Imagine two small Ontario towns. One is a reserve that blocks an outside investigation into its $31.2 million annual operating budget. That town, Attawapiskat First Nation, has 1,549 people on the reserve according to the last census.
Now imagine another town, a non-Native one, where recent budget estimates peg its annual operating expenditures at $8.4 million. That’s the township of Atikokan, near Thunder Bay, with 3,293 people.
Follow the money
Careful readers will notice that the larger town, Atikokan, has a much smaller operating budget than does Attawapiskat.
What’s additionally curious is where the money is spent. According to Attawapiskat’s latest budget documents, $11.2 million went to salaries, wages and employee benefits. That equates to $7,249 per reserve resident on just compensation-related expenditures.
In contrast, according to the latest available estimates from Atikokan, that town spends just under $3 million on salaries and benefits, or $904 per person.
Part of the Attawapiskat difference might be explained by education-related expenses (which Atikokan doesn’t have). Unaudited financials from the reserve note $5.5 million is spent on education-related compensation. But even with that expense figured out, the per capita expense is $3,690 per person on reserve.
However, the town of Atikokan also has expenses which the Attawpiskat reserve does not: $3-million in transportation and environmental expenses according to its budget, only some of which will end up in the “compensation” category (the new budget doesn’t break it out; one will have to await post-budget audited statements). Also, for the record, both towns spend money on housing, health, social and cultural services.
Perhaps a clearer contrast between the two towns emerges when the cost of politicians is compared. In Atikokan, (for the fiscal year ending in December 2009), the mayor’s salary was $7,713 with travel expenses of $4,268. The total cost to taxpayers was thus just under $12,000. In fact, total salaries and expenses for Atikokan’s mayor and seven councillors was just $46,691.
On the Attawapiskat reserve (for the fiscal year ending in March 2010) the chief’s salary alone was $51,803. In total, salaries for Attawapiskat’s chief, deputy chief and 18 councillors that year amounted to $386,129. With $28,535 in expenses, the total cost to taxpayers was $414,664. In the next fiscal year, that cost jumped to $615,552 - a 48 per cent increase.
The Attawapiskat-Atikokan comparison isn’t the only useful contrast.
Consider other northern Canadian towns that are also not reserves. In 2010, the northern Alberta town of Athabasca, with a population of 2,575 had an operating budget of $5.5 million. It spent just over $1.6 million spent on wages and benefits for all city staff, council included. That crunches out to just $644 per Athabascan.
Or how about Valemount, in northern British Columbia? That village, with 1,018 people, had an annual operating budget of $3.2 million in 2010. It paid out $811,852 in compensation-related expenses, or $797 per capita.
Such comparisons should be remembered by everyone when Chief Shawn Atleo from the Assembly of First Nations, and Attawapiskat chief Theresa Spence mount the rhetorical barricades and urge everyone to move on without “assigning blame,” which is a dodge, or when they blame “colonialism”.
Such facts should be remembered by anyone concerned about Canada’s First Nations reserves and their too-often sub-standard shape. What’s clear is that a lack of money isn’t the problem. Rather, it’s how that money is spent.
With the exception of obvious short-term help for the people of Attawapiskat in winter - to make up for past monies that were spent on a large bureaucracy instead of housing - more money won’t solve anything.
Instead, a long-term strategy is needed with the following elements: accountability for money spent; eventual transfers directly to individual natives with money then taxed back for band services; property rights for individual Natives on reserves which would help foment accountability, entrepreneurship and pride.
Time to get real
Finally, realism is needed about the fact so many reserves are not economically viable. For the last two centuries, people around the world have moved from rural areas to the cities. Similarly, many people on reserves (mostly in rural areas) need to find their way close to educational, economic and social opportunities closer to major population centres, if not for themselves, then certainly for their kids.
Such opportunities are why the majority of First Nations people, 57 per cent, already choose to live off-reserve.
The challenge for politicians, native and non-native alike, is to remove existing incentives for people to stay on remote reserves, and to provide transitional help those same people move closer to opportunities.
Mark Milke is a Senior Fellow with the Fraser Institute and author of Life is better in the Cities, which compared economic and social indicators on reserves to urban Canada.
By Mark Milke
Senior Fellow, The Fraser Institute
Troy Media