Writing in the National Post, Macdonald-Laurier Institute Senior Fellow Ken Coates says the election of Perry Bellegarde as the Chief of the Assembly of First Nations will make expectations for resource revenue sharing the norm across Canada.

Ken Coats

Resource revenue sharing involves the transfer of wealth federal, provincial, territorial governments derive from natural resource projects to First Nations. This is in addition to funds they receive directly from resource companies.

Coates also spoke to the Regina Leader-Post for a story on the issue.

Coates is the author of a forthcoming MLI paper examining resource revenue sharing with Aboriginal peoples.

By Ken Coates, Dec. 15, 2014

Assembly of First Nations National Chief Perry Bellegarde, elected on Wednesday, has made his priority clear: “To the people across the great land, I say to you, that the values of fairness and tolerance which Canada exports to the world, is a lie when it comes to our people.” The national chief then declared that First Nations expected a far greater share of the country’s prosperity: “To Canada, we say, for far too long we have been dispossessed of our homelands and the wealth of our rightful inheritance.”

To most Canadians, Chief Bellegarde’s statement seems provocative, if not radical. Conditioned to believing that First Nations simply stand before the government of Canada, cap in hand, demanding additional funding, the general public likely looks on the latest call to action as yet another money grab. It is nothing of the sort.

The national chief, in calling for aboriginal people to receive a “rightful” share of the country’s prosperity, is asserting the First Nations’ expectation that resource-revenue sharing will become the norm across Canada. Only a few decades ago, such an argument would have been rejected out of hand. Governments provided a variety of social welfare, housing and other payments, a process that cost the Department of Indian Affairs a great deal of money but did little to address the underlying socio-economic needs of aboriginal communities.

First Nations wanted something different. They believed, as Bellegarde himself has said many times, that the historical treaties only transferred land “to the depth of the plough,” leaving the question of control of the wealth below the surface unresolved. In non-treaty areas, where First Nations’ claims to the land and resources remained unresolved, it seemed obvious to aboriginal people that they deserved a share in the natural bounty of their territories.

In recent years, federal, provincial and territorial governments reconsidered their earlier stance and instituted several forms of resource-revenue sharing. The concept is simple: Governments receive financial benefits, in the forms of royalties, from companies developing natural resources. The governments, in turn, allocate a portion of the resource revenues to one or more First Nations. In this way, First Nations become beneficiaries of economic development on their traditional territories. These funds are on top of financial, employment and business-development agreements negotiated with the resource companies.

Although Bellegarde is undoubtedly thinking of a much higher return on mining and energy projects than that included in the current arrangements, the reality is that resource-revenue sharing exists in much of Canada. While the historical or numbered treaties are silent on revenue sharing, modern accords signed in British Columbia, Yukon, Northwest Territories, Nunavut, Quebec and Labrador include wealth-sharing arrangements. In British Columbia (where most of the province is not yet covered by a modern treaty), the provincial government has agreed to project-by-project revenue sharing. The Northwest Territories, having negotiated devolution of resource control from the federal government to the territory, agreed to share a substantial portion of their resource revenues with aboriginal governments. Clearly, resource-

revenue sharing already distributes millions of dollars to First Nations and Inuit communities across the country.

There are gaps. Saskatchewan and Alberta — both resource-rich provinces — do not yet have revenue sharing arrangements. They argue that aboriginal people benefit from the general social and other spending in the province. Manitoba has indicated a willingness to consider a new approach. Ontario, reeling from the collapse of the Ring of Fire mining project, is working closely with northern First Nations on different arrangements. The Maritime provinces, which have neither historic nor modern treaties and no comprehensive resource-revenue sharing with First Nations, face demands for proper agreements.

Canada has started down the road that Bellegarde supports. The steps, large compared to where the country was 40 years ago, are small compared to where First Nations expect the country to be. First Nations have legal reasons to expect more. The 2014 Tsilhqot’in decision by the Supreme Court greatly enhanced the strength of aboriginal territorial rights in non-treaty areas. Similarly, as governments exercise their constitutional “duty to consult and accommodate” requirements, they face increased pressure to satisfy aboriginal demands. These powers, combined with broader First Nations legal and constitutional rights and untested indigenous claims related to the historic and numbered treaties, give aboriginal people considerable authority.

The current resource-revenue agreements emerged as a result of unrelenting aboriginal pressure for an appropriate financial return from Canadian resource development. Resource-revenue sharing, where implemented, has brought neither explosive aboriginal wealth nor chaos on the development frontier. While some communities have struggled to capitalize on financial opportunities, most have used the revenue constructively.

The rapid rise of joint ventures, indigenous equity investments, the expansion of aboriginal development corporations and other measures, indicate the potential for positive results on resource extraction on First Nations’ territories. National Chief Bellegarde is right to point to prosperity sharing as the foundation for a new and lasting relationship between Aboriginal people and the rest of Canada.

Ken Coates is a senior fellow with the Macdonald-Laurier Institute and author of a forthcoming research paper examining resource revenue sharing with aboriginal peoples.

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