Ottawa kicks a peg out from foundational organizations

The four-prong approach to fiscal management and economic development created in the First Nations Fiscal and Statistical Management Act of 2006 was reduced to three in the recent federal budget.

The 2012-2013 operating dollars for the First Nations Statistical Institute have been cut in half to $2.5 million. By April 1, 2013, there will be no funding available to the only First Nations-led and managed Crown corporation in Canada.

“We were taken aback by the announcement,” said Keith Conn, FNSI’s chief operating officer. However, he points to other similar institutes and organizations that were casualties to Finance Minister Jim Flaherty. “We’re part of a tsunami of budget cuts for organizations that are focused on research and data.”

Harold Calla, chair of the First Nations Financial Management Board, said the loss of FNSI will leave his organization having to collect its own data in order to satisfy the requirements of the investment banks and rating agencies that First Nations need to accomplish long-term investments. The financial management board, statistical institute, First Nations Tax Commission and First Nations Finance Authority were created under the same 2006 legislation.

The FNSI is an important nonpartisan tool used to provide the necessary financial analysis and data gathering for the bond debenture process. That work came to the forefront recently when Osoyoos Indian Band Development Corp., along with Songhees and Tzeachten First Nations, became the first bands to become borrowing members of the First Nation Finance Authority.

The FNFA sells debentures and, in turn, lends the money to certified First Nations.

To qualify for this standing, the three First Nations had to meet stringent guidelines and it was data provided by the FNSI that helped establish their credit rating.

Conn pointed out that the FNSI was created by the government because of a perceived gap in First Nations statistical information. Many First Nations do not participate in the census process because they do not trust how the information will be used. As the FNSI is an independent, neutral body which is First Nations-led, First Nations-managed and housed on a First Nation, it generates that trust, he said.

FNSI gathers the data through specific agreements on how the data will be collected, managed and published. The data remains the property of the individual community.

“Data is important in terms of generating knowledge and it’s also important for policy development and planning processes,” Conn said, pointing to the planning that is required in such areas as housing, employment and education.

“There’s also an important aspect around communities wanting to be more accountable to their (members), by having the right tools and analysis in terms of reporting out.”

Not only is statistical data vital for on-reserve planning, but it’s also important for acquiring government funding, said Calla. “It is statistical data that drives decisions on allocation of scarce resources that comes from government.”

“The organization was on the cusp of doing a lot more work with communities,” said Conn. He noted that there are 24 projects FNSI has on the go with different First Nations communities and organizations. Those will have to be wound down over the next 11 months, and the 23 staff will have to find new jobs.

Conn said FNSI is working closely with the other three “sister organizations” to map out what that transition will entail and expects direction and an amendment to the First Nations Fiscal and Statistical Management Act to be included in the 2012 Budget Implementation Act. He noted that the federal government and Aboriginal and Northern Affairs Canada will have to ensure that the “intent and spirit of the original legislation” is maintained.
What will happen with the data and information collected by the FNSI is also at issue. Some material is private to specific First Nations and needs to go to them. General information is also a concern and Conn wants to ensure that the material is publicly available and easily accessible.

“We have to find a new safe home for many of our products and services we have developed,” said Conn. He added an established First Nations-centred organization, such as an academic institution, would be suitable. “We need to explore all these options as to what would be advantageous to First Nations.”

“We’re now in the position with the phasing out of this institution that I see these things, like full inclusion of all Aboriginal data, not being as easily achieved as it otherwise could have been,” said Calla.

Conn is concerned that closing down FNSI will take First Nations back to where they were before.

“With the gap widening, that will create a great and significant disadvantage for First Nations governments and communities in terms of planning and negotiating and trying to identify disparities and eliminate gaps,” said Conn.