OGGO Committee Meeting

     I call the meeting to order.

    Welcome, everyone, to meeting 44 of the House of Commons Standing Committee on Government Operations and Estimates, fondly known as “the only committee that matters”.

    There is no interpretation, Mr. Chair.

    We will wait a moment while we fix our translation.

    While we're checking translation, can we confirm that the witnesses who are Zooming in have passed the audio check?

     They have. Thank you.

    Is the translation working now, Ms. Vignola?

    It's working now.

    Thank you.

    The translation is back and it's working.

    We are continuing our diversity in procurement study. We have four witnesses today, each with an opening statement.

    We'll start with the opening statement from Mr. Metatawabin.

    Please go ahead for five minutes.

     [Witness spoke in Cree]

    [English]

    Waachi’ye. My name is Shannin Metatawabin. I'm the chief executive officer for the National Aboriginal Capital Corporations Association. I am also a member of the Peetabeck or Fort Albany First Nation of the Mushkegowuk nations.

    Thank you for the invitation to speak to you today.

    Before I start, I would like to acknowledge that we are meeting on the traditional and unceded territories of the Anishinabe Algonquin people.

    The National Aboriginal Capital Corporations Association, NACCA, is the representative organization of over 50 indigenous financial institutions across Canada, from coast to coast to coast. They provide developmental lending to hundreds of first nations, Inuit and Métis businesses across the country.

    Indigenous financial institutions are an incredible success story. They were recently highlighted in a 2019 OECD study that promotes this network as a model for the rest of the world.

    During a 30-year program partnership with the Government of Canada, indigenous financial institutions have provided over 50,000 loans, totalling $3.3 billion, to indigenous-owned businesses. Each year, IFIs make over $120 million in loans to indigenous-owned businesses. Indigenous financial institutions have a current aggregate loan portfolio of $329 million. We are proud to state that we have a 97% repayment rate.

    Recently, we launched an indigenous growth fund. It is a $153-million investment vehicle to provide the private sector mechanism to invest into our community. This was supported by BDC, EDC and FCC, along with the Government of Canada.

    Indigenous businesses are a key driver of employment, wealth creation and better socio-economic outcomes for indigenous communities and people. Every loan we provide results in 3.34 jobs and contributes $3.6 to GDP for every dollar lent. Additionally, IFIs' lending in indigenous communities is linked to marked improvements in community well-being scores, with poor health outcomes being reduced by 75% and food insecurity being cut in half.

    I commend your committee for undertaking your work to examine diversity in procurement. I believe that NACCA can provide some important insights and recommendations to support your study.

    Since the government announced its commitment to ensure that a minimum of 5% of the total value of federal contracts is held by indigenous businesses, six indigenous organizations—NACCA, CCAB, AFN, ITK, CANDO and NIEDB—formed the national indigenous procurement working group to begin planning. These are in your packages, so you'll see the full names of them there.

    Additionally, in 2022, the national indigenous economic strategy for Canada, which was developed by over 20 indigenous organizations, recommended that the government devolve government procurement processes to indigenous institutions.

    Article 5 of the United Nations Declaration on the Rights of Indigenous Peoples reaffirms the need by highlighting “the right to maintain and strengthen their distinct political, legal, economic, social and cultural institutions, while retaining their right to participate fully, if they so choose, in the political, economic, social and cultural life of the State.” This is something that Canada is also supporting.

    The federal procurement process is a complex system with many players, including Indigenous Services Canada, Public Services and Procurement Canada, the Office of the Procurement Ombudsman, Treasury Board Secretariat, and the Office of the Comptroller General.

    The federal procurement process presents many barriers to our businesses, including systemic bias within the procurement ecosystem, restrictive administrative processes, multiple procurement actors creating a complex landscape to navigate, capacity for first nations to respond to opportunities, and lack of a trustworthy and updated national database of available first nations businesses.

    Today, I'm proposing the creation of a first nations procurement institute that will play a key role in the procurement industry by providing culturally appropriate wraparound services via a single window of contact for all things related to first nations procurement.

    The mission of the first nations procurement institute will be to maximize the potential for first nations businesses to successfully access and win procurement opportunities through providing necessary certification, education, networking and promotion. The first nations procurement institute will be focused on better outcomes for first nations businesses while assisting the federal government to reach its 5% procurement target.

    The first nations procurement institute will offer four streams of service to address the needs of its users, including a first nations business certification and a directory of certified businesses; education services and training; networking, collaboration and partnerships; and the promotion of first nation procurement and, most importantly, advocacy and accountability.

     It is time that Canada acknowledges that the current system is not working. It is also time to recognize that indigenous-led solutions have been enormously successful. The success of the indigenous financial institutions is a testament to our view that indigenous organizations are best placed to design and deliver programs and services to indigenous people, including first nations.

    The existing federal structures that are supposed to support indigenous procurement opportunities, including the procurement strategy for indigenous business, have not been successful. After more than 25 years of operation under PSIB, indigenous procurement remains stubbornly under 1% of total federal procurement. You may recall, from their testimony before your committee in October, that federal officials were unable to provide any concrete measures of the government's effort at moving toward the 5% target.

    During the last election, all major parties committed themselves to undertaking the important work of walking the path to reconciliation. Reconciliation is not possible if indigenous people continue to be excluded from Canada's economy and the sharing of Canada's prosperity. First nations want an end to the systemic economic exclusion, and to be full partners in this confederation. This is what we mean by economic reconciliation. Working together to meet the government's indigenous procurement commitment is a significant step in the journey, but the Government of Canada must be willing to accept that first nation people are true partners in this effort.

    Meegwetch.

    Thanks very much.

    Now, over Zoom, we have Ms. LaBillois, please, for five minutes.

     Thank you, Mr. Chair.

    [Witness spoke in Mi'kmaq and provided the following text:]

    Weli'egsipug. Teluisi Gepme'g Gitpuisq. Gespe'gewagi tleawi. Aq Wigi Listuguj.

    [Witness provided the following translation:]

    Good morning. My name is Victoria LaBillois. My traditional territory is Gespegewagi, and I live in Listuguj.

     [English]

    I come to you from the Listuguj Mi’gmaq First Nation, located on the southern shore of Gaspésie.

     Thank you for inviting me to speak with you today on the issue of diversity in procurement. I'm the vice-chair of the National Indigenous Economic Development Board, a ministerial-appointed, non-political organization mandated to provide advice to the federal government on issues related to indigenous economic development.

    Our board was established in 1990 and is comprised of first nation, Inuit and Métis business and community leaders from across Canada. I invite you to check out our board's website, which includes our series of national indigenous economic progress reports, the next of which will be released in late 2023.

    I also invite you to review the national indigenous economic strategy referenced by my colleague Shannin. This strategy was released in June 2022. Brought forward in partnership with more than 20 national indigenous economic organizations, this strategy provides economic development practitioners and policy-makers with a coherent vision designed to guide efforts in the coming decade.

    As you are aware, the Government of Canada is the largest purchaser of goods and services in the nation, spending approximately $22 billion annually on goods and services. Clearly, the federal procurement policy has the potential to be a key driver of economic reconciliation.

    However, despite the federal commitment to increase access to federal procurement opportunities for indigenous businesses, year over year, indigenous businesses have received less than 1% of the value of contracts for tendering goods and services to the Government of Canada.

    Despite the Government of Canada's goal that federal departments and agencies ensure that a minimum of 5% of the total value of federal contracts is awarded to indigenous businesses, innovation in this area continues to lag. There are a number of reasons for this, including constraints that are hard-wired within the Indian Act and impediments to accessing capital by indigenous communities and governments.

    The NIEDB is a member of the federal government's indigenous procurement working group and the indigenous reference group created specifically for these issues. We applaud the government's openness to working with indigenous representatives on these issues and recognize the significance of the new 5% target. However, more can be done in the immediate term to better utilize government procurement processes. In this context, the NIEDB believes a significant investment is necessary for the establishment of a new indigenous-led procurement institution at the national level. This is our key recommendation for immediate action.

    Indigenous national economic development organizations are close to finalizing a business plan for an indigenous procurement institute with the responsibility of maintaining a directory of certified indigenous businesses, and helping such businesses navigate federal and corporate procurement processes.

    The NIEDB also recommends that the very low thresholds for non-competitive processes and sole-source contracting be increased immediately. The current rules indicate that contract opportunities for goods over $25,000, services over $40,000 and construction over $100,000 must be advertised via tendering, and that only opportunities under these amounts may be awarded through a sole-source contract. These limits have not changed for many years. In 2021, the Treasury Board Secretariat indicated that increasing the sole-source contract limits for indigenous businesses to $100,000 would not contravene Canada's free trade agreements.

    Increasing these thresholds immediately will assist indigenous businesses in taking advantage of the opportunities presented by procurement within the federal government.

