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37th PARLIAMENT, 3rd SESSION

Standing Committee on Aboriginal Affairs, Northern Development and Natural Resources

EVIDENCE

CONTENTS

Thursday, March 25, 2004

0835

The Chair (Mr. Guy St-Julien (Abitibi—Baie-James—Nunavik, Lib.))

Ms. Sheila Fraser (Auditor General of Canada, Office of the Auditor General of Canada)

0840

0845

The Chair

Ms. Sheila Fraser

The Chair

Mr. John Duncan (Vancouver Island North, CPC)

Ms. Sheila Fraser

0850

Mr. John Duncan

Ms. Sheila Fraser

Mr. John Duncan

0855

Ms. Sheila Fraser

The Chair

Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ)

0900

Ms. Sheila Fraser

Mr. Yvan Loubier

Ms. Sheila Fraser

0905

Mr. Yvan Loubier

Ms. Sheila Fraser

Mr. Jerome Berthelette (Principal, Office of the Auditor General of Canada)

The Chair

Mr. Yvan Loubier

Mr. Jerome Berthelette

Mr. Yvan Loubier

Ms. Sheila Fraser

Mr. Yvan Loubier

The Chair

0910

Ms. Sheila Fraser

The Chair

Mr. Stan Dromisky (Thunder Bay—Atikokan, Lib.)

Ms. Sheila Fraser

Mr. Stan Dromisky

Ms. Sheila Fraser

0915

Mr. Stan Dromisky

Ms. Sheila Fraser

Mr. Jerome Berthelette

Mr. Stan Dromisky

The Chair

Mr. Jerome Berthelette

The Chair

Mr. John Duncan

0920

The Chair

Ms. Sheila Fraser

The Chair

0925

Mr. Rick Laliberte (Churchill River, Lib.)

The Chair

Ms. Sheila Fraser

0930

Mr. Jerome Berthelette

The Chair

Mr. Rick Laliberte

0935

Mr. Jerome Berthelette

The Chair

Mr. Yvan Loubier

Ms. Sheila Fraser

0940

The Chair

Hon. Larry Bagnell (Yukon, Lib.)

0945

Ms. Sheila Fraser

Mr. Jeff Greenberg (Principal, Audit Operations Branch, Office of the Auditor General of Canada)

The Vice-Chair (Ms. Nancy Karetak-Lindell (Nunavut, Lib.))

Mr. Andy Burton (Skeena, CPC)

0950

Ms. Sheila Fraser

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Hon. Andrew Telegdi (Kitchener—Waterloo, Lib.)

Ms. Sheila Fraser

Mr. Jerome Berthelette

Hon. Andrew Telegdi

Mr. Jerome Berthelette

Hon. Andrew Telegdi

Mr. Jerome Berthelette

Hon. Andrew Telegdi

Ms. Sheila Fraser

Hon. Andrew Telegdi

0955

Mr. Jerome Berthelette

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. John Duncan

Ms. Sheila Fraser

Mr. John Duncan

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Ms. Sheila Fraser

1000

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Ms. Sheila Fraser

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Joanasie Akumalik (Director of Implementation, Nunavut Tunngavik Incorporated)

1010

1015

The Vice-Chair (Ms. Nancy Karetak-Lindell)

1020

Ms. Deborah Bisson (Director, Lands, Resources and Implementation, Gwich'in Tribal Council)

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. Brian Crane (Barrister and Solicitor, Gowling Lafleur Henderson, Gwich'in Tribal Council)

1025

1030

The Vice-Chair (Ms. Nancy Karetak-Lindell)

Mr. John Duncan

Mr. Joanasie Akumalik

1035

Mr. John Bainbridge (Senior Policy Advisor, Nunavut Tunngavik Incorporated)

Mr. John Duncan

Mr. John Bainbridge

Mr. John Duncan

Ms. Deborah Bisson

Mr. John Duncan

Mr. John Bainbridge

1040

Mr. John Duncan

The Chair

Ms. Deborah Bisson

The Chair

Mrs. Bev Desjarlais (Churchill, NDP)

Ms. Deborah Bisson

Mrs. Bev Desjarlais

Ms. Deborah Bisson

Mrs. Bev Desjarlais

Ms. Deborah Bisson

Mrs. Bev Desjarlais

Ms. Deborah Bisson

Mrs. Bev Desjarlais

The Chair

Hon. Larry Bagnell

1045

Mr. John Bainbridge

Hon. Larry Bagnell

Mr. John Bainbridge

Hon. Larry Bagnell

Mr. John Bainbridge

Hon. Larry Bagnell

The Chair

Hon. Larry Bagnell

1050

Ms. Deborah Bisson

Hon. Larry Bagnell

Ms. Deborah Bisson

Hon. Larry Bagnell

The Chair

Ms. Nancy Karetak-Lindell

Mr. Joanasie Akumalik

1055

Mr. John Bainbridge

Ms. Nancy Karetak-Lindell

Ms. Deborah Bisson

Ms. Nancy Karetak-Lindell

The Chair

Mr. Rick Laliberte

1100

The Chair

Mr. Joanasie Akumalik

The Chair

CANADA

Standing Committee on Aboriginal Affairs, Northern Development and Natural Resources

NUMBER 006

3rd SESSION

37th PARLIAMENT

EVIDENCE

Thursday, March 25, 2004

[Recorded by Electronic Apparatus]

¾ (0835)

[Translation]

The Chair (Mr. Guy St-Julien (Abitibi—Baie-James—Nunavik, Lib.)): Good morning everyone.

On today's agenda we have chapters 8, 9 and 10 of the November 2003 report by the Auditor General of Canada. We will sit until 10 o'clock and we will hear from the Auditor General, Ms. Sheila Fraser, who will introduce the two people who are with her.

Ms. Fraser, it is an honour and a pleasure to welcome you to the committee. We know that you are very busy, and we would like to thank you for coming in so early this morning. I think that it is probably standard operating procedure for you: time is always of the essence when it comes to discharging your duties. We look forward to hearing you.

[English]

Ms. Sheila Fraser (Auditor General of Canada, Office of the Auditor General of Canada): Merci, monsieur le président.

I thank you for inviting us here today to discuss the three chapters of my November 2003 report that deal with aboriginal issues. With me are Jerome Berthelette and Jeff Greenberg, the principals responsible for our work on aboriginal and northern issues.

Aboriginal issues are one of my five areas of focus for my term as Auditor General. This means we will place an emphasis on this area and look for measurable change over time. That said, I recognize that the issues are many and complex. The areas in which we plan to contribute in a meaningful way are accountability, partnerships in program delivery, including partnerships across the federal government, and dispute resolution.

While I am not the auditor of first nations, I believe their perspective is vital to our work, and we engage them in several ways. I receive guidance from a panel of advisers on first nation issues and from separate advisory committees established for each chapter. The majority of participants are representatives of the aboriginal community with a wealth of experience.

The November report chapters on aboriginal issues shared two common themes, first, the importance of establishing workable institutions that contribute to the management and growth of aboriginal communities and their economies, and second, the need to manage for results.

Both aboriginal peoples and the federal government recognize the importance of establishing institutions that contribute both culturally and economically to the long-term success of aboriginal people. Aboriginal leaders and the federal government need to define together the nature and types of institutions that will enable both to meet their goals and the results they want to achieve, not the least in the three areas you are examining today, economic development, third-party intervention, and the management of land claims agreements.

In our study of institutional arrangements for economic development we noted several positive examples of institutions that had helped first nations to develop economically. These included developing corporations that, in many cases, were supported by the federal government. However, we also heard about impediments to development, such as some of the structures concerning land management.

I was pleased that the federal government agreed with the three recommendations in that chapter that were aimed at establishing a more consolidated, proactive, and results-based approach by government organizations. I was also pleased that the federal organizations involved were able to arrive at a joint response. As we observed in the study and in other work on first nations issues, coordination and cooperation across the many federal organizations involved in aboriginal programs is a major challenge.

The federal government has also committed itself to making important changes in its approach to third-party intervention through a new third-party manager policy. The audit observation in chapter 10 recommends how Indian and Northern Affairs Canada could go further. Third-party management is an extreme intervention intended to be temporary. However, unless it is more transparent and focuses more on capacity development, the intervention may not resolve the underlying problems.

¾ (0840)

[Translation]

Chapter 8 "Transferring Federal Responsibilities to the North", discusses the need to manage for results and to do so in a way that shares the responsibility for that to happen among all the parties to the land claim agreement.

Our audit found that the department does not know if it is fulfilling all of its responsibilities spelled out in two land claim agreements in the North—with the Gwich'in in the Northwest Territories and with the Inuit in Nunavut. We found that the department is focused on meeting the specific obligations set out in the land claim agreements, without considering their impact on the higher-level objectives agreed upon when the land claims were signed.

Let me give you an example. Article 23 of the Nunavut land claim has the objective of increasing Inuit participation in government employment to a level representative of the Nunavut population. To meet this objective, 85 per cent of government employees in the Nunavut settlement area would have to be Inuit.

However, at the time of the negotiations, the parties did not set a target date for reaching this level, or a process for getting there, or milestones for assessing progress. Consequently, we could find nothing to indicate whether federal activities were helping to increase the number of Inuit employed in the government.

The lack of a results-based management approach has led to a dispute between the Inuit and the federal government. The five-year independent review called for in the land claim agreement noted the lack of cooperation between the federal government and Nunavut Tunngavik Incorporated to make article 23 work.

The institutional arrangements for resolving disputes as set out in both the Nunavut and the Gwich'in agreements are not working. In each case, an implementation committee oversees the agreement and attempts to resolve disputes. Because these committees operate by consensus, goodwill is essential for their effectiveness. However, when committee members cannot agree over such fundamental matters as the relationship between activities, obligations, and objectives, the processes break down.

In 2001, the Nunavut land claim participants created a working group to discuss the implementation of article 23, including the nature of the federal involvement. The working group was to report in a year. At the time of our audit, that report was still pending.

In its response to our audit, the department indicated that it fundamentally disagreed with our view of how its success should be measured. The department defines success as fulfilling the specific obligations set out in the agreements. We believe that success means more than meeting the minimum legal requirements—that results matter above all.

I am pleased to note Indian and Northern Affairs Canada has posted on its website a press release dated February 13, 2004, in which the Hon. Andy Mitchell, Minister of Indian and Northern Affairs Canada, states that he agrees with the need to focus on the lasting benefits of land claim agreements.

[English]

One final point: I believe the federal government is not providing adequate information to Parliament on its management of the land claims agreements. Put simply, there is no reporting of results, there is nothing to indicate that disagreements exist, and there is nothing on the cost to the federal government of managing individual claims.

