think you will agree this is quite an achievement, given that this is the first time first nations people have had the opportunity have had the opportunity to participate in such a wide government consultation.

The next phase started a few days ago. Representatives from every major aboriginal organization, from CAP to NAWA and the AFN, have joined together under a group we are calling the joint ministerial advisory committee. They will advise us on the analysis of the consultation and drafting of the legislation. Again, this is an historic occasion to see each major aboriginal organization working with the government on this project.

As you know, my department recently concluded the first ever on-reserve poll. The results indicated many things. One of the most striking was that first nations wanted to hear directly from the federal government. As a result, we are planning another first. In the new year, my department will launch the first ever first nations bulletin. This mail-out will provide information on government services and initiatives to first nations people directly.

Canada's economic and social well-being benefits from strong, self-sufficient aboriginal and northern peoples and communities. The government is fulfilling its commitment to work in partnership on a wide range of initiatives to accelerate progress in aboriginal economic development. The partnering strategy on aboriginal economic development, of which the economic development game plan is an integral part, is eliminating obstacles and fostering opportunities for economic development and long-term economic self-sufficiency.

We are pleased that progress is being made, but we must also recognize that the major challenges are formidable and immediate. Concrete action is being taken on a number of fronts. In fact, I'm proud to report that in the past few years we have begun to address historic issues and enable aboriginal people to take control over their own lives.

We've seen positive results in that the gap in living conditions between aboriginal people and non-aboriginal people has narrowed. For me, that's an indication that we're on the right track. For example, the total number of houses in first nations communities rose 13% between 1996 and 2000. In 1991, less than 80% of houses on reserve had basic water and sewer services. By 2000, this number had increased to 94%. As of 2000, 90% of first nations communities had access to electric services and 88% had access by road year-round.

Education levels have also risen. The total enrolment in elementary and secondary education of first nations students has increased by 11% over eight years. In 1998-1999 there were 3,681 first nations and Inuit students who had completed studies and post-secondary education. Between 1988 and 1998 the number of students enrolled in post-secondary education doubled from 14,000 to 28,000, and 74% of university graduates were employed following completion of their programs.

The aboriginal agenda continues to be a top priority for the Government of Canada. Mr. Chairman, I expect that you and your committee will be very busy in the foreseeable future, based on our commitment in the Speech from the Throne that we place this as a high priority of the government. As a result, INAC's budget continues to grow by about 2% a year to keep pace with the dramatic growth of the aboriginal population and increasing demands for school space, housing, infrastructure, social services, and jobs.

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Overall, Mr. Chairman, twelve federal departments and agencies offer programs for aboriginal people with total planned expenditures of approximately $7.3 billion in 2001-2002, of which INAC accounts for about $5.1 billion, or 70% of the total. Basic, provincial-type services account for more than 80% of total on-reserve funding.

Our priorities for the year ahead reflect an integrated approach that includes dealing with the past and looking to the future. Most importantly, Mr. Chairman, we will begin to focus our investments in areas where there is a direct impact on first nations peoples and their communities. Clearly, long, drawn-out negotiations with first nations people benefit no one but the consultants and the lawyers, and they are not our primary client. We will continue the shift of concluding negotiations where possible, and where not, focusing on investments directly into the community until they are ready to come to the table.

Funding for aboriginal initiatives includes $40 million in fiscal 2001-2002, and $43.7 million in 2002-2003, for the second payment of the settlement of the specific claim with the Horse Lake First Nation of Alberta.

You'll notice, Mr. Chairman, I'm starting to talk a little more specifically about the supplementary estimates, and one of them is the conclusion of the settlement of the specific claim and the resources necessary to pay for the claim of the Horse Lake First Nation of Alberta. There is $34.5 million for the final settlement of the specific claim with the Fishing Lake First Nation of Saskatchewan.

The settlement of these long-standing claims honours the Government of Canada's lawful obligations to these first nations. Reaching settlements also creates opportunities for business partnerships and economic development, both on first nations land and in surrounding communities.

Another important development is our long-term strategy to address the implications of the Supreme Court's Marshall decision and build a new treaty relationship with the Mi'kmaq and Maliseet first nations.

In my initial meetings with the Mi'kmaq and Maliseet leaders in the aftermath of the Marshall decision, they talked about the importance of economic development and increasing the land base of their reserves to address urgent social needs. Mr. Chairman, I couldn't agree more.

For those of you who have not had the opportunity to go to the Atlantic, you will find that the smallest and the poorest of all the first nations are in the Atlantic region. They have a dramatic need for a larger land base, and that's part and parcel of the reason why there are so many social issues in these communities. They virtually have no more land to even build residential housing.

So to demonstrate our commitment, we have increased resources to build more diversified first nations economies and address the shortage of land and build the capacity these east coast communities so desperately need. We have upped the budgets in those areas to deal with that in the last year and a half.

Funding of $12.7 million has been requested for the Marshall response. Part of this funding will help the Mi'kmaq and Maliseet first nations in Nova Scotia, New Brunswick, Prince Edward Island, and Quebec research and prepare for long-term negotiations to address the Marshall decision and its impacts.

The long-term resolution of these issues is key to creating a just and fair relationship with the first nations in the Maritimes, along with a viable economic base they can build on. The department's new initiatives in program integrity deal with three major issues: information management and technology, aboriginal litigation, and the northern affairs program.

First of all, $4.8 million is needed for administration, information management, and necessary upgrades in computer technology and hardware.

Second, $11.6 million is requested to help the department manage and re-engineer its litigation inventory. This re-engineering is needed to deal with a dramatic increase in the volume and complexity of the department's aboriginal litigation. Many of these cases are high-profile and have serious and far-reaching financial and policy implications for the government.

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This is a comprehensive strategy that includes such measures as building a national team and overall strategy, creating a national business centre, increased use of dispute resolution, and consolidating our research.

Finally, Mr. Chairman, $24.2 million is requested for the northern affairs program to manage natural resources and abandoned mines in the north, which pose a serious health risk for northerners. The northern affairs program is currently responsible for four abandoned mines in the north. Three of these mine sites have contaminated tailing ponds, which must be treated and contained. The fourth mine has contaminants stored underground in the permafrost. It is important that we begin to deal with these sites or risk the health and safety of northerners and their fragile environment.

I would remind my colleagues that I'm not only the Minister of Indian Affairs; I'm the Minister of Northern Development, and that is a very large part of Canada's land mass. Our requirements as a department also include, Mr. Chairman, my being the lead minister for natural resources, the environment, regulatory regimes, and the building of the economy—all at the same time as we deal with aboriginal issues that affect the north.

I just wanted to remind you that in your work you'll see that this minister takes his northern responsibilities extremely seriously. For too many years now I have noticed that the northern affairs budget in particular has been shortchanged at the expense of the other budgets, and I'm trying to rebalance. You'll notice in the estimates over the next few years that I have started to do that very thing. So if you see more money moving to the north, it's because, in my view, we have underfunded some of the very important issues we need to deal with.

One of them is the fragile environment and our obligations to make sure the liabilities dealing with that, whether it's in the Yukon or Nunavut or in the Northwest Territories, are delivered by the federal government.

I just give you that in the context of the very important role we have to play. There's not much I can do when a particular mine company goes bankrupt and walks away from a site now. If there's a new mine, of course, we have new regulations to deal with it. There are funds put aside to deal with it. But in some cases these are mines that go back a number of years, before those regulations existed, and those liabilities are in essence ours.