    I would also like to share a few more recommendations. The implementation of these will be crucial to the success or failure of the government's goals in this area.

    In areas of the country where the indigenous population is more than 5%, the target for the total value of federal contracts awarded to indigenous businesses should also be proportionally higher.

    Training on indigenous cultural awareness for procurement officials should be mandatory. This is necessary not only to ensure that government officials understand indigenous cultures and the importance of economic reconciliation, but to deal with the growing issue of false indigeneity within business lists used by the Government of Canada.

    Finally, the NIEDB recommends that the government monitor and report on an annual basis, distinct from other reporting processes, whether or not each federal department is meeting its mandated 5% indigenous procurement target.

     Thank you. Wela'lioq.

    Thank you very much. That was right on time.

    Mr. Ducharme, please go ahead for five minutes—see if you can match that.

    Good luck with that, but thanks.

    Good morning. As mentioned, my name is Philip Ducharme. As vice-president of entrepreneurship and procurement at the Canadian Council for Aboriginal Business, I want to thank you, Mr. Chair and all distinguished members of this committee, for the opportunity to provide you with my testimony and to answer your questions.

    Speaking to you from my home office, I acknowledge the land as the traditional territory of many nations, including the Mississaugas of the Credit, the Anishinabe, the Chippewa, the Haudenosaunee and the Wendat peoples, and now home to many other first nations, Inuit and Métis people.

    Since CCAB's two previous appearances before this committee, in February and June 2021, it is heartening to see that one of our recommendations that was brought forward has been implemented. We were asking for measures that would mandate federal government departments and agencies to publicly report on their purchases from indigenous businesses within a shorter time frame. Currently, the most recent data we have been able to publicly identify for indigenous procurement was from fiscal year 2018.

    On August 6, 2021, the Minister of PSPC announced new and immediate measures to increase federal procurement opportunities for indigenous businesses across Canada. Included in that announcement was the development of a reporting framework that would see spending publicly reported in a much more timely manner. My understanding is that the value of federal spending with indigenous businesses for the fiscal year ending March 31, 2023 will be published by the end of calendar year 2023.

    By having a fulsome mechanism for measuring and reporting on indigenous procurement, we will be better situated to evaluate and improve on meeting the minimum mandated requirement of 5% indigenous procurement spend.

    In 2022, CCAB conducted research on government contracting and heard from indigenous business owners about a wide range of challenges preventing them from taking full advantage of federal procurement opportunities. One of the most common themes that indigenous businesses expressed was a concern about the lack of knowledge among government staff regarding indigenous peoples and communities and the procurement process itself.

    Business is best conducted between parties that understand and respect each other, so providing increased training and awareness for government employees will help facilitate lasting and mutually beneficial relationships, which are the cornerstone of a robust procurement strategy. True economic reconciliation is accommodating indigenous peoples to ensure their full participation in the Canadian economy, not forcing them to assimilate in order to obtain contracts.

    A portion of this concern was addressed in the PSPC minister's August 21 update, when she announced that the federal government will be developing a mandatory training for the federal procurement community on modern treaty and self-government agreement implementation of procurement obligations, and ensuring that such training is integrated into the regular curriculum. Enhanced indigenous cultural awareness will also be explored, so that more responsive and culturally relevant procurement strategies may be developed. That is a start, but we will push to ensure that the enhanced indigenous cultural awareness will quickly move from exploratory to implemented.

    Indigenous businesses also claim that the federal government has failed to make the necessary changes to promote access to the procurement process itself, given its many intricacies. Businesses consulted felt inferior and marginalized by the contract requirements, which excluded indigenous businesses in favour of larger mainstream companies. Some participants found the process difficult and time-consuming, and believed that the requirements were set up in a way that excluded indigenous businesses, despite having the capacity to execute a project. Bonds, payment holdbacks and, particularly, over-complex applications all contributed to these barriers.

    If the federal government is truly committed to allocating 5% of its procurement spend to indigenous businesses, it should also be responsible for providing indigenous businesses with the tools and resources they need to participate meaningfully in that process.

    Another challenge frequently cited by indigenous participants in our procurement research is that federal departments need to better collaborate to share best practices when engaging with indigenous businesses and communities. While collaboration among federal departments to share best practices will help, the way forward must include establishing a government-wide approach to indigenous procurement that ensures consistency by explicitly laying out the best path and penalizing those who break from it, while ensuring that the context and needs of indigenous businesses are substantively addressed.

    If the federal government is truly committed to indigenous reconciliation, more must be done to mobilize the recommendations of national indigenous economic organizations such as CCAB, and those that my fellow witnesses are representing, and apply the learning and the takeaways we gather directly from indigenous business leaders.

    We at CCAB are very fortunate to have the opportunity to connect with our indigenous businesses on a daily basis, and we will continue to be the voice for indigenous businesses as we engage with the federal government to ensure that our indigenous businesses reach the minimum of 5% of the dollar value of federal procurement. Even though there are still many barriers and challenges to overcome, we look forward to the future with hope and excitement as we rebuild and strengthen the path towards reconciliation and a healthy and prosperous Canada.

     Thank you. I look forward to answering any questions you may have.

    Thank you, Mr. Ducharme.

    Now, Mr. Wanuch, go ahead, please, for five minutes.

     Good morning, honourable Mr. McCauley and honourable members of the standing committee.

    My name is Ray Wanuch. I am the executive director of the Council for the Advancement of Native Development Officers, otherwise known as CANDO. Today, I am speaking from Edmonton, the traditional name of which was Amiskwaciy Waskahikan, which means “beaver hills house”, located within Treaty 6 territory, the traditional territory of the Cree, Blackfoot, Dene, Stoney and Métis peoples.

    Indigenous economic development is essential is for positive socio-economic outcomes and empowerment of indigenous peoples. CANDO is a national indigenous organization established in 1991 by economic development officers throughout Canada. CANDO provides membership certification, training and tools to support EDOs, land managers and community leaders to create positive impacts on indigenous economies. CANDO provides both in-person and virtual support for EDOs through a national “Links to Learning” educational series, an annual conference and an annual youth summit.

    CANDO has co-developed an innovative community economic development initiative called CEDI, which creates positive relationship-building opportunities between indigenous communities and their municipal neighbours to work together on mutually beneficial projects. The initiative is co-delivered by the Federation of Canadian Municipalities and CANDO. One such example was the CEDI project that partnered Enoch Cree Nation with the City of Edmonton.

    Since 2021, CANDO has worked with procurement assistance Canada to create studies, pilots and new tools for EDOs and community leaders to support increased indigenous community and business access to federal procurement opportunities. As part of this partnership, CANDO has developed several reports and studies around indigenous participation in federal procurement: in November 2020, on federal procurement and indigenous capacity building and an assessment of how CANDO and the EDO network can support PSPC; in July 2021, a road map of federal procurement progress for indigenous communities and businesses; and also in 2021, an inventory of federal programming supporting indigenous businesses.

    Inclusive procurement and making procurement more inclusive are good for everyone, and by finding better and more creative solutions to increase indigenous participation in federal procurement, the government will begin to change its culture and will also have very positive impacts for other disadvantaged groups.

    CANDO feels that the government needs to have better reporting and data collection. Eventually this responsibility is expected to be transferred to a group of indigenous organizations to manage the process. CANDO feels that the concept of a data lake, which aggregates data from multiple sources, will likely be required to support and measure the impact of the 5% policy and the transformation of the procurement study for indigenous business.

    During the work completed by the indigenous business COVID-19 task force, CANDO and other national indigenous organizations compiled a database focused on providing more indigenous businesses to supply PPE to the Government of Canada. The data lake concept was attempted between the collective networks of national indigenous organizations and Indigenous Services Canada. CANDO viewed this effort as being successful, as several indigenous organizations won federal procurement contracts and were supported by the task force. Yet a key issue with the process was the inability to obtain contract award data for indigenous businesses. That made it difficult to track progress. Being able to have a central point for indigenous business services and capabilities and more timely access to contract bidding and award data would allow for more effective decision-making.

    CANDO has been developing a capacity assessment process and tools for EDOs, which are currently being piloted in B.C. One important consideration for achieving the 5% goal is to ensure that we can understand the current skills gaps that keep indigenous people from working in major industries.

     Early engagement with indigenous rights holders, communities and businesses is essential. In many communities, economic development officers and economic development corporations are a key hub for engagement with indigenous peoples. The earlier in the process the government can engage with communities to allow time to prepare for opportunities, the more socio-economic benefits will likely be realized.

     CANDO provides training for EDOs through virtual and in-person “Links to Learning” events and an ongoing weekly webinar series.

     CANDO and procurement assistance Canada are expanding their EDO procurement mentorship pilot, which will provide a “train the trainer” model for EDOs to understand the basics of procurement. Two cohorts have graduated 18 participants, and this program will now be rolled out within all procurement assistance Canada regions, of which there are six.