Parliament approved each land claim agreement through separate legislation. We believe that, as a minimum, we should get a report on how much money the federal government is spending to meet its commitments. The department did not agree that these costs should be tracked and reported.

In conclusion, Mr. Chair, in future hearings the committee may wish to discuss with the department how it will respond to the recommendations in our chapters. These include: what success means in land claims agreements how the department will amend its management framework to focus on responsibilities, not simply obligations; how it will report the costs of land claims agreements; the implementation of the third-party manager policy; and how the department will implement the recommendations concerning institutional arrangements for economic development.

We have listed in an annex to the statement the recommendations that are contained in the three chapters.

Mr. Chair, that completes my opening statement. My colleagues and I would be pleased to answer any questions the committee may have.

Thank you.

¾ (0845)

[Translation]

The Chair: Thank you very much, Ms. Fraser. Before we begin our question period, I have a question for you.

With respect to dispute resolutions—and we know that this provision is available to the Cree and the Nunavik Inuit in the James Bay and Northern Quebec Agreement—are there any other examples of this in Canada? Are you aware of any other situations where there is a dispute settlement process involving other aboriginal Inuit or Métis groups?

Ms. Sheila Fraser: Our audit only involved the two agreements in the chapter and we did not seek other examples. However, I doubt that any such mechanisms exist, in land claim or other types of agreements. What is lacking is a clause dealing with the procedure for dealing with differences of opinion.

The Chair: Thank you. Before we continue, I see that a group from Nunavut has just arrived. They are students who are here as observers. I think it is important for us to see the new generation.

Nakurmik marialuk, pissiti marialuk.

We will now move on to questions.

Mr. Duncan.

[English]

Mr. John Duncan (Vancouver Island North, CPC): Thank you very much.

Thank you for your good work on the three chapters of the report that we're looking at today.

Just on a broad level in regard to chapter 8 dealing with transferring federal responsibilities to the north, the response of Indian Affairs and Northern Development to the AG chapter was basically to disagree that they should be responsible for results and that their only responsibility should be fulfilling specific obligations. I think that leaves the door wide open for a complete lack of accountability.

I'm assuming this is of concern to you also, so I'd ask your opinion on that.

I also have some other, more specific questions, so if you could provide an appropriate answer to that one at this time....

Ms. Sheila Fraser: Thank you, Mr. Chair.

It is correct, as we noted in our opening statement, that in preparing the response to this chapter, the Department of Indian and Northern Affairs indicated that it was fundamentally in disagreement with our definition of success. In fact, they took a very, I guess you could call it colloquially legalistic point of view that if the obligations set out in an agreement were met, that meant success for them, rather than actually looking to see if the overall objective or intent was being met.

I would remind the committee that when the report was prepared, we had expected to table this in November. Because of the prorogation of Parliament, the report was only tabled in February. In the intervening time, in response to the tabling in February, Minister Mitchell posted a news release and statement on his website saying he agreed that success meant more than simply meeting specific obligations.

I think it would perhaps be interesting for the committee to explore with the department how they are changing, if you will, the way they operate and their framework and their management approach to adopt a broader view of success—if that is the case. It is my impression, and the impression of my staff, until now that the people actually working in the department have taken a much narrower perspective on success.

I would expect that this will mean a fairly significant change in the approach of the department.

¾ (0850)

Mr. John Duncan: Thank you.

I'll move to chapter 9, which deals with economic development. I have a specific case that will give an example of my major concern of the lack of clear policy that is leading to counter-productive economic development results. It involves the granting of moneys by the Department of Indian and Northern Affairs. In this case, $42,000 in government funds went to an outfitter, Lawford Lake Outfitters, which was one of the band councillors. At the same time, they gave $229,000 to the Norway House corporation of which the same individual is the president and a member of the board of directors. Both businesses are providing the same service.

Upon being challenged about this conflict of interest and the fact that you would have two businesses competing against each other to the detriment of the band business, the minister's response to me basically indicated that because there was a third-party assessor who had looked at the viability of the plan and recommended it to the regional director general, who had taken it to the Manitoba region representatives of the tribal councils, the Southern Chiefs' Organization, and so on, and because the band council had put forward a resolution at which this councillor had excused himself, this was all okay, particularly since discussions were also held to address the perceived conflict of interest.

I think this points out an area where there's a complete absence of government direction and policy. More and more we're finding that the business of individuals and the business of the bands can be one and the same, or complicated. The assets can end up being moved from one area to another. It's a very unsatisfactory set of circumstances. I wonder if you have any comment on that.

Ms. Sheila Fraser: Thank you, Mr. Chair.

As I'm sure you can appreciate, I can't comment on the specifics of the case that has been mentioned, not being aware of it.

I guess I would just point out a couple of the findings of the study. One is that the federal government needs to manage more horizontally and to make sure the programs are all coordinated, and hopefully through that to achieve more efficiencies and more effectiveness.

But a major aspect in all this, of course, is that first nations do have a responsibility for economic development. The federal government is there to help them in building institutions and to help them in their economic development. It is a shared responsibility, in a way, in these cases. We are certainly not trying to be proponents that the federal government should be controlling all of this. Obviously the first nations have to be involved, and there has to be a responsibility and accountability placed on those first nations--the bands and councils as well--for the good management of these funds.

Mr. John Duncan: I understand I'm getting quite short on time here, so I'll move to chapter 10, which deals with third-party management. I'm aware of ongoing difficulties with the Mohawk Council at Kanesatake, and it seems the Department of Indian Affairs is dealing with third-party management by instructing third-party managers who among the five chiefs to pay and who not to pay, depending on their degree of cooperation with the third-party manager, and the third-party manager is being less than transparent on the activities. All of this comes within the context of a very lucrative contract. I am wondering if you have any comments about the degree of control a department should have over the third-party managers and what the degree of transparency should be between the third-party manager and the existing band council.

¾ (0855)

Ms. Sheila Fraser: Again, I wouldn't want to comment on specific cases, but third-party intervention is really an extreme measure and should be taken generally in fairly limited circumstances, when the financial situation is very serious in these first nations.

In the note we did there are a couple of findings. First, we hope the department would intervene earlier in the process, to try to help correct the issues before there is need of a third-party manager. In the business world, when you have to put somebody into receivership or under a tutor, it's an extreme situation, and we hope there could be intervention and action with a first nation much earlier, to help them correct the situation before you have to resort to such a drastic intervention. But we truly believe it is very important that when the third-party managers are once there, that there be input from the first nations, that there be a proper evaluation of the third-party manager role, and that the third-party manager should have a responsibility to help build the capacity. Once the problems are identified, you have to make sure that once the situation is corrected, if you will, once the third-party manager leaves, it then won't recreate itself, that the capacity has been built in that community to deal with the issues on an ongoing basis.

There are a lot of responsibilities. I think incumbent on the third-party manager is the training, the capacity-building, not simply financial correction, if you will.

[Translation]

The Chair: Thank you, Ms. Fraser and Mr. Duncan.

Now we will go on to Mr. Loubier. I sometimes give people an extra minute because this is an important topic. The questions are excellent, as are the answers.

Mr. Loubier.

Mr. Yvan Loubier (Saint-Hyacinthe—Bagot, BQ): Thank you, Mr. Chairman.

Welcome Ms. Fraser, Mr. Greenberg and Mr. Berthelette.

I would first like to congratulate you and your team, Ms. Fraser, for the work that you have done. It is always a pleasure for me to read your reports. Not necessarily because of the sometimes spicy content, but because you play an essential role, as did your predecessor, Mr. Desautels. I have a great deal of admiration for the office and I also admire the individuals whose duty it is to serve the State with transparency, clarity and sound management.

I have a number of questions for you, Ms. Fraser, but I will limit myself to three. I have been my party's aboriginal affairs critic for about two years now. Before that, it was finance. The finance portfolio is straightforward and clear. We had a comprehensive picture of how things were managed. We could not ferret things out like you do because that was not part of our mandate, but I would say that it was clear.

There are certain things that I have noticed about the Department of Indian and Northern Affairs since becoming the critic for aboriginal affairs. It appears to be a very big department with an annual budget of over $5 billion per year. It's a bit of a hodge-podge. Even when we ask questions, we don't often get a very clear answer. Representatives of aboriginal communities throughout Canada often tell us about horror stories, for example, the fact that local officials have a very strong discretionary power over whether or not to grant funding to a community. It often depends on the mood they are in or something like that.

I have also noted that a number of decisions are made on the fly without any real planning. When visiting a community, for example, we have seen that there was a budget to demolish housing, but no money for reconstruction. In another community, there was a budget to tear down a house and $35,000 to build another one. However, the furniture, which was mouldy, like the houses that were being demolished, was not replaced because there was no budget for that. So, two years later, they had to start over, because the mould spread to the new houses. The same goes for the schools. They had a comprehensive budget, but could not afford a part-time teacher to provide quality education to aboriginal students on some reserves.

Do you not feel that the Department of Indian and Northern Affairs is sadly lacking in management and planning, that the civil servants at the local level are given too much discretion and treat the aboriginal leaders and band councils according to their own whim?

¿ (0900)

Ms. Sheila Fraser: Mr. Chairman, we have not really done any work that would allow me to answer the very broad question put by Mr. Loubier. I might perhaps comment by referring to some of our recent chapters.

I believe that the great challenge for the department lies in the multiplicity of programs that it must manage. That is not only the case for Indian and Northern Affairs Canada, but for a number of government departments.

With respect to housing, this is something that was audited last year, as you know, and there were four stakeholders. We also examined the number of reports that a first nation must submit. If we look at each program individually, the requirements appear to be reasonable. However, when we put them all together, we see that a first nation must submit a minimum of 168 reports per year, which makes no sense at all.

We must review the programs, increase coordination and even simplify some of them. There should be some "streamlining", as we say in English, to better target the objectives. In the audits that we conducted, we also noted that we were lacking information on the broader results and objectives, in determining whether or not they are clear and if the outcome can be measured.

I realize that the issue is quite complex. Some of the objectives cannot be measured in terms of weeks or months; it can take years or even decades. However, if a plan has no clear objective or procedure, I don't know how we will determine if the situation has improved or if the programs have been successful or if something needs to be changed along the way.

Mr. Yvan Loubier: Ms. Fraser, you are telling us—and you said the same thing last year—that we are lacking information, that we don't know how the results are managed or if the expected results have been achieved.

Would it not be time to take a closer look at the management, planning and culture at Indian and Northern Affairs Canada?

Ms. Sheila Fraser: We are currently undertaking a joint study of information systems with the first nations. I feel that it is important for the first nations to take part so that the information, as we mentioned in our report, will be of some use to them, in their management, and so that the department can use this information to manage the programs.

