Transparency and Accountability in First Nations Governments
VANCOUVER— Data from the 2024/25 fiscal year shows 59 per cent of First Nations in Canada are not meeting the requirements of the First Nations Financial Transparency Act, and non-compliance has increased substantially from almost zero (near complete compliance) in 2014/15, when Ottawa stopped enforcing violations, finds a new study published by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
“Financial transparency and accountability are paramount in any government to ensure honesty, which is exactly what the act was meant to achieve within First Nation communities,” said Tom Flanagan, a senior fellow at the Fraser Institute and co-author of Transparency and Accountability in First Nations Governments.
The First Nations Financial Transparency Act was introduced in 2013 by the federal government to enforce financial accountability and public transparency of finances handled by First Nations bands across Canada. It required First Nations chiefs and councillors to publish audited financial statements so that they were made easily accessible by the public. Moreover, the federal government intended the disclosures to help ensure that money provided by Ottawa was used for its intended purposes by First Nations.
Although the act remains in place, the federal government stopped enforcing reporting violations in 2015, which kickstarted a rapid decline of compliance among First Nations.
In fact, as of 2024/25, 59 per cent of First Nations are not meeting disclosure and financial reporting requirements. The absence of enforcement of the act means there are virtually no financial consequences if leaders within First Nations governments do not complete the required financial audits.
Crucially, the amount of monies provided to First Nations by Ottawa is not insubstantial. In 2024/25, for instance, Ottawa spent over $32 billion for Indigenous groups across the country.
“First Nations people themselves need to lead the process of amending this fiscal transparency legislation so that it better suits the level of increased investment and funding First Nations across Canada have been receiving from government,” Flanagan said.
“By meaningfully updating and enforcing this legislation, Ottawa could encourage greater compliance in First Nations fiscal reporting and restore trust in how taxpayer money is being used.”
Media Contact:
Tom Flanagan, Senior Fellow, Fraser Institute
To arrange media interviews or for more information, please contact:
Erin Clemens, Fraser Institute
604-688-0221 ext.615 erin.clemens@fraserinstitute.org
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