JMAC cautioned that “[i]f there is not an institutional
capacity component to this initiative, bands will be forced to privately
retain lawyers, accountants, financial officers, and other consultants at
considerable expense.”(60) It suggested
that an “independent Institution” created legislatively could fill many
functions, including assisting to establish and implement governance practices
and draft codes upon request, designing and providing training programs,
handling election appeals, undertaking responsibilities related to financial
accountability, and so forth.(61)
During the House of Commons first-reading debate on Bill
C-7 in the 1st session of the 37th Parliament, the
Minister touched briefly on the institutional issue, indicating that the
bill would “pave the way to create an advisory body to support first nations
as they take on added roles to build better communities. The advisory body
could assist with developing codes for governance, leadership selection
and financial management, as well as providing a process for complaints
and appeals.”(62) Bill C-7, as introduced,
did not provide explicitly for any institution of the sort advocated by
the JMAC Report, nor did the House Committee amend the bill to address
this matter. A major Report Stage government amendment, however, proposed
creation of the Canadian Centre for First Nations Governance that would:
play a public education role on governance matters; provide communities
with various forms of technical assistance in implementing the legislation;
develop governance guidelines; offer capacity-building training in governance;
and maintain a national registry of band codes and laws.(63)
It is worth mentioning, in the context of this proposal,
a recent short-lived precedent for a non-statutory First Nations governance
centre with broad support, research, training and facilitation objectives.
Flowing from the 1996 Report of the Royal Commission on Aboriginal Peoples
and the federal government’s Gathering Strength response, a joint
initiative of the Assembly of First Nations and the Department of Indian
Affairs culminated, in May 2001, in the establishment of the First Nations
Governance Institute under a ten-person board of directors consisting of
regional First Nations representatives.(64)
The Institute’s federal funding was terminated and its operations suspended
several months after its inception. A number of witnesses testifying before
the House Committee on Bill C-7 recommended that it be reinstated. In the
result, the model proposed by the government for Bill C-7 both resembled
and differed from the Institute and the independent Institution recommended
by JMAC(65) in a number of respects.
On 4 December 2003, the Minister announced the creation
of and seed funding for another non-statutory First Nations Governance Institute,
whose objectives are to include promoting and assisting in the development
of First Nations’ governance. It remains to be determined whether this
initiative will be retained by current Minister Andrew Mitchell, named 12
The FNGA did not create a “compliance” mechanism to determine
if band-designed governance regimes met the legislation’s requirements.
On this matter, the JMAC Report concluded by consensus that “such a requirement
is unnecessarily intrusive and costly” and would amount to “nothing more
than a continuation of the Minister’s power of disallowance” of band by-laws
under the Indian Act. The Report further noted that band-designed
regimes were open to court challenge whether or not a verification procedure
2. Financial Management
(Clauses 8-10, Clause 59)
Clauses 8 through 10 prescribed additional financial management
measures with further implications for bands’ implementation capacities.(67)
Statements (Clauses 8 and 9)
Under the FNGA, bands would have been required to maintain
their accounts and prepare annual financial statements following accounting
principles of the Canadian Institute of Chartered Accountants (clause 8).
The bill also required that bands’ financial statements be audited under
that Institute’s standards by an independent auditor (clause 9(1)), and
that they include the salaries and expenses of council members (clause 9(2)).
Bill C-7 made provision for enhanced access to bands’ financial
statements, stipulating that a band must make its financial statements “publicly
available” within a prescribed period, and provide a copy to “any person”
paying a fee (clause 9(3)). The issue of disclosure of bands’ audited financial
statements has been controversial. Currently, no legislated requirements
apply. Government policy specifies that bands must submit annual consolidated
audits to DIAND for evaluation of their overall financial status, and make
them available to their members.(68)
Although audits submitted to government are generally subject to the Access
to Information Act, a band may refuse access to non-band members where
the requested audit contains confidential information concerning the band’s
private commercial transactions, financial holdings or own-source revenues.(69)
Clause 9(3) did not define the scope of the statements
that must be made public, neither stipulating that they must be consolidated,
nor that they need detail only public revenues. JMAC members differed as
to how financial management provisions in eventual legislation might deal
with this issue.(70) The Report observed,
on the one hand, that information concerning a band’s commercial transactions
and revenues unrelated to government transfer payments was vital for band
members but arguably “no affair of the general public.”(71)
On the other hand, other levels of government and the many bands that do
make consolidated audits widely available do not appear penalized by publication
of commercial information. Given that band members are already entitled
to full disclosure, “it may be a small step to require full public disclosure.”(72)
Breach (Clauses 10(1)-(2))
Any “significant breach” of a rule related to debt or deficit
in a band-designed accountability code or default regulation would have
triggered a requirement that the band council assess the band’s position
and develop a recovery plan for the financial management of “band funds,”
to be presented to band members within a prescribed period (clause 10(1)).
Quarterly reports on the plan were to be made until the breach was remedied
The bill did not define “significant breach.” Under current
DIAND policy, a deficit of 8% of a band’s operating budget results in review
of its financial circumstances, with the first stage of intervention involving
a band-designed and -administered remedial plan under DIAND supervision.
The scheme set out in clauses 10(1) and (2) appeared to combine elements
of the existing policy approach and of a JMAC option aimed at ensuring bands
a high degree of independence in dealing with their financial situation.
In this regard, while DIAND interventions deal exclusively with moneys transferred
under funding agreements, “band funds” referred to in clause 10, as defined
in clause 2, appeared to include non-governmental sources of band revenue.