I think we also face a major challenge to help and support the communities in developing their management capabilities, as a whole. Some of them are quite good at it, they have excellent reports on their objectives and priorities which they follow. These good examples should be used by the department and applied extensively. They should, above all, use the information provided by the first nations for their own management.

¿ (0905)

Mr. Yvan Loubier: By the way, Ms. Fraser, I would like to thank you for destroying a myth last year. We always thought that the first nations did not know how to properly manage their affairs. However, we saw that the department was greatly responsible, because it had its own management problem, and most of the first nation communities were managing quite well on their own. That destroyed the myth. Even here, around this table, there were sceptics. You managed to convince them, and I commend you for that.

Ms. Fraser, for two years now—and I asked you this question when you tabled your report—I have been trying to obtain the terms of reference given to the co-managers or third party administrators, or managers. I tried through access to information but I was unsuccessful. I want to see their terms of reference, the amounts that they are assigned and their job descriptions. The minister undertook to try and change things, but I am constantly being told that they don't have that type of information, and it is scattered around the country.

Did you manage to find some of this information, or should we not demand more transparency from the department so that it will supply the names, the terms of reference and the amounts given to the co-managers or third party managers?

Ms. Sheila Fraser: Mr. Chairman, I would like to ask my colleague Mr. Berthelette to answer this question.

Mr. Jerome Berthelette (Principal, Office of the Auditor General of Canada): The department has a great deal of information on the third party managers.

[English]

They have, by region, the information on how many managers are in place, how many communities are in third-party management. They also have the information concerning how much is being paid to each of the third-party managers. In this report we give you some figures for the province of Manitoba on how much is being paid to third-party managers. So the department does have this information and should be able to provide you with it.

[Translation]

The Chair: You have one minute remaining, Mr. Loubier. Go ahead.

Mr. Yvan Loubier: We are talking about the same thing. When you talk about third party management and third party administrators, they are one and the same. How can you have this information when, for the past two years, I have been trying to get it, even through access to information, and I have not managed to do so? Were you told that this was confidential information, that it was given to you because you had a mandate to look into these things, or is it possible for me to have access to this information as well?

Mr. Jerome Berthelette: Mr. Chairman, no one from the department said that the information was confidential.

Mr. Yvan Loubier: Could you provide that to me? It would be easier for me.

Ms. Sheila Fraser: Mr. Chairman, our policy prevents us from acting as a go-between for the committees and the departments. I would suggest that you ask the department to provide this information the next time it appears before you.

Mr. Yvan Loubier: Absolutely. It's unbelievable. I think you must have better contacts with the department than I do.

The Chair: Thank you, Ms. Fraser. As you know, Mr. Loubier is good at saving his best questions for last, but he had done his homework. I believe it is important for our aboriginal and Inuit friends.

Before moving on to Mr. Dromisky, I have a question for you. When you speak of the transfer of responsibility, the transfer of land or resources first comes to mind, and there is something that I wonder about. We know that the pubic servants, from the clerk right up to the deputy minister, are located in Canada's larger cities. When it comes to staff transfers, and assigning positions within Indian and Northern Affairs Canada... I go to visit, I just returned from Nunavik last night, and the people on the ground tell me that they never see anyone, that all the business is conducted by telephone, by mail, or in meetings held further south.

Have you examined whether or not there should be some staff members transferred to prepare the James Bay Cree, the first nations or the Métis to take over? If we had department employees on location, they could show them what to do, and the young people would be ready to step in. Everything is located in the urban centres, in big buildings. Have you given any thought to that?

¿ (0910)

Ms. Sheila Fraser: That is an excellent question, Mr. Chairman, but we have not conducted an audit or done any work in that area. I might point out, however, that we have noted the example of the transfer of responsibilities to the Yukon which, if you will, is probably the best example of a transfer of responsibilities, and, in spite of the fact that there might have been room for improvement, it was a success. We have suggested that some lessons can be learned from this experience for the next time. But we did not look at the way in which the department assigns staff to remote locations or elsewhere in Canada.

The Chair: Thank you. One thing is clear: the department is better able to assess what is happening if it is located along side the Métis, the aboriginal people and the Inuit. We will leave that for another day.

We will now move on to Mr. Dromisky.

[English]

Mr. Stan Dromisky (Thunder Bay—Atikokan, Lib.): Thank you very much, Mr. Chairman.

It's the management area I'm concerned about. Maybe for the listening public we should define what we're talking about here. There are three different types.

First, when does the co-management program come in? My understanding is that it is when there's a deficit above 8% of the accumulated total annual revenues, in other words, you've overspent by 8%. But my understanding is also that the alarm bells don't ring until much later, in some cases over 20%, and I'm wondering why it's so late.

We could leave it in the hands of the first nations to solve their problems once they're alerted, or there could be co-management, and that is where a third party comes in and helps them, teaches them to handle their own financial problems, their budgets, and so forth. But the most extreme, as you indicated already, is third-party management, where the manager comes in and runs everything and decides how to handle the needs, the programs, and so forth of the first nations people.

What role do the aboriginals play in the selection of the third-party managers? I would like to point out that your report indicates that in March 2003 approximately 134 or 135 first nations were under some type of management program, and 32 first nations were under complete third-party management. Is that correct?

Ms. Sheila Fraser: We note in paragraph 10.25 that there were 32 first nations out of 614 in third-party management at the time of our audit.

Mr. Stan Dromisky: Okay.

Now the next question concerns the nature of the financial problems. What were the causes? Was it because of a lack of training, incompetence on the part of the first nations people who were handling budgets, or was it because the government had underfunded and not met the needs of the people, so that decisions had to be made on food, clothing, and everything else, and they went over their budget? Was there any indication of hanky-panky, fraud, or anything of that nature?

My next question is about solving the problem. My understanding is that the budget doesn't change. There might be some change as far as the government is concerned; they might increase the budget, but to get rid of that deficit, each year a certain percentage has to be taken off the total package. In other words, there are fewer dollars now for the first nations people. On top of that, they have to take out of their annual budget the salary for these external agents who are supposed to be coming in to handle their affairs. How in the world can a first nation get out of debt with that kind of program? That could take years and years and years.

Ms. Sheila Fraser: Mr. Chairman, Mr. Dromisky is absolutely right that the situation is a very serious one and in many cases is cause for concern when first nations go into third-party management. We didn't in this report, I don't think, look at all of the causes, and I would imagine that the causes are as varied as the number of first nations under third-party management. There could be simply cases of bad management. There could be cases of increasing populations without increasing funding. There could be cases of other costs the first nation does not control suddenly rising dramatically, and if the funding is not adjusted to meet that, over a period of time this puts them into a very difficult financial situation.

But you are right. When you get to the ultimate of the third-party manager, there is a financial recovery plan set up to bring the first nation back into balance over a certain period of time, but I would suspect in most cases this means reducing expenditures and also taking into account the fees of the managers. One of the issues we brought up in this is that the department should be identifying these cases much earlier, rather than waiting until debt levels.... I think I mention here that in some cases the debt levels totalled between 22% and 55% of the yearly funding.

¿ (0915)

Mr. Stan Dromisky: Right. That's too high.

Ms. Sheila Fraser: It compounds the difficulties if we wait until a third party....

I'll ask Mr. Berthelette, perhaps, to answer some of the other questions you asked.

Mr. Jerome Berthelette: There are three levels of intervention associated with the intervention policy, which are set out at paragraph 10.23 of our audit note. There's low-level intervention, which is a remedial management plan. That's where problems are identified by the department or by the community, together sometimes, and a regional remedial management plan is put into place that sets out the steps the community will take to deal with the problems they're having.

There's the second level, which is a moderate level of intervention, which is co-management, where the department and the community hire a co-manager who works with the community in this case to help the community deal with the financial problems they face.

Of course, the highest level of intervention is a third-party manager. When you get to that level of intervention, what happens is that the community loses all control over its finances; the third-party manager enters into an agreement with the department.

As you rightly point out, the fees for the third-party manager are paid out of the community's budget. This means, as the Auditor General has said, that programs and some services have to be reduced; sometimes it's in the area of housing, and sometimes some education funds are reduced. Wherever there are some discretionary dollars available, that's where the third-party manager will try to find the money to help reduce the deficit.

Mr. Stan Dromisky: Thank you.

[Translation]

The Chair: Go ahead.

[English]

Mr. Jerome Berthelette: Just on the issue of problem solving, as the Auditor General has pointed out, I think it's very important that both the government and the first nations come together to try to determine what they want the third-party managers to do and how they want the third-party mangers to carry out their work. Because third-party management is such a serious intervention, it has led, as we observed here in the audit, to some communities not taking well to the imposition of third-party management. The department has to do something to overcome that unwillingness on the part of some communities to work with third-party managers. One way to do that would be to sit down with the communities and try to determine exactly what the third-party manager is responsible for and how the third-party manager will work with the communities. I just add that in terms of problem solving.

[Translation]

The Chair: That's fine. Thank you very much.

Mr. Duncan, you have three minutes.

[English]

Mr. John Duncan: I'm back again.

Yesterday Southern Grand Chief Margaret Swan pleaded guilty to theft. From some time last year she's been charged; there are allegations that considerable money is missing, and all through that piece she has continued as the southern grand chief for the southern chiefs office in Manitoba.

There is an organization called the First Nations National Accountability Coalition, which is a native organization; it's a volunteer organization, and they have been calling for a halt to funding under her stewardship. They have documented moneys expended on overseas trips to Geneva, Switzerland, Paris, Brussels, Germany, Florida, and other locations with multiple individuals. One rationale that was given for this travel was that the southern chiefs office receives federal funding for political lobbying and that it was important to protest internationally on changes planned for the governance act and so on.

The minister's response to all of this was that as long as legal proceedings were continuing, it was not appropriate for the Department of Indian Affairs to comment as the matter was before the courts. Now, this seems like a very weak response to me, and this is doing nobody any good. It's not lending credibility to the department, it's not lending credibility to the aboriginal community, and it's certainly not building confidence on the part of the taxpaying population at large.

I understand the Auditor General has no mandate in this area. The Department of Indian Affairs, which has a mandate, is not exercising it, even when charges are pending; people are left in place, which would not happen in this place, presumably.

This is not an area you're unfamiliar with but it's one you're unable to deal with. So my question is, is it an area of interest to the point where you would like to see your mandate expanded?

Thank you.

¿ (0920)

The Chair: Thank you, Mr. Duncan.

Ms. Fraser.

Ms. Sheila Fraser: Mr. Chair, I'm sure the committee can appreciate that I can't make any comments on that specific case.