Another big commitment for my department is rebuilding the community of Davis Inlet. Funding of $8.8 million is requested to build houses in the new community of Little Sango Pond. I would give you the aboriginal word, but I can't seem to get it around my tongue these days, so I'll stick to the English version.

This, of course, is a community in Labrador that we are in the process of relocating to Davis Inlet. Mr. Chair, this relocation is necessary to improve the living conditions of the Innu of Davis Inlet. We know that solutions will not happen overnight, but this move will definitely improve the health and begin the healing of this shattered community.

As you know, government online is part of our plan to become the most electronically connected government in the world by the year 2004. It promises to bring a full range of federal government information and services right to Canadians' fingertips.

As we have done over the last few years, we propose to transfer some money between parliamentary votes to cover such ongoing priorities as strategic communications, litigation management, including food mail subsidies for northerners, and environmental cleanup in the north. This includes systems costs to become compliant with the government's move to an accrual-based accounting system.

Mr. Chairman, if I can, I'll just take a quick break here, since I still have this awful cold that my four-year-old brought home last week. He got it from one of his buddies, I understand. That's the price you pay for having young children, I'm told, though I'm not complaining, just stating a fact. I have no choice in the matter.

One of the most important issues for me as a northerner and as the Minister of Northern Development is the food mail program. It's a very important one that delivers nutritious food to isolated northern communities by mail. I'm sure you've heard of it and have maybe debated it at one time or another, depending on how long you've been on this committee, because it's not a new issue. This program is part of our efforts to improve the health of northern communities.

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Mr. Chair, as I've said on many occasions, in order to move forward, we must deal with the grievances of the past. When you bring it down to its basic principles, what aboriginal people want is no different from what any other Canadian wants, and that is a good quality of life and a good standard of living. I believe this integrated approach will provide aboriginal people with the opportunities and tools they need to build a better life for themselves and their families. The initiatives I outlined today are part of our commitment to ensure this vision is realized.

First nations people helped build Canada. These programs and priorities will help ensure they can begin to take their place in this country and begin to reap the benefits of what we have created together.

We know that many challenges lie ahead, but we are confident those challenges will also bring countless opportunities to build a more promising future for aboriginal people and indeed for all Canadians. Mr. Chair, I am honoured to be able to play a role in this historic process.

I'm here to answer your questions, no matter what they are. Whether it's within the supplementary estimates or outside, I certainly am willing to be as transparent as I always have been and be my northern self—very blunt, direct, and to the point. We'll have no difficulty sticking to your five-minute timelines as I move to answering my colleagues' questions.

I thank you for an opportunity to make a few comments, and I look forward to your questions and our answers.

The Chair: Thank you very much, Mr. Minister, and thank you also for encouraging me as chair to change the consensus we had reached as a committee. Yesterday, we discussed whether we should request that this meeting be held on camera. Some of our members felt it was short notice and we should have done it before. As a group, we recommended that we not do it for that reason, but when I spoke to the minister in caucus this morning and brought it to his attention, he is the one who suggested we should do it on camera. We appreciate that. We appreciate a minister who encourages that the public be witness to the questions members will ask.

Mr. Elley will begin the five-minute round.

Mr. Reed Elley (Nanaimo—Cowichan, Canadian Alliance): Thank you very much, Mr. Chair. I want, on behalf of the official opposition, to welcome Minister Nault to committee today. You have already seen, I think, Minister, that we have a committee that is trying very hard to work together. We do have some apparent differences as we go along, but I think we are trying to work together for the benefit of native people across Canada.

As the author of that motion yesterday to have this televised, I am very pleased the minister has agreed to it. I knew he would.

However, having said all that, let's get down to the business of constructive criticism.

Mr. Minister, I think many Canadians—those who have been following the issue for a long time—are alarmed over the number of bands across Canada that have been placed, for instance, in third-party management. Since 1996, the department's budget has risen from $4.2 billion to $5.1 billion. That's a 21% increase. In spite of the almost $30 billion in expenditures over the last five years by the department, Canadians continue to hear, in the press and on the radio, on TV, in first-hand encounters with native people, some very heart-wrenching stories about the appalling conditions on many reserves.

The good success stories—for instance, I visited the Six Nations Reserve down in southwestern Ontario not too long ago and was very impressed by what they've done—are often eclipsed by some of the other stories we hear. We've all heard those stories: the gas sniffing at Davis Inlet, the unacceptably high rates of suicide on many reserves, rampant substance abuse in different parts of the country.

You, as I myself, have seen some of the appalling housing conditions on some of the reserves across Canada. Many aboriginal people have expressed their concerns to me about these overall conditions under which they have to live. Sometimes they express a good deal of concern about what they feel is the lack of accountability by their own chief, the council, and indeed the department itself. When they take a look at the larger situation, they feel somewhat hopeless.

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During this time period, departmental records indicate that third-party management has increased from 5.9% to 16% of all recognized bands. That means for the last fiscal year, 98 bands across Canada were in third-party management, or approximately one out of every six bands.

In the last six years, that's an increase of 75% in the number of bands who are in third-party management. From my point of view, and maybe the point of view of others, it means we have recognized there's a system out there that is not working, in terms of the whole accountability issue.

Mr. Minister, you've asked for supplementary estimate increases of $148 million in your budget. Yet many Canadians would really seriously question whether this would be simply throwing good money away, in light of some of these conditions and some of the things I've stated.

Can you account for this increase in the number of bands that are now under third-party management, and tell us what you and your department are planning to do to change this particular situation today?

Mr. Robert Nault: Thank you very much, Mr. Elley.

First, I think you have to recognize that the number of 96 is not factually the number in third-party management. That is the number of communities in remedial management, which includes co-management, intervention of some type, and third party. So there's a difference. I'll get you the exact number item; I don't have it at my fingertips. But that's the total number of communities in preventive processes we either entertain together with them, or where we recognize, through the audit process, there are some financial issues that need to be dealt with.

I would make my comments based on this point. I see it as a positive that the department is working so closely with communities that we are now recognizing the financial issues a lot earlier than we were in the past. Because of my interest in accountability and financial management, we've undertaken to be much more vigilant in the process of making sure we intervene sooner rather than later.

Because of that, I suppose, I'm the reason why it's going up and not down. I am purposely asking the department to work closer with communities on their financial issues. So you are seeing an increase because we are intervening earlier. I think that's a good sign for all of us because that builds capacity. The whole objective of an audit and the process of third-party management or co-management is to build financial management systems and capacity for those communities that need it.

In some cases, as I've said many times at this committee, being in debt or having a deficit isn't necessarily a bad thing. It depends on what kind of deficit and debt it is.

If a community, for its own reasons, goes out and builds an arena—because we don't build arenas as the Department of Indian Affairs and Northern Development—and uses its own resources, it would cause it to have a deficit. That wouldn't be any different than if a municipality went and got a debenture and built an arena.

It would show on its audit as a deficit, that's true, and it would be a concern of the government and the minister. So we would work with it to make sure it didn't get to a point where the programs that were important under statute to deliver—education, social services, and health—were in jeopardy. Those are the areas where we would want to assure ourselves.

I don't see it as a negative. I see it as a very positive thing, as the government wanting to be more involved in assuring ourselves that if there are problems, we can work together to solve them.