    A key barrier noted in CANDO's work is a lack of ability to understand the procurement process, whether it's a community responding to an indigenous participation plan requirement in an RFP or whether an EDO is supporting a community-based business writing a proposal. CANDO's procurement mentorship should provide more insights into training requirements.

    One of the lessons learned from the indigenous business COVID-19 task force was that there needed to be a support service for indigenous communities and businesses to participate in federal procurement. The support service was launched to help communities go through the process. Under an SPI pilot, CANDO is developing a virtual EDO website space to provide a library of support tools for EDOs, communities and businesses, along with a resourced indigenous procurement navigator role. We feel this strategy will provide more procurement and be more inclusive for indigenous communities and businesses.

    Ensuring that public servants understand the culture of indigenous communities is essential. Specifically, giving procurement officers the authority to take more time to prioritize working with indigenous communities and businesses and respecting the communities' requirements will increase trust and build relationships. An example of positive cultural—

    Mr. Wanuch, I'm sorry. I've given you a bit of extra time because you're from Edmonton as well, but can I get you to wrap up, please?

    Okay.

    CANDO is well positioned to support the rollout of this 5% policy with national, regional and local networks, within indigenous communities and government organizations. We're currently working with PSPC, ISC, NRCan, PrairiesCAN, Transport Canada and DFO's Coast Guard.

    Thank you.

    That's wonderful. Thank you very much.

    Before we start, I just want to thank all four witnesses for the very important testimony you've given today in your opening statements. I've worked on this particular issue, I think, three times now in OGGO, and the information you've put forward is fantastic.

    I also want to welcome back a couple of OGGO alumni. Mrs. Shanahan is joining us today virtually, and Dr. Robert Kitchen is back today. Welcome back, OGGO alumni.

    We'll start with Mrs. Kusie for six minutes.

    Go ahead, please.

    Thank you, Mr. Chair.

    Thank you very much, esteemed witnesses, for being here with us today. Meegwetch. I'm the member of Parliament for Calgary Midnapore, which is located in the traditional territories of the Niitsitapi and the people of the Treaty 7 region of Alberta. As well, of course, the city of Calgary is also home to the Métis nation of Alberta, region three.

    Madame LaBillois, Indigenous Services Canada maintains the indigenous business directory, which identifies over 2,100 businesses that can compete for federal contracts set aside through the procurement strategy for indigenous businesses. Only indigenous businesses that meet the eligibility requirements for the indigenous set-aside program can register in this directory.

    Do you think the eligibility criteria are adequate, or do you think there need to be changes?

    Thank you for the question.

    I think changes need to be made. What we see happening across the country, actually across North America, with the issue of false indigeneity, is also pervasive throughout the Government of Canada's listing of indigenous businesses. Where there is self-identification as the threshold, you need to ensure that there are mechanisms put in place to verify the authenticity and veracity of this type of information. It's a pervasive problem that has existed for a number of years across the procurement strategy for indigenous businesses.

    The short answer to your question would be yes.

    Thank you.

    Thank you.

    What do you think are the biggest barriers for indigenous businesses to get on the indigenous business directory?

     I don't think there's a barrier to get on the list. I think the barrier is that there is a lack of due diligence in confirming the indigeneity of these businesses. Where there is a potential for material gain, we are going to see abuse and fraud. As more attention is being paid to procurement and with setting the 5% procurement threshold, that brings lots of non-indigenous businesses out of the woodwork. It could be putting a red face on a company and seeking to register on this procurement database.

    We have a challenge. I've heard my colleagues mention the difficulty in accessing procurement opportunities. You have companies pretending to be red-faced to benefit from the strategy. They have the experience to navigate the system, and it's at our expense. We have a wonderful program that exists on paper, yet the challenge is implementing this and addressing it. How can we address this? I think it's by strengthening the offices regionally, having more contact with boots on the ground, with legitimate indigenous companies that exist. The centralization of this does not allow for that knowledge to exist.

    Thank you.

    Given that, how can we encourage more indigenous businesses to apply to be on the directory? To your point, what I would potentially describe as fraudulent applications might exist, but given that, how can we encourage more indigenous businesses to apply, please?

    That's an easy question. Thank you.

    We have a number of organizations that exist across the country that interface regularly with legitimate indigenous businesses. You've heard from my colleagues, be it the Canadian Council for Aboriginal Business—which does have an existing database through its market-based program—through my colleague Ray with CANDO—they have a network of economic development officers from coast to coast to coast who know who indigenous businesses are—as well as through my colleague with NACCA. The lending institutions are very familiar with legitimate indigenous businesses.

    We have these networks. How do we collaborate and bring them together under an indigenous-led procurement institute? I think that would help us to achieve this. Thank you.

    Do you believe the process to get on the directory is too cumbersome for indigenous businesses?

    I'm a serial entrepreneur, and I have registered a number of my businesses. Is it cumbersome? No, but there were a number of steps to take, like obtaining the SRI number and different pieces. The issue was that once I got on the database, I started to receive spam and people trying to sell things. It represents an opportunity cost for a small entrepreneur. There was some navigation to get on the system, but once I was on the system, I wasn't hearing about opportunities that I could apply for for my companies. I was more being sold things.

    Thank you.

    Mr. Metatawabin, did you want to weigh in, please?

    Thank you for that. I'm glad you're spreading it around.

    I think what we want to recognize is that we're not trying to promote the continued use of a database that hasn't been successful over many decades. I think what we're trying to do is provide solutions for a better way forward so that we can actually impact the target positively.

    What we're promoting is the creation of a new institute that will maintain and develop a database that will look at all the problems of the current database, which include self-identification, those businesses that are on there that are probably not indigenous. They're currently going through an audit of that database right now so that when we do develop a database it will be good information. I think we should focus, really, on where we need to go.

    Thanks.

    We have Ms. Thompson for six minutes, please.

    Thank you, Mr. Chair, and thank you to all of the witnesses.

    I would like to open by acknowledging that I am on the traditional unceded territory of the Algonquin Anishinabe nation. Welcome to every witness here.

    Mr. Ducharme, perhaps I could begin with you. Thank you for your opening comments. I'd really like to be able to expand on what you have already provided. Would you share some background and more information, please, on what your role is with the Canadian Council for Aboriginal Business? Thank you.

     Thanks, Ms. Thompson.

    In my role as the vice-president of entrepreneurship and procurement, I have a number of roles at CCAB. The one that's most relevant to today's hearing is “Supply Change”. Supply Change is CCAB's trademarked indigenous procurement strategy, which we started in 2018. This strategy aims to increase indigenous participation in all buying entities within Canada—not just the federal government, but all levels of government and corporate Canada.

    We have a number of different pillars within that strategy that bring indigenous businesses together with buyers. We have aboriginal procurement champions, who currently have 117 corporations in all sectors and industries across the country that have signed on to help us increase participation with indigenous businesses within their supply chains, either directly or indirectly.

    We also provide learning experiences for our certified indigenous businesses. As Ray talked about with some of the programs they do, we have also done some of that stuff with indigenous businesses as they try to navigate federal procurement.

    On the previous question about what would get more indigenous businesses on the directory, it would be simplifying the procurement process for procurement within the federal government. Small businesses, indigenous businesses, do not have the capacity or the resources to respond to these overwhelmingly admin-heavy RFPs that the federal government does.

    Again, we are very focused on bringing our indigenous businesses to the rest of Canada to ensure they're included.

    Thank you.

    You referenced this in your opening comments, but could you share your experiences with past challenges that indigenous communities have faced and still continue to face with economic business development? Basically, just provide more information and maybe some examples of what groups are facing.

    Well, I think that in the past indigenous people felt quite often that they were excluded, that there was a bias within the federal government, and even within the procurement practices with all the mandatory requirements. One little mistake and you were automatically wiped out from that. It seemed like there were so many requirements, which made it impossible for someone to do it. If they didn't upload one document, they were automatically deemed non-compliant and weren't even reviewed. That was a big issue.

    The bid bonding is another thing. As our indigenous businesses grow, they have trouble with the bid bonding. I know that in eastern Canada there was a business based on a reserve that tried to get bonding. They were told that because they were based on the first nation, on the reserve, they weren't going to be eligible for it. That has been an issue.

    As well, there's the capacity that Ray was talking about. When an RFP comes out, it's too late at that point for our indigenous businesses to grow to be able to meet that requirement. We need to educate our businesses on the opportunities—where they are going to be and what requirements they have when that opportunity comes out—so that they will be successful and will be compliant for the opportunities.

    Thank you.

    You and other witnesses have referenced the importance of an institute. How do you feel an institute, that coming together, would be able to assist in the process of information gathering but also in support once the application process has begun?

