Toward a New Federal Framework for Aboriginal Economic Development: A Case Study Presentation to Public Sector Management Workshop 2009

The Current Federal Approach to Economic Development Current suite of programs date from the Canadian Aboriginal Economic Development Strategy 1989 Focus on three interconnected areas of economic activity, across three departments: Labour market development (HRSDC); Business development (Industry Canada); Community development (INAC) Conditions, needs and opportunities have changed significantly since 1989 Current Federal Spending on Aboriginal Economic Development

Aboriginal Economic Development is a Priority Budget 2008: A commitment to establish a new federal framework for Aboriginal economic development The Government will work with Aboriginal groups and other stakeholders to develop a framework that will be partnership-based and opportunity-driven and that will ensure that federal investments help Aboriginal Canadians benefit from viable economic opportunities. A new federal framework for Aboriginal economic development will provide long-term strategic direction for government actions in support of Aboriginal economic development

Aboriginal Canadians must be full participants in the Canadian economy Aboriginal Canadians can help fuel Canada’s economic performance and recovery Growing Aboriginal population can meet Canada’s long-term labour market needs Income and employment parity between Aboriginal and non-Aboriginal Canadians would contribute nearly $8 billion to the Canadian economy Corporate Canada needs and wants to work with Aboriginal Canada Substantial and growing land base represents significant opportunity for regional economies, natural resource development and commercial development Private sector wants to work with Aboriginal communities to avoid disputes and delays over major developments that could be worth up to $315 billion Duty to Consult has reinforced importance of Aboriginal participation in projects Economic development increases self-reliance and reduces social costs Participation in the economy means escaping “cycle of dependency” - failure to address means greater reliance on social programs and costs to government

The State of Aboriginal Economic Development Unemployment Rate Self-employment Rate Average Annual Income Government Transfers as a % of Total Income Census 2001 Census 2006 Census 2001 Census 2006 Census 2001 Census 2006 Census 2001 Census 2006 First Nations (on-reserve) 300, %24.9%4.5%3.6%$14,383$15, %28.6% First Nations (off-reserve) 397, %14.0%6.9%7.1%$19,728$24, %18.6% Inuit 50, %20.3%5.0%3.2%$19,878$25, %17.7% Métis 389, %10.0%9.2%8.4%$22,213$28, %13.8% Aboriginal Population 1,172, %14.8%7.2%6.8%$19,132$23, %18.1% Non-Aboriginal Population 30,068, %6.3%12.1%12.0%$30,062$35, %10.9%

Economic Outcomes of Aboriginal Canadians (Census 2006) GenderLabour force participation rate First Nations Women on reserve55.6% Women off reserve69.3% Men on reserve48.3% Men off reserve59.3% Inuit Women58.9% Men63.9% Métis Women66.3% Men74.1% Aboriginal populationWomen & Men63.0% Non-Aboriginal population Women & Men66.8%

Total Labour Force 15 Years of Age and Over By Class of Worker, First Nation Identity and the Non-Aboriginal Population, 2006

Per Cent of Population 15 Years of Age and Over Whose Highest Level of Education Is Less Than High School, First Nation Identity Population On and Off Reserve and the Non-Aboriginal Population, 1996, 2001 and 2006

First Nations Communities and Community Well-being

Building on Success Outcomes have been improving Significant increases in the labour force participation, self-employment and earned income of Aboriginal Canadians over the past 20 years An increasing number of Aboriginal communities are achieving outcomes comparable to non-Aboriginal communities Although gaps continue to exist in outcomes between Aboriginal and non-Aboriginal Canadians Conditions and opportunities are changing Private investment and development are pushing further into every region of the country Historic evolution in the roles and relationships of all levels of government, the private sector and Aboriginal peoples A new approach is needed More significant gains can be achieved with a more up-to-date approach that is driven by these new opportunities, responsive to the new conditions, leverages partnerships and is more focused on results

Dimensions of economic development: Analytic model  Text styles  Second level C LIMATE Creating the right economic conditions B ASE Building economic potential  Lands and natural resources  Infrastructure  People  Business development  Community investment strategies  Labour market development  Private sector partnerships  Major project participation  Legal and regulatory climate  Governance and institutions  Fiscal capacity and arrangements A CTIVATION Taking advantage of opportunities

Aboriginal Economic Development has Unique Characteristics Idle Community-owned assets Growing base of community-owned assets need to be activated to build successful and dynamic economies A non-business friendly climate (laws, regulations, lands and resource management regimes, infrastructure, governance and institutions) marginalizes communities from mainstream economy and prevents communities from attracting outside investment Not all communities have the same needs, conditions or opportunities Under-developed Aboriginal private sector A larger Aboriginal-owned private sector is critical to improving income and employment outcomes Persistent difficulties in accessing private capital and investment hampers business start-ups, growth and market development On- and off-reserve economic climate requires different business strategies and approaches Emerging labour force Largest growing segment of Canada’s population is poised to enter the labour market over next 10 years Skills development and training need to be better aligned with labour market needs

Moving Forward on Economic Development One size does not fit all Federal actions must respond to the viable opportunities and the real conditions of First Nations, Inuit, and Métis businesses and communities across Canada Canada must employ a whole-of-government approach to achieve the greatest benefit from federal intervention, including on a sectoral and regional basis, and through both Aboriginal-specific and mainstream programming Implementation is key Stronger governance structure will ensure coordination across government and between partners, and greater accountability to Canadians Canada must continue to engage with all players to ensure federal investments and actions keep up with dynamic and changing environment The federal government cannot act alone Canada can play an important role in setting the right conditions for better economic development outcomes, but does not have all levers, responsibility and resources Canada must work in partnerships with Aboriginal Canadians, provinces, territories, and Corporate Canada to share responsibilities and build success

Partners

Promoting Partnerships Major Resource and Energy Development Investments Initiative Designed to help Aboriginal businesses partner in some of the most important economic developments and energy projects across Canada Will leverage financial participation from other levels of government, the private sector and Aboriginal partners to increase the availability of equity funding to medium and large Aboriginal businesses Examples Aboriginal Energy Partnership (British Columbia) $7 million fund co-managed by Ecotrust Capital Canada and 2 Aboriginal Capital Corporations Business Ready Investment Development Gateway (Saskatchewan) Pilot investment to Westcap Management Limited that will provide funding and training to Aboriginal communities to help them become “business-ready” First Peoples Economic Growth Fund (Manitoba) Partnership between Manitoba Hydro, the Province of Manitoba, and the Government of Canada

Aboriginal Economic Development: Some Conclusions Participation in the Canadian economy is key to improving the outcomes for Aboriginal Canadians There are important opportunities for Aboriginal Canadians and for all Canadians There is broad consensus on the need for change Working in partnership is the way forward