Involvement (Clause 10(3))
The FNGA also authorized discretionary ministerial interventions
in bands’ financial affairs. Clause 10(3), as introduced, allowed the Minister
to assess a band’s “financial position” and, if he or she considered it
necessary, require “remedial measures” when any of three circumstances became
known: deteriorated financial health compromising delivery of “essential”
programs; failure to make financial statements public within the prescribed
period; and an adverse opinion by the band’s auditor. First Nations
witnesses and others objected strongly to the statutory entrenchment
of the Minister’s existing intervention authority under funding agreements.
A government amendment adopted by the House Committee provided that, in
addition to the Minister, “a person or body designated by the Minister”
might also undertake the financial assessment, but left the remedial measures
phase under the Minister’s sole authority. A further Report Stage government
proposal would have empowered the Minister’s designate to order remedial
measures as well.(74)
Clause 10(3) contained elements of another alternative
outlined in the JMAC Report relating to interventions for bands in financial
difficulty.(75) The Report noted
that this option “maintains a significant role for the Minister in the financial
accountability regime of bands and therefore runs contrary to one of the
main objectives of this legislation project.”(76)
JMAC suggested that it would be preferable to assign the intervention role
to an independent First Nations institution: eventual legislation could
“provide for a transition and a linkage by designating the Minister as the
institution until such time as a First Nations institution comes into being
with the capacity to perform this function,”(77)
perhaps under anticipated fiscal institutions legislation. Although
the amended clause did allow for intervention by some person or body other
than the Minister, it would not appear that this modification addressed
witnesses’ underlying criticism of the provision that related not only to
the Minister’s continued role in bands’ financial management, but also to
the new statutory basis for that role.
Under present DIAND policy, interventions in a band’s affairs
may follow political or social turmoil as well as financial difficulties.
Clause 10(3) appeared to restrict the Minister’s statutory capacity
to intervene to financially driven circumstances, but did not preclude continued
interventions under funding agreements in other contexts. The provision
did not define the sort of remedial measures the Minister might undertake,
set a time limit for ministerial interventions,(78)
nor define the scope of the “financial position” in clause 10 that the Minister
was authorized to assess. A government amendment to clause 33 did address
these matters. As introduced, clause 33 provided for very broad authority
to make regulations to carry out the FNGA’s purposes. The amendment adopted
by the House Committee set out an exhaustive list defining regulatory powers
under that provision, much of which related to clause 10(3). Under the
modified clause 33, regulations might be made specifying:
As amended, clause 33 regulations might also provide
that clause 10(3) powers “do not affect any right exercisable” under funding
agreements with bands – including presumably the Minister’s right to intervene
in specified circumstances – and authorize the withholding of funds payable
to a band until remedial measures were in place.
The JMAC Report underscored that “whatever intervention
method is selected, it should ensure that the intervener has the same capacity
as the band administration to deal with the full financial picture of a
band including trust accounts, commercial ventures, other own source revenues,
as well as inter-governmental transfers.”(79)
Bill C-7 did not provide for an external auditor general.
The JMAC Report considered that such a body would be premature at this early
stage of the development of bands’ governance structures, and that the Report’s
proposals provided a comprehensive accountability package. JMAC expected
that bands would function satisfactorily with capacity development help
through a First Nations institution, but might wish to establish such an
external body to provide independent assessment of their performance at
some future date.(80)
The legislation made no mention of “results-based” accountability.
The JMAC Report considered this option, concluding that performance measures
for Canadian public institutions remain largely policy-dictated, and that
“legislation is not the appropriate vehicle to ensure that program outcomes
and Redress (Clauses 11, 33, 39, 41-42)
a. Band Process (Clauses
11, 33, 39)
Apart from election appeals to the government,(82)
the Indian Act does not currently provide a mechanism for treatment
of band members’ grievances related to band administration. Under Bill
C-7, a band council would have been required, within two years of Royal
Assent (clause 39), to put in place a law authorizing either an impartial
person or body to consider complaints by band members or non-member reserve
residents and to undertake remedial measures (clauses 11(1)-(2)). This
represented the only mandatory exercise of band council law-making authority
under the FNGA.
Bill C-7’s redress mechanism, as introduced, applied
to complaints (1) alleging breach of a governance code or (2) contesting
a discretionary decision “against” a member or resident by the council or
a band employee. A government amendment adopted by the House Committee
expanded the grounds for complaint under (1) to include “contravention”
or “unfair or improper application” of the legislation, default regulations
or certain band laws, and added council members to the persons against whom
a complaint might be lodged. The amendment further provided that a First
Nations law under clause 11 might authorize the redress body, when dealing
with a complaint based on the conduct of an election or the gravity of a
contravention, to set aside a council member’s election or to order a member’s
removal from office (clause 11(2.1)).(83)
Bill C-7 prohibited any person or body in a conflict of interest position
in relation to a complaint from considering it (clause 11(4)), while
a decision from which an appeal could be taken under a governance code,
default regulations or other prescribed instruments might not be
contested using the bill’s redress mechanism (clause 11(5)).
Many First Nations witnesses criticized the clause
11 redress scheme, not only on the basis of its obligatory nature, but also
from a capacity perspective, particularly for smaller or isolated communities.(84)
The question of whether a national Ombudsperson office might prove a more
suitable, more impartial structure was also raised with some frequency.
On this topic, the JMAC Report suggested that First Nations members would
benefit from an internal process, which could be supplemented by an Ombudsman
function carried out by JMAC’s recommended independent Institution.