    I think that together we're stronger. At CCAB, Supply Change is, in essence, what an institute would be. We've been doing it on a very tight budget and with tight resources as well. Anyone who knows resources knows that HR resources right now are a big issue. We have been doing it, and I have to say that I'm quite proud of what we have accomplished with our work at CCAB.

    Again, we are a member-based organization. We work with the ones who have joined us as members. We've done the certification. Ideally, this would be open to all indigenous businesses. Again, together we are stronger, but I do believe that we've actually laid the pathway for what an indigenous institute would look like.

    Thank you.

    Am I good, Mr. Chair?

    You have one minute.

    Mr. Metatawabin, you're in the room, so I certainly want to provide you the opportunity to answer a question.

     You referenced this in your opening comments. Could you speak about the National Aboriginal Capital Corporations Association in a little more detail? Especially now that the conversation has begun, I think more detail would be helpful.

    Thank you.

    Thank you very much.

    Thirty-five years ago, the government recognized that indigenous people were not participating in the economy. One of the things they did is that they created a network of indigenous financial institutions on par with the Business Development Bank of Canada to encourage the economic growth of our community.

     They put together a program that provides some enabling programs to support indigenous entrepreneurs to access financing. What they found is that they couldn't get mainstream financing because of the systemic barriers, lack of generational wealth and the legislative barriers that continue to persist today, so they created a program with $240 million from government, and they've recycled it 15 times to $3.3 billion in lending from coast to coast to coast.

     We provide support to Métis entrepreneurs, Inuit entrepreneurs and first nation entrepreneurs. We've been doing this for 35 years. Some of our IFIs are celebrating 35 years of impacting the community.

    Thank you.

    Thanks very much.

    Ms. Vignola, you have six minutes, please.

    Thank you very much, Mr. Chair.

    My first question will be for Ms. LaBillois, but before I begin, I want to make it clear that I am going to name an act whose title makes my hair stand on end. I really don't like to say it. I think this act has always caused and is still causing enormous harm to first nations, and I deplore that. That said, it has to be named.

    Ms. LaBillois, in your presentation, you mention the difficulties and obstacles caused by the Indian Act. Since 1867, this act has treated first nations as minor children unable to make their own decisions and have full responsibility for them, especially on reserves. It's worse for people who want to start their own business because, as you mentioned, they don't have access to capital. It's especially difficult for businesses established on reserves.

    In a minute or a minute and a half, could you give us some more details on the problems that the Indian Act causes for first nations entrepreneurs?

    Thank you for your question.

    I also deplore that act.

     I will respond in English to speak faster, to answer in one minute. I'll give you two quick examples.

    One is the certificate of possession. I live on reserve. In my community, I cannot own the land according to this law. I can possess the land. I have a certificate of possession. Therefore, I cannot use the land that I own in the community against obtaining a loan.

    Second, if I am trying to obtain a piece of equipment, I must sign an affidavit. For example, I'm buying an excavator, which is in excess of $150,000 or $200,000. To do that, I must sign an affidavit that my equipment will not be stored in my community, that it will only be used for work off my community and it will always be off community, so that in the event of non-payment, the asset can be seized.

    I must ask permission from chief and council. Asking our elected politicians for permission to be running my business or for assistance with a ministerial loan I find very offensive, especially in 2022.

    Thank you.

    I'm trying to find the right exclamation. I hesitate among “wow!”, “disgusting!” and downright “yuck!”. I'm sorry. As you say, it's 2022. It's unacceptable that people are still stuck like this today.

    In your presentation, you bring up a potential solution for first nations to have better access to procurement, which is through the creation of a new indigenous-led procurement institution.

    How would this institution help indigenous people have better access to procurement?

    Let me begin by sharing with you the philosophy of “nothing about us without us”.

    How do I think an indigenous-led institute would help indigenous businesses access procurement opportunities from the federal, provincial and corporate organizations? An indigenous-led organization would have a sound knowledge of the landscape of indigenous economic reconciliation. It would have a sound understanding of the definition of indigenous wealth. It is indigenous businesses that hire indigenous people. This is an anecdotal truth that we see across our communities.

    We need to design our own institutions that are responsive to the unique realities that exist in Inuit, Métis and first nation communities, both on and off reserve. There is not a one-size-fits-all or a pan-indigenous approach. We have three different jurisdictional groups. We have different laws in place, as you have just mentioned with the Indian Act, applying to status Indians on reserve. There is a mishmash of regulations that are hindering our progress.

    We need our own people leading our own institutions to help drive indigenous economic reconciliation.

    Thank you.

     Do you also think that this procurement institution would make it easier for you to access capital, or would the Indian Act really need to be completely overhauled for that to happen?

     I don't think the priority of an indigenous procurement institute is to facilitate access to capital. That is work that we do that is continuing. Growing the skill sets and capacity of indigenous businesses in accessing procurement opportunities—that's where I see the importance of this institute.

    That's on the demand side. On the supply side of the procurement equation, the procurement institute would also be working with corporate Canada and with the federal government in ensuring that its procurement processes are responsive and realistic in meeting the needs of indigenous businesses to access these important opportunities.

    Thank you.

    Thank you.

    Great. That's our time.

    Mr. Johns, you have six minutes, please.

    Thank you.

     I also acknowledge that we're doing business today on the unceded lands of the Algonquin and Anishinabe people. I live in Nuu-chah-nulth territory in the Hupačasath and Tseshaht communities and nations.

    I'll start with you, Mr. Metatawabin. First, 50% of the population is indigenous in large areas of my riding. The 5% threshold doesn't work. It should be much higher. In Nunavut, 80% of the population is Inuit.

    Can you speak about how that needs to be fixed and adjusted? Maybe you can also speak about jurisdictions where there has been more success than Canada has had in terms of ensuring that the equity is fair when it comes to indigenous peoples and procurement.

    I think we have to recognize that Canada is very systemic in its exclusion of the indigenous community. As an example, today a building project in an indigenous community doesn't allow the indigenous community that has an economic corporation to even be eligible for that project, to bid and be successful in that project, so that the money would stay in that community and be socially impacting that community and those families. In my opening statement, I said that food security would be improved by half.

    We need to improve the services throughout. This is not a solution of procurement services Canada improving and enhancing its services to say that they can meet the target. It's a bigger problem than that. We need to change the way the system progresses. The example I use is the National Aboriginal Capital Corporations Association. Indigenous Services Canada used to deliver our program 30 years ago. Their loss rate was 75%. Our loss rate is 3%. That's an indigenous organization delivering to our own people. We have deep social connections to our people. We know who is in the community. We do our due diligence. We ensure that it will be a successful operation, because it's for our children's children.

    If you are looking at a procurement process that's going to be created by our people, we want to make sure that it's going to be successful. We are going to ensure that the right businesses are eligible. We're undertaking right now an indigenous business definition project to ensure that we have a new way of looking at what an indigenous business is.

    All these processes have to be linked together. We need to have, to go back to Ray's point, a data link to connect everybody's database to one database so that everybody can rely on it.

    Thank you.

    I appreciate that.

    Carol Anne Hilton is from my riding. She's from the Hesquiaht nation. She wrote a whole book on indigenomics. I've mentioned before how important her work is.

    Perhaps expanding on what you just talked about, can you please comment on how impediments for indigenous businesses accessing capital are creating obstacles to meeting the federal government's target for indigenous procurement and going beyond what their target is? Maybe you can share some of your thoughts on how access to capital can be improved.

     The systemic barriers that indigenous people face start with legislation, the Indian Act. There is still an act called the Indian Act, which makes me a ward of the state. I'm not even my own person. I'm basically a child of the government. We don't own our own lands on our communities. We can't take security. We don't have any generational wealth because we've been excluded from the economy for so long. Everybody was able to buy a house, but we were not allowed to buy houses. We don't have money that we can pass down to our kids, so we're basically starting from zero. We really need to ensure that we produce the access to capital.

     NACCA recently launched the indigenous growth fund. This is an institutional-grade investment tool that allows the private sector to invest in an investment vehicle that will, in turn, be accessed by our members, who can pass it on to our indigenous entrepreneurs. There is a vehicle for access to capital that will be perpetual into the future and will continue to grow. Investors and social-impact investors.... That is $35 trillion globally that we'll be able to earn in interest from our market. These are creating tools to plug into the indigenous economy.

    We're at the very infant stage of developing this indigenous economy; 300-plus court cases affirm our rights and title to our lands. Major projects, resource projects, the drive to critical minerals, are going go through our communities and our lands. The sooner government and corporations accept the fact that we need to be partnered with indigenous communities and create the conditions to allow us to participate, the more prosperous Canada will be.

    Thank you.

    Ms. LaBillois, do you want to also comment on access to capital and give us your thoughts on that as well?

    I do. I was just taking notes.