I would say, though, that it's unfortunate, when there are confirmed or proven cases of fraud and abuse, that it is ultimately the people who should be receiving the services with those government funds who suffer the most.

We are in discussions with the government on the possibility of extending our mandate, but we have suggested that should our mandate be expanded, there be a specific exclusion for other levels of government and first nations. We believe that first nations have their own auditors, that the department should be relying on the work of those auditors, and that it would in fact be inappropriate for the Auditor General to be assuming all of that responsibility.

I would say that in all of the work we do, we have started to do each year one audit report or study looking at the program perspective from the first nations' point of view, for instance, on issues like reporting on economic development. We're doing others, and first nations have consistently been extremely cooperative on this, have opened their doors to us, and have participated very willingly in our work.

I guess I would leave it at that, that we will continue to work with them on a voluntary basis in doing our work.

[Translation]

The Chair: Thank you very much, Ms. Fraser.

Mr. Laliberte, you have three minutes.

¿ (0925)

[English]

Mr. Rick Laliberte (Churchill River, Lib.): Thank you, Mr. Chair.

For now I'd like to focus on third-party management, which has quite a detrimental impact on a first nation. I'm going to use as an example one of my communities, the Peter Ballantyne Cree Nation, one of the bands under third-party management.

When the third-party manager was selected, there was no tendering, no public tendering. A former INAC employee was selected to collect a team of managers, including employees of Peter Ballantyne who brought him into this management team. It just doesn't seem right to have the first nation removed from all management when their budget and their money, as was confirmed, pays for the very salary of the third-party managers.

The other part is that nobody looks at the reasons why the third-party management or the financial problems were precipitated. In this situation, the department funds Peter Ballantyne Cree Nation as one band, but it's a multi-community band. It's spread out over a quarter of the province of Saskatchewan within the northern region, where the roads and everything don't provide a good administrative structure, but the funding does not reflect that.

Another situation is that Bill C-31 comes into reality where memberships are renewed, band memberships, but in Peter Ballantyne's case, entire communities--two villages and two hamlets--were transferred.

Here I have a funding agreement between the provincial government and the federal government. The provincial government is transferring administrative dollars that they used to transfer to the village municipality but now give to the federal Treasury so that the federal government can transfer it through INAC for community administration of all these community services. But Peter Ballantyne had signed a five-year funding agreement. In between this, the communities were transferred, and none of this was entered into their administration. They're running new water and sewer systems out of their existing membership funding. INAC could not understand this issue.

So is there a dispute resolution system that somebody could plead, that a band could raise? That is what I'm saying here.

The other thing is the whole process. You said there were three orders of intervention. This one came and there was no co-management. It jumped from a remedial plan right to third-party management. The impact was that it cost them an investment they had for economic development. They had a huge plan for forestry operations in the northeast region of the province. Because of economic uncertainty for investors, that was out the door. They were on the verge of establishing sawmills and opportunities for their communities, right in their communities, and that was thrown out.

My question is about the role of the tribal council. There are tribal councils throughout Canada, but do the tribal council agreements include financial management and capacity building? Why should we look at INAC for capacity building when we have professionals? We have accountants and we have certified managers all across the country. We have organizations that deal with and train and bring capacity to managers. But if the tribal council played a significant role, maybe it wouldn't go to these extreme levels. The chiefs and band councils might have an easier time working through and envisioning and formulating their way out of the financial loop they're in.

So it's all very detrimental, especially what caused, in this case, the third-party management and the lack of INAC's capacity to review this case. This has been going on for up to four years, and I still haven't been able to get the funding of this. This is up to $25 million annually. This money is being transferred by the province every year to the federal government, but it's not reaching the communities.

I was wondering if your department would audit this arrangement. This is a very unique arrangement, and it's not happening to every band or every community in the country. This is a unique situation, and this is an agreement on which nobody has been able to answer.

[Translation]

The Chair: Thank you, Mr. Laliberte.

Ms. Fraser.

[English]

Ms. Sheila Fraser: Thank you, Mr. Chair.

I will answer some aspects of Mr. Laliberte's question and then pass it on to Mr. Berthelette.

You mentioned the choice of third-party managers. We have a part in here that indicates that we were concerned as well about the process. It was not open, not transparent. We believe the new policy should address some of that, but obviously it wasn't really in effect when we did our audit. So we will have to look in the future to see if that situation has been corrected or not.

A major issue you raise is that unfortunately the label of third-party management puts a label on these communities and first nations, and it is not always due to circumstances that they can control. I think you're right in saying that probably there has to be more understanding of the reasons why first nations are put under third-party management, that they are not all labelled as being bad managers or that something untoward has happened with the financial resources of that community. I believe, like you, that it is not always the case, and I believe there are other cases that would indicate that as well.

We note very strongly in here the need for cooperation and a collaborative approach between the federal government and first nations. Even in difficult situations, the first nations have to have input and involvement in the choice of the third-party manager. As Mr. Berthelette mentioned earlier, there's often resistance to this. If a first nation isn't involved at all, how do you break down that resistance? Secondly, the major issue is to build capacity going forward in many of these first nations. It's not simply to correct the financial situation but to ensure that it doesn't reoccur.

So all of the issues Mr. Laliberte has raised are very pertinent, I think, and are reflected in our audit observations.

Mr. Berthelette might have some other specific responses as well.

¿ (0930)

Mr. Jerome Berthelette: Mr. Chairman, in response to the points Mr. Laliberte has raised, I would just add a couple more points.

I think the issue around the role of the tribal council is an important one, as the council could provide a means by which the first nations themselves would be able to deal with issues that come up in communities around, say, financial management and around the issue of managing the budgets. Tribal councils, or tribal council processes and structures, are organizations that could help the communities, and this could be used by Indian Affairs to help the communities with their financial issues.

So it is something that, as Mr. Laliberte has mentioned, could and should be followed up by Indian Affairs as a means to help develop capacity in those communities before they get into trouble. This means, as well, the communities themselves would have to be prepared to have the tribal council come in and assist them and help the communities identify the problems.

In terms of a dispute resolution process, we didn't do any work in terms of that particular question vis-à-vis going into third-party management. We saw in the policy that there was no process for resolving disputes between the community, or community members, and third-party managers for decisions made by the managers that affect individuals in the communities. So we raised that particular issue.

Resolving the disputes around going into third-party management may be difficult, but again, this is an area where a tribal council or first nations organization may be helpful in terms of helping the communities understand what the problems are and what the solutions to those problems are. If third-party management is one of the solutions, then the tribal council could help the communities come to that decision, and the need for a dispute resolution process around third-party management could be reduced.

[Translation]

The Chair: Mr. Laliberte, do you have another question? I will make an exception and give you one minute because I feel that you have a message from your people that Ottawa should hear. You are an excellent member of Parliament. You have one minute.

[English]

Mr. Rick Laliberte: I just want to touch on the economic development file. There is a component in there, called the first nations component of the Infrastructure Canada program, that seems to split it up one-third for INAC, one-third for Industry, and one-third for own-source funding. But it's $21 million annually by INAC. So if you add up all of this, that's $63 million that's expected for infrastructure development on reserve.

Is that all there is? I hadn't realized the final amount for this infrastructure funding. We have provincial and federal infrastructure agreements. This seems to me to be the federal and first nations infrastructure agreement, but if it only totals $21 million annually, maybe that's a big reason why economic development isn't flourishing in first nations. We're not building the necessary infrastructure for development.

¿ (0935)

Mr. Jerome Berthelette: Mr. Chair, Mr. Laliberte has raised an issue around infrastructure in the communities. We've set out here those programs that are related to economic development and infrastructure. Communities also have received some money through Indian Affairs for their community-based infrastructure, such as housing, roads, and sewers, as part of their funding arrangements. They apply to Indian Affairs on a yearly basis.

When we were in the communities, some of the communities did raise the issue of infrastructure and how important infrastructure is to economic development. They did raise the issue of the need to have better infrastructure in order to attract industry and support economic development in their communities.

Given the nature of this piece, we didn't go into that particular issue in great detail here, but I would just respond to Mr. Laliberte by saying that this issue was raised by the communities when we were speaking to them. It is one you may want to raise with Indian Affairs in terms of how they go about supporting infrastructure related to economic development in communities.

[Translation]

The Chair: Thank you very much.

Mr. Loubier, you are also an excellent member of Parliament.

Mr. Yvan Loubier: Thank you, Mr. Chairman.

I have a comment and a question. I think we should be careful when we talk about specific cases. I am referring to what Mr. Duncan spoke of earlier with respect to a grand chief who has been accused of wrongdoing. I think we should be more positive in our outlook, and in talking about that type of thing before a standing committee of the House of Commons, there is tendency to generalize, to make it sound worse than it is. We must be extremely careful.

I'm sure that is not what Mr. Duncan was trying to do, and I hope that for every single case of wrongdoing, there are hundreds of chiefs who are doing an honest job, representing and defending their community.

That brings to mind the sponsorship scandal. That is not something we should be proud of. Amongst the Conservatives, when Mr. Mulroney was leader, there were also cases of wrongdoing by elected members who... We should not assume that this is a common occurrence. There is a tendency to look for what is wrong, to blow it out of proportion and forget about everyone else.

It reminds me of the time when the committee was travelling to hear witnesses on the governance bill, and a specialist from Alberta painted a very bleak picture of the aboriginal communities. He said that between 20 and 25 per cent of communities were poorly managed. I told him to look at it another way: 100 minus 25 is 75 per cent; that means that 75 per cent of the communities are okay. I think it is normal. In a society, that type of thing is bound to happen.

I have a question for you, Ms. Fraser. You started to tell us earlier about the work that has begun with the first nations. I would like to know what type of work is involved and the cooperation that you have with the first nations. This is something that interests me.

Ms. Sheila Fraser: Thank you, Mr. Chairman. As I have already said, aboriginal issues are one of my priorities as Auditor General. We have given some thought to our approach. I believe that the office has audited a number of programs at Indian and Northern Affairs Canada, but these audits have been mainly traditional, a look at the way that the department is managed, the results, and that sort of thing. We have often been told, when suggesting that some improvement could be made in the way in which the programs were managed by the department, that this represented a criticism of the first nations, of aboriginals, which has caused us to rethink our approach. We have decided that we would try, at least once every 12 or 18 months, or there about, to undertake a study that would reflect the way in which the first nations see some aspects of the programs.

The first one dealt with reporting requirements. We have often audited the programs to see if the requirements were acceptable, but this time we studied the impact they had on the first nations.

When looking at the housing program, a number of communities explained the problems that they were facing.

Our study of economic management was done in cooperation with the first nations.

We also wanted to use our reports as a vehicle to share best practices and good examples of things that had been done by the communities or that could be adopted by other communities.