During the House Committee’s deliberations, an opposition
amendment to create an Ombudsman office to complement the clause 11 redress
body was judged inadmissible as a “money” amendment. A Report Stage government
amendment proposed the establishment of the “Office of the First Nations
Ombudsman,” with an Ombudsman appointed by the Governor in Council and mandated
to consider and mediate only those complaints that were alleged to have
been dealt with inadequately by the clause 11 body.(85)
The government-proposed body would thus apparently have resembled a second-level
structure akin in some respects to an appeal body.
b. External Process
Bill C-7 opened a broader redress avenue under the Canadian
Human Rights Act(86) (CHRA).
Section 67 of that statute has stipulated since 1976 that “[n]othing in
this Act affects any provision of the Indian Act or any provision
made under or pursuant to that Act.” The controversial exemption has not
entirely prevented band members from gaining access to CHRA mechanisms,
as the courts have generally interpreted that the human rights legislation
remains applicable to band council activities or policies that are not
based on the Indian Act or regulations under it.
In 2000, the report of the federally appointed Review Panel
on its comprehensive review of the CHRA recommended that the section 67
exemption be removed, and that an interpretive provision be incorporated
in the CHRA “to ensure that Aboriginal community needs and aspirations are
taken into account in interpreting the rights and defences in the [CHRA]
in cases involving employment and services provided by Aboriginal governmental
organizations. Such a provision would ensure an appropriate balance between
individual rights and … community interests.”(87)
Clause 42 of the FNGA proposed to repeal section 67 of
the CHRA, thus making its redress mechanisms available to band members in
relation to federal and band government actions under both the Indian
Act and Bill C-7. Clause 41 added an interpretive provision along the
lines recommended by the Review Panel under which the needs and aspirations
of the Aboriginal community affected by a complaint against an “aboriginal
governmental organization” were to be taken into account in interpreting
and applying the CHRA, “to the extent consistent with principles of gender
The bill did not define “aboriginal governmental organization”
or “principles of gender equality.” The concept of gender equality does
not appear in other federal statutes consulted.(88)
Its inclusion in clause 41 appeared to represent the sort of balancing exercise
contemplated by the Review Panel, with specific reference to gender alone
perhaps reflecting recognition of the potential prevalence of gender-related
issues that might be raised under the CHRA following removal of the section
67 exemption. Under clause 41, a woman complainant’s rights under the CHRA
might be trumped by community interests only to the degree consistent with
gender equality principles.
The JMAC Report agreed removal of section 67 should be
linked to insertion of an interpretive provision to ensure “aboriginal and
treaty rights [are considered] in interpreting and applying the CHRA
to bands and band councils.” It ultimately concluded, however, that repeal
should occur “only in the context of the federal government’s comprehensive
response to the Review Panel’s recommendations,” which has not yet taken
place. JMAC also expressed concern that elimination of the exemption would
result in increased workload for the Canadian Human Rights Tribunal and
increased training and resource needs of bands in order to implement the
CHRA and defend against complaints. In JMAC’s view, “[c]onsideration will
need to be given to whether band councils will face complaints when they
are implementing federal programs,” as well as to the relationship between
the CHRA and status and membership issues under the Indian Act.(89)
First Nations and other witnesses raised a number of
questions about the interpretive clause at clause 41, describing it as vague,
difficult to interpret, potentially unworkable, and in need of clarification
as well as broadening of the factors to be considered by the CHRC.
Concern was also expressed with respect to the potential effect of the interpretive
clause on collective rights. Many witnesses echoed JMAC’s concerns about
the capacity of First Nations communities and the CHRC to deal effectively
with the repercussions of removal of the section 67 exemption.
4. Band Government Operations
The FNGA provided that band councils must make policies
and rules related to government operations available to members and reserve
residents, including programs and services offered to them (clause 12).
It is not clear to what degree this requirement could have represented an
additional burden for band administrators, particularly those from small
bands. In addition, assuming the provision extended to federal operations,
programs and services, the federal government would arguably be better placed,
from both resource and knowledge perspectives, to provide information about
The Indian Act does not currently protect band councils
or employees from civil proceedings related to work or office-related activity.
Bill C-7 provided that the liability of council members and band employees
would be limited with respect to anything done during the exercise in good
faith of any power or duty under the Indian Act, the bill, regulations
made under either, any governance code or law under the FNGA or any by-law
under the Indian Act (clause 14).
E. Provisions Related
to the Powers of Band Councils
1. Legal Capacity (Clause
Although the Indian Act defines bands and band councils
and confers authority on both, it has not, to date, explicitly recognized
either as legal persons. Bands under the Indian Act are considered
unique legal entities with somewhat ambiguous status under Canadian law,
legal persons for specific purposes under specific statutes but not others.(90)
The JMAC Report concluded that “certain advantages would accrue to bands
if their legal status was clarified.”(91)
Bill C-7 proposed that any band under the Indian Act
would have “the legal capacity, rights, powers and privileges of a natural
person,” including the right to contract, engage in property transactions
and legal proceedings, and do anything ancillary to its capacity (clause
15(1)), and that a band’s capacity be exercised through its council (clause
15(2)). The clause 15(1) definition echoed the general substance of those
set out for specific bands under various federal statutes establishing self-government
or other regimes,(92) and generally
corresponded to one of the options contained in the JMAC Report.(93)
The JMAC Report acknowledged an enduring view that equating bands with
legal persons makes them akin to corporate bodies and represents a fundamental
change in their status.(94) It recommended
that any changes in this area “must be accompanied by provisions that ensure
that [they] do not diminish [bands’] unique nature under Canadian law.
