First Nations Should Welcome New Transparency Law: Troubling minority mention lack of transparency

Commentary, Aboriginal Futures, Joseph Quesnel

The best-governed First Nations are always the most transparent.

According to the Frontier Centre for Public Policy’s annual Aboriginal Governance Index (AGI), the highest ranked First Nations are always the communities that post basic financial and electoral information on their websites, or have governments with an “open books” policy to its members.

Through surveys, the Frontier Centre’s Governance Index gauges the opinions of common residents on the quality of governance and services band governments provide.

We also find every year in our survey that there is a statistical connection between high transparency and good administration, well-run elections and respect for human rights.

Bernard Valcourt, federal Minister of Aboriginal Affairs, discussed details of the First Nations Financial Transparency Act (formerly Bill C-27) in Winnipeg recently. It requires band governments to post on band websites: audited consolidated financial statements; schedules of remuneration and expenses; auditors’ written reports respecting consolidated financial statements; and auditors’ reports or review engagement regarding the schedule of remuneration.

Each band is required to provide such information to any member, upon request and “without delay,” within 120 days after the close of the financial year. As the name of the law suggests, the objective is to introduce a greater measure of transparency.

The law also provides remedies against blocking such information. Individuals may apply to a superior court to compel the band government to provide it. In the event of a breach, the minister of Aboriginal Affairs could also apply one of three administrative steps:

1) Require a band council to develop an action plan to remedy the breach;

 2) Withhold monies payable to a band as a grant or contribution under a current agreement;

3) Terminate any current agreement respecting a grant or contribution payable to the band government.

Understandably, steps 2 and 3 would only be used as last resorts.

Many critics question the need for a legal remedy to the lack of transparency. They argue bands already provide this information to the government. However, such an argument fails to acknowledge the difference between the law on paper and the reality.

Frontier’s surveys reveal a troubling minority of band members across the Prairies remain concerned about a lack of transparency in their communities. In our fifth annual AGI, we asked more than 3,000 band members in 32 indigenous communities in Alberta, Manitoba, and Saskatchewan what they thought about transparency. Unsurprisingly, more than 80 per cent of respondents believe band governments should be open about their salaries and benefits.

Conversely, about 25 per cent said this information is “definitely not” available to everyone on the reserve. About 42 per cent thought the information was “definitely” available, and 32 per cent gave a neutral response.

Our survey also found that the best-governed bands do not need to be compelled by law when they proactively establish websites containing all relevant financial information. The new law is aimed at the minority of communities failing to provide this information.

Just like any municipal government, these proactive band governments understand that lenders and outside investors are concerned about financial transparency when they seek to establish relationships with First Nations.

In surveying the common band members we interact with we found that they will have more tools to deal less fearfully with bands lacking transparency. Typically, in band governments with no separation between administration and politics, elected leaders have been known to ostracize members who ask too many questions.

Our most recent AGI reported that 20 per cent of respondents said they were “definitely” afraid chief and council could make people leave the community through a band council resolution, depriving someone of reserve membership and the entitlement to reside there.

Canadian indigenous peoples need the basic protections and transparency that we take for granted in Canada. All First Nations communities should welcome the First Nations Financial Transparency Act.