I will end my comments with this point. That's the main reason why I committed myself last year to a 20% increase in band support funding. One of the areas of weakness I have found in the department and in first nations is the capacity to govern. The reason why they have a weakness in capacity to govern is a lack of resources. If you don't have enough money to hire proper staff, you wonder why you have difficulties.

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I have committed the government and our department to a 20% increase over the life of this Parliament, when in fact that particular funding had been frozen since 1995. So I think that will help us deal with the capacity issues in the community and improve the financial management of those communities. I see that as a positive initiative, not as a negative initiative.

[Translation]

The Chair: Mr. Marceau, you have six minutes.

Mr. Richard Marceau (Charlesbourg—Jacques-Cartier, BQ): Thank you, Mr. Chairman.

I want to begin by making the point that what occurred today is highly unusual. Don't misunderstand me: I am not complaining about the fact that it will be televised. Indeed, I was in favour of that. However, I was under the impression that it was up to this Committee to decide whether its proceedings would be televised or not. The Liberal majority had voted against it. The Chairman then decided to reverse the Committee's decision, so he wins. In any case, I really don't understand how this could have happened, and I would like to be given an opportunity to gain some understanding of that before I move to my questions.

The Chair: I am fully responsible for reversing the Committee's consensus decision. I discussed it with the people who were opposed. Naturally, opposition members wanted the proceedings to be televised, and it was in fact to please the members of the parties opposites that I took this action. So, I take full responsibility for it.

Mr. Richard Marceau: I see.

Minister, I want to thank you for being here today. It is always a pleasure to have you come before the Committee.

Is your office located in Room 407 of the West Block?

The Chair: What does that have to...

Mr. Richard Marceau: I want to know whether the member's office is indeed located in Room 407 of the West Block.

The Chair: What does that have to do with the order of the day?

Mr. Richard Marceau: There is a connection.

[English]

Mr. Robert Nault: Yes.

[Translation]

Mr. Richard Marceau: Thank you. The last time you appeared before the Committee was on May 3, 2001. During our exchange at that time, you challenged me—in a friendly way, I presume—to find a recommendation in the Erasmus-Dussault report that not been acted on by your government, because I was making the point that you had not followed up on a number of those recommendations and was wondering why we could not use them as a basis for further action. You asked me to send you some examples, saying that you would respond. So, I have all of that in front of me here.

On June 13, 2001—more than five months ago—I wrote you an eight-page letter outlining the various recommendations in the Erasmus-Dussault report that the government had not acted on, in response to your friendly challenge. How do you explain the fact that five months after I first sent this letter, I have yet to receive an answer from you?

The Chair: I have a problem with this kind of questioning.

Mr. Richard Marceau: Why?

The Chair: We are here to review the Supplementary Estimates. We have to send a series of votes back to the House of Commons. I don't see the connection between that and your question. So, I am ruling your question out of order. If another Committee member wishes to challenge my decision, I would invite him or her to do so.

Mr. Richard Marceau: Mr. Chairman, we are talking about budget estimates. A speech was presented that outlined not only what the government wants to do with respect to spending, but its general philosophy regarding aboriginal issues. And one of the main documents dealing with First Nations governments and the way they should be treated is the Erasmus-Dussault report. As I see it, it is extremely relevant to the government's philosophy in this area.

The last time we met with the Minister for a similar exercise, I asked a number of different questions with respect to the Erasmus-Dussault report. I did not receive an answer. So, I would like to know why I received no answer regarding issues that are closely related to aboriginal governance and the way the government fulfills its responsibilities towards First Nations.

The Chair: Well then, Mr. Marceau, please ask your question.

Mr. Richard Marceau: That's what I just did.

The Chair: What happened here in May is of no concern to me. I was not here then. So, I'm not interested in knowing that you sent a letter to the Minister in June. What I am interested in is hearing you ask questions related to the Supplementary Estimates. So, please proceed with your question, but do spare us the history behind that question.

Mr. Richard Marceau: What happened to the questions I referred to you?

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[English]

Mr. Robert Nault: That's a perfectly legitimate question, I suppose, by the member.

[Translation]

An hon. Member: Thank you.

[English]

Mr. Robert Nault: I want to tell all the members how the process works in my office.

If any member of Parliament, provincial or federal minister, or chief writes me a letter, I see them myself. I don't recall seeing this letter, so I'll check because I get every single letter. Mr. Elley will know because he sends me a lot of them. I keep close track of every letter that is sent by an elected official, including yourself.

I don't recall seeing this letter, and I will find out. Sometimes they end up in the wrong place, and I can't for the life of me recall this very lengthy letter. If I had seen it, I would recall it. If it was about the royal commission and the recommendations, I would be very much aware of it. It is not my view that any member should wait four or five months for an answer.

I can only tell you that I'll look into it and make every effort to find out what happened to it. But I don't recall seeing this letter. I can tell you that practically every single member in this room—Mr. Mark, Mr. Martin—have all sent me letters and I've seen them. I know exactly what they were, which community they referred to, and on which issue, because I personally take an interest in letters from members of Parliament, and I don't recall seeing this letter.

[Translation]

Mr. Richard Marceau: I have no problem with that. Thank you very much. That is the answer I was expecting.

In light of the events of September 11th, the government's agenda has radically changed, for obvious reasons. In the last Speech from the Throne, the government announced its intention to make aboriginal issues its top priority. Now, given what occurred on September 11th, I would like to know whether these issues continue to be viewed—not just in form but in substance—by the government as a top priority? That is my first question.

I also have a second question. I was reading in the newspapers this morning that federal government expenditures required to respond to the September 11th attack and the consequences of that attack have been estimated to amount to about $5 billion. What is the direct impact of that not only on projects that were already under way, but on planned spending for the purposes of implementing these different projects?

[English]

Mr. Robert Nault: First, every single department of the government, and the country itself, has been affected by September 11. It's pretty safe to say everybody would recognize that it's had a financial impact on the government and on citizens of our country.

The question relates to whether this has affected our priorities. Of course, one of the priorities in the Speech from the Throne is to work with aboriginal people on education, health, building an economy, and improving government structures. On whether that commitment still remains, the answer is yes, very much so.

We have always said—and all governments will say to you—that a Speech from the Throne is intended to be our vision document for a term, not just for one budget. So I see that the vision and direction in the Speech from the Throne has already commenced.

I want to report to you that a few short weeks ago I entered into an agreement with the AFN, in particular the national chief and his executive, to look at and work together on the initiatives dealing with the Speech from the Throne. We're in the process of a work plan, as we speak.

So I think the commitment is there, not only from the government but from the aboriginal people themselves, to find those out-of-the-box ways of developing solutions, based on the fact that some of the solutions we have suggested in the past have not worked.

One of them, obviously, is governance and that is proceeding. One deals with issues of the past, and that is the claims envelope. We should be coming forward to you as a committee with an independent claims body piece of legislation. Those are all commitments within the Speech from the Throne, and we have every intention of meeting them.

Is there a need for more resources? Yes, I believe there is, in the Department of Indian Affairs and Northern Development, because we have the responsibility for the youngest and fastest-growing population in our country. It's pretty safe to say that the budget of this minister, since this party has been in government, has never been cut; it has always been increased, and we will do everything in our power to continue that, whether it is a 2% increase overall, or in some claim areas we'll spend more money, depending upon what the priorities are.

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So I give the member the assurance that the agenda is still on track, and we are still very committed to improving the lives of aboriginal people in this budget and in further budgets.

The Chair: Mr. Martin.