Bands must not be transformed into corporations.” Similarly, concerns over
potentially increased vulnerability of reserve lands and band moneys led
JMAC to conclude it was essential that these interests not be affected by
any amendments related to bands’ legal capacity. The FNGA generally reflected
both areas of concern. Although not explicitly acknowledging the unique
nature of bands’ legal status, the bill did provide, for greater certainty,
that the definition in clause 15(1) neither affected that status nor had
an incorporating effect (clause 15(3)), nor did it affect band members’
interests in reserve lands and band moneys under the Indian Act (clause
Several witnesses before the House Committee maintained
the position that it would be more appropriate to define a First Nation’s
legal capacity as that of a government or nation rather than that of a natural
person. It was also recommended that the legislation stipulate explicitly
that the legal capacity provision would not restrict the inherent right
of self-government, Aboriginal or treaty rights.
In relation to a further concern related to the fiduciary
relationship between the Crown and bands, the JMAC Report noted that defining
bands’ legal capacity “will not affect the general fiduciary relationship
between the Crown and First Nations” per se, but that other amendments
giving bands greater authority over their interests could alter specific
fiduciary duties.(95) Finally, JMAC
noted the need to reconcile the Bill C-7 definition of legal capacity with
those in other acts, none of which was amended by the bill.
2. Law-making Powers (Clauses
16-18, 33, 37, 51, 53-55, 59)
Under the Indian Act, a band council’s by-law-making
powers in relation to reserves may at present be considered analogous in
some respects to those of municipalities under provincial legislation, with
the council’s authority confined to matters delegated and defined by the
Indian Act. These limitations have long been criticized by bands
and representative organizations as out of keeping with traditional law-making
practices. Currently, the Indian Act provides for band by-laws as
Divergences in governmental and First Nations’ perspectives
on the First Nations Governance Initiative emerged during the pre-legislative
period beginning in April 2001. A substantial body of documentation, as
well as the overwhelming majority of testimony given before the House Committee,
attest that they continued to differ sharply as to the objectives, merits
and effects of Bill C-7 throughout the abbreviated legislative process.
From the government’s viewpoint, the legislation reflected
commitments to strengthen First Nations governance made in the January 2001
Speech from the Throne, and was essential to address an unacceptable situation
affecting First Nations communities arising largely from a deficient Indian
Act regime. Bill C-7 was thus intended to remedy significant gaps in
that regime that have prevented First Nations communities and governments
from managing their own affairs effectively and responsibly, by providing
tools that would enable First Nations communities to develop economically
and to exercise autonomous decision-making power with reduced government
involvement. For the government, the FNGA was also a pivotal component
of a broader reform plan to modernize First Nations governance systems that
included the 1999 First Nations Land Management Act as well as anticipated
fiscal legislation. It was not intended to replace the historical treaties,
undermine ongoing treaty and self-government processes, or affect the government’s
fiduciary responsibilities toward First Nations people.
The Assembly of First Nations and other First Nations
bodies representing regions across the country viewed Bill C-7 differently.
At its Annual General Assembly (AGA) in July 2002, the AFN confirmed its
position on Bill C-7’s predecessor, Bill C-61, in a resolution condemning
the legislation as a violation of the inherent right of self-government
and committing the AFN to oppose it. The resolution called upon AFN Chiefs
to ensure this opposition was heard, including through the parliamentary
process. A separate resolution gave notice of First Nations’ intention
“to strengthen and sustain our own systems of governance, to enact and enforce
our own laws without interference from federal government and legislative
policies and regulations.” The AGA endorsed the February 2002 First
Nations Plan as an alternative to Bill C-61, now C-7. In November
2002, a Special Chiefs’ Assembly called on the Prime Minister to withdraw
Bill C-7 and other then‑pending pieces of legislation, and undertake
a renewed partnership with First Nations. Subsequent assemblies to October
2003 reiterated the AFN’s opposition to the FNGA.
In condensed form, some of First Nations’ primary criticisms
were that the bill: was drafted without consultation or consent following
a flawed process; was based on subsection 91(24) of the 1867 Constitution,
rather than on a rights-based approach under section 35 of the Constitution
Act, 1982; represented an attack on historical treaties and a threat
to the inherent right of self-government under section 35; imposed more
bureaucratic control over the lives of First Nations people without resolving
long-standing social and economic issues; failed to address urgent needs
of First Nations communities in matters such as health, housing and employment,
or the concerns of First Nations women; imposed a one-size-fits-all approach
with numerous additional requirements for all First Nations communities
and no parallel commitment to provide necessary resources or supports; served
the interests of government by off-loading federal responsibility; increased
the costs of governance for First Nations communities; and failed to provide
measures that would enable First Nations communities to develop their economies.
Before the House Committee, many First Nations spokespersons maintained
that the imposition of Bill C-7 would be especially onerous since their
communities had already developed standards through their own process.
Others argued that, in any event, prescriptive legislation such as Bill
C-7 was not necessary to bring about administrative reform for communities
in need of it.
Excluding those matters on which the House Committee adopted
amendments, as discussed in preceding pages, specific criticisms of the
bill raised by First Nations spokespersons, often from a capacity/cost perspective,
included the 25% threshold for code adoption (clause 4); legislating authority
for ministerial interventions in First Nations communities’ financial affairs
(clause 10); the requirement that all communities create a redress mechanism
(clause 11); the legal capacity clause (clause 15); and the repeal of section
67 of the CHRA (clause 41).