As to our current work, there is a follow-up to the education programs, which is a traditional audit. At the same time, we are also looking at the information systems that are used by the first nations and ways to improve the transfer of information to the department. There is also an audit of water quality on the reserves. Those are the three current audits, but if the committee wishes, we would be happy to come back to discuss our work plan and hear your suggestions. We are always open to ideas from honourable members that might help to guide us in our future work.

¿ (0940)

The Chair: Thank you, Mr. Loubier.

Mr. Bagnell.

[English]

Hon. Larry Bagnell (Yukon, Lib.): Thank you.

Thank you, Auditor General.

It was a timely comment, because I have two suggestions on what you might look into. First of all, I think your work is great; it's a fantastic function. I find it very hard—this is slightly off topic—as a member of Parliament.... I have two staff members. One looks after all the administration and scheduling and the other looks after correspondence. So how could I deal with several hundred thousand civil servants in relation to my 30,000 constituents? You know, a congressman has between 20 and 30 staff members, and I think there could be more accountability. I'd love it if that were looked into sometime.

I'm delighted it's one of your five priorities, because I think it's one for the new Prime Minister as well. I'm delighted that you're looking at progress, because there's no use having all sorts of activities if we're not making progress, so I think that's great.

I have just a couple of comments before I ask my question. On third-party managers, I think everyone on our side, your side, and in the opposition is happy that the minister moved rather decisively a couple of months ago to establish a new regime of third-party managers and intervention that's more cooperative and collaborative--which are the exact words you used.

I want to make a comment on Yukon devolution, which you did a study on. I agreed with everything you said. I think the minister agreed with virtually everything you said in those chapters too and is putting plans in place.

I just want to add information on Yukon devolution. Since it went into place, you can count on my fingers the number of complaints I've had, which is absolutely remarkable. This basically created, to all intents and purposes, a new province. For that to occur with virtually no ripples is absolutely astonishing. I guess my only disappointment was that the national media didn't even cover it...this is since Newfoundland joined Confederation. We basically made a new province, and they refused to cover it.

My question is related to the objectives of the land claims. I think it's a great point, and I think the minister agreed with you. It's just the method of fulfilling those objectives. We determine the objectives we want, and hopefully the land claim itself is part of the template to achieve those objectives. Even further and more technical is the implementation plan that goes with the land claim. In theory, that plan is put in place so those objectives are achieved.

I hope you're saying that the implementation plans we've signed, which all parties to the claim have agreed is the way to achieve the objectives, are deficient. I don't think you would want civil servants just running off, spending money, and doing all sorts of things outside a plan. Then they could just say they were achieving the objectives. I'm assuming you're saying the plan we've signed with all parties is deficient because it doesn't measure the objectives and ways of achieving them.

¿ (0945)

Ms. Sheila Fraser: Thank you, Madam Chair.

I'd just like to start off by saying to Mr. Bagnell that our role really is to provide information to parliamentarians. Fundamentally that is what we are here for, and we are always pleased when a parliamentarian thanks us just for doing our job. That is the role, and that is why it is important for us to understand issues that you may have concerns about, which will help us in determining future audit work.

You are correct. I think the devolution to the Yukon was a significant event, and maybe events that happen without a whole lot of problems somehow don't seem to get a lot of attention in the media. But we are hoping there can be lessons learned from that so that in future, devolutions like this will go just as successfully and perhaps will even be improved upon.

On the final point, on the implementation plans, you are right. The difficulty is that very broad objectives are set--for instance, increasing employment--but there is no real target. There's no plan as to how to actually get there, and there is no monitoring to see if progress has been made and if corrections need to be done in the actions that are being taken. We recognize in the report, of course, that it is not only the responsibility of the federal government, it is the responsibility of all the partners involved in these agreements. But the federal government is in many cases, if you will, the largest, most important player, and we certainly think it has the responsibility to show leadership in some of this.

I guess we've sort of alluded to the fact that too often people see the signature of these agreements as the end of something, and in fact it's only the beginning. There's a much longer process to actually implement them and get the success that these agreements are leading to.

Perhaps Mr. Greenberg would like to elaborate a little bit more on some of this.

Mr. Jeff Greenberg (Principal, Audit Operations Branch, Office of the Auditor General of Canada): Thank you, Madam Chair.

We did not look at whether implementation plans were deficient; we simply looked at illustrations of where the specific obligations didn't line up or didn't get to the overall objectives. And that in itself wouldn't necessarily be a concern if the mechanisms for resolving disputes actually worked also. This was something that troubled us. We found that they didn't achieve, simply because of the way they operated. They operated either by consensus or unanimity, and if any one party disagreed, things never even went to arbitration.

Finally, the last element of that was the reporting. There are no illustrations of the disputes appearing in any of the reports associated with the land claims. That applies both in the case of Nunavut as well as in the case of the Gwich'in.

The Vice-Chair (Ms. Nancy Karetak-Lindell (Nunavut, Lib.)): I'm sorry, we've given you twice the time. I have four speakers here and we're rapidly reaching our one hour with Madam Fraser.

Mr. Burton, three minutes, please.

Mr. Andy Burton (Skeena, CPC): Thank you, Madam Chairman, and thank you, Ms. Fraser, for being here today.

I'm from northwestern British Columbia, an area that borders south of the Yukon. I have a very high native population in my area, probably 30% to 35% native, with dozens of villages. So I do get my share of input from what is actually happening out there. I don't really want to concentrate on my own area so much as look at the bigger picture, because I think the microcosm probably reflects the macrocosm to a large degree.

You mentioned in your opening remarks that you were looking for accountability, partnership program delivery, and dispute resolution. Certainly those are issues, especially the accountability, that I hear an awful lot about and that I'm very concerned about.

If we look at the INAC budget, it's a very large budget, one of the largest in the government. I guess the question really is whether we're getting value for money from the overall budget, and if not, why not. And how significant is the accountability and reporting from these various groups right across Canada? What kind of job are we doing here in terms of getting that accountability?

Secondly, we talked about third-party management and so on earlier. I really question...you know, by the time it's got to the third-party management level, things are probably totally out of hand already. Again it comes back to accountability. How could we improve that whole situation--in other words, shut the barn door before the horse gets out? We need to deal with these problems up front, at the beginning, before they get out of hand. What would you suggest, from your position, regarding recommendations we could make that would improve this accountability situation overall?

¿ (0950)

Ms. Sheila Fraser: Madam Chair, thank you. I'll try to do this briefly.

The question that has been raised is in fact very complex. This isn't just accountability to the federal government on the funds that have been transferred, but in fact an accountability to first nations people as to what those programs have actually done to better their situation.

I would hope as we go forward we would perhaps be doing a study with first nations on the kinds of information they provide to their people to show them this. But again, it's the whole measuring of results. Have health indicators improved? Have housing conditions improved? Have education levels increased? We recognize this is very complex and it will take a very long time to do.

As for value for money, I will leave that judgment up to parliamentarians and first nations people--the value of the money that is being spent in that area.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you, and your timing was great.

Mr. Telegdi.

Hon. Andrew Telegdi (Kitchener—Waterloo, Lib.): Thank you very much, Madam Chair.

Welcome, Madam Fraser. I'm very pleased that this is an area of focus for your department. It's also an area of focus for the Prime Minister, and it's also a big focus of mine.

In talking about the need for transparency and accountability, I think it's a two-way exercise. I think you have to have it from the government as well as from the aboriginal community. I think what we're looking at down the road is some kind of partnership. I think it's important to note that 78% of the management have done quite well on their own. Of course, we have had some problem areas.

I wonder, in the case of third-party managers or even co-managers, have you come across any people from the aboriginal community who are involved in that? Because certainly I look at that as an economic development activity for them.

Ms. Sheila Fraser: I'll ask Mr. Berthelette to respond, Madam Chair.

Mr. Jerome Berthelette: Madam Chair, there are some third-party managers and co-managers who are aboriginal. There have been, as I understand it, some co-management agreements that have been taken by tribal councils and other organizations. So there is some of that going on, but I don't know what the percentage is or the extent to which aboriginal people or organizations are involved in co-management or third-party management.

Hon. Andrew Telegdi: Are any of the direct managers, third-party management, aboriginal?

Mr. Jerome Berthelette: There have been some third-party managers who were aboriginal. I'm not sure if there are some in place at the moment...yes, I believe there is one in place at the moment.

Hon. Andrew Telegdi: Mr. Laliberte, in the case he mentioned, said the third-party manager had worked in the department previously. Are there many people who are third-party managers who worked in the department previously?

Mr. Jerome Berthelette: I don't know. I can't answer that question. I don't have the facts.

Hon. Andrew Telegdi: You have no profile on that? I guess that's something the committee could....

Ms. Sheila Fraser: I would suggest the committee might wish to ask the department for that kind of information. We only looked at certain examples and didn't address that question in our report.

Hon. Andrew Telegdi: Another question I have, and this actually follows up on Mr. Laliberte's question, is to what extent would it be useful in capacity building to involve, say, the Assembly of First Nations to have some managers who are ready to go in situations where there are problems?

¿ (0955)

Mr. Jerome Berthelette: Madam Chair, I think it's an idea that should be pursued by the Department of Indian Affairs. It probably makes sense to try to do it that way.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

Mr. Duncan, third round, for three minutes.

Mr. John Duncan: Thank you very much.

My final question deals with information. The Auditor General gets her information in various forms, and so do members of Parliament. Some of it is from the normal route, and sometimes information arrives through various sources.

In the case of the current controversy swirling around the government, the whole issue of whistle-blower protection has suddenly taken on a whole new dimension, because it's obviously a very important protection that we require.

In the case of someone who talked to me earlier.... I'm just trying to remember the timeframe, but I guess it was last year. From the moment a school principal from an isolated reserve talked to me, and I took her major concerns forward, which have since been verified, she knew her job was on the line—and indeed she was fired. All she was trying to do was to ensure the safety and protection of school children.

This points up a major black hole, from the standpoint that there is no forecast protection for people in this situation, and the circumstances of this former school principal are not nice from a financial standpoint.

I'm wondering if you have any comments that you'd like to offer, since the aboriginal area is one of your five priority focuses, and since you must have some opinion on the value and importance of whistle-blowers in our society.

Ms. Sheila Fraser: The question I think Mr. Duncan is asking is really one of policy, and it would be inappropriate for me to discuss policy. It is my understanding that there is legislation currently before the House, and I am sure that there would be some forum where that sort of consideration might be given by the people studying the current legislation.

Mr. John Duncan: Currently, it would neither apply to this individual, which is unfortunate, nor to that whole set of circumstances on first nations reserves.