Mr. Pat Martin (Winnipeg Centre, NDP): Thank you, Mr. Chair. I too would like to thank the minister for being here with us today and for being so frank with us. I noticed in his opening remarks and with the Speech from the Throne that he has reinforced today that the aboriginal agenda is one of this government's top-ranking priorities. I am pleased to hear that, because I believe, as I think most of the members in the room believe, that Canada's track record for its treatment of our aboriginal people is this country's greatest shame.

Having said that, I think the questions of my colleague from the Bloc were quite pertinent and quite relevant in that, given the laudable, lofty goals cited in the vision statement, if you will, of the Speech from the Throne, many of us were heartened to believe that this budgetary era, if you will, this surplus era that we found ourselves in, would be the time when we finally address some of these long-standing issues. Then the events of September 11 came along, and it would seem to us in digging through the estimates that with the Solicitor General getting a 160% increase in his budget and other portfolios getting 30% and 40% increases in their budgets, we're going to pay for our new security measures on the backs of the people who can least afford it—people living in third world conditions in aboriginal communities who have been waiting patiently for all these long years to finally have their issues addressed.

I would ask the minister first of all whether, with regard to the 2% growth target or goal, the research is there to indicate that will keep up with the growth in population that he just cited—the fastest-growing demographic group in the country. Would he not agree as well that this year we're not getting anywhere near 2%? When you take away the settlement to the Horse Lake Band and the Fishing Lake Band, I think you only have new money of $37 million, which on a base rate of $5.1 billion is a real increase of about 0.6 of 1%. Am I missing something there, or is this new money more like 0.6%?

Mr. Robert Nault: Mr. Chairman, I just want to remind my colleague that these are the supplementary estimates. So this is above and beyond the resources we received at the beginning of the fiscal year. The next fiscal year, I would presume, we will get further increases to our budget based on the budget of the Minister of Finance and the estimates you will see in March-April. Of course, the final conclusion of our estimate discussions is usually in May, if my memory serves me correctly. The last time I was here, if you recall, was to deal with the main estimates.

Overall our increase has been closer to 7%, but we don't factor in the increases we get from the centre or from Finance and Treasury Board on individual claims. We keep that separate because those are one-time occurrences.

We only include the 2% basically that is for programming of our regular services. I want to remind my colleague that if we looked at the cost of some of the settlements of the specific claims in the last year, they have been much larger than my claims budget would allow. So those resources have come from the Department of Finance through an agreement with Treasury Board.

The overall increase is about 7%, but we don't look at it that way because the 2% is really for programming. I just want to remind my colleague that these are the supplementary estimates, which are intended to deal with issues that were not foreseen at the beginning of the year and need to be dealt with, to some extent, at the end of the fiscal year.

• 1615

Mr. Pat Martin: Fair enough.

Could I ask one specific question about a budget line under the explanations on page 85? Your strategic communications plan seems like a very generous $9.2 million. What do you contemplate under strategic communication? To me that sounds like a PR line. I'm wondering why you would need to advertise the services you offer.

Mr. Robert Nault: Well, no, Mr. Chairman, in fact it's not. But I appreciate you thinking that I am becoming more popular. I didn't think that was the case.

Here is an example of the kinds of things communications deals with. This minister, as you know, has just mentioned to you that we undertook in the department, for the first time in the history of the government, a consultation with first nations citizens. There is a communication process to that—questionnaires, booklets that go out. They come through the communications shop and we pay for them through those processes. It has been a very expensive year as it relates to our new approach to try to resolve what we believe has been a lack of political will over the last number of years to restructure and modernize the Indian Act. So we've taken a different approach, and that's part and parcel of the communication dollars.

But as far as any other matter, Mr. Chairman, we are still doing basically the same polling we did in the past. We're not doing anything differently, as far as the minister's office communicating or anything of that nature. We are just attempting to try to communicate better with first nations communities and their citizens.

For example, earlier I mentioned the bulletin. One of the things that came out of the poll that we did was that the citizens find it distressful that the government doesn't give them information about what the Department of Indian Affairs really does for them. Every citizen has a right to know what their government does do. So instead of relying on old processes of chiefs' meetings or major assemblies, we are now going to try to directly speak to first nations citizens about the government's mandate, government issues. I hope that will improve our relationship, provide understanding of the direction we're trying to go in, and most importantly build trust, because I think trust is the weakness that we have as parliamentarians, as governments, in dealing with aboriginal issues.

People think we're trying to take someone's rights away. I've been accused, as you know, about trying to take aboriginal and treaty rights away in the governance initiative, when in fact that's the least of my interests. I have no interest in doing that. It's to build the whole issue of our treaty relationship by improving the Indian Act and the tools within it. The only way you can do that is by directly communicating, which we haven't done in the past, and I hope to do much better in the future.

So that's the objective, if I can answer Mr. Martin's question in that way.

The Chair: Mr. Mark.

Mr. Inky Mark (Dauphin—Swan River, PC/DR): Thank you, Mr. Chair, and it's nice to have the opportunity to work with you again.

On behalf of the coalition, thank you for coming to the committee.

Coming from a riding that has 13 Indian bands, I've always had a deep interest in aboriginal affairs. Unfortunately, even up to today, the non-aboriginal communities still see the deplorable conditions on reserves as they drive through them. They wonder why this continues to happen when they read in the papers of the bands that are always in the red. I know many of the chiefs personally, and I know for most of them their heart is in the right place. They do their best to work in the best interests of their constituencies. I agree with you that governance is no doubt an issue that needs to be dealt with.

With these allocations and millions of dollars of expenditures, how do you assure the legislators as well as the taxpayers that the basic needs will be dealt with and the moneys you spend will actually get there and it will actually happen?

Mr. Robert Nault: I think that's the whole exercise of our governance initiative. It's a strong belief by both native and non-native citizens that governments, whether they're aboriginal or non-aboriginal, need to be accountable and responsible for their actions. We have attempted, and I've said this publicly many times, to develop our relationship based on a contribution agreement approved by Treasury Board because of the lack of structure within the act itself. We had originally anticipated that we would develop our relationship built on self-government agreements, but as you can tell, we're moving extremely slowly in that regard.

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The objective of the exercise, which I hope this committee will participate in fully in the new year, is to look at governance structures as an interim step to self-government within the act. All those accountability structures will be there.

I want to report to you, Mr. Chairman, that when I came in May, before you became the chair, I made a commitment to the committee that it was the intention of the minister and the department to make public all the audits for the general population. I also said we would in the next fiscal year separate the consolidated audits so we could legally release the amount of money spent in each community on what I believe are core services any government would expect to receive or any peoples would expect to receive—core services dealing with education, social services, and infrastructure. Information on all these dollars will now be made available to you on the Internet at the website of the Department of Indian Affairs in the new fiscal year. It's a commitment I made, and it's one I think most first nations leaders are very supportive of.

That will also go a long way towards dealing with the myth that somehow first nations communities are not being well managed, when the vast majority are doing an extremely good job. Yes, there are communities that have problems, and we shouldn't diminish that fact.

I think once you get to see where the money is spent and how little flexibility in our contribution agreements is available to first nations leaders to spend on things they shouldn't be spending on, you will agree with me that they're doing a very good job based on what they have to work with. Now, it's our objective to improve what they have to work with and to give them the tools, and those tools of course are part of the governance initiative.