In July 2002, the Federation of Saskatchewan Indian Nations
initiated a Federal Court challenge to Bill C‑7’s predecessor,
Bill C-61, alleging, inter alia, that the FNGA process breached the
government’s fiduciary duties toward First Nations and seeking a declaration
to that effect. In March and August 2003, government applications to
prevent the case from proceeding were dismissed.
First Nations opposition to Bill C-7 was not universal.
The National Chief of the Congress of Aboriginal Peoples described the legislation
as a move to address obsolete sections of the Indian Act, and as
positive for the CAP constituency, providing off-reserve members the means
and process to exercise their right to vote in band elections. According
to the President of the National Aboriginal Women’s Association, positive
aspects included the bill’s human rights protections, which would improve
the lives of women on reserves, and band councils’ authority to pass laws
without ministerial interference. Individual First Nations members expressed
support for the legislation’s accountability provisions, in particular,
or, more generally, for its practical solutions. Others, acknowledging
proposals such as removal of the CHRA exemption, considered that positive
steps had been undone by bad process.
Non-Aboriginal editorial opinion, although mixed, tended
to favour the FNGA, describing the bill as “a promising start,” “necessary
and overdue,” setting “the right course,” “a straightforward, sensible outline,”
“addressing native grievances,” “[providing] a better framework” for First
Nations governments and not to be feared by them. It was suggested that
although the bill had important positive effects, the government should
admit that it “really is about assimilation.” Less positive commentary
observed that because drafting the FNGA was neither collaborative nor inclusive,
the bill should be allowed to die to enable government and First Nations
to resume discussions to resolve outstanding issues, and that the Minister
had “lost any hope of winning the support” of the Chiefs for the FNGA.
Available commentary from the academic sector, also mixed,
tended to be more critical of Bill C-7.
(1) The bill was
originally introduced in the 1st session of the 37th Parliament as Bill
C-61, but died on the Order Paper when Parliament was prorogued
on 16 September 2002. By motion adopted 7 October 2002, the House
of Commons provided for the reintroduction in the 2nd session of legislation
that had not received Royal Assent. The bills would be reinstated at
the same stage in the legislative process they had reached when the previous
session was prorogued.
(2) Only First Nations
communities with self-government legislation in place – the Nisga’a
and Sechelt in British Columbia, the Cree of northern Quebec, and a number
of Yukon First Nations groups – were expressly excluded from the bill’s
application by clause 35.
(3) Under subsection
2(1) of the Indian Act, R.S.C. 1985, c. I-5: an “Indian” is a
person who is either registered or entitled to be registered under the
legislation; the term “reserve” means a tract of land to which the federal
Crown holds title but that is “set apart by Her Majesty for the use and
benefit of a band”; a “band” is a “body of Indians” for whose common use
and benefit lands have been set apart or moneys are held, or that is declared
to be a band by the Governor in Council. A “council of the band” is selected
under the Act’s electoral regime, or according to band “custom.”
(4) Problems with
the Indian Act have been identified in reports of governments,
First Nations and other organizations. See, for example, Royal Commission
on Aboriginal Peoples, Report of the Royal Commission on Aboriginal
Peoples, Volume 1, Looking Forward, Looking Back, Chapter 9:
“The Indian Act” (Ottawa, Ministry of Supply and Services, 1996),
(5) Subsection 35(1)
recognizes and affirms “[t]he existing aboriginal and treaty rights of
the aboriginal peoples of Canada,” including the Indian, Inuit and Métis
peoples. In August 1995, the government issued a policy statement recognizing
the inherent right of Aboriginal self-government as an existing Aboriginal
right under section 35.
(6) In its 1939
decision Re Eskimo, the Supreme Court of Canada ruled that Inuit
were “Indians” within the meaning of subsection 91(24).
of First Nations in Canada, Presentation to the House of Commons Standing
Committee on Aboriginal Affairs, Northern Development and Natural Resources,
21 February 2002.
(11) DIAND, Backgrounder,
“Consultations on the Corbiere Decision,” 9 December 1999, Ottawa.
(12) Since 1998,
this joint process has been devoted to creating a framework for the eventual
transfer to First Nations of greater control over matters within the Lands
and Trusts Services Sector that covers approximately 80% of the Indian
(13) In May 2000,
the Minister of Indian Affairs appointed a Special Representative to investigate
and make recommendations related to the general absence of protection
for First Nations women under the Indian Act. Her report, submitted
in January 2001, has not been made public to date.
(14) Since its
enactment in 1976, section 67 of the CHRA has provided that “[n]othing
in this Act affects any provision of the Indian Act or any provision
made under or pursuant to that Act.”
(17) They include
the Atlantic Policy Congress of First Nation Chiefs, the Chiefs in Ontario,
the Assembly of Manitoba Chiefs, the Federation of Saskatchewan Indian
Nations, the Union of British Columbia Indian Chiefs, the First Nations
Coalition for Inherent Rights, the Six Nations of the Grand River.
(19) The AFN and
CAP are at odds as to which organization speaks for off-reserve First
(21) For a fuller
discussion of this issue, see Standing Committee on Aboriginal Affairs,
Northern Development and Natural Resources, Evidence,
14 March 2002.
and Legislative Options ... on the First Nations Governance Initiative,
March 2002, Ottawa, p. B-4-5.
(24) JMAC recommended
against changing the term “band” to “First Nation” at this time owing
to ongoing debate as to the scope and significance of the latter appellation,
and concern that such a change could influence “the outcome of the broader
efforts at Nation re-building,” ibid., p. B-6.
