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Thursday » April 6 » 2006
 
New Tory ethics plan to grant new power to audit native reserves
 
Alexander Panetta And Sue Bailey - Canadian Press

OTTAWA (CP) - First Nations would be subject to unprecedented spending scrutiny under omnibus ethics legislation the new Conservative government will introduce next week, The Canadian Press has learned.

The Tories' Federal Accountability Act will allow the auditor general to examine aboriginal communities' books to determine whether taxpayers are getting value from federal cash transfers. "(This is) a groundbreaking move," said a federal official who asked not to be named.

"The auditor general is going to have extended powers and one of those groups (affected) is going to be First Nations bands."

The Tories have already said their accountability act, the sweeping ethics package they cite as their first priority in government, will drastically expand Auditor General Sheila Fraser's oversight power.

But the decision to include native communities among her list of potential auditing targets has never been announced.

It is sure to be controversial.

First Nations have long complained they are already overly subjected to cumbersome audits.

They must submit their books for examination each year to the Indian Affairs department, although the auditor general has no automatic access to those documents.

Fraser blew the lid open on the sponsorship scandal in 2004 by exposing waste and murky paper trails in the Public Works department.

She complained at the time, however, that she could not access the books of private companies like Groupaction that received the federal cash.

Government sources say the Tory legislation will allow her to follow the money into non-government entities - including aboriginal communities.

"She knew the money went there but she couldn't see what happened once the money ended up at Groupaction," said one federal official.

"Now she will be able to."

The national chief of the Assembly of First Nations urged the Conservatives last week not to impose new accountability measures without discussion.

Phil Fontaine has proposed a native auditor general to assess reserve governments.

He has also repeatedly stressed that just a tiny minority of First Nations fail to file independently certified audits required by Indian Affairs each year.

That's just one in a long list of reporting demands.

In fact, Fraser assailed the former Liberal government in 2002 for what she called a "crazy quilt" of audits that Ottawa receives from cash-strapped band councils.

Auditors visited four First Nations and two tribal councils in Saskatchewan that year. Fraser reported that at least 168 reports were required each year to account for federal funds from a wide range of departments.

Much of the thick paper trail wasn't even read once it got to Ottawa, Fraser found.

One aboriginal expert is concerned that unfairly singling out a small percentage of troubled communities will tarnish all bands.

"It reaffirms this notion that there is mismanagement and corruption rampant - even though that's not in fact the case," said Dan Wilson, special accountability adviser to the Assembly of First Nations.

Wilson sees a silver lining to Fraser's potential input, however.

"If she were able to do it, I could actually see it paying off in terms of raising awareness about where the real problems in accountability lie."

Native leaders have long said that yearly increases in federal funding capped at two per cent have not kept pace with inflation and population growth.

Many First Nations have struggled to make ends meet while deplorable living standards erode, they say.

Fontaine also points out that Ottawa should be accountable for unfulfilled treaties that have denied native people a fair share of natural resources.

"I have seen calculations indicating that the energy, forestry and mining sectors contribute $141.8 billion to Canada's economy," he said in a recent speech.

"Much of that economy would not be available to Canada if our ancestors were not willing to strike honourable agreements to share in the riches of this beautiful land."

The Canadian Taxpayers Federation has long argued for a better look at native books.

Canadians through their federal tax dollars spend about $8 billion a year on aboriginal programs, says spokeswoman Tanis Fiss.

"Right now, the auditor general does not have access to audit that information.

"Taxpayers deserve the right to know how and where their money is being spent and whether or not they're receiving value for their money."

© The Canadian Press 2006