    I think what's important when we say we have challenges with access to capital.... I'm going to further qualify that and call it “access to competitively priced capital”. If I can obtain a loan at 11% but I'm lacking the financial literacy or the financial management competence to understand the importance of interest rates, my business is going to go under. We need to ensure that the capital we're accessing is competitively priced, in line with lending rates that are prevalent across Canada. That is one of the things I see challenged. We see different efforts to increase access for, say, indigenous women entrepreneurs or indigenous people in general, but we must keep in mind that it's not just access to capital. It's access to competitively priced capital.

    Thank you.

    Thanks, Mr. Johns.

    Mr. Barrett, you have five minutes, please.

    Thanks very much, Mr. Chair.

    Thank you to all the witnesses for joining us today.

    We'll start with you, Mr. Metatawabin, please.

    Has the government fulfilled its 5% commitment when it comes to IT contracting?

    I don't believe it has, no.

    I will just give the other witnesses the opportunity to indicate if their answers are different.

    Why don't we start with Mr. Wanuch, please?

    No. I think that's been cited a number of times, the lack of data. I couldn't tell you what the number is. I think we know where it should be, but there's a lack of data. It's not there.

    Okay.

    It's sad to say, but we can't give you an answer.

    Thank you.

    Mr. Ducharme, go ahead.

    Again, it's what Ray and Shannin said. There is no data that's available. You can't get that information from the federal government.

    Within our team, we went into Buyandsell Canada to search contracts to see if we could do it that way. However, 2018 was the last time it was publicly reported. Hopefully by December 2023 we'll have a better indication of where the federal government stands with indigenous procurement.

    Thank you.

    Finally, it's over to you, Ms. LaBillois.

    I don't have access to the data. I could not answer your question. However, I'm a storyteller. I want to tell you about using IT, as an example.

    Our board, the National Indigenous Economic Development Board, was seeking to update our website. Under the sole-source contracting, which I referenced in my opening statement about the $40,000 threshold, we were working with an indigenous-owned website development company that could do the work. Over the course of navigating this process—and you are aware of how costs have increased during the pandemic—we didn't meet that $40,000 threshold any longer. That eliminated the company, although it did all the initial work of trying to respond to the bid and complete this. We're still without an updated website, and we dragged this indigenous-owned company through the mud in trying to get there.

    Thank you.

     Thank you.

    We've seen many of the government's IT contracts go to a relatively narrow group of well-connected consulting firms. In some cases, the contracts are written in such a narrow way that only a couple of firms could fit those criteria and qualify.

    Has it been your experience that indigenous companies might not qualify for contracts, when, it seems, these contracts have been written with a predetermined outcome in mind? That is to say, one specific company is selected. Although it's presented like an open procurement, they've predetermined who will receive it, based on the narrow set of criteria they included in there.

    One or two of you folks could respond to that one. Then, I have one more question, if I have the time.

    I would like to respond to that question.

    Again, our research shows that indigenous businesses feel they are being excluded by the language of the RFPs that are coming through. The federal government has talked about unbundling contracts. Unless they start unbundling them and making it easier for our indigenous businesses to qualify, they're not going to meet the mandatory requirements. That, again, is an issue where we lose out all the time.

    There is, I think, some truth to what you're saying.

    I'm going to move to my last question, because I have about a minute left, I think.

     I will turn to you, Mr. Metatawabin, if I can.

    I'm curious whether you have any examples of jurisdictions with strong accountability programs to ensure governments follow through with their promises, with respect to procurement.

    I think a good example is Supply Nation in Australia. They created an indigenous organization that has done exactly what we're promoting today: creating an indigenous procurement institute. In the first year, when they targeted 3%, they achieved 9%. They achieved higher targets when they put the department's targets in the public realm, and this is what they are achieving on an annual basis. It was accountability by departments, to each other, that prompted everybody to get something done.

    Unless there are consequences to not achieving targets, there won't be anybody wanting to take drastic steps to ensure indigenous businesses achieve procurement opportunities. For 35 years, we've been talking about procurement opportunities for indigenous businesses. It's the frontline managers who develop the RFPs that exclude indigenous businesses. When you have an indigenous business that's actually eligible, they will go with what they know. That's a non-indigenous business.

    That is the big problem, right there.

    Thank you, Mr. Barrett.

    Mr. Bains, you're up.

    Thank you, Mr. Chair.

    Thank you to all our witnesses for joining us today.

    My questions are coming from the traditional territories of the Musqueam and Coast Salish peoples.

    I'm going to begin with Mr. Ducharme.

    Can you please tell us about recent developments in indigenous procurement in the natural resources industry, and the steps you've taken to help its development?

    I think the natural resources sector has led the charge on indigenous procurement in Canada. The Wood Buffalo region, especially, has been doing it for many years. In 2021, Suncor and Syncrude did a combined spend of $2.4 billion with indigenous businesses, which equated to, I believe, 17% of Suncor's overall spend and 27% of Syncrude's.

    It's happening across the country if you're looking at clean energy, as well. Some of our champions, including Ontario Power Generation, have publicly made targets. Hydro One has also publicly made targets. By making them public, they are opening themselves up to ensuring they meet them and working with our indigenous businesses. They do that through a number of different ways, even through indirect opportunities, where they bring in their prime vendors. These prime vendors are working with our indigenous businesses to grow the capacity and make them be suppliers.

    I think that sector has been doing it for a long time. They share some great practices. Suncor has spoken to Deloitte, another one of our champions, on how to increase it. I believe Deloitte has met its internal targets, as well, for indigenous procurement. I think, again, that the best practices that came through the natural resources sector can come through the rest of Canada, as well.

    Is there still room for improvement there? I imagine there is.

    There is. There's always room for improvement.

    Again, regarding that 5% in a previous question asked.... We were advocating for that 5% based on the indigenous population. However, in regions where the population is bigger, it should be higher. If you look at the Yukon government, their indigenous procurement target is 25%.

    We also look at indigenous businesses as a whole. Fifty per cent of our businesses are urban-based. If they are only working with the resources within that area, they are not helping that demographic. We want to ensure that, within the entire supply chain—not just where they are doing the work, but even in corporate offices—they are utilizing indigenous businesses for IT, for staffing requirements, or even for something as simple as catering.

     Thank you.

    Mr. Wanuch, can you tell us about your recommendations on indigenous business diversity for the future?

    I think it starts at home, allowing access to procurement. We've also addressed throughout this presentation the lack of finances, the lack of training. Our role is capacity building. We've been dealing with a number of federal departments to roll that training out in many ways to our members, whom we bring together.

    You've seen a number of organizations here at the table representing their own memberships. I think it's more about how we bring them together and work together. That's why I like the idea of a federated approach. You can still deal with your own membership in your respective area, but come together to share information and best practices, whether it's under the banner of a data lake, which I think should be considered, or other issues, such as training for procurement officers. I think this is how we have to come together for the betterment of our communities, our indigenous entrepreneurs and what we contribute to the GDP of this country.

    Thank you.

    Ms. LaBillois, I think you've spoken quite a lot about the challenges with the awarding of contracts to indigenous businesses, diversity measures and programs, and where the government can improve.

    Can you please share some areas you think the government has done well?

    I'm afraid it will have to be a brief answer, please.

    Luckily, it is.

    Where has the government done well in procurement? I think looking at the procurement program and going through this modernization exercise has afforded the opportunity to listen to many indigenous voices and their experiences with procurement. Creating a target is a good starting point.

    I know my colleagues have mentioned working within education and sensitization within the procurement delivery landscape within the federal public service. We've seen progress happening there, but it can't be exploratory; that type of education and sensitization needs to be mandatory.

    Thank you.

    Thanks very much.

    Colleagues, if you don't mind, I'm going to combine the last two rounds for the NDP and the Bloc.

    Ms. Vignola, you have five minutes.

    Thank you very much, Mr. Chair.

    Ms. LaBillois, I would like to ask you two questions that you can answer with a yes or a no. I would like to go back to one of your answers. You said that you had to seek permission from the board to establish and operate your business.

    Does being an indigenous woman increase the number of challenges you face in the entrepreneurial world, specifically in procurement?

    Yes.

    Thank you.

    Before attempting to solve the problems related to access to federal government contracts caused by the Indian Act, would it not be wiser to carry out a complete review of the act?

    Yes.

    Thank you.

    Mr. Metatawabin, earlier you listed the services that indigenous capital corporations provide to indigenous businesses. However, I am wondering about access to capital.

    Are the capital corporations able to offer interest rates as good as those offered by the major Canadian banks, for example?

     Thank you for that question.

     We're in the process right now of making sure that access to capital is something that indigenous entrepreneurs have. The organization I represent received $240 million 30 years ago and has recycled it 15 times to $3.3 billion in lending. They've never been able to take advantage of all the opportunities within their regions with adequate access to capital.