(27) S.C. 1999,
c. 24. Under this legislation, land-related provisions of the Indian
Act cease to apply to signatory First Nations communities that adopt
prescribed land codes. In March 2002, the Minister announced the FNLMA
process would be opened up to enable additional communities to assume
land management jurisdiction. As of November 2003, 12 communities
had ratified land codes.
(28) Under the
Kanesatake Interim Land Base Governance Act, S.C. 2001, c. 8, specified
Kanesatake lands are not subject to the Indian Act’s reserve provisions,
while provisions not related to reserves continue to apply to Kanesatake
(29) See, for
example, the Nunavut Waters and Nunavut Surface Rights Tribunal Act,
S.C. 2002, c. 10; the Nisga’a Final Agreement Act, S.C.
2000, c. 7; the Canada National Marine Conservation Areas Act,
S.C. 2002, c. 18; the Federal Law-Civil Law Harmonization Act,
No. 1, S.C. 2001, c. 4; the Law Commission of Canada Act, S.C.
1996, c. 9.
(30) Self-government negotiations,
which would presumably have continued as they have under the Indian
Act, cover a range of comprehensive and sectoral initiatives and currently
number about 80.
(31) The Minister
suggested that separate legislation might be forthcoming to provide for
the transfer of Indian moneys currently held in trust by the Crown to
(32) The Indian
Act’s existing definition was to be replaced to conform to the FNGA
(33) Clause 43(3)
would have modified the definition to remove a reference to “band elections”
which would no longer have taken place under the Indian Act.
to the discussion under First Nations and Governance, A. The 1999 Corbiere
Decision, it should be noted that the Corbiere decision did not
definitively settle the scope of off-reserve band members’ entitlement
to participate in band affairs. It is therefore not apparent post-Corbiere
that the term “elector” in the Indian Act is to be read as implicitly
including off-reserve members for all purposes. In this light, the Supreme
Court of Canada’s finding that “Aboriginality-residence” is an analogous
ground or a “constant marker” of potential discrimination for purposes
of section 15 of the Charter remains important.
(35) The evolution
of the Indian Act’s system of elective government is summarized
in a 1991 paper prepared by Wendy Moss (Cornet) and Elaine Gardner O’Toole
entitled Aboriginal People: History of Discriminatory Laws, BP-175E,
Parliamentary Research Branch, Library of Parliament, Ottawa, under the
(36) DIAND, Conversion to Community
Election System Policy.
(37) Custom bands are not distinguished
for other purposes under the Indian Act.
(38) JMAC Report, pp. D-18–19.
(39) Clause 5(1)
did not stipulate that persons who are “eligible voters” in relation to
code adoption procedures must also be entitled, under leadership selection
codes, to vote in council elections.
(40) The question of appeals is
touched upon under D.1.h, Observations related to governance codes.
(41) See D.1.e, Governance codes
vs. Regulatory default system.
(42) The Corbiere
decision was not required to address the custom context either. The JMAC
Report noted that related issues are before the courts, p. D-16.
(45) This was
also the sole option open to newly established bands under clause 5(4)).
It is worth noting that the term “established” does not necessarily mean
new entities: see section 17 of the Indian Act on “New Bands.”
For example, when Newfoundland entered Confederation, in 1949, the bands
in the region were not recognized under the Indian Act. In 2002,
both Innu communities in Labrador became “bands” under the Indian Act
by Order of the Governor in Council.
(47) JMAC Report, p. F-9.
(48) Clause 2(3)
provided that unless excepted, a council’s powers under the FNGA were
to comply with the band’s administration of government code or the relevant
default regulations. Clause 43(4) amended section 2(3) of the Indian
Act accordingly and modernized the provision relating to the exercise
of band powers without altering its substance.
(49) See discussion on clause
30 concerning band and national registries.
(50) JMAC Report,
pp. F-25–26. JMAC cautioned that conflict of interest rules risk being
overly complex and technical, leading to inadvertent breaches, and recommended
that such rules relate only to financial matters, with optional inclusion
in administration of government codes of conflict of interest rules for
band employees: p. F-20 and F-26.
(54) Under clause 36, a band’s
eligible voters might adopt clause 32 regulations within the three-year
(55) During this transition period,
the Indian Act’s electoral provisions were to remain in effect.
(56) While a band
code was in force, regulations under clause 32 on the same subject matter
were to be inapplicable to that band (clause 4(3)).
amendments were made to other clauses in which the two-year period appeared
in the bill, as introduced (see clauses 5(3), 34). The two-year time
frame was maintained for the obligation to enact a band law establishing
a redress body under clause 11.
a government amendment adopted by the House Committee, an exemption order
was required to provide that those Indian Act measures repealed
or amended by Bill C-7 that were specified in the order continued to apply
to the First Nations community during the exemption (clause 34(2)).
(59) JMAC Report, p. G-3.
(63) House of Commons, Order
Paper and Notice Paper No. 114, 9 June 2003, Motion No. 85.
information about the 2001 First Nations Governance Institute may be obtained
via the former body’s Web
(65) JMAC Report, pp. G-4 – 11.
(66) JMAC Report, pp. B-18–19.
(67) The JMAC
Report noted that many bands lack capacity to deal with this complex area
of administration. It indicated that certified Aboriginal Financial Officers
of the relatively recent Aboriginal Financial Officers Association are
making inroads in addressing this matter.
