Question Period Note: Renewed Fiscal Relationship / Two Percent Escalator

Our Government continues to work in partnership to build a new fiscal relationship with First Nations, which will provide long term, sustainable and predictable funding.
Building on previous commitments, Budget 2019 commits a $4.5 billion over five years to close socioeconomic gaps and advance economic prosperity in Indigenous communities.
This brings our total planned investments in Indigenous programs to more than $17 billion in 2021 22, an increase of 50 percent compared to 2015.
I am proud of the hard work and progress made so far in partnership.

In July 2016, the then-Minister of Indigenous and Northern Affairs and the National Chief of the Assembly of First Nations signed a Memorandum of Understanding to jointly research and develop proposals for the design of a new fiscal relationship between Canada and First Nations under the Indian Act. The result of this work is summarized in a report, A New Approach: Co-development of a New Fiscal Relationship, released in December 2017. The report contains the following recommendations:
1. Establish a permanent advisory committee that could be appointed by Order in Council that would reflect regional circumstances and interests.
2. Take immediate action to create ten-year grants for qualified First Nations to leverage full flexibility under the Policy on Transfer Payments, to be implemented on or before April 1, 2019.
3. Co-develop an approach to repeal the First Nations Financial Transparency Act in 2018 and replace it with a co-developed mutual accountability framework supported by First Nations Institutions-led audit ‎and statistical functions.
4. Replace the Default Prevention and Management Policy (DPMP) with a new approach that includes continued work under the First Nations Financial Management Board pilot project.

Building on previous commitments, Budget 2019 invested a further $4.5 billion over five years, beginning in 2019–20, to continue efforts to close the gap between the living conditions of Indigenous Peoples and the non-Indigenous population, bringing total planned federal government investments in Indigenous programs to more than $17 billion in 2021–22, an increase of 50 per cent compared to 2015.

In Fall of 2018 the Assembly of First Nations – Indigenous Services Canada Joint Advisory Committee on Fiscal Relations was established to inform further co-development of the new fiscal relationship. The Committee presented its interim recommendations to the Minister of Indigenous Services and the National Chief of the Assembly of First Nations in June 2019.

If pressed on escalator for 10-year grant

We are committed to co developing a new fiscal relationship with First Nations that addresses sufficiency, predictability and sustainability of funding and that supports self determination and closing of socio economic gaps.
An escalator for the 10-year grant will support First Nations governments by providing enhanced predictability of funding by factoring in population increases and cost of inflation.
Providing an escalator in the 10 year grant starting in 2020 complements necessary investments in essential services, and will strengthen the ability of First Nations to deliver services based on First Nation priorities.

If pressed on default management policy

Our Government is committed to a fiscal relationship with First Nations that supports self-determination and closing of socio-economic gaps.
We are taking steps to replace the punitive Default Management Prevention (Third Party Management) Policy with a new, proactive approach that respects communities and supports capacity development.
This approach will be based on successful pilot projects of the First Nations Financial Management Board.

If pressed on fiscal relationship codevelopment

To support the new fiscal relationship, we are committed to continued co-development of fiscal relationship reforms with First Nations.
The Assembly of First Nations – Indigenous Services Canada Joint Advisory Committee on Fiscal Relations has provided interim recommendations, and intends to engage with First Nations on those recommendations in the coming months.
We will continue to work to build a fiscal relationship that is nation-to-nation.