The Harper Administration has made transparency its theme since assuming office in 2006. First, it brought in the Federal Accountability Act, S.C. 2006, c. 9, to make transparent all communication to the Federal Government, where a fee is charged for such communication. Secret lobbying for pay was made illegal.
Then, on December 5, 2011, Russ Hiebert, M.P. succeeded in having Parliament advance his private member’s bill (C-377) requiring the financial records of labour unions to be disclosed to both members of labour unions and members of the public. The House of Commons passed Bill C-377 on December 12, 2012 and the Bill is currently at second reading in the Senate. On May 9, 2013 the Senate Banking Committee commenced hearings on Bill C?377.
First Nations’ transparency was the next focus for the Parliament of Canada. On March 27, 2013 the First Nations Financial Transparency Act, S.C. 2013, c. 7, (“Act”) received Royal Assent. Sixteen months were expended debating the legislation after it was introduced for first reading by the Minister of Aboriginal Affairs and Northern Development (“Minister”) on November 23, 2011.
The Act establishes three significant financial reporting requirements for First Nations:
- Audited financial statements must be prepared by First Nations and made available to the Minister, to First Nations members and to the public (see sections 5 and 7 of the Act);
- A schedule of remuneration must be prepared each year that includes details of any “salaries, wages, commissions, bonuses, fees, honoraria, dividends and reimbursement of expenses … and any other monetary benefits and non-monetary benefits” and must be audited and made available in the same manner as the financial statements (see sections 2 and 6 of the Act);
- The First Nations and the Minister must each independently place the financial statements and the schedule of remuneration on their respective internet sites (see sections 8 and 9 of the Act);
As well, the Act creates two significant enforcement procedures:
- Any person, including a First Nations’ member and the Minister, may obtain a court order (with enforcement through the contempt powers of the Court) against a First Nation (see sections 10 and 11 of the Act) where there is non-compliance with the Act;
- The Minister may utilize administrative measures to enforce the Act, including withholding funds due to a First Nation or termination of an agreement that provides Federal funding to a First Nation.
In conclusion, it is important to note that the Act applies to financial statements and schedules of remuneration for financial periods commencing after March 27, 2013. This means that many First Nations are almost immediately impacted by the Act. All First Nations with a fiscal period commencing on April 1, 2013 must file financial statements and schedules of remuneration within 120 days after March 31, 2014, in accordance with the Act.