(68) DIAND also provides these
audits to members claiming denial of access.
(69) This was
confirmed in the 1988 decision of the Federal Court of Canada in Montana
Band of Indians v. Canada (Minister of Indian Affairs and
Northern Development),  1 F.C. 143 (T.D.) and in subsequent
complaints to the Information Commissioner.
(70) JMAC Report, p. E-24.
(73) Under the
FNGA’s transitional clauses, bands that exceeded their accountability
code’s deficit limit as of the taking effect of clause 10 were subject
to that provision (clause 40(1)).
(74) House of Commons, Order
Paper and Notice Paper No. 114, 9 June 2003, Motion No. 26.
(75) JMAC Report, p. E-19.
(78) Bill C-7
provided that the Minister might continue remedial measures for a band
under such measures on the coming into force of section 10, or order a
recovery plan for that band (clause 40(2)).
(79) JMAC Report, p. E-19.
(81) Ibid., pp. E-21–22,
(82) The process
set out in the Indian Band Election Regulations, C.R.C., c. 952,
s. 12-13, applies only to bands under the Indian Act’s election
(83) See previous discussion of
(84) See discussion of clause
18 under E.2.b, Governance Laws.
of Commons, Order Paper and Notice Paper No. 114, 9 June 2003,
Motion No. 84. The government amendment also proposed that the Ombudsman
would deal with clause 11 complaints pending the making of a clause 11
law by a band council.
(86) R.S.C. 1985, c. H-6.
Human Rights Review Panel, Promoting Equality: A New Vision, June
2000, Ottawa, p. 132.
(88) DIAND policy
requires that gender equality analysis to assess the “differential impact
on women and men of proposed and existing policies, programs and legislation”
be integrated in the development and implementation of legislation: Gender
Equality Analysis Policy.
(89) JMAC Report, p. B-12.
(90) While some
courts have held that a band has the capacity to sue, be sued and to enter
into contracts, others have ruled that a band is not a “person,” has no
corporate status, and may not own real estate.
(91) JMAC Report, p. C-13.
(of Quebec) Act, Sechelt Indian Band Self-Government Act, Yukon
First Nations Self-Government Act, Kanesatake Interim Land Base
Governance Act, First Nations Land Management Act.
(93) JMAC Report, p. C-18.
(94) In this light,
one alternative considered by JMAC on which no consensus was reached would
have made any new provisions for enhanced legal capacity optional, ibid.,
p. C-15. JMAC underscored the distinction between the fiduciary relationship
and fiduciary obligations, noting that if the Minister of the Cabinet
no longer has authority over a given subject matter, the fiduciary duty
in that area will cease as well, pp. B-4–5, n.
(98) Under transitional
clause 37, a band’s by-laws that were in effect when the Indian Act’s
by-law provisions were repealed and that did not conflict with the FNGA
or the band’s governance code(s) were to be deemed band laws under the
FNGA, and deposited in the registries required by clause 30 within the
prescribed period. Registry provisions are discussed under E.4.
(99) Money by-laws
retained in section 83 of the Indian Act included those related
to taxation for local purposes; enforcement of payments; recovery of interest;
and raising moneys from band members for projects. Note that the
Indian Act’s remaining provisions pertaining to money by-laws (sections 83 and
84) were to be repealed by Bill C-19, the First Nations Fiscal and Statistical
Management Act, described as the “third plank” of a plan designed to improve
bands’ self-sufficiency, the other two being the FNGA and the First
Nations Land Management Act. Bill C-19 also died on the Order
Paper when Parliament was prorogued on 12 November 2003.
(100) Bill C-7
did not make provision for laws on local environmental matters, as suggested
by JMAC, perhaps reflecting the complexity of jurisdictional issues in
(101) JMAC Report, p. F-26.
(102) The JMAC Report referred
to “band council committees,” ibid.
(103) The conditions
for entering into commercial transactions may also be the subject of laws
under clause 18(1).
requirements in government administration codes and, presumably, in the
eventual analogous default system, would apply.
(105) DIAND, “Communities First:
First Nations Governance,” Law-making.
(106) JMAC Report, p. F-11.
6(3) provided that a government administration code must contain rules
for the maintenance of such a registry.
a proposed consequential Report Stage government amendment, the First
Nations governance centre, discussed under heading D.1.h., Observations,
was to establish the national registry.
(109) JMAC Report, p. F-25.
“Communities First: First Nations Governance,” Registration and Proof
of Band-Designed Codes and Laws.
(112) JMAC Report,
p. F-5. The Indian Act does not make explicit provision for
the appointment of by-law enforcement officers. Although some bands
do create “enforcement” positions, for example under their by-law authority
over the observance of law and order (par. 81(1)(c)), they have
limited duties and no true enforcement capacity.
(113) In the
case of a law for the conservation and protection of natural resources
on the reserve or related to public works and waste management, the
maximum fine and term of imprisonment that might be set were $300,000
and six months, respectively.
(114) Under clause
21(4), a band might make an agreement with a competent provincial authority
as to which ticket or process would be used under the ticketing scheme,
thus determining procedures applicable to it.
(115) In 1996,
Bill C-79 contained similar provisions, with less substantial fine increases.
Bill C-7 did not address the JMAC Report’s further recommendation related
to lack of clarity with regard to prosecutions of band laws. According
to JMAC, provincial and/or federal prosecutors may refuse to prosecute
band by-laws on the ground that they are not within their respective areas
Report Stage government amendments were proposed for a number of inspection
and search provisions.
making related consequential changes to the Indian Act or minor
textual modifications have not been reviewed.