Thank you very much.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

I was actually on the speaking list, so I just have a very short question. I was very interested in your recommendation 8.63, that INAC “should amend the land claim obligation system...to ensure that it focusses not only on obligations but also on results and that it provides measurable milestones and targets to gauge progress”.

One concern that Nunavut beneficiaries have had is Inuit employment—or really, in our case, lack of employment. I think this recommendation pretty well states exactly what the people have been asking for, that unless they can see results, it's very difficult for people who are not actively participating in the processes, because of lack of language, or who are just still learning to participate in all these different processes that other Canadians participate in.

What would you see coming out of this recommendation as far as Inuit employment is concerned? Because that has been lacking for us in the implementation process.

Ms. Sheila Fraser: Thank you, Madam Chair.

I think that is a really good example of the kind of point we are trying to make, that there should be clear objectives set, not only in terms of the percentage of Inuit employment, but also in what timeframe. The government, or all of the parties involved, should know what the current situation is and then what the plan is to actually get to that ultimate objective. There should be some measuring or tracking of that over time, so that someone can judge if the actions being taken now are successful or not.

There are, I presume, a number of activities going on to try to encourage an increase in Inuit employment, but if nobody knows what the actual numbers being employed are, how would you ever know if you're ever going to meet that ultimate target?

So what we're saying is that success isn't just doing the specific activities. For instance, if the agreement says that you have to hold a meeting, has the fact of holding a meeting had any impact on meeting your ultimate objectives? So that's what we're encouraging; they have to look at the results.

The department, as I noted, at the time of the response, fundamentally disagreed with us and our approach and and how we define success. The current minister, though, has indicated that he does agree that success is more than just obligations, and I think it would be worth while for the committee to review with the department what they are doing to adapt their management framework to take account of that new definition of success.

À (1000)

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you very much, Madam Fraser.

Ms. Sheila Fraser: Thank you. It was a pleasure.

The Vice-Chair (Ms. Nancy Karetak-Lindell) And thank you to your assistants. That was very informative.

We're going to suspend for a few minutes just to give us time to get the other witnesses, and then we'll hear directly from the people who are affected by these....

Thank you.

À (1002)

À (1008)

The Vice-Chair (Ms. Nancy Karetak-Lindell): I call the meeting back to order, please.

I guess the arrangement was that the four witnesses this morning would give their presentations, and then we will follow with questions. We have a total of 15 minutes for the presentations. According to the schedule, we have Nunavut Tunngavik Incorporated starting first, represented by Joanasie Akumalik, director of implementation; and John Bainbridge, senior policy adviser.

You have about seven and a half minutes, and then we'll go on with the witnesses from the Gwich'in Tribal Council.

Welcome.

Mr. Joanasie Akumalik (Director of Implementation, Nunavut Tunngavik Incorporated): Thank you, Madam Chair.

First of all, on behalf of the Inuit of Nunavut, I would like to thank you for this opportunity to make a presentation to the standing committee. I am joined by John Bainbridge, our senior policy adviser. I would also like to point out that there are a number of northern Inuit students present with us, and I am sure they are our future leaders.

We are pleased to hear the presentation of the Auditor General, and I want to say that NTI is in full agreement with the Auditor General's conclusion that by managing without determining how best to meet the objectives, the department has contributed to a sense of frustration that has developed between the beneficiaries and the federal government.

Nunavut Tunngavik Incorporated, which I will now call NTI, represents 24,000 Inuit who are beneficiaries of the Nunavut land claims agreement, or as I shall call it, our agreement. This agreement is in this form. NTI is an organization that negotiated and signed the agreement in 1993. Back then we were called Tunngavik Federation of Nunavut. Our agreement is with Her Majesty, the Queen, in the right of Canada and was signed by Canada's Prime Minister. It is the largest land claim agreement in Canadian history, and it has attracted world-wide attention. Canada has earned much international attention and praise from countries and indigenous peoples around the world for its land claims policy, and the Nunavut agreement in particular.

Under our agreement, Inuit gave a measure of certainty to title to one-fifth of the Canadian land mass, which has opened the way to development. That is of enormous benefit to Canada, and I would like to ask you to keep that in mind as I speak to you. When Canada signs land claims agreements, it makes other important gains. Each land claims agreement signed has enabled the Government of Canada to put in place a process for obtaining the consent of the local people for development where none existed before. This is an important gain for the state.

Canada's promises to Inuit, which were made in return for benefits it received, are protected in the Constitution of Canada. They are most solemn promises, and the Supreme Court of Canada has noted that the honour of the crown is at stake in matters respecting how aboriginal rights are dealt with. Yet 11 years after our agreement was signed by Inuit leaders and the Prime Minister of Canada, many crucial obligations remain outstanding, and there appears to be no will to fulfil them. In 1998 an independent five-year review supported this conclusion. Many of the outstanding obligations are about power-sharing and self-sufficiency and go to the heart of our agreement. I want to speak about three of these.

First, article 24 requires that the Government of Canada shall develop procurement policies that support Inuit firms for all government contracts required to support their activities in the Nunavut settlement area. This article is founded on the well-tested notion that new and fragile economies need protection to allow them to take root and mature. These policies were required to be in place no later than one year following the date of the ratification of the agreement, but 11 years after the agreement was signed, there is no federal policy in place and no intention to put one in place.

À (1010)

Second, article 12 of our agreement requires the government to develop a monitoring plan to collect and analyse information on the long-term state and health of the ecosystem and socio-economic environment in the Nunavut settlement area. This enlightened provision, if it were ever implemented, would enable the emergence of a reliable picture of Nunavut society and remove an obstacle to more informed policy-making and better use of public resources. Yet 11 years after our agreement, Nunavut is a jurisdiction unique in Canada for the lack of information about its ecosystem and socio-economic environment.

Third, article 23 is probably the most important unfulfilled promise. It requires that the public service shall have a representative level of Inuit employment at all grades and in occupational groups. As Inuit make up roughly 85% of the Nunavut population, that is the representative level. But 11 years after our agreement was signed, the representative level in the government of Nunavut is approximately 42%, and in the regional federal public service it is 33%. Most of the Inuit employed in government today are concentrated in a narrow band of lower-skilled occupational groups and at the lowest grades. The average salary rate of Inuit in the GN is consequently 78.5% of that of non-Inuit. So even the current 42% representation paints a brighter picture than actually exists.

Studies recently undertaken by Informetrica and Pricewaterhouse Coopers indicate the cost of this situation. In economic terms alone, putting aside mounting costs of socio-economic distress and political consequences, conservatively estimated, the Inuit of Nunavut miss out on a collective payroll that could be some $123 million higher annually. In addition, governments together spend some $65 million per year on recruitment and relocation costs to support a flying bureaucracy and welfare costs to support very high young Inuit unemployment. Both these costs would be drastically reduced if Inuit educational and training levels were reset to national norms.

One would think that the tabling of this research would have prompted the federal government to leave its own financial self-interest and, independently of all other legal and moral obligations, to seek to immediately engage Inuit in any number of questions surrounding this research. Unfortunately, that has not been the case. The long-term payoff to Canadian taxpayers of avoiding $65 million per year in unnecessary costs doesn't seem to matter. That resonates in the federal land claims policy world.

Last November NTI and other aboriginal organizations across Canada held a conference in Ottawa to examine the implementation of the land claims agreement. All shared the same experience and frustrations. Out of this aboriginal organization was formed a land claims coalition to work with the Government of Canada to develop a policy to ensure that agreements are implemented in a way that will achieve the objectives of the land claims.

As is apparent in its response to the recent Auditor General's report, DIAND has demonstrated that it does not have the will to move beyond a narrow legalistic interpretation of the agreements. Nor does it have the ability to engage with and provide necessary leadership to other arms of federal government. Nor does it have the vision necessary to manage this important task of nation building.

À (1015)

Madam Chair, let me conclude by suggesting that this committee endorse the recommendations of chapter 8 of the Auditor General's report. The Government of Canada should develop for the first time a policy on implementation as a matter of urgency. Finally, the creation of that policy should not be left to DIAND, but should be entrusted to the cabinet committee on aboriginal affairs in cooperation with the coalition. In the development of this new policy we hope to have the active support and engagement of this committee. To this end, NTI would be pleased, along with the members of the coalition, to appear before you again at your convenience.

I will be pleased to take any questions from the committee.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you.

We will hear from the other witnesses, from the Gwich'in Tribal Council. We have with us Deborah Bisson, director, and Mr. Brian Crane. We will hear your intervention, then we'll proceed to questions.

À (1020)

Ms. Deborah Bisson (Director, Lands, Resources and Implementation, Gwich'in Tribal Council): Thank you, Madam Chair.

Va'nh Gwiinzii--good morning, in Gwich'in.

The Gwich'in Tribal Council, GTC, is pleased to have the opportunity to address this committee on matters raised by the Auditor General's report. These matters are very important to Gwich'in, and I've travelled on very short notice for two days from Inuvik to make this point. As a result, we have not had the opportunity to prepare a formal written submission, and I offer my apologies for this.

By way of background, the Gwich'in comprehensive land claim agreement was settled in 1992. It represents nearly 3,000 beneficiaries, most of whom live in four Gwich'in communities: Inuvik, Fort McPherson, Aklavik, and Tsiigehtchic in the Northwest Territories in the Arctic.

With respect to the Auditor General's report, the Gwich'in Tribal Council is supportive of the findings and recommendations. Achieving self-sufficiency is a key objective of the Gwich'in, and a number of the Auditor General's findings and recommendations relate to this objective, in particular the matter of funding.

The Gwich'in Tribal Council, as a signatory to the agreement, is charged with implementing and administering the land claim on behalf of Gwich'in. Yet it has struggled consistently over the past nine or ten years with a lack of resources and has had to dip into settlement funds, which were never intended to be used for implementation.

On a related matter, self-sufficiency requires capacity building. As the Gwich'in Tribal Council stated in a news release relating to the Auditor General's report:

It is an economic imperative that government programs pay more than lip service to education, skills development, and preferential contracting required ensuring there are Gwich'in people and businesses available to develop the economy.

As the Gwich'in Tribal Council President Fred Carmichael said in this news release:

Our negotiators have always raised the issue of lack of funding needed to effectively implement the Gwich'in Comprehensive Land Claim Agreement.

This continues to hamper the Gwich'in people in achieving economic self-sufficiency and to be able to control our own destiny. The Gwich'in Tribal Council would like to see the economic measures chapter implemented so as to address this imperative. A number of the recommendations in the Auditor General's report relate to this.

