AANDC press release

Government of Canada Focuses Funding on Essential Programs and Services for Aboriginal Peoples

OTTAWA, ONTARIO (September 4, 2012) -The Honourable John Duncan, Minister of Aboriginal Affairs and Northern Development, announced today changes to funding for Aboriginal Representative Organizations (AROs) and Tribal Councils.

"The Government of Canada is taking concrete steps to create the conditions for healthier, more self-sufficient Aboriginal communities," said Minister Duncan. "To sustain that progress we are changing the funding model for Aboriginal Organizations and Tribal Councils, to make funding more equitable among organizations across the country, and ensure funding is focused on our shared priorities: education, economic development, on-reserve infrastructure, land management and governance programs."

The new model will make core funding for AROs more equitable and cap it for regional AROs, while project funding will be directed primarily at initiatives that address priorities such as education and economic development, and that promote healthier, more self-sufficient Aboriginal communities.

Tribal Councils will be funded based on several considerations, including the size of the populations they serve, the number of First Nations in their membership, and the range of major programs they deliver. This is the first significant change to the Tribal Council funding program since its launch nearly 30 years ago.

The new approach includes a simplified application and reporting process for Tribal Councils which will reduce the reporting burden on organizations. These changes will be introduced over the next two years, allowing organizations time to adapt their operations and, should they desire to, seek out new sources of funding.

Over the last six years the Government of Canada has invested in creating the conditions for healthier, more self-sufficient Aboriginal communities. Economic Action Plan 2012 builds on that progress with $275 million in new funding for First Nation education, an additional $330.8 million to build and renovate water infrastructure on reserve and improve water quality for First Nation communities, $27 million to renew the Urban Aboriginal Strategy, and $13.6 million to support Aboriginal consultation on resource development projects.

For more information on the new funding approach, please visit:

• Backgrounder - Funding for Aboriginal Representative Organizations
• Backgrounder - Funding for Tribal Councils and Band Advisory Services

For more information, please contact:

Minister's Office
Jason MacDonald
Director of Communications
Office of the Honourable John Duncan
819-997-0002

Media Relations
Aboriginal Affairs and Northern Development Canada
819-953-1160

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Backgrounder - Funding for Aboriginal Representative Organizations

In 2010-2011, AANDC provided $28 million in core funding to 5 national and 40 regional Aboriginal organizations and an additional $73 million in project-based funding for a total of $101 million (2010-2011 Report).

The Government values its relationship with Aboriginal Representative Organizations and recognizes the contribution they make on behalf of their members. To support the work of AROs, AANDC provides both core funding and project funding. Core funding supports basic operations such as salaries, rent and utilities.

Project funding is allocated on a case-by-case basis based the proposed projects' alignment with Government of Canada priorities and funding availability. Typically, project funding is accessed through proposals for specific projects or initiatives with fixed timeframes.

Changes to ARO Funding:

We are taking steps to ensure that government funding for organizations is directed at the delivery of essential services and programs for Aboriginal peoples.

Our new approach will ensure that projects being funded are better aligned with our shared priorities: education, economic development, community infrastructure, and other initiatives that promote greater self-sufficiency in Aboriginal communities.

The changes to core funding will also create greater funding equity among Aboriginal organizations across Canada.

To minimize the impact of these changes on organizations, we are streamlining their reporting requirements, and we are implementing them over time. This will allow Aboriginal organizations to adapt their operations, and should they desire to do so, seek out new funding sources.

Under the new funding formula, all National and Regional AROs in receipt of core funding in 2012-2013 will have their funding reduced. Core funding for national Aboriginal Representative Organizations will be reduced by 10 percent. Regional AROs will either have funding reduced by 10 percent or have a ceiling up to $500,000 applied to their core funding. Reductions are based on current 2012-2013 funding levels.

There will also be gradual reductions in the amount available for proposal-based project funding. Overall project-based funding will be more closely aligned with key priorities.

In order for Aboriginal Representative Organizations to have sufficient time to adjust their operations, these changes will be implemented over two fiscal years, with reductions in project funding starting in 2013-14 and reductions in core funding taking effect in 2014-2015.