(118) Proposed repeals of section
32-34, 71, 92-93 (clauses 46, 50, 57) duplicate proposals made in 1996
in Bill C-79.
(119) Bill C-79 proposed to repeal
88 makes provincial laws of general application applicable to Indians,
provided they are consistent with the Indian Act and its subordinate
statutory instruments and do not make provision for anything in or under
that Act. Clause 56 incorporated the FNGA and regulations and laws under
it into section 88.
SELECTIVE OVERVIEW OF INDIAN ACT HISTORY*
1876 to 1985
The first consolidated Indian Act (the Act) enacted
in 1876 reflected the government’s preoccupation with land management, First
Nations membership and local government, and its ultimate goal of total
assimilation of Canada’s Aboriginal population. Despite frequent modifications
over the period from 1876 to 1951 in areas such as settlement of western
reserves, leadership selection,(1)
enfranchisement(2) and prohibition
of traditional practices, its underlying principles related to civilizing,
assimilating and protecting Indians remained unchanged.(3)
The amendments in question generally increased government control over and
reduced autonomy for Indian bands.
From 1946 through 1948, a Special Joint Committee of the
Senate and House of Commons reviewing the Act heard of poor living conditions,
government intrusion in band affairs, unmet treaty obligations and other
concerns. Its ensuing report reflected few Indian priorities; the Committee
proposed revising the Act “to remove many of its coercive measures without
altering its assimilative purpose.”(4)
In the result, the amended 1951 Act did not differ a great deal from its
predecessor, preserving its key elements while reducing the role of the
Minister of Indian Affairs (the Minister) in band government somewhat and
increasing autonomy in reserve management.
Participants in consultations on possible further revisions
to the Act in the 1960s stressed the need to honour special rights, address
historic grievances and allow greater Indian involvement in policy-making.(5)
Instead, the government issued its 1969 White Paper on Indian Policy, which
was withdrawn in 1971 in light of First Nations groups’ rejection of the
policy’s proposed repeal of the Act and termination of distinct “Indian”
Aboriginal and treaty rights were recognized and affirmed
in section 35 of the Constitution Act, 1982. In 1983, a Special
Committee of the House of Commons conducted a landmark study of Indian self-government.
Indians appearing before the Penner Committee criticized the Act, inter
alia, because it lacked measures enabling them to manage their own communities,
while the then Minister listed government authority over band powers and
assets; limitations on reserve land use; and the ambiguous legal status
of bandsamong the Act’s constraints. The Committee concluded that the Act’s
policy basis was “antiquated,” proposed that a framework for self-government
be legislated and recommended against amending the Act as an approach to
1985 to 1997(7)
Enacted in 1985, Bill C-31 aimed to eliminate discrimination
based on gender and marital status in the Act’s registration provisions,(8)
reinstate or recognize those who had been excluded from status under those
provisions, and empower bands, for the first time, to assume control over
their membership.(9) Bill C-31
also increased bands’ by-law authority over, for example, residence on and
development of reserve lands. Ensuing rapid growth in the status Indian
population, with increased demands upon community and government resources,
and varying capacities to transmit status to offspring owing to different
categories of registrant are among Bill C-31’s ongoing controversial effects.
Those associated with the bill’s membership provisions also persist.(10)
A multi-phased review of the Act from 1986 to 1990 that
featured some consultation with Indian organizations focused on a number
of areas for reform, with a view to proposing optional legislative changes
that would enable individual bands to decide when they were ready to take
on increased responsibility.(11)
As the broader review continued, the 1988 “Kamloops Amendment” (Bill C-115)
clarified the status of conditionally surrendered or “designated” reserve
lands and granted band councils taxation authority. In 1993, DIAND-supported
working groups of chiefs narrowed the range of priorities for legislative
action that bands might opt into to three areas: lands, forestry and moneys.
The 1999 First Nations Land Management Act is the only one of these
initiatives to have resulted in final legislation to date.(12)
In April 1995, the then Minister embarked on a process
to amend the Act, assuring leaders that only changes with First Nations
support would proceed.(13)
Strong negative reactions to September 1996 proposals from segments of First
Nations leadership resulted in some pre-introduction revision to Bill C-79,
the Indian Act Optional Modification Act, which was tabled in the House
of Commons in December 1996. As its title implies, the bill would have
allowed bands to opt into – but not out of – its package of changes to the
Act. These related to, inter alia, reserve lands, bands’ legal capacity,
band council elections and law-making authority and rules of succession.
In the constitutional context in which its changes were being proposed,
Bill C-79 also contained a non-derogation clause under which neither the
Act nor the amendments were to be construed as abrogating or derogating
from existing Aboriginal and treaty rights, including the inherent right
Following first-reading debate, the House of Commons Standing
Committee on Aboriginal Affairs and Northern Development held hearings on
Bill C-79 from February through April 1997. In the main, First Nations
representations rejected the bill on process and substantive grounds. Common
general concerns related to the pre-legislation consultation process; differing
First Nations priorities; retention of ministerial powers;potentialeffects
of opting in; effects onFirst Nations’ inherent right of self-government
and constitutionally protected Aboriginal and treaty rights; and the Crown’s
fiduciary obligations toward First Nations. Concerns with specific aspects
of the bill included its low opt-in threshold and definition of bands’ legal
capacity.(14) Bill C-79 died
on the Order Paper in spring 1997.
The November 1996 RCAP Report recommended enactment of
an Aboriginal Nations Recognition and Government Act, which