Treaties will bring $4 billion to province -Wilson

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Gordon Wilson, British Columbia's minister of Aboriginal Affairs, released a recently-commissioned independent study on March 24, claiming the settlement of outstanding treaties will bring more than four billion federal government dollars into the province.

The study by Grant Thornton Management Consultants of Vancouver, applies recent treaty precedents such as the Nisga'a agreement to the 50 other First Nations organizations currently registered in the treaty process. The study also takes a number of possible economic variables into consideration and the understanding that not all treaties will be comparable to the Nisga'a agreement.

The 45-page report cites the Nisga'a precedent almost exclusively. That worries many First Nations leaders who object to having a "Nisga'a template" thrust into their treaty negotiations.

"We congratulate the Nisga'a for their agreement with the other levels of government," said Richard Watts, co-chair of the Nuu-chah-nulth Tribal Council. "But federal and provincial negotiators have to realize that the Nisga'a agreement is not the Nuu-chah-nulth treaty, and will not be acceptable as a basis for their negotiations with us."

Thorton's report states estimates are "based on cost estimates tied to the Nisga'a settlement," but Wilson vehemently denies any provincial effort to apply a Nisga'a template to all B.C. First Nation negotiations.

"It's not based on a Nisga'a template per se," said Wilson. "What we're looking at is what will be land/cash quantums in negotiations."

"If we look at the settlement with Nisga'a; if we look at what Sechelt is doing, if we look at the Ditidaht, if we look at the Pacheedaht, if we look at a number of the Interior bands that are starting to move their negotiations ahead, we can now get a fairly reasonable projection of where these costs are going to be," said Wilson.

"We've got a fairly good estimate of where these are going to come down on a per capita basis. It's not based on a Nisga'a template per se, because in Sechelt for example there's a relatively small land component, and a relatively increased cash component, and so these will vary, and as they vary the costs to British Columbia will vary," he said.

Wilson explained that"the land/cash quantum varies with every First Nation, especially in the case of First Nations in or near urban centres.

In those situations, the cash portion will be larger to make up for the smaller land portion. The band can then use that money to perhaps purchase land on a willing seller-willing buyer basis.

"We're able to predict what the land and cash quantum is going to be," said Wilson. "We are making an estimate based on a fairly reasonable assumption of about 34 negotiations right now where we can already see what the quantum is going to be because it's already basically agreed to in general terms.

"The basis for projection is reasonably accurate and we can now take some reasonable assurance that the numbers we're looking at here are certainly very close to be the final ones, if not the final ones."

Taking into account the Nisga'a experience, the total financial benefit of all treaty settlements to British Columbia's First Nations is estimated at between $6.3 and $6.8 billion. After the provincial and federal governments' share of the costs - including cash, pre-treaty, and negotiation costs - are subtracted, the net financial benefit to the province as a whole is estimated to be between $3.8 and $4.7 billion.

The estimates carry a substantial degree of risk since many of the variables used are complex, and rely on a number of factors taking place.

Treaty negotiation have been ongoing for the past six years, and if the Nisga'a agreement is ratified, it will be the first treaty in the province since 1899.

In 1996, the provincial government hired KPMG consultants to estimate the value of treaties in the province, based on treaty settlement throughout Canada, the United States and New Zealand. The latest report by Grant Thorton Consultants is an update on the 1996 report, which takes the Nisga'a agreement into consideration as the first modern-day treaty settled in British Columbia.

Currently there are 50 First Nations involved in the treaty process, with 39 of those being in the fourth (agreement in principle) stage.

Another 10 First Nations are expected to join the process within the next five years.

The consultants' report estimates that all treaties will be settled within 20 years, but also recognizes that their crystal ball is quite cloudy given the volatile nature of political and economic systems.

The provincial and federal governments expect to benefit from taxes collected from First Nations as a result of investment, economic activity and employment in Aboriginal communities.

The net benefits to British Columbia from the Nisga'a agreement alone exceeds $188 million, while the benefits to the Nisga'a people are estimated at $347 million. In total, settlement costs for the Nisga'a final agreement are estimated to be $276 million annually.

Although critics of the treaty call this figure "astronomical," supporters point to recent corporate bail-out packages such as the Skeena Cellulose rescue which cost provincial taxpayers $200 million for only a one-year bail-out.

Thornton's report concludes that the settlement of all outstanding treaties in British Columbia will cost between $5.9 and $6.3 billion over 20 years, plus 2.4 to 2.9 million hectares of rural land.

Under the cost sharing arrangement, the federal government would be responsible for more than 75 per cent of a treaty's cash component and the province would be responsible for the land component. The actual share depends on the land and cash balance of each individual treaty.

When the value of land is added into the mix, Thornton estimates the total economic value of treaties to the province to be between $9.2 and $9.4 billion. This compares with the $9 billion estimated in the 1996 report.

After deducting the costs of neotiations ($2.1 to $2.5 billion) from the total financial benefit to First Nations (estimated to be approximately $6.3 to $6.8 billio) and the net financial benefit to the province as a whole ranges between $3.8 and $4.7 billion.

"This should lay to rest some fears about what the total cost of treaty settlement in B.C. will be," said Wilson. "The total cost of settlement is in and around the $9 billion range. This is a stark contrast to the $30 billion that was reported by an independent consultant for the Reform Party.

"This will inject substantial amounts of capital into Interior and rural communities, which right now could use that influx of capital," said Wilson. "There will be somewhere between $7 to $11.6 billion worth of economic spinoffs as a result of these cash transfers, because much of that will get pushed into adjoining communities. And it will also develop what is desperately needed here, and that's the economic certainty on the land."

Wilson expects the Nisga'a agreement to be ratified in the provincial legislature during the current session.

"We anticipate being completed by the end of April," said Wilson. "This largely depends on the official opposition. They could try to be obstructive I suppose, and drag it on longer. But that should give sufficient time to complete the committee stage work that needs to be done."