Yesterday the coalition of settled land claims groups, referred to by Mr. Akumalik in his comments, tabled a report, which he also referred to. It's a proposed policy approach, a new approach, to implementation. The Gwich'in Tribal Council is supportive of that report and this policy initiative, and in particular of the proposal for an approach that includes more prominent consideration of objectives in implementing land claims agreements.

There are nine objectives stated in the Gwich'in comprehensive land claim agreement, and more than one of those objectives are related to self-sufficiency.

The Gwich'in Tribal Council has asked Brian Crane, our outside counsel, to make some comments on our behalf. Brian Crane has been our counsel since before the Gwich'in comprehensive land claim. He brings to his remarks a continuity of knowledge about objectives and understandings that were in place throughout the negotiation of the land claim and how those have been addressed throughout the conclusion of the land claim and its implementation over the past ten years.

Thank you.

The Vice-Chair (Ms. Nancy Karetak-Lindell): Mr. Crane.

Mr. Brian Crane (Barrister and Solicitor, Gowling Lafleur Henderson, Gwich'in Tribal Council): Thank you, Madam Chair.

It's an honour to be here before the committee to share some perceptions on the difficulties the Gwich'in have faced in the context of implementing their land claim.

One of the difficulties—and these are outlined in the Auditor General's report—has been the failure to develop a joint problem-solving approach with the Department of Indian Affairs on what might be called the central economic problems of self-sufficiency and economic development. This is common in all land claims, and arises from essentially a black-letter-driven philosophy within the department on what is required to be done once a land claim is signed off.

This is true and applies to many of the obligations under agreements, such as the land that's to be transferred, the financial benefits that are transferred, the question of setting up institutions, and so on. But there are other obligations in the land claim agreements that are equally important that relate to an ongoing relationship with Canada and that will support economic development.

We've heard about article 23 in the Nunavut Land Claims Agreement. In the Gwich'in land claim there is chapter 10, which deals with economic measures. The objective of chapter 10 is that the Gwich'in shall be self-sufficient. One would have thought that after the dust had settled from the original negotiations, the parties would have met to develop some form of joint plan to address this objective. Unfortunately, that did not take place, and there has not been much change in terms of self-sufficiency and capacity building in the Gwich'in settlement area.

On the instance of training, there was support in the implementation plan for training dollars, but unfortunately that was negotiated as a one-time payment of $700,000, which lasted, I suspect, about 18 months or two years. After that there has been nothing in the way of a transfer to help capacity building in terms of implementation funding. That's just one example of a rather narrow approach to a long-term economic objective.

What would we recommend to this committee? I have about three or four recommendations that could be made. All of these relate to the objectives of the land claims that deal with self-sufficiency.

First, give your support to the Auditor General's recommendations.

Second, give your support to the coalition's recommendation that DIAND have a transparent policy on implementation of land claims. Right now there is no published policy at all, and there never has been one on the implementation of land claims. There are documents within the department, but none of these have been published as official policy.

Third, develop some form of institutional change. It has been suggested by the Nunavut representatives that the cabinet committee might be involved. Another possibility would be a regular report to this committee on the implementation of land claims and the recommendations of the Auditor General for transparent reporting and accountability on a regular basis on what has happened about the implementation plans.

À (1025)

There is no open explanation to the public, either to the Gwich'in public or to the Canadian public at large, as to what the problems are in implementation. The annual reports have in fact been very pallid, uninteresting documents. There should be an honest transparent reporting of what the problems are.

Another way of dealing with issues is to resort to the arbitration mechanisms in the agreements. Let's have some of these disputes—and there are disputes out there on what should be done—resolved by arbitration, as required by the land claim agreement.

Lastly, let me return, in closing, to support what is recommended by the Auditor General as a results-based management approach. This plays into the ideas, some of which have been hopefully supported by the new minister, that there should be an ongoing relationship between the department and the land claim groups to implement the land claim. It's not something that ended at the time the land claim was signed, but it is an ongoing relationship with cooperative solutions.

As the Auditor General said in her remarks, this is not the end of something, but the beginning. I would urge the committee to get the process started, to kick-start a different way of looking at things from the departmental point of view.

Thank you very much.

À (1030)

The Vice-Chair (Ms. Nancy Karetak-Lindell): Thank you very much.

To let the members know, there are some presentations by NTI over on that table, but because they're not in both official languages, we're leaving it up to the members to get their copies there.

Thank you very much for your presentations this morning.

We will do a round of questions.

First of all, I'm not sure when the chair will be coming back. In that case, I want to welcome everyone here. I see a lot of familiar faces this morning.

I would again like to welcome the students of the Nunavut Tunngavik program and other faces that I've seen over the years of the aboriginal affairs committee hearings.

We will start with Mr. Duncan in the first round.

Mr. John Duncan: Thank you.

I only wanted to mention how timely your presence is. I think the Auditor General's report was focused on very heavily, but these chapters were not focused on very heavily.

In terms of implementation of treaties or comprehensive claims, the recommendations of the Auditor General have common sense, are powerful, and have been adopted in an interim way, at least at this point, in party policy for my party. That's a new development, so I wanted to share that with you.

It was only in the last few minutes that I realized there was documentation on the other side. I haven't had an opportunity to go through all of it.

On the signators of the proposed implementation policy, were there any exceptions to people who could potentially have signed on? Was there anyone who did not sign on who could have? That's my first question.

Mr. Joanasie Akumalik: Madam Chair, thank you for the question.

I agree with you that the Auditor General's report had common sense and was very powerful.

In regard to your question, I would like to ask our senior policy adviser to answer. He is the key person working on this coalition.

À (1035)

Mr. John Bainbridge (Senior Policy Advisor, Nunavut Tunngavik Incorporated): There were two notable absences, one being the Labrador Inuit Association. They have been involved with us from the start in a peripheral way. They are very busy with bringing their own claim to a conclusion, so they haven't been able to give the attention they would have liked to this coalition. They've listened in and given their support, but they haven't been able to engage the process fully.

The other notable exception is Makivik. I'm not sure why they're not there. They were certainly there up until last week, but this document was put out very quickly. We had a tight deadline; we wanted to mail it to the Prime Minister yesterday, and it's possible, I think, that they did not get their logo to us in time for the letter to go. I think it's just that it was Monday.

Mr. John Duncan: Yes, practicalities.

Well, without having had the benefit of being able to read all of the material, I'd say the whole aspect of training is obviously crucial on the issue of hiring and the issue of entrepreneurship. That seems to be a major stumbling block. Is there a specific proposal with dollars tied to it or associated with it from Nunavut, for example, or from the Gwich'in?

Mr. John Bainbridge: Well, from the point of view of Nunavut, we are starting the fourth year of negotiations with the Government of Canada, DIAND in particular, on the next ten years of funding for implementing the land claims agreement, and central to those negotiations has been the funding of article 23.

We have put in a number of short-term initiatives we'd like to see--these are primarily research projects--but the centrepiece of our proposal is that there should be put in place a body that can do some long-term planning to address training and education issues in Nunavut. Then by the year 2013, at the end of this second planning period, we will be able to see some measurable progress towards reaching a representative level. At the present time there's no coherent planning at all in Nunavut towards training and education.

Mr. John Duncan: Did Ms. Bisson want to say anything on that?

Ms. Deborah Bisson: There is an initiative that goes by the acronym ASEP, but I can't remember the full name. I think it's just between the territorial government and industry and is aimed primarily at training in relation to readiness for the Mackenzie gas project. I don't know enough about it to say any more other than that we are negotiating benefits and access agreements with the Mackenzie gas project. That has led me to understand that the ASEP program, while it will be helpful, does not cover all bases. Some of those bases will have to be covered in our negotiations.

Mr. John Duncan: So it would be fair to say that in both cases this would be directed to more than just government hiring and government procurement; it would also be oriented towards the industrial sector--the private sector, the job sector--as well?

Mr. John Bainbridge: Inasmuch as you can't force anybody to work in government or stay employed in government, they will move around. Certainly the experience in Nunavut is that there's a great deal of movement because the pool of trained and educated Inuit is quite small, so any training program is going to benefit all employers.

À (1040)

Mr. John Duncan: I just have a comment, not a question. I talked to a native from the Okanagan who was working in the north, and the opportunities were amazing simply because he was trained. It seems like in many cases there's not a shortage of work; there's a shortage of qualified workers, plain and simple. Obviously, if you're trained and have the expertise, you'll have an advantage as a resident, as opposed to somebody who has to relocate.

That's my time.

[Translation]

The Chair: Thank you very much.

Ms. Bisson wanted to add something. I apologize for being late; I was gone for a few minutes because of a procedural matter in the House of Commons.

Ms. Bisson, you have the floor.

[English]

Ms. Deborah Bisson: I just have a quick follow-up. It might be worth distinguishing the situation in the Gwich'in settlement area from that in Nunavut. It's a little bit different In Nunavut, where there would be emphasis on filling government positions. In the Gwich'in settlement area we don't have that governance situation, so the emphasis is more on training employees to participate in industry and business opportunities as well as on building the capacity within the business sector to be able to fulfill contracts to supply products and services.

[Translation]

The Chair: Thank you very much.

Ms. Desjarlais, please.

[English]

Mrs. Bev Desjarlais (Churchill, NDP): I think it was Mr. Crane who was mentioning something about chapter 10 and capacity building and how there was a one-time payment of $700,000. From your side of the table, so to speak, is there a long-term plan in place, an overall costing of what's involved, and a breakdown of that costing for the capacity building?

Ms. Deborah Bisson: I might need clarification on your question. When you say is there a long-term plan in place for capacity building, are you referring to a Gwich'in plan or a joint Gwich'in-government plan?

Mrs. Bev Desjarlais: Your plan. I know there was an indication that there hasn't been a working group between the government side and the Gwich'in; there was just the one-time payment. I'm asking, do you have a plan or vision in place as to what you would like to see and what the costing would be?

Ms. Deborah Bisson: I think there isn't a plan in terms of a document. There is the work done on the ASEP initiative with funding and identification of job opportunities, but in terms of specifically identifying job opportunity and business opportunity, I'm not aware of a specific document addressing that.

It is a heightened issue right now in the context of the Mackenzie gas project and will be addressed in a lot of detail over the next two or three years as that project goes through the regulatory process and as the benefits and agreements are negotiated. The view is for looking towards this project and beyond.

Mrs. Bev Desjarlais: Are you looking at opportunities other than the gas project?

Ms. Deborah Bisson: Absolutely, because the idea is to try to take advantage of training opportunities now so people, when construction is finished, can work or fulfill business opportunities elsewhere.

Mrs. Bev Desjarlais: Is the cost of that program out there? Is it built into the plan what the cost is expected to be?

