Fraser Institute News Release: Government Spending on Aboriginal People up Dramatically Over Decades yet Communities Still Struggle

TORONTO, ON--(Marketwired - March 10, 2016) -  Government spending on Canada's Aboriginal population has risen dramatically -- well beyond spending for other Canadians -- yet education and employment outcomes in many Aboriginal communities remain dire, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

"While some may advocate for increased Aboriginal funding in the upcoming federal budget, it's clear that decades of significant spending increases alone haven't led to better outcomes for many Aboriginal communities across the country," says Ravina Bains, associate director of Aboriginal studies at the Fraser Institute and co-author of Government Spending and Own Source Revenue for Canada's Aboriginals: A Comparative Analysis.

For example, federal government spending through Indigenous and Northern Affairs Canada (which does not represent all federal government spending related to Aboriginals) increased to $7.9 billion (adjusted for inflation) in 2013/14 from $82 million over the past six decades.

On a per person basis that equals $8,578 per registered First Nation member compared to $939 in 1949/50 -- an increase of more than 800 per cent.

By comparison, federal government spending per person on all Canadians was $7,295 in 2013/14, an increase of 376 per cent from 1949/50.

Among provinces, total annual provincial spending on Aboriginal people rose to $946 million in 2013/14 from $43 million in 1993/94 (the earliest year of available comparable data). On a per person basis, provincial spending increased 1,235 per cent to $1,028 from $77. In comparison provincial spending per person on all Canadians rose only 31 per cent during the same period.

"Despite this increased spending, average unemployment rates on reserve are above 20 per cent and high school graduation rates remain below 40 per cent," Bains said.

The study also spotlights own source revenues -- revenues generated by Aboriginal governments through natural resource agreements and other businesses.

For the first time, the public is able to see how First Nations communities are raising their own-source revenue due to the introduction of the First Nations Financial Transparency Act (FNFTA). Signed into law in 2013, the FNFTA requires all bands to make their audited financial statements and salaries public.

The data shows that in 2013/14, First Nations communities in Canada generated more than $3.3 billion dollars in own-source revenue. The average own-source revenue earnings for the top 10 reporting communities in 2013/14 was more than $64 million. The Tsuu T'ina Nation in Alberta, alone, generated more than $100 million in own-source revenue. 

"Many First Nations communities are generating significant own-source revenue -- in addition to increased government transfers. Any discussion about spending levels on Aboriginal issues needs to take all existing transfers and revenues into account with a focus on improving economic outcomes," Bains said.

Because of the wide range of multi-level government spending over the decades, across multiple programs, departments and ministries, this study does not represent all government spending related to Aboriginals, but rather provides a snapshot of spending trends.

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 86 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org