Financial Institution Act in the works

Page 2

An act that the federal government hopes to table within the next several months will "provide for an integrated system of First Nation financial management, to establish certain First Nation institutions for that purpose and to make consequential amendments to other acts."

After several requests for background material regarding the matter were ignored by AFN communications staff, a draft copy of the proposed First Nations Financial Institutions Act, drafted by DIAND staff with input from AFN technicians, was obtained by this newspaper from other sources. The AFN has not yet commented on the act.

The new law will create the First Nation Taxation Commission (FNTC). It will be "an independent regulatory body, created to provide leadership in working with Canada and First Nations in the development of taxation on First Nation lands."

The new body will replace the Indian Taxation Advisory Board (ITAB) and deal with developing ways for First Nations to pass tax bylaws to tax mostly non-Native interests on their land.

It states in the preamble of the draft bill that "whereas First Nations, while wishing to retain the identity and flexibility of their local governments, also require that advantages of scale and policy consistency deriving from participation in national institutions."

The new act will enable the development of national institutions to support the social, economic and political development of First Nations communities, the preamble reads.

As with other legislation proposed by the federal government to deal with First Nations affairs, it will be scrutinized very closely. Preliminary reaction from some First Nation specialists are wary. No specific criticisms have been made of the draft bill at this point because it is so new. But sources preparing to analyze it want to make sure the government isn't trying to diminish the tax exempt rights of First Nations people.

The minister said he has no intention of doing anything to affect the tax exemption.

"We're not going to be talking about the tax exemption of First Nation people under the act. That's not part of the discussion. I've made that very clear in speeches I've made to [political territorial organizations] and First Nations all across the country," said Robert Nault. "So that boogie man can be put to rest because we're not going to be talking about First Nations tax exemptions under the Indian Act. Unless all the chiefs say they want to take a look at it, but I'm pretty sure that's not going to be one of the priorities of the chiefs and/or the communities. So that's not going to be brought up."

Critics of the First Nation Governance Act say the government is preparing all of these new legislative initiatives to reduce its financial expenditures for First Nations. Nault said that's not true.

"People keep talking about shrinking funding. Our budget has gone up year after year. So for someone to suggest that we're very concerned about other source revenue-no, we're not. This minister has said that what I'd like to do is have transparency for government funds- taxpayers' money that's transferred to First Nations-and to be accountable for them. I'm not interested in other source revenue. I don't even need to know about it."

Nault insists that he is trying to correct the Indian Act, a very flawed document, and there is no hidden agenda.

"I suspect you're going to get a million excuses as to why you can't trust the government or you can't trust the minister. 'They have a hidden agenda.' I have said to you and said to others, 'There's no hidden agenda.' I just would like prosperous First Nations that are involved in the Canadian economy as a whole. Can we get there from where we are now? The answer as far as I'm concerned is no. So what's the alternative? We can sit on our hands and wait until the courts decide or we can get into it and come up with our own solutions. That's what leadership is all about and that's what this debate is going to be abot. But if anybody wants to turn it into 'he-said, she said. Look at all these leaked documents, they must have a hidden agenda.' People who know me will probably tell you that I'm not smart enough to have a hidden agenda," the minister joked. "I'm just looking to do something right. I know we're going to get run at from a lot of people who will find a thousand excuses to say what we have is good enough. You know I have strong words for people who believe what we have is good enough. I've traveled in 51 First Nations for the last 12 years. I've seen the poverty. I've seen the young people who don't seem to have a lot of hope. If that's good enough for the leadership, well, obviously, it's not good enough for me. So we're going to have a big debate."