Money's there for compensation, says Finance minister

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Federal Finance Minister Ralph Goodale said preparations are being made within his department to line up the cash that will be needed to pay for residential school compensation.

During a Sept. 9 meeting with Windspeaker, the man responsible for formulating the federal government's budget promised there will be money available. An exact figure has not been set.

Former Supreme Court of Canada Justice Frank Iacobucci has been travelling the country in recent months preparing to make recommendations to the government about how the compensation process should unfold. He will file his report by March 2006 at the latest.

"No one knows what Judge Iacobucci will ultimately recommend, but it's prudent for the government of Canada to make sure that it's prepared for whatever the consequences will be,"

Goodale said. "We need to see what Judge Iacobucci recommends, but in broad terms, without being able at this stage to be precise about the arithmetic, we would anticipate that we will need to make provisions."

A finance minister must weigh many factors as the political decisions that are made before the budget speech are pondered, Goodale said.

"That's one of the reasons why, even despite the criticisms from time to time about [the government] being too cautious and too prudent, there are always issues to come along in every fiscal year that you cannot fully anticipate. And sometimes they carry big price tags," he said.

As well as trying to plan for unpredictable events that could drain the federal treasury, such as the SARS outbreak or the BSE crisis, Finance officials are also monitoring a number of issues that could require large cash outlays.

"If you recall a few years ago, there was a ruling in favor of an unequal pay advocate within the public service. That had been subject to litigation for years. At some levels one side had won. At other levels the other side had won. So it wasn't clear how this case was going to go. But if it went in a certain direction it would ultimately be a bill that the federal treasury would have to pay instantly at something like $3.5 billion. So out of prudence the government of Canada had made provision for that," he said. "There are environmental issues. There are legal issues. There are a number of outstanding Aboriginal issues. There's a big court case about veterans and whether or not the federal government 50 years ago had properly invested certain funds on behalf of veterans to protect their pension rights. Some people say that could ultimately cost $50 million, others say $6 billion. When you've got those sorts of numbers out there that are really big depending on how the liabilities are ascertained, you've got to make sure that you have prepared for that in advance."

Many First Nation leaders would say that sounds like another government minister preparing them to go once again to the back of the line, Windspeaker suggested.

"On this one, the whole point of naming former Judge Iacobucci is to make sure that this issue does not go to the back of the line," Goodale stated. "This will not be the only issue that the government of Canada has to deal with. If you assiduously read the annual reports of Atomic Energy of Canada Limited (AECL), I don't know if it's a best seller or not, but they've just had to absorb a $2 billion environmental charge on their uranium properties in Ontario. That goes right to the bottom line of the government of Canada because they're a wholly owned subsidiary of the government of Canada. So there will be issues that we will have to deal with as the fiscal year unfolds. But it was the prime minister's determination and certainly Minister [Anne] McLellan's determination that [residential school compensation] will get dealt with once and for all and it will not fall off the edge of the table."

There has also been talk of a large infusion of new government money for a variety of Aboriginal issues. Goodale said the potential cost f those initiatives is a factor in the Finance department's planning.

"We had the initial summit meeting in the spring of last year and then the roundtable process over several months and then the retreat in May of this year and now a first ministers meeting coming in November. And that's the meeting that I think will actually identify the tangible deliverables and who will be doing the delivering. Is it a province? Is it the federal government? Is it a First Nations' organization? Is it a combination of all of those things? Provision has been made in the budget to put some money behind the decision-making when it comes out. There are lots of priorities," he said.

When asked whether the government would be looking at budgeting $5 billion, as suggested by Assembly of First Nation National Chief Phil Fontaine, or $2 billion as reported in the press, Goodale said it was too soon to discuss details.

"If I were to comment on sums I'm just going to get myself into trouble. I know what's on the national chief's list and it's a very good list. And in many ways it's not all that different from [Indian Affairs Minister] Andy Scott's list. There will be a lot of very fervent discussion on how to bring all this together," he said.

Goodale noted that the provincial premiers sounded "very positive' while talking about how to work with the federal government on Aboriginal issues during their meeting this summer in Banff.

"The provinces seem to be inclined to set aside a lot of the jurisdictional hassles. That's good. Progress is being made here," he said. "There's a lot of momentum that's been built up and all of us want to see this get across the finish line."

Goodale said that with Parliament's resumption on Sept. 26, the minority Liberals will be forced to stay close to Ottawa in case of a confidence vote. So he was making stops across the country before that date.

With an election call promised within 30 days of the release of the Gomery Commission reporton the sponsorship scandal-which has recently been postponed-Goodale may not get a chance to hand down another budget before an election. But he will soon update the country on the state of the economy.

"The major economic event for the government in the fall is the annual fall economic statement. That is published every October or November. It's a report to Canadians halfway through the fiscal year on how we're doing from an economic point of view. And it will be a very positive report. We're still early in the fiscal year and there are lots of things that can yet change, but all the early indications for fiscal year 2005-06 are very positive," he said.

Goodale is looking ahead and sees a growing role for Aboriginal people in the economy.

"Canada has a big demographic issue coming at us just around the corner. The baby boomer generation that was born after the war is heading towards retirement. They'll start to retire in big numbers around 2010. The numbers will get bigger in 2015, bigger again in 2020. This is the first time ever that we've seen this inversion in population. We've always been able to expect that the upcoming generation would be bigger than the generation that is retiring. That is now reversing itself. The retiring generation is going to be bigger than the generation that comes along behind them. So that raises issues of how do you keep the economy growing? Who's there in the workforce? How many taxpayers have you got? Those are the issues that I'm thinking my way through as we do our economic planning for the years ahead," he said. "One issue that I am very interested in relates to this demographic change that's coming and that is: How can we maximize the numbers of people that are available to participate in the Canadian workforce? You've got the baby boomers retiring; a smaller generation coming behind; a very low domestic birth rate. So we have to work on inclusion. And that means, I think, better dealing with the issues affecting Aboiginal people so that they feel fully involved and fully welcome in the Canadian economy and it means a better focus on immigration for the future because that is probably the principle source of growth."