Wait one year on Fiscal Institutions Act

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National Chief Matthew Coon Come sent out letters to all First Nations chiefs in early July asking for their support for the First Nations Fiscal Institutions Act. Grand Chief Larry Sault of the Ontario political territorial organization the Association of Iroquois and Allied Indians thinks that request was out of line.

Coon Come's two-page letter was a hearty endorsement of the fiscal institutions act. He called it an "important initiative" that will provide "essential financial tools and services for First Nations" and said the services the proposed financial institutions will provide "will have an immediate and lasting beneficial impact on First Nations communities and First Nations economies."

Sault responded with a two-pager of his own.

"I respect that as national chief you have a right to lead, as well as to follow," he wrote. "You have a right to express an opinion on the critical issues of the day. However, in this particular instance, my respectful view is that it would have been more prudent to simply provide balanced information, rather than take sides. The Fiscal Institutions Act is controversial, and First Nations chiefs should not feel pressured to make a decision without adequate information."

The act, championed by British Columbia vice-chief Herb Satsan George and former Kamloops Indian Band chief Manny Jules, who are visiting communities across the country trying to drum up support for the initiative, has been described as First Nation-driven because it was developed in joint initiative by AFN and Indian Affairs officials. Sault said he is not convinced it truly deserves to be called a First Nation initiative.

"My understanding is that the current rush to get chiefs to approve the Fiscal Institutions Act is based on a legislative time-frame imposed by INAC last February," he wrote. "After careful review of the material, my conclusion is that there is a significant and worrisome overlap between the Fiscal Institutions Act and the INAC agenda behind the Nault governance bill. Both . . . ignore the RCAP recommendation of increased federal transfers, and instead focus on First Nations own source revenue and taxation."

Noting that some First Nations are in favor of the fiscal institutions act, while also noting that the Chiefs of Ontario have already formally rejected it, Sault was reluctant to recommend the act be rejected. But he did suggest there shouldn't be such a rush over such a crucial decision.

"[M]y view is that the proposed act should be deferred for one year to permit due diligence and re-consideration of the fiscal relations strategy of the AFN," he wrote.

Sault believes the AFN should be lobbying the government for increased transfer of funding as recommended in the Royal Commission report. He sees the Fiscal Institutions Act as moving away from that objective towards the government's preferred direction of making First Nations raise their own money through taxation and other non-government sources.

The biggest pocket of support for the act is in British Columbia but one prominent B.C. Native leader sides with Sault on this dispute.

"I agree totally with Larry's assessment that the national chief is responsible for protecting our interest at all times. In order to do that you have to present a very balanced assessment any time a proposal comes forward from government," said Stewart Phillip, president of the Union of British Columbia Indian Chiefs. "On the government side, the Financial Institutions Act is probably more important to them than the governance act. I have that sense and I think the real debate is going to centre around the First Nations Financial Institutions initiative."