Ms. Deborah Bisson: There is no overriding plan. There is the ASEP initiative. I'm sorry I can't explain more to the committee about that initiative; I'm not involved in it. The rest of the costs will be borne by the Gwich'in and will be incorporated in some way, we hope, into the benefits and access agreement.

Mrs. Bev Desjarlais: Thank you.

[Translation]

The Chair: Thank you, Ms. Bisson. Thank you, Ms. Desjarlais.

Mr. Bagnell.

[English]

Hon. Larry Bagnell: [Member speaks in Gwich'in]

I gave a whole speech in Gwich'in at the Tetlit Gwich'in this summer, although they are outside my constituency. I was at Peel River.

I want to say hi to all the youth who are here. It's great to see you learning about the parliamentary process. It's a credit to you that you've come today and shown an interest in how democracy works. We've learned a lot about your area from your member of Parliament; she's been a great ambassador here and has told us a lot about Nunavut in Parliament and raised a lot of these issues.

I'd just like to ask Joanasie about something. You mentioned percentages of people employed, but I wonder what number of Inuit are employed in the Nunavut and federal governments, if you have numbers, people who have jobs but wouldn't have had jobs before a land claim was settled.

À (1045)

Mr. John Bainbridge: Do you mean before the claim was signed?

Hon. Larry Bagnell: No, I mean people who are now employed in governments in Nunavut who wouldn't have had those jobs if we had not signed a land claim. I've found that anywhere I've seen a land claim settled there's been a great progression; there are a number of jobs in self-sufficiency. I'm just trying to get a measure on how many jobs have been....

Mr. John Bainbridge: Had there not been a claim, I think the level of employment would have been quite low. I couldn't possibly say what it would be.

In 1997, the then Minister of DIAND Ron Irwin set a target of 50% employment in government for 1999 when the Government of Nunavut was formed, but when that date was reached, the level was only 45%. Our concern is that since that point it has steadily declined.

The other important piece of information is that the comparative wage level between Inuit employed in government and non-Inuit is such that Inuit are at 78%, which tells you that most of the Inuit are employed in the lower end of the salary scale.

Hon. Larry Bagnell: I think Nunavut Tunngavik is a relatively unique organization, even in land claims. I don't think most land claims have a body like yours that can keep track of it in the implementation.

I don't understand the technical advice, and maybe other people don't as well. I'm curious as to how you relate to the Nunavut government in a sense that, let's say there is something that is supposed to be done in the land claim and you want to suggest to the Nunavut government how you do that. Is there a technical relationship where you can get that message across?

Mr. John Bainbridge: Shortly after the Government of Nunavut was formed, the government recognized that there needed to be a formal relationship established, because the Government of Nunavut is unique in Canada in that the claim requires it to consult on virtually everything it does, with 85% of its population being Inuit. In order to meet that requirement of consultation, they negotiated what they call the Clyde River protocol, which recognizes mutually the different responsibilities and roles of NTI and the Government of Nunavut, and also set out a process for meeting regularly at the highest level in order to identify the common objectives of Inuit as represented in NTI and through the government.

Typically, in the first year, education, for example, was seen as a priority, so both NTI and the Government of Nunavut would work together to try to push that to agenda one. This Clyde River protocol is reviewed every year, and the priorities are reviewed also.

Hon. Larry Bagnell: Do I have any time left?

[Translation]

The Chair: Yes, you have three minutes left, Mr. Bagnell.

[English]

Hon. Larry Bagnell: I have basically the same question for the Gwich'in. As I said, when I've visited communities before and after a land claim and self-government, it is like night and day afterwards. There might have been a small office with one or two people there before, and then after, there is a full-fledged government, a very professional bureaucracy, and lots of jobs for local people. I wonder if it's the same thing in your particular claim. Are there a number of jobs and similar large advancement since the claim has been signed, in the individual Gwich'in communities or governments?

À (1050)

Ms. Deborah Bisson: There is a governance structure for the tribal council. It's in Inuvik and it is made up of a board of directors from two representatives of each of the four communities that I named in my remarks. The tribal council strives to hire almost completely only beneficiaries. However, this gets back to capacity building, and there just isn't always the capacity. If we need a chartered accountant, there's no chartered accountant. That's the structure in the Gwich'in settlement areas.

I don't know if that is a full answer to your question.

Hon. Larry Bagnell: I was also thinking, in those four communities, do they now have a number of employees they would not have had before a land claim?

Ms. Deborah Bisson: There has been an effort to place some of the governance functions in the communities, and some remain in the communities. For instance, the Gwich'in Social and Cultural Institute is in one of the communities. But it does make it difficult in terms of communication and travelling back and forth for meetings, so maybe there hasn't been as much of that as one might have hoped.

Hon. Larry Bagnell: I have just a closing comment to assure you, and I mentioned it earlier this morning about the government. The minister has agreed fully with the Auditor General on the objectives and the fact that we have to achieve objectives, not just activities. He met with her to pass that message on. Hopefully, we can all make some progress in the levels of progress that we're making. It would be great.

Thank you.

[Translation]

The Chair: Thank you very much, Mr. Bagnell.

Your turn, Ms. Karetak-Lindell.

[English]

Ms. Nancy Karetak-Lindell: Thank you.

I was very interested in Joanasie's comments about the payroll estimates if Inuit would be in the employment positions that we so strongly wanted to see, once we got our land claims agreement. I know expectations have been very high. It's been difficult for all of us, even in NTI and the Government of Nunavut, and certainly in my position, when people have very high expectations. I don't think this is an unrealistic goal that Inuit should be employed in those positions that we see in our decentralized government. The point is that it could be $123 million in payroll for the community. Of course, being in the government, you automatically think of the taxes that could be going to the government that could even out the money that we invest for training.

I guess what I want from Joanasie and also from the Gwich'in is what training dollars would you think would be workable between NTI and Gwich'in and the government--what types of investments? I always want to refer to these as investments because they are. What amount of training dollars would we like to see that are realistic, within our means, and would change year by year those figures that we want to see eventually?

Coming from one of the smaller communities where it's predominantly Inuit in the community, I know that we have seen a few changes, but they seem to be more at the lower ends. And yes, because we have students taking post-secondary education, I realize--I see some people from the law program too--that we will see changes. For us, wanting results yesterday, it's difficult to see the very slow transformation of our workforce. What would be a realistic training commitment by our federal government? What types of programs are you looking for that would change the face of the workforce in let's say five years?

Mr. Joanasie Akumalik: Mr. Chair, education and training are very important for the Inuit of Nunavut. There are some programs that are ongoing, but the problem of acquiring good funding and accessing it is always a problem.

I was briefed on this issue just last night, so I'll ask Mr. Bainbridge to add to your question.

À (1055)

Mr. John Bainbridge: I think the thing that everybody recognizes is that in order to build a labour pool of Inuit that's large enough for government to be able to draw from and begin to meet a representative level, it's going to take many, many years and it's going to be expensive. I don't think that anyone is under the illusion that training and education are not expensive.

I think the significant statistic is Price Waterhouse finding that the government was spending $65 million a year in Nunavut, simply to bring in a non-Inuit labour force from the south and to support the highest unemployment rate in the country. So if money is spent on training to bring Inuit into the labour force, that $65 million a year will presumably go down. So there will be over time a trade-off, and it shouldn't, practically speaking, be any more expensive than it already is today. It's a case of where you put your resources.

Ms. Nancy Karetak-Lindell: Ms. Bisson.

Ms. Deborah Bisson: I'm not in a position to speak to the question of amounts of money. However, there is a point I would like to make. When we talk about capacity development and training, there's a bigger issue we see in the Gwich'in settlement area. Before you can realistically take advantage of a comprehensive approach to training, you need to address underlying social problems. There need to be community people with the capacity and the ability to even enter a training program, and right now there are social problems that need to be addressed so that children are born with the ability to complete a high school education and so that they are nurtured in a family structure such that they can successfully complete a high school education. Addressing those issues is every bit as important as addressing training in the Gwich'in settlement area.

Ms. Nancy Karetak-Lindell: Thank you.

I have also gone to many communities and spoken to many people, and I think one of the things we have to change too is the attitude of the people who are doing the hiring and assessing abilities. I think part of it is that we don't look for the right things in the right people. We're using a system that is set up somewhere else, and sometimes we look maybe more for the negatives than the positives. I think that's one of the things we have to change in our criteria for hiring people.

[Translation]

The Chair: Thank you very much. Your last comment was a good one, Ms. Karetak-Lindell. We must really go and see what is happening on site, and you have said what I have been thinking for a number of months.

We have one final member, Mr. Laliberte. The Transport Committee has this room as of 11 o'clock, because they are hearing witnesses. Our next meeting will be held on March 30. Hon. Andy Mitchell, Minister of Indian and Northern Affairs Canada, will be meeting with us in room 308 West Block. He is also responsible for issues relating to the residential schools, but he will be discussing the main estimates.

You have one minute, Mr. Laliberte. I apologize, but we are pressed for time.

[English]

Mr. Rick Laliberte: Thank you, Mr. Chair.

I wanted to speak on the coalition's notion that the implementation of the land claims is in question, and maybe to offer a solution. I know you're looking at the cabinet committee, and maybe even the standing committee could review the implementation or the scheduling or reporting, but historically, there were treaty commissioners who entered into the number treaties and historical treaties and the modern land claim agreements. Maybe Canada should be considering a federal treaty commission, a land claim office that is separate from the department. The department may be the implementer of the treaties or the land claims, but if there are disputes, they can go back to a commissioner to resolve them, with a higher standing office. Because of the way Canada was created, there are historical treaties and modern day agreements. Maybe we should go back to a structure that existed before, a federal treaty commissioner office. Maybe you could speak on that, because we're looking at training and encouraging our young students to use their imaginations in this huge number of careers created or implied in these agreements. We will have to give them some hope that these disputes will be resolved. I'm just trying to present a possible solution for this.

Á (1100)

The Chair: Thank you very much, Mr. Laliberte.

You have one minute, sir.

Mr. Joanasie Akumalik: Thank you, Mr. Chair.

I think that's a very good suggestion. I'm a younger person, so I didn't realize what the treaty commission office did in the past, if there was one. I think this would require some consultation with our beneficiaries, as well as with our leadership, but that's something I will take note of.

[Translation]

The Chair: Is there anything else? Thank you very much.

In closing, I would like to say something to the students who are here with us today. You listened very attentively to what happened in committee this morning. The future is yours, and you must prepare for it. You heard the questions and the answers. I believe you are from the École Nunavut Sivuniksavut which is, I think, in Nunavut.

Nakurmik marialuk.

[English]

You are lucky to have a very good MP in Ottawa in Nancy Karetak-Lindell.

Thank you very much.

The meeting is adjourned.