The revised amount of funding for projects will be targeted to priority areas, where real and concrete results can be achieved. This will mean more accountability to members and, in keeping with AANDC's commitment to reducing the reporting burden for funding recipients, will include a streamlined application and reporting mechanism for project-based funding.

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Backgrounder - Funding for Tribal Councils and Band Advisory Services

The Department began funding Tribal Councils in the mid-1980s to provide for the aggregated delivery of programs and services to affiliated bands, the management and administration of Tribal Councils as well as for the delivery of advisory services and programs to affiliated First Nations.

In addition to delivering aggregated programming such as economic development, 78 Tribal Councils have responsibility for providing advisory services in the areas of economic development, financial management, community planning, technical services and band governance. In 2011-2012, AANDC provided a total of $46.9 million to 78 Tribal Councils serving 475 First Nations. The Band Advisory Services program provided $2.4 million in funding in 2011-2012 to 19 of the largest First Nations with an on-reserve population of 2,000 Status Indians or more, and which are not affiliated with Tribal Councils.

In the almost 30 years since AANDC began funding tribal councils, the institutional landscape and the needs of First Nations have changed. An increasing number of specialized institutions such as the Aboriginal Financial Officers' Association, the First Nations Financial Management Board and the Aboriginal Economic Development Board now provide expert advisory services to First Nations, that were once provided exclusively through Tribal Council or Band Advisory Services.

Changes to Tribal Council and Band Advisory Services Funding:

AANDC is shifting the focus of funding for Tribal Councils and Band Advisory Services away from the requirement to deliver specific advisory services, in order to ensure that resources are directed toward the more efficient and effective delivery of essential programs and services. This will also mean placing a greater emphasis on performance in determining funding allocations.

Effective in 2014-2015, AANDC will implement a new funding formula for Tribal Councils. To accommodate the reduced level of funding, the Tribal Council Funding program's design will change to include: a simpler funding formula; incentives for First Nations to aggregate program delivery through tribal councils; reduced administrative burden and more flexibility with regard to advisory services.

The emphasis will be on core funding for major program delivery through a simplified system with incentives based on the number of First Nations represented and the number of major programs delivered.

Changes to the Funding Formula:

As of April 1, 2014, a revised funding formula will contribute towards core funding for aggregate program delivery through a tiered system. The tiers provide incentives to encourage aggregation in the size of populations served by tribal councils and in the range of major AANDC programs they deliver.

Tier 1 - Base of $200,000

Tier 1 tribal councils will receive a base amount of $200,000 per year. A Tier 1 tribal council has the following characteristics:

• Serves an on-reserve population less than 2,000 AND
• Serves 2 to 5 member First Nations AND
• Delivers fewer than 3 major AANDC programs

Tier 2 - Base + Incentive of $150,000 (total of $350,000)

Tier 2 tribal councils will receive the base amount of $200,000 plus an incentive amount of $150,000 for a total of $350,000 per year. A Tier 2 tribal council has one or more of the following characteristics:

• Serves an on-reserve population of between 2,000 and 5,500; or
• Serves 6 to 8 member First Nations; or
• Delivers 3 to 5 major AANDC programs

Tier 3 - Base + Incentive of $300,000 (total of $500,000)

Tier 3 tribal councils will receive a base amount of $200,000 plus an incentive of $300,000 for a total of $500,000 per year. A Tier 3 tribal council has one or more of the following characteristics:

• Serves an on-reserve population over 5,500; or
• Serves 9 or more member First Nations; or
• Delivers 6 or more major AANDC programs

Tribal Councils will no longer be required to deliver the five specific advisory services required under the existing funding formula, and, as such, Band Advisory Services funding will also be eliminated in 2014-2015. Tribal Councils may continue to provide advisory services if mandated by their members, provided that the requirements of the program have been satisfied.

Tribal Council funding will be provided through multi-year funding agreements with a minimum two-year term and will include streamlined and reduced reporting requirements.

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Copy of Letter from AANDC Deputy Minister to First Nations and their organizations

Click here for a PDF copy of this letter