    In order to deploy money, you need to ensure there's an enabling environment to ensure you have deal flow. The Government of Canada created a program called “Aboriginal Business Canada” many years ago, which provides an equity contribution to an indigenous business that reduces the risk level on that loan. That has been highly successful. They've shown that for every dollar provided, there is $1.26 to $1.40 provided back to the treasury department. These are social impacts and returns to the government. It's an actual investment to invest in the indigenous economy: providing more enablers, tax incentives for investors and also the training capacity that Ray was talking about. It's very important to make sure that everybody has the training, understanding, knowledge and know-how to start a business.

    Being plugged into the procurement system needs to be improved, because they make it highly complex, and for indigenous entrepreneurs, some of the barriers they create make it highly complex to even get in the door. We just have to improve everything, and if we have that opportunity, this organization can work with the government to make sure we take down these barriers.

    Thank you.

    Thank you very much.

    My last question is for Mr. Wanuch.

    Mr. Wanuch, 18 years ago now, I supported Innu students in a major pan-Canadian indigenous entrepreneurship competition that was organized in conjunction with a section of the Business Development Bank of Canada that was committed to supporting indigenous entrepreneurs. I don't know if that section still exists or if it has changed its name, but the competition was called E‑Spirit.

    Throughout the year, the students would learn the different steps towards creating a product and a business. Then, at the end of the year, they would go to a location to share with first nations from across Canada what they had done and how they had done it. In our case, it was in Prince George, British Columbia, and it was amazing. I still get chills just thinking about it.

    Is this competition, or one like it, still going on to your knowledge?

    If it no longer exists, would it be wise to re‑establish it to encourage indigenous youth to go into entrepreneurship?

    That's a good question. I don't know if it still exists. However, I think there are variations of entrepreneurship going on throughout Canada. Shannin may be able to offer up an answer on that too.

     It's vitally important. I think where we try to come across is that it has to be in balance, meaning that, yes, you can have entrepreneurship, but when you're within our communities, it's more about job creation and sustaining a livelihood, rather than profit being the main motivator.

     I think there are options for that. You're finding communities going through the additions to reserve process now, or starting to develop profitable businesses in urban centres and taking those profits and bringing them back to the community for social programming and for educational purposes, such as becoming an entrepreneur or, in our case, an economic development officer, which all still brings it together. There are so many entrepreneurship programs for our indigenous youth, but there still have to be more specialized programs depending on the age and depending on the region and what industry they are in. We have to look at all of this.

    We're going to have our national conference out at Membertou next year. Look at Clearwater Industries and what happened there, where the First Nations Finance Authority was able to provide capital so that indigenous groups could buy out that corporation and have a lot of input into that local economy. There are examples like that one that we have to cite and continue the process.

    Thanks very much.

    Mr. Johns, we'll go to you.

     Colleagues, I hope you don't mind that I've been letting things go a tiny bit longer, because I think we're still hearing important things, so bear with me.

    Thank you, Mr. Chair.

    Ms. LaBillois, last June, Public Services and Procurement Canada indicated that over the previous three years they had awarded an annual average of $442 million to indigenous suppliers. In your opening statement, you indicated that indigenous businesses receive less than 1% of the value of federal procurement contracts, or about $68 million a year.

     Can you maybe share why you think there may be a discrepancy between what the government is reporting and what's actually happening?

     I cannot speak to what is causing that discrepancy. I can only speak to my experience in working with the procurement strategy. Since 2011, as I have tried to make this strategy work for my suite of different companies, I've seen that one of the initial challenges an indigenous business owner will encounter is the lack of projects deemed indigenous set-asides. Once an RFP is released, you can't turn back time and say that would have been a great opportunity for indigenous businesses to be competing for this work.

    There were also a number of qualifiers attached to how a project could be deemed an indigenous set-aside. One was related to the percentage of the population that was indigenous. Eighty per cent or the majority of end-users of the product, good or service had to be indigenous. Think of it as a funnel. If the projects aren't being deemed indigenous set-asides, we're starting from less than zero in getting our foot in the procurement door.

    Once a project is deemed an indigenous set-aside, there are additional barriers we encounter. One of my colleagues spoke about the problem of an indigenous-owned company not being able to obtain a bid bond just because they're located on reserve. In my humble opinion, once we get to this 5% of projects being deemed indigenous set-asides, that's going to be the stumbling block for us, in addition to problems with access to competitively priced capital and the systemic barriers that exist in the insurance industry and with bonding and banking.

    Thank you.

    In your opening statements, you mentioned that indigenous national economic development organizations are close to finalizing their business plan for an indigenous procurement institute. Mr. Metatawabin also talked about it.

    Can you speak about how the federal government can support such an institute in meeting its goals?

    I think one of the primary ways the federal government can support the development of this institute is through its financial support and endorsement of this organization. It is being designed by indigenous organizations that are coming together.

     It's truly a historic time for our people. I referenced in my opening statement the national indigenous economic strategy for Canada, which in itself is a historic document, because it's indigenous people holding the pen for the first time, stating with clarity what we want. And if we look at this indigenous-led procurement institute, this is a continuation of that exercise, with us stating decisively that this is what we want to move forward together.

    Thank you.

    Mr. Metatawabin, go ahead, please.

    Thank you for that.

    I think this is a historic time. In the United Nations Declarations on the Rights of Indigenous Peoples, the declaration the government has supported and created legislation for, article 5 says that indigenous people are best placed to provide services to their own people.

     By supporting institutions, we can plan and we can support. What we're asking for from the government is that runway to begin this process of planning and creating this institute so that it can create its mechanism, work with the government, advocate and hold accountable the departments that are not investing in providing services and contracts to indigenous businesses. It's important to hold everybody accountable, and that's the only way a change can be made.

    Thank you.

    I have a really short question, Mr. Wanuch. There was a conversation earlier about it really being procurement literacy and the challenges around the process and ensuring that people get the proper training to apply for procurement. Can you speak about the importance of that and what Canada could do better?

    Yes. There's a concierge process that we've talked about, not only for us with our database but also for NACCA and CCAB. We've also instilled a navigator approach and a mentorship program. A lot of our entrepreneurs are new to this game, and there needs to be a facilitation process. That's how we see our role—to facilitate and hold their hands.

     You talked about IT and how maybe there are only a few companies getting it. Well, maybe there has to be a set-aside there for new indigenous suppliers that are going to enter the process, and we will go along for that journey with them to make it fair and equitable for everybody in this procurement table.

    I think that as we evolve, procurement is going to evolve. I think we can provide that training for our procurement officers, too, so that they can relate to those entrepreneurs in smaller centres and where they come from, where they don't have access to capital and maybe where they don't have access to clean drinking water.

     We have to generate this whole process and facilitate it right to the end.

     Mr. Johns, thank you.

    Mrs. Kusie, you have five minutes.

    Thank you, Mr. Chair.

    Mr. Metatawabin, I want to go further on something Mr. Ducharme touched upon: entries into federal procurement contracts for indigenous businesses in certain sectors. In your opinion, what sectors are easier for indigenous businesses, and which ones are more difficult in terms of obtaining contracts?

    Through our 35 years of providing entrepreneurs with access to capital, indigenous entrepreneurs have covered all industries. Over the last 35 years, we've seen more service-type businesses, for sure, because we're in the community. We're providing service-type businesses—contractors, builders, transportation, food services—but we're gradually getting into the more complex, such as IT or professional services.

    Indigenous entrepreneurs will respond. Twenty years ago, the Government of Canada had this big drive for procurement, and it said there was going to be this big opportunity, so indigenous entrepreneurs invested time and money into accessing procurement. However, the government never responded by providing contracts to indigenous entrepreneurs, so they went back just to the market within their regions. They did not spend time going through the process of submitting any other contract requests through the Government of Canada.

    We need to do this right, because the market is there and they will respond in kind. They are waiting, willing and able. We just have to have the right enablers.

    I want to highlight that, over 35 years, the National Aboriginal Capital Corporations Association has seen a 70% decline in the support for its programs and services for IFIs. That eliminates the nice youth program that you mentioned. All these programs that were in place have been reduced to minimal levels.

    If we support it—and I said that it's an investment in our community—you'll see businesses ramping up and getting ready for this.

    Thank you.

    Thank you very much.

    Mr. Wanuch, I want to go to you, although as a Calgarian, I do take offence with your Edmonton Oilers sticker.

    Point of order.

    Some hon. members: Oh, oh!

    In your opinion, what about certain federal departments? Which ones are easier, and which ones would you say are more difficult?

    We love to work with all the federal government departments. We believe in relationship building. It takes time. We're not based in Ottawa. We have some people on the ground there, though. We love working with Indigenous Services Canada, with Natural Resources Canada, with PAC. I'm on a strategic committee with PAC.

    Believe me, I'm not answering for the other indigenous organizations, but it's been fairly easy for us to get a voice at the table with our partners. That what I call them. I like to view us as stakeholders, not rights holders. Those are our communities. Our communities now are coming to us and asking us to state these questions and draw out that information. Like I said, we just facilitate the process.