There's one other tool, Mr. Chairman, I will be announcing for you, and I don't mind announcing it today, if everyone is listening. We will be opening the First Nations Land Management Act. The First Nations Land Management Act was passed in 1997. In 1997 we put 14 first nations into what we call the First Nations Land Management Act. It was intended for first nations to, outside the Indian Act, have control over land management planning.

If my colleague follows along on the importance of tools of governance, one of them is land planning in order to have planning for the future on residential, commercial, industrial... The objective of this exercise is to make the first nations communities business friendly, and that's the objective of the First Nations Land Management Act.

We already have 30 communities that have passed band council resolutions looking to be in the Land Management Act, and we have another 80 showing interest. I think that will go a long way towards improving the economy once we get the land management structure into some semblance of order.

Mr. Inky Mark: If I may, Mr. Chair, I'll just ask the following question to the same issue of governance and decision-making in relation to other governments, such as provincial governments. For example, in my own experience I have as many Métis communities as Indian, the settlements normally being right beside a reserve. It almost seems ridiculous that when the reserves build a rink, then the Métis settlement builds another rink, and we have a duplication of services. I just wondered, what's in the plans in the future for status Indian governments to perhaps work closer with Métis communities. That's under provincial jurisdiction, I'm sure.

Mr. Robert Nault: Mr. Mark, you ask a fundamental question many of us have been asking ourselves. It's not important whose jurisdiction it is. It's important to find ways to work with the aboriginal community, be it Métis, non-status, status living off-reserve, and of course first nations living on-reserve, to whom the Government of Canada has legal obligations.

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We have in the Speech from the Throne signalled that we'd like to find ways to work with aboriginal people by looking outside the jurisdictional box, meaning to find ways to make people's lives better in working with the provinces.

I'll just give you one example of an initiative I've undertaken as Minister of Indian Affairs. We now have a regional partnership initiative Mr. Shanks is the lead on. The regional partnership initiative is intended to find ways with the regions—in this case the Government of Manitoba—and the aboriginal people, whether they be Métis, non-status, or first nations, to build an economy so it benefits all Canadians. It's to the benefit of Canada to participate in a regional partnership initiative like that.

We are now in the beginning of our second year of this initiative and have been in conversation with all provincial jurisdictions.

I have a very good relationship with the Manitoba government about wanting to work with them on these initiatives that involve thinking outside the jurisdictional box. This means that if we can find a solution to poverty or unemployment, we will be willing to participate because it's the mandate of the Minister of Indian Affairs from an economic point of view.

That's the objective of the regional partnership initiative. It's one that's been communicated right across the country. Some have already started to take this on, and others are just trying to feel their way through it, but overall the provinces have been very positive in response to the initiative.

We have put more resources into the economic development envelope to do things, in Manitoba, for example, to look at the east-side road, which should have a big impact on the first nations that are isolated in that particular area, because how do you build an economy if you're completely isolated? It's very hard, and I think my colleague from Nunavut can attest to that. It's extremely difficult.

There are some needs we have to deal with right up front. If we build the east-side road and participate, it benefits the Government of Canada as well as the province and the first nations communities in that particular area. I just use that as an example.

[Translation]

The Chair: Mr. Binet.

Mr. Gérard Binet (Frontenac—Mégantic, Lib.): Good afternoon, Mr. Nault. I am pleased to have this opportunity to welcome you to our Committee.

Mr. Nault, for how many years have you been Minister of Indian Affairs and Northern Development?

[English]

Mr. Robert Nault: I've been minister for two years and a few months.

[Translation]

Mr. Gérard Binet: And how many First Nations do you have in your riding?

[English]

Mr. Robert Nault: I have 51 first nations in my riding.

[Translation]

Mr. Gérard Binet: That means that you are used to negotiating and are familiar with First Nations.

The Chair: A Committee member is asking that you ask a question on the Estimates.

Mr. Gérard Binet: Yes. I would like to know how you negotiate. Since you have a very thorough understanding of the situation, perhaps you could tell us how First Nations are accountable to you?

[English]

Mr. Robert Nault: Well, Mr. Chairman, if I understand the question, there are a number of different policies the Government of Canada is involved in. One of them of course is specific claims negotiation and the other is comprehensive claims negotiation.

One of the policy changes you heard me announce to you but that has only been restructured and made public within the last month or so is that we are signalling to first nations that we're not prepared to stay at the negotiating table for the sake of staying at the negotiating table. There are in fact some first nations we've been at the table with for a generation and have made very little movement with.

We are going to be doing an assessment of every claim and getting a better understanding of whether in fact the first nation and/or groups of first nations are ready to agree to the mandate the minister has through cabinet. If not, we would be better served using our valuable time to build a capacity in the communities, improving their economy, and the like. We spend about $110 million a year on negotiation across the country, and we are not as successful as I believe we can be.

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So one of the objectives is to ask the negotiators, which the Minister of Indian Affairs hires, to do an assessment and, if possible, to arrive at an agreement. We would certainly expect that agreement would be arrived at within a reasonable timeframe.

For this minister, once there is a framework agreement, “reasonable” should be within a five-year period. If you can't arrive at an agreement, and you're still at the table spending millions of dollars, you question the priority of the government in a situation like that.

I was—as I am usually—extremely blunt as to who gets that money. It goes to lawyers, consultants, and the like. I have no intention of continuing to spend that kind of money if there's no opportunity to arrive at an agreement.

Now this is not, as some might portray, an attempt to put pressure on people. It's just a recognition that if people are not at this point in time prepared to arrive at an agreement, then we might be better served to focus our attention and our scarce resources somewhere else.

When colleagues continue to criticize the government and the minister for not having enough resources for housing, I take that extremely seriously. If I can find ways to get money out of the negotiating envelope, where we're not making progress, I certainly will put it in housing, directly into the communities where it'll have the most impact.

That's the change in direction I was talking about and why your role in the next year is going to be extremely important. I hope to visit you on a number of occasions with legislation of a variety of sorts that will improve the tools of governance, and part of that, of course, relates to setting your priorities differently from in the past.

I disagree with some members, though, who are suggesting that things are appalling in communities, in the sense that it sends the message to Canadians that all the communities are in appalling shape. That's not the case. I have been to many communities where things are really going well, where there's an economy, where there's zero unemployment, where there are business opportunities. That's the kind of leadership that exists out there.

But it's amazing to believe, with an act that's about 130 years old, people could become successful. So my objective this coming year and beyond, working with you, is to stop tying peoples' hands behind their backs. Give them an opportunity to be successful.

That's really the point I was making on negotiation. We're not there just to keep people happy. We're there to get results, to move from there to a new relationship. I make that point because it's an area that has not been discussed much in the public domain, but it's one that interests me a lot.

I want to make one last point, Mr. Chairman, if I could, and it's one that's very close to my colleague from the Yukon.

I was in the Yukon a few weeks ago. We have six first nations left out of the fourteen to arrive at final settlements. It's my strong belief that every one of those first nations is very close to agreement. But it's also safe to say there may not be the political will to go that final mile, that extra step, to complete them.

We've been at the negotiating table in the Yukon for 30 years—30 years. I think it's high time we settle those agreements and get on with implementing self-government and land claims.

The Chair: Thank you, Mr. Minister, and colleagues.

We will now proceed to a four-minute round. I will be very strict on the four minutes, because I have Mr. Vellacott, Ms. Karetak-Lindell, Monsieur Marceau, Mr. Finlay, Mr. Martin, Monsieur Bertrand, and Mr. Mark.