    To come back to the question, I haven't had a department that has said no to me yet.

    Thank you very much.

    Mr. Ducharme, I'll go back to you since you were the one who mentioned the activity of first nations in the natural resources sector. In your opinion, are there sectors that are easier for indigenous businesses and sectors that are more difficult for indigenous businesses to enter?

     Well, actually, it can be both. If you look at the construction industry, indigenous businesses have made a lot of strides in it, but there are also lots of requirements that sometimes indigenous businesses struggle to meet regarding insurance and regarding bonding that are a barrier to entry for them.

    With national defence, I have to say that Defence Construction Canada has probably led the charge. They actually go out to our indigenous businesses, a number of whom have called me to say that Defence Construction Canada has called them about an opportunity. I think they've been playing a big role in trying to increase it. The defence sector as well has been really promoting indigenous procurement to their prime vendors. I participated at a defence conference two weeks ago. All those big key players now are looking to bring in indigenous businesses because of the indigenous participation plans within the RFPs. I think that's an area our businesses will be able to come into.

    Again, indigenous businesses encompass every sector and industry across the country. We are so fortunate to hear of new businesses that are coming up and the innovative products and services they provide. We work with all levels of government. Any time we hear about any opportunity, we try to make sure that our indigenous businesses are aware of these opportunities.

    Thanks very much. That's your time.

    Thank you.

    Go ahead, Mr. Jowhari.

    Thank you, Mr. Chair.

    Welcome to all our witnesses. These have been great testimonies.

    During responses to a number of questions and also in your opening remarks, a number of you talked about economic reconciliation. I would be very interested in getting a better understanding of what you mean by economic reconciliation as it relates to indigenous procurement. Aside from the 5% and where we are now, what would you consider to be the building blocks of economic reconciliation?

    As well, how would your organization partner with the government to be able to make sure that we actually deliver? This is the message I'm hearing: We need to partner and we need to make sure that we deliver.

    I'll start with the first person I heard comment on economic reconciliation. I believe that was Mr. Metatawabin, please.

    Thank you very much for that question.

    I believe economic reconciliation is as simple as ensuring that indigenous people are part of the economy. We have faced many barriers, and we continue to face them even today. Access to capital is one of them. Having the right ecosystem to ensure that we can be part of this system, the right capacity, training programs, access to information, processes that are adequate for us to participate—those are all things that we need improved. Barriers that have been systemically put into place don't allow us to participate.

    I think if we can address all those areas and have an indigenous organization that represents all the partners around the table, with the witnesses today being part of that, it would ensure economic reconciliation.

    Thank you.

    Go ahead, Ms. LaBillois.

    It's a fabulous question. Thank you.

    I'll begin by saying that when I take a look around the landscape in this region—I'm talking about Gaspésie and Mi’gma’gi—we were not destined to be poor on our own homelands, but often we find ourselves as spectators to the regional economy that's happening around us. If I look to the industries that are active here, we have commercial fisheries and we have forestry. The latest we have is wind energy. Most often we've been watching people get rich off our land and resources. We have been excluded from it for various reasons.

    We've touched upon some of the systemic issues. We've touched upon some of the legislation that contributes to this exclusion from participating in regional economies. I also stated that it's indigenous businesses that hire indigenous people. This is what we need in order to support the creation of indigenous businesses and growth. This growth in building skill sets and capacity can be increased with a solid procurement policy.

    You asked about building blocks. I think a fundamental building block for us is indigenous financial literacy. We know that financial literacy is not taught in schools. If we look at our communities, and at what is non-existent in the business landscape, our people are accustomed to managing poverty. It's a mentality of scarcity. We need to shift that mentality to managing the abundance and managing finance through financial literacy.

    Thank you.

     Thank you.

    I only have about a minute and 15 seconds, so please be quick, Mr. Wanuch.

    It's training, navigating the system, facilitation, early engagement and mentoring. If the goal is to have an indigenous prime contractor in this country, we're going to need a lot of hand-holding, capacity development and reduced complexity of the whole process. I think that is going to help us.

    There are many different ways we might want to do this, but if you look around at what we're doing today—coming together and bringing our energies and skills from all the national organizations—we're going to chip away at this and get there.

    Thank you.

    The last 30 seconds are going to Mr. Ducharme.

    Go ahead, Mr. Ducharme.

    I think reconciliation is respect and having indigenous people as full partners in any type of development. Again, we've been on the outside looking in. We get bits and bobs handed to us. For true, meaningful reconciliation, we are sitting at the table.

    Look at all the different industries, as well. Economic reconciliation could also mean board members. Within the last two years, we've had three indigenous people assigned to boards, two with national banks and one with a national telecom company. Again, reconciliation is us being full participants and partners, not just customers.

    Thank you.

    Mr. Barrett, you have five minutes.

    I'm going to give my time to Mrs. Kusie.

    Mrs. Kusie, then, has five minutes.

    Thank you very much, Mr. Chair.

    Thank you very much, Mr. Barrett.

    Mr. Metatawabin, indigenous businesses are eligible for this procurement strategy if at least 51% of the firm is owned and controlled by indigenous individuals, and if the firm has six or more full-time staff, where at least one-third of the employees are indigenous.

    Do you agree with these eligibility criteria?

    Right now, we are in the process of fine-tuning that “indigenous business” definition.

    I think 51% is a minimum, but there are a lot of social impacts that would require that other firms be eligible. If they're making an impact in the indigenous community, there needs to be a mechanism to recognize those impacts. I think ISC is in the process, right now, of a short-term strategy that recognizes 51%, but then you have land claim processes and the social impact measurements, but yes.

    Do you believe these criteria should also be enforced on subcontracts?

    For ancillary and subcontracting, I think if there's a social impact in the indigenous community, that score should definitely be elevated.

    To expand on my initial question, do you think the enforcement of the criteria is useful and effective?

    I don't believe it is, right now. I think we can do a better job of ensuring we have the right definition and accountabilities, and the mechanism to select and provide contracts that are actually with indigenous businesses.

    Thank you.

    Mr. Ducharme, would you like to weigh in?

    Yes. Actually, as of August 2021, the requirement of a third of the workforce, if there are six or more, has been lifted. This helps our indigenous businesses as they grow, especially in certain sectors, where it's hard to keep up that resource of a third of the employees being indigenous.

    Indigenous businesses were the only ones held to account for this by the federal government in any of their social procurement or platforms. That requirement was not there for a woman-owned business that only had male employees. Hers was still considered a woman-owned business. If a minority-owned business has non-minority employees, they are still.... Again, that was an extra level imposed on indigenous businesses.

    It is a bit contentious, but when indigenous businesses have the opportunity, we are going to hire our own people. I think it's up to us to determine that, not the federal government saying we're not a business if we don't meet that third. I think that has been eliminated.

    Thank you for the clarification, and I apologize for being incorrect in missing that.

    Madame LaBillois, in the departmental results for 2021-22, Public Services and Procurement Canada increased the percentage for participation in procurement processes by businesses owned by indigenous people. Pardon me, but I'm getting to the point. The result was a 4% decrease in participation.

    Why do you think that is?

    I think surviving the pandemic was a challenge for everybody, and the accessibility of some of the tools put in place by the federal government for businesses during the pandemic may not have applied to indigenous businesses.

    I'm not saying this is the blanket reason, but look at the tremendous amount of resources that go into responding to an RFP. It's an opportunity cost. As an entrepreneur, where are you going to put your time and resources? If you put them into responding to an RFP and you're not successful, and not even getting feedback as to why you're not successful, are you going to apply again? You need to determine where the best investment of time and energy is. Perhaps it's not in the procurement strategy, as it exists today.

    Thank you.

     Thank you.

    What do you think the government is not doing to increase the participation?

    I think there are two things. One of them I just mentioned, which is creating those relationships with indigenous businesses through procurement and PSIB coordinators who exist in all departments. If they don't know about indigenous businesses that exist, we're not going to get projects deemed as set-asides through the procurement strategy. It's about relationship building, decentralizing this, having boots on the ground in different regions and understanding what the indigenous business community looks like.

    Second, it's about giving feedback, mentoring and having to navigate that response to RFPs.

    Thank you.

    I think that's our time.

    Mr. Kusmierczyk, you have five minutes.

    Thank you, Mr. Chair.

    Thank you so much to all the witnesses for this tremendous conversation. I wish we could continue this the entire day, to be honest with you. These are tremendous insights, so thank you for that.

    Mr. Ducharme, I think you mentioned in your testimony that the natural resources sector was leading the charge in indigenous procurement. Are there other sectors that you see as primed right now with tremendous opportunities for growth in indigenous services and procurement?