I have to get all the questions in and I'm short four minutes.

Mr. Vellacott.

Mr. Maurice Vellacott (Saskatoon—Wanuskewin, Canadian Alliance): I'll be quick, Minister Nault. I have less time than... I guess we're on the first here. I want to focus for just a few minutes on Manitoba and the issue of financial accountability in that particular region.

There's been a lot of concern expressed by different people, to us in particular, regarding the department's intervention policy in Manitoba. It's the matter of businesses that are currently under the impression that when a band is placed under third-party management, that manager is under no obligation to address the past debts owed by the band. That places businesses in a very precarious position.

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I would like to know, or have some idea, what the intervention policy is in respect to bands under third-party management that owe large sums of money to businesses. Does Manitoba operate under different guidelines? I think you know the drift of my question. What is the responsibility for those past debts?

Mr. Robert Nault: Mr. Chairman, that's a very important question and one that needs to be answered for everyone to hear.

The Government of Canada and the Department of Indian Affairs have no legal obligation to third parties. We hire a third-party manager with the intent of assuring ourselves that our legal obligations to first nations citizens are met, that is, the delivery of core services. That's their obligation and that's their directive when they are hired as a third-party manager.

You can imagine, Mr. Chairman, what it would be like if this minister and this government were responsible for every interaction between the private sector and the band, or some entity within the band, with over 600 first nations across the country. The department would then virtually have to run the whole community.

So we have no legal obligation, and every single business enterprise across the country should be aware of that if they're not.

We do suggest to the third-party manager that it would be helpful to work with the business community in the sense of trying to assure them that after the core services and programs are delivered through the process, there could be arrangements to pay back. But there's no legal obligation to do so.

I think that's important to know, because on many occasions, I have had letters written to me by members of Parliament on behalf of a business person who believes it's the obligation of the Government of Canada to deal with a bill that has not been paid, when in fact it's not our obligation, because we didn't enter into that agreement; the band council did. They can take the legal route.

Mr. Maurice Vellacott: Okay. I appreciate that, Mr. Nault. You're very clear in respect of that.

Mr. Robert Nault: You want another question.

Mr. Maurice Vellacott: Yes, I do, and thank you, you were most forthcoming with respect to that.

I was going through transcripts from back in May of this year when you previously appeared before the committee, and you spoke then about the total number of bands in third-party arrangements. You said—this is verbatim—there were 29, and 41 were co-managed. That would make a total of 70. Today you indicated 98 bands. We thought it was 98 under third-party management, but you indicated that was both third-party management and co-management. Is my understanding correct?

Mr. Robert Nault: If I'm not mistaken, the number of third-party arrangements—I'll absolutely confirm it for you—is 25, right across the country. In Manitoba, as we speak, there are 11.

Mr. Maurice Vellacott: I was trying to get at this confusion, because the math doesn't seem to add up here.

I'm looking at the performance report for the period ending March 31, and in the pie chart it says 16% of—I assume—600-plus bands are managed by third party. That's gives you a figure in third-party management of 90-plus bands. Your own department's figures don't square away here. If you have 16% of bands in third-party management, you'll have a total of 38%, if you add the 22% co-managed. So 38% in total are between third party and co-management. There's something of a discrepancy there.

Could you possibly clarify that for me in writing at some point?

Mr. Robert Nault: Yes, certainly I will do that.

Mr. Maurice Vellacott: Because 90—

The Chair: Mr. Vellacott, you're well over your time, so we'll give you a few seconds.

Mr. Robert Nault: Mr. Chairman, I think that is important, because it's factually incorrect and I don't know where that information came from. It may be being misinterpreted, or it may not be written clearly enough.

There are 25 first nations across the country in third-party management. That's a fact. The rest of the communities are either in co-management or in remedial management plans, which means when we look at the audit and there's a particular issue we have a concern about, we deal with remedial management structures to try to improve upon that particular area within the community.

We work with the community to improve on it so they don't end up in third party. There are a number of communities in that. That adds up to a total of about 96 or so across the country. Some of those are very minor items that, if corrected right away, have very little impact on the community overall in the long run, but still they show up in the audit as discrepancies.

Mr. Maurice Vellacott: I'll leave you with that.

Mr. Robert Nault: Okay, and I will give you the information.

Mr. Maurice Vellacott: There's a major discrepancy there.

• 1640

The Chair: Okay. Would you provide it to the clerk for all the members?

Mr. Robert Nault: Yes, certainly.

The Chair: Ms. Karetak-Lindell.

Ms. Nancy Karetak-Lindell (Nunavut. Lib.): Thank you, Minister, for trying very hard in your portfolio to improve the lives of aboriginal Canadians and always being very open to different ideas. Looking at the northern affairs program, I am very encouraged by the objective to promote political, economic, scientific, and social development of Canada's north. Also, last week we were very pleased to see the Yukon Devolution Act going through.

You have heard from all the northern members about our need for some kind of economic development strategy, similar to ACOA and similar to Western Economic Diversification.

As we've stated many times, aboriginal people want to be players in the other opportunities in Canada, but unless we have some mechanism to work with in that and, as you said in your opening speech, have the tools and the resources, then it's almost like asking business people to be competitive with one strike against them, or two usually, in our case, because of the expenses.

The Chair: I urge you to get to the question, please.

Ms. Nancy Karetak-Lindell: In the northern affairs program, do you see any chance of an economic development agreement for the north any time soon?

Mr. Robert Nault: Without getting into the details of what potentially would be in a budget, Mr. Chairman, I want to report to my colleagues that it would seem almost impossible to envision the Government of Canada not having an economic development and training strategy for north of 60. The reason for that should be obvious to members around the table. We are now starting to see a boom in the economy in the Northwest Territories. We think that will also go across the north to include Nunavut and of course the Yukon over the next number of years.

You are very much aware that there's a discussion going on about oil and gas and the pipelines that are being discussed, as we speak, coming out of Alaska and at the same time the Mackenzie Delta. There are huge resources that will come out of the north. With that, there's a need to develop an economic strategy and a training strategy so first nations and northerners in particular will benefit from that improved economy.

As I say, I would find it somewhat unimaginable for us not to have an economic development envelope. You're aware that the Minister of Indian Affairs and Northern Development, the Minister of Human Resources, and other ministers, are working very much in that direction. We're hopeful that the resources will be available to move it to the next level, which is an economic development envelope in particular, for those three territorial governments.

The Chair: Mr. Marceau.

[Translation]

Mr. Richard Marceau: Thank you.

Minister, in your opening statement, you say that the Assembly of First Nations is one of the major aboriginal organizations in Canada. How is it then that funding from your Department has dropped so dramatically?

[English]

Mr. Robert Nault: Mr. Chairman, I'm very pleased that the member asked the question because it's one that has been directed to me before. Let me take you back through the last ten years of funding for the Assembly of First Nations, if I can, to set the parameters.

In seven of the last ten years, the AFN's core budget was $2.1 million. Included in that was a recognition that there were certain work plans we would agree with. So over the course of those seven years, the average budget for the AFN was under $6 million. Only for the last three years has the budget climbed to close to $20 million. But at the same time the core budget remained at $2.1 million.

• 1645

This year, I changed the core budget to include what we call core-like initiatives to add up to close to $6 million of core and core-like budget for AFN to do its business as an organization. The rest of the funding is all based on agreements on work plans. They're not annual budgets and should not be considered as such.

This year we have agreed to core and core-like budgets and work plans that add up to around $10 million. I think that's a significant amount of money, considering the budgets over the last ten years, when you look at how much the government has expended.

There were a number of work plans that were going on with the AFN that I terminated or disagreed to continue to participate in because I didn't believe they would give us the kinds of improvements to the lives of first nations peoples I believe are necessary. But I take exception to the argument of some that the Minister of Indian Affairs has cut their core budget when in fact I have tripled it. I think that's a legitimate argument. I do not want people to get the view, though, that the $20 million was a core budget for the AFN when in fact it never was intended to be the case.

[Translation]

Mr. Richard Marceau: In the Supplementary Estimates (A), there is a figure given here that I am having trouble reconciling with the goal you have cited repeatedly, which is to facilitate self-government agreements. The budget item I refer to is:

Contributions to First Nations and Inuit communities to facilitate their participation in negotiation of the inherent right of self-government.

From a budget of $17,700,000 last year, the allocation has gone down to $14,700,000. Why was the budget cut by $3 million when this item, as you repeated again today, goes to the heart of your political philosophy, which is to reach self-government agreements with as many nations as possible, as quickly as possible, so that money isn't wasted on lawyers and consultants?

[English]

Mr. Robert Nault: I assume he is referring to the Marshall initiative, Mr. Chairman, under... would you give me the particular page?

[Translation]

Mr. Richard Marceau: This is on page 13-6 of the English version.

[English]

Mr. Robert Nault: Can you give us the line?

The Chair: Is the question about main estimates or supplementary?

Mr. Robert Nault: It's main estimates, Mr. Chairman.

The Chair: Well, we're well over the four minutes.

Mr. Robert Nault: Then let me see if I can, in general, give my colleague an understanding of the process.

Every fiscal year we estimate the cost of negotiation. Depending on how much negotiation occurs or how much doesn't, we re-assess that, and in this case there was $3 million in the budget that wasn't necessary for that particular negotiation. In such circumstances we move it to another line in order for it to be used in a cost-effective way. That's a pretty normal structure we follow.

I'll give you an example. We have not made as much progress as I hoped we would have made in the Manitoba framework initiative. I think my colleagues from Manitoba would recognize that, and as a result the resources expended have been a lot less than originally anticipated. That money then flows to other initiatives within the Manitoba region. That would be the same argument that would flow in this case.

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It doesn't signal that we're not committed; it just means negotiations can be very fluid. For a number of reasons we might not be at the table, so the costs of that negotiation would be much less than anticipated.

The Chair: Mr. Finlay.

Mr. John Finlay (Oxford, Lib.): Thank you, Mr. Chairman.

Mr. Minister, it's a pleasure to have you with us and be so frank in answering our questions. I think we can all support most heartily your compassionate, knowledgeable, direct, and commonsense way of dealing with these problems.

As a committee we think we've done some good work, but you've probably got more in hand. I wonder if you can give us a brief outline of the legislative agenda for the next session, if you have thought about it or had time to think about it.

Mr. Robert Nault: I think it's safe to say that on governance you will see if our targets are met sometime in February, or at the latest March. But we're on target so far, and we're comfortable that we can meet those targets.

I want to repeat what I've said publicly a number of times. This committee will be receiving the legislation before second reading. It will be the first time this committee will have received a piece of legislation before second reading. It will allow a tremendous amount of flexibility by the committee to make amendments. I'm expecting some serious work and some good consultations with first nations, to assure myself that I didn't get it wrong in the first go round. So your work will be instrumental in getting it right, under the changes that are being proposed.

Secondly, I expect you will see a piece of legislation on the independent claims body within the next few months. We are working on that with our colleagues, the first nations people right across the country, as we speak. We have agreement in principle with the AFN on the independent claims body. There are a couple of issues we're dealing with, but we're extremely comfortable that you will have a discussion in this committee on a commission and tribunal dealing with specific claims.

One is extremely important to western Canada, where a large number of those claims exist, in particular in Saskatchewan, which has 40% of all the specific claims outstanding. So I think this is an opportunity for us to improve our abilities to arrive at agreements on those claims, without having to go to court, which is a very costly and time-consuming initiative.

The third initiative I hope you will see in the early part of the next session will be a first nations institutions act, which will allow first nations the opportunity to deal with other source revenue. It's the issue of generating revenue for their community. Any government should have the ability to do that.

As an example, first nations have the ability today, if they enter into an agreement with Finance, to take the GST and PST room up, collect PST and GST on reserve, and use those financial resources for the betterment of their own communities. A number of first nations in Canada do that today. So we are going to put in the right kinds of structures to allow them to build an economy on the financial side of the coin as well.

Finally, I would just point out that as I mentioned earlier, we will certainly be opening up the First Nations Land Management Act, but I don't think that work will have to come before you. It will be done through Order in Council.

So those are the main items. The last one you probably won't see until the fall is our interest in looking at the education system. It is one that is extremely important to me as a parent. We have concerns about the successes of the education system.

So those are the initiatives I would throw out as work you should expect to be involved in within the next 12 months.

The Chair: Mr. Martin.

Mr. Pat Martin: Thank you, Mr. Chair.

I'll make three quick points, and then ask the minister if he can squeeze in answers, in the limited time we have.

First, the NDP caucus sees a direct connection between the tragic events of September 11 and the change in plans, cancellation of programs, or postponement of things that were alluded to, if not announced, in the Speech from the Throne. I'd ask the minister what specifically is being cancelled or postponed in the long-range plans that were referred to in the Speech from the Throne.

• 1655

The second is, when we hear the AFN talk about their budget being cut, they say they've had to lay off 90 people. Now something doesn't quite jibe here. By losing 90 core staff people, we feel they've seriously been handicapped in their ability to go forward into this crucial time of changing the very relationship the first nations have with the federal government. They certainly make the point that they've had their ability to negotiate diminished by losing all these skilled people. So where is the contradiction here?

The last thing is, if the aboriginal people were to be given the right to tax on reserves and collect GST, etc., would it be dedicated? Would that money go into general revenue, or would it in fact stay on the reserve for their use as a dedicated tax?

Mr. Robert Nault: It presently stays on the reserve, and that would be the intent of their abilities to collect revenue. It's an agreement between Finance and of course the first nation. So that wouldn't change.

I want to make something very clear on the AFN's budget, and you might want to keep this in mind. The national chief himself has said that AFN's role is not to be a super-band office and to deliver services. It's a political organization intended to advocate politically on behalf of the communities and to push the government vis-à-vis policy. It is not to become, on parallel tracks, another Department of Indian Affairs. To some extent, that was starting to become the case.

I believe, very frankly, Mr. Chairman, that the AFN has around 40 staff presently—somewhere in that neighbourhood. That's a realistic number to advocate on behalf of first nations people. I agree with the national chief. The resources would be better spent in the regions dealing with initiatives that will bring benefits to the communities. That is a legitimate argument I have made, and I hope people understand it. It is not one of disrespect, just one of using your resources to the best benefit of the communities themselves.

Let me give you an example. At present the Department of Indian Affairs spends close to $300 million on political and tribal organizations. I'm doing a review of political organizations and tribal councils to assess whether we're getting good cost-effective benefits for $300 million. If we can find savings and/or improve upon what those two particular organizations do, it will be to the benefit of first nations citizens. I think those reviews are necessary by the Minister of Indian Affairs and by the government. I have given first nations leadership my assurances that once the internal review is done, we will share it with them and we'll have a discussion about who does what.