    Again, I said national defence. I think if you look at the spending and all the work that's coming on through national defence and with the shipbuilding and all of those opportunities, there are great opportunities for indigenous businesses. My fellow presenter Victoria knows well about some of the opportunities that come in within the shipbuilding that was going out to Atlantic Canada. Again, when you look at indigenous businesses, a large portion of our certified indigenous businesses are in the IT sector. There are opportunities in there.

    Again, indigenous businesses are all over the place. We can't be pigeonholed by saying that we're only in natural resources or all in one area. Indigenous businesses are very resilient and innovative. I think that with the correct tools and help from the federal government, we'll be able to be full participants in every procurement opportunity the federal government brings forward.

    I appreciate that.

    When I was working for a regional innovation centre back home in Windsor, I was proud to spearhead an initiative called “Supporting Aboriginal Youth Entrepreneurs in Windsor and Essex”. It was a wonderful initiative. From that initiative, we saw how important networking and mentoring opportunities are.

    Can you talk a bit about the programming CCAB has to support young indigenous entrepreneurs, and whether there's a special role the federal government can play in helping to nurture young entrepreneurs in the indigenous communities?

    Previously, we were focused on entrepreneurs regardless of whether they were young or seasoned. We are getting more input from young entrepreneurs who are coming. We work with JEDI, which is a joint economic development initiative based out of New Brunswick.

     We spoke last week to a forum of young entrepreneurs who are starting their businesses, and we work with them. We also provide young entrepreneurship awards, and I think that's really helpful to indigenous businesses. Any time our people can be recognized for the success we've had, it makes us proud to see someone who looks like us succeeding and making a difference.

    We provide grants to small businesses. A lot of them go to the young entrepreneurs. They're small grants. We've been fortunate enough to get funding from our corporate members. It's a $2,500 grant. We're lucky that the grants that have been given to us allow the indigenous businesses to spend so much time programming our grants.

     There are a lot of requirements or barriers to what they could utilize that money for. I think the partners we have realize that indigenous businesses know what they want. If you're going to say that we can spend this money but we can only do that, is it really beneficial to our businesses?

    We work. We do networking. Networking is the most important thing. The more you can get out there, the more confidence you can build. It's hard to get a contract over the telephone. You build that relationship and it's going to grow over time. Networking is something that's very important, and we really want to promote our indigenous businesses.

     An area we really want to focus on is young indigenous entrepreneurs. The federal government can help. They can provide programming and support. We're not a government-funded organization. We get some project money, but overall, it's hard. Resources are limited out there, but I think the federal government can step in and do more.

    You mentioned the role of—

    I'm afraid that's our time, Mr. Kusmierczyk.

    Thank you.

    Mrs. Kusie, you have three minutes, then Mr. Housefather has three minutes, and then we'll finish up.

     Thank you very much, Chair.

    I'm going to go back to the departmental results for 2021-22 and go to Madame LaBillois.

    We talked a bit about what the government should have been doing to ensure levels didn't decrease. As well, we had the input there from Mr. Ducharme, but it also notes in the departmental results that there wasn't even a target to increase participation by. Do you think setting a target would be beneficial, Madame Ms. LaBillois?

    Absolutely, and the target, I believe, should remain a floor rather than a ceiling.

    For instance, we know that the rollout with the modernization of the procurement strategy will happen over three years. During some of these discussions, certain departments were prioritized. My question at that time, when we were talking about prioritizing departments, was, how are priorities determined? It was linked to those departments that were most ready to increase their indigenous spend.

    I refuted this by saying: “Well, what is there at these departments? What is the proximity to indigenous communities and indigenous businesses across the country?” It was more about satisfying a department's readiness than it was about proximity to projects where departments would be spending and that indigenous businesses could access. Who we are trying to accommodate with this new policy, I think should be one of the questions we ask ourselves as we move forward.

    What do you think is the impact of not setting a target?

    If there's not a target set, at the end of the year we say, “Oh well, we tried.” How did we try? I think if you have benchmarking, reporting, tying this to bonuses and shedding a light by having a department-by-department reporting mechanism in place, it will highlight to us where the issues and challenges are and where we can focus our attention.

    What target do you think Public Services and Procurement Canada should be setting?

    Could we have a very brief answer, please?

    Look at the indigenous population of the region and set it accordingly.

    The Chair: Thank you—

    Chair, are you sure? I wanted to go back to the Oilers game—

    Voices: Oh, oh!

    Mrs. Stephanie Kusie: Thank you.

    Delete that from the record, please.

    We have Mr. Housefather for three minutes, please.

    I thought it would be the Flames. I'm confused. I think we can all agree the Canadiens are the best team.

    First of all, thank you so much for coming, everybody.

    Ms. LaBillois, I wanted to ask a couple of questions about something that you answered before. You talked about self-identification and the problems related to self-identification when it comes time to determine what is an indigenous business that should be considered in the 5%.

     Can you talk to me about how you would like to have indigenous communities agree, perhaps, on what should be done beyond self-identification?

    Yes.

     As my colleague Shannin mentioned, we have developed a definition of indigenous businesses, and we are going through our own organizations to engage and make sure everybody is on board with this, but essentially it's looking at our communities from a community perspective: We know who our people are.

    The cost of false indigeneity or companies that can access projects that were set aside for indigenous businesses is huge. It takes up space that was created for our businesses. Most often, these shell companies aren't looking to hire our own people. Furthermore, the wealth that would accrue from this contract isn't returned to the indigenous community.

     It's a pervasive problem. We're hearing about it across academia, within the public service and within businesses. It's out there and it's problematic.

    I acknowledge that, and I agree.

    May I ask another question? Should there be some mechanism...? Right now, we're talking about who owns a business. Should there be some reward or some mechanism where businesses are also judged on the number of indigenous people they hire, so that it's not just “I own a business and I don't hire any indigenous people, but it's an indigenous-owned business”. Does there have to be some reflection also of the percentage of the workforce that is indigenous to make sure that a business makes an effort to actually employ people from the community?

     I would say that this would create a further barrier to us. As the point was made earlier, for women-owned businesses, if they don't hire women, they are still considered women-owned businesses. It's the same for a minority-owned business. If we're telling an indigenous-owned company, “We're not going to deem you an indigenous-owned company because you didn't hire enough indigenous people”....

    Also to the point, I'll talk about difficulty accessing them. Say you're hiring a project engineer. These would be in very high demand in the indigenous community, and if I couldn't hire an indigenous engineer or project manager, that's an additional barrier to me.

    I know I'm almost finished, but let me just mention that wasn't quite what I was mentioning. I was talking about that in a system not related to indigenous-owned businesses but to all businesses in terms of tenders offering additional points for having a diverse workforce, including indigenous peoples. That's what I meant.

    Thank you so much.

    Thank you, Mr. Housefather.

    Witnesses, thank you very much for joining us today. Thank you for your feedback. As I mentioned, we have studied this before in this committee, but we've heard a lot of new things today. I've heard a lot of new things today, so it was very valuable. I really appreciate everything you've shared with us today.

    We are done with this study portion. We're going to go on to some committee issues.

    Witnesses, you're welcome to sit and listen to us vote; otherwise, you can sign off.

    We're staying public, colleagues.

    Today is the last day of the committee. We can vote on the supplementary estimates (B) and report them back to the House. In all, there are nine votes in the supplementary estimates (B), 2022-23 referred to this committee. Unless anyone objects, I will seek the unanimous consent of the committee to group the votes together for decision.

    Do we have that consent, please, to group them all together?

    Some hon. members: Agreed.

    (Vote 1b agreed to on division)

    (Vote 5b agreed to on division)

    (Vote 1b agreed to on division)

    (Vote 1b agreed to on division)

    (Votes 1b, 10b, 15b, 20b and 25b agreed to on division)

    The Chair: Thank you.

    Shall we report them to the House?

    Some hon. members: Agreed.

    The Chair: Wonderful. Thanks very much.

    There's just one other item, the Governor General's travel expense study. The deadline for submitting the next group of documents is Sunday, January 15, 2023. I'm not sure why we picked a Sunday, but there we have it.

    There's also no specific time on January 15 when the documents are due. Obviously, it's difficult to submit them on a Sunday. I'm wondering if we wish to change that to an alternative date, perhaps January 16, and a specific time, such as noon. Are you good with January 16 at noon?

    We could change the date to January 16, 4 p.m. or noon; I don't see a problem with that. If we had until 4 p.m., that would give us all day to—

    On the 16th, at 4 p.m., seems like a great idea to me.

    On the 16th, at 4 p.m.— That sounds good.

    It's perfect: 4:00 p.m. on Monday, January 16. I know Mrs. Vignola will be here waiting for them.

    Does everyone agree?

    Some hon. members: Agreed.

    The Chair: Wonderful.

    Is there anything else? Otherwise, we'll be adjourned.

     We are adjourned.