It makes no sense to be over-governed outside of your community when you're under-governed in your community. That's why we have shifted our priorities to the community.

Lastly, Mr. Chairman, I don't think anything will be cancelled based on the security agenda. I believe very strongly in this mandate that we will succeed in moving towards improving first nations people's lives based on our commitments in the Speech from the Throne. I have not seen this Prime Minister or this cabinet or this government change direction vis-à-vis aboriginal people since September 11.

The Chair: Monsieur Bertrand and Mr. Mark, you will each have one minute to ask your question, after which the minister will have two minutes to respond to both questions.

[Translation]

Mr. Bertrand.

Mr. Robert Bertrand (Pontiac—Gatineau—Labelle, Lib.): Thank you very much, Mr. Chairman.

I have a quick comment to make as well as a question. In your opening statement, you say:

Clearly, long, drawn-out negotiations with First Nations people benefit no one but the consultants and lawyers, and they are not our primary client.

I just wanted to say that I agree with you completely on that point and that I think we have to focus on the people themselves, rather than their so-called representatives. I just wanted to mention that.

• 1700

I am coming to my question now. As you know, I have two reserves in my riding. I would like to talk about economic development with you, if you're willing. Based on my information and the phone calls I have received, economic development comes within the purview of the Department of Industry.

Sometimes I find their criteria for assisting communities or individuals rather rigid. I'm wondering whether it wouldn't be possible to change some of the criteria. Do you agree with this type of arrangement or, as Mrs. Karetak-Lindell was saying, do you think we should consider creating another organization to take responsibility for economic development?

Thank you very much, Mr. Chairman.

[English]

The Chair: Mr. Mark, one minute.

Mr. Inky Mark: Thank you.

I agree that your future initiative on education is critically important. I have to ask you this question. There has been a drop this past year in terms of the number of aboriginal students enrolling in post-secondary institutions, has there not? I wonder what you attribute that to.

Mr. Robert Nault: I don't think so, Mr. Mark. I'll double-check, but I think it's just the reverse. It's going up in leaps and bounds.

Mr. Inky Mark: Thank you.

The Chair: Mr. Minister, would you respond to Monsieur Bertrand?

Mr. Robert Nault: Mr. Chairman, I'll try to do this fairly quickly, but this is probably—

The Chair: If I may interrupt, Mr. Minister, you can take all the time you want, because you're the one that has a meeting at 5 o'clock.

Mr. Robert Nault: One of the things about being the Minister of Indian Affairs is you can always be late and nobody gets too uptight about it, because it's expected in my jurisdiction.

Mr. Chairman, if I could, I want to use the opportunity of Mr. Bertrand's question to go back to what I have been saying since the day I became minister. The number one priority, if you believe in the words that I have coined on many occasions, is that to have social justice you need to have economic justice. To me, that is one of the reasons why we have restructured ourselves in the department to become more involved in economic development.

Now, in the last number of months the interest of the regional development agencies and their ministers has been to work closer with first nations in developing those economies. You will notice as you go across the country that more and more of the economic development ministers, whether it's WED in western Canada, ACOA in Atlantic Canada, Canada Economic Development (DEC) in Quebec, or FedNor in northern Ontario, have certainly been given the mandate by the Prime Minister to work on building first nations economies. To me, that's the number one priority. If we're to improve housing, we certainly have to expect that first nations people who have employment will participate in buying their own homes and having mortgages, like other Canadians. I believe in that very strongly and so do aboriginal people.

If we're expecting to have good infrastructure in the communities, we will have to see an economy built in those first nations communities. We have to participate. If we're going to develop north of 60 and first nations people are going to be involved, they have to have some benefits to those resources in those regions. There have to be benefit agreements, and governments have to participate in seeing that that happens. That's the direction we are speaking of in the Speech from the Throne when we talk about practical solutions.

It's not that complicated to give people an opportunity to participate in the economy if we believe in it strongly enough. That's really why we have to have the tools—the fundamentals—in place first, and that's why I've worked hard this last year to convince aboriginal people that they don't have the proper tools at their disposal. It's not the fault of first nations leaders at all. It's the lack of tools to have the right institutions to be successful. That's the mandate of this committee and the mandate of this minister in this term—to see that this isn't the case at the end of the mandate.

So I want to encourage you to continue to work as hard as you have.

• 1705

I congratulate you on your abilities to get legislation through the committee. It's a sign, obviously, that it must be easy when everybody agrees with things or works closely together. But I'm sure there are days when people disagree.

I want to make one last point, because it's important. I do not want members to think we are trying to fast-track legislation through the House or through the committee, because that's not the case.

For example, on the Yukon legislation, we had total support, I understand, of all the parties, and it seemed to me, if we all have support, if the territorial government has been waiting for a number of years for devolution, we shouldn't hold it up if we all agree that it's a tremendous improvement.

So I don't want people to get the impression that we have something to hide or we're in a hurry. We've been working at this now with Liberal governments, NDP governments, and Conservative governments for the last number of years, so I think we've gone past partisanship. We're basically trying to improve the lives of northerners. I hope you will see it as I do, that the sooner we get the legislation out and the process completed, the more control northerners have over their own lives and the better off they'll be in the end.

That's why I'm very pleased to see that you've got the Yukon Act through, because we have a lot of work ahead of us. Implementation is much harder than standing on a platform signing an agreement. Implementation means we have to look after workers and workers' rights. There are some federal employees who are being transferred territorially, and I'm very seized with making sure they're treated fairly.

All this goes back to my original point, that if we work closely together and you communicate with me...

I just want to make one point about TV, Mr. Chairman. I wasn't asked for my view about whether I wanted to be on TV or not. Quite frankly, I think it's appropriate that Canadians get to listen to the work of the committee, so whenever you want, go ahead and have TV. You don't have to get it through me. But I was a little surprised to hear that we weren't going to be on TV, because aboriginal affairs doesn't get enough exposure. So I want to make that point to you.

I appreciate very much you allowing me to come... and all your questions. I'm very disappointed that Gordon didn't get to answer a question, but maybe next time.

Thank you very much.

The Chair: Thank you very much, Mr. Minister. Thank you for the concise response with information. They were not political answers; they were answers to the questions that were asked, and we really appreciate that.

As to the Minister of Natural Resources, who couldn't appear when we did the estimates, we did place a request for him to appear next week to answer your questions.

Are we prepared to deal with the votes?

INDIAN AFFAIRS AND NORTHERN DEVELOPMENT

Administration Program

Vote 1a—Program expenditures ...... $27,080,237

Indian and Inuit Affairs Program

Vote 5a—Operating expenditures ...... $30,305,443

Vote 15a—The grants listed in the Estimates ...... $37,184,447

Vote L20a—Loans to native claimants (Non-Budgetary) ...... $6,000,000

Northern Affairs Program

Vote 35a—Operating expenditures ...... $30,300,174

Vote 40a—The grants listed in the Estimates and contributions ...... $9,650,501

Vote 45a—Payments to Canada Post Corporation ...... $8,000,000

Canadian Polar Commission

Vote 50a—Program expenditures ...... $41,642

(Votes 1a, 5a, 15a, L20a, 35a, 40a, 45a, and 50a agreed to)

The Chair: Shall I report the supplementary estimates (A) without amendments?

Some hon. members: Agreed.

The Chair: Thank you very much.

The meeting is adjourned.