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Ken Coates is a distinguished fellow and director of the Indigenous Affairs program at the Macdonald-Laurier Institute, and a Canada Research Chair in Regional Innovation at the University of Saskatchewan.

Despite a decade of dramatic increases in federal funding for Indigenous affairs, a damning report from the Parliamentary Budget Officer released in May revealed a gaping disconnect between the government’s aspirations and the amount of money spent on the one hand, and the actual consequences on the other.

Put bluntly, Canada is not getting what it is paying for – and what’s worse, the massive spending is not improving lives in Indigenous communities.

The PBO’s report on Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) and Indigenous Services Canada (ISC) summarized the situation succinctly, in the passion-free language that defines Ottawa’s civil service: “The increased spending did not result in a commensurate improvement in the ability of these organizations to achieve the goals that they had set for themselves. Based on the qualitative review the ability to achieve the targets specified has declined.”

The government can and does change up targets and metrics, making it difficult to determine actual outcomes. But given the vast expenditures, such a conclusion is tragic.

Canadians have become numb to reading about public expenditures on Indigenous peoples, much as they have to federal spending generally. Routine announcements of millions or billions of dollars for Indigenous initiatives, court settlements, compensation payments and on-reserve infrastructure have dulled many Canadians’ sensitivities. Instead, many of us have grown to see the spending of public funds as evidence of affection: If Canada spends billions on Indigenous affairs, it must mean that we care deeply about First Nations, Métis and Inuit peoples.

But it does nothing of the sort. While headlines emphasize dollar amounts, the statistics that tell the actual story of Indigenous well-being – around employment, health, housing conditions, suicide rates, violence and imprisonment, language, cultural revitalization – are much more sombre. When spending vast sums fails to make a substantial difference in many communities, the federal response is too often to double down and spend even more, in the absence of understanding what actually works to improve the lives of Indigenous peoples.

In recent years, there has been a great deal of long-overdue attention focused on residential schools, but the schools were just a vehicle for a broader and more pernicious force: state paternalism. And Canadian governments have revealed that they have a problem with stepping away from it.

After the Second World War, in a surge of well-intended social engineering, successive governments concluded that more intervention was the solution to Indigenous living conditions. Forced relocations, reserve housing that was substandard from the start, intrusive education, bureaucratic oversight and targeted federal programs (among other initiatives) gave the state enormous authority over Indigenous lives.

Welfare dependency, one of the greatest curses inflicted on Indigenous peoples, was an almost-inevitable result. Government payments often displaced Indigenous work, disrupted families and social relations, encouraged migration to larger centres, and asserted bureaucratic domination over communities. In the early 1950s, the number of Indigenous peoples collecting welfare in its various and emerging forms was small; by the 1970s, thousands of Indigenous families were wedded to regular government support, while also facing marginalization and discrimination if they attempted to work in the mainstream economy.

Government funding comes with multiple strings attached, not the least of which is forced adherence to federal dictates. Securing government funding also requires a great deal of precious staff time, not just in applying for grants but around reporting expenditures and outcomes. Federal priorities take precedence over Indigenous preferences, distorting community initiatives and prompting the grovelling for funds to become part of Indigenous governments’ processes. Indeed, individual dependency has become Indigenous government dependency, though many communities are resisting that transition today through creative economic development strategies.

As the Auditor-General and Parliamentary Budget Office have frequently shown, far too little attention is paid to medium- and long-term outcomes. What often matters most to the federal government is whether the money was spent on time and according to budget, even if community needs and shifting priorities would have seen the funds better spent elsewhere. As Canada has shown repeatedly over the past 40 years, governments can spend a lot of money and achieve mediocre or even terrible results – typically sparking more spending to solve those new issues, rather than fundamentally re-examining whether state funding was really needed.

Moreover, Canada’s collective management of Indigenous affairs is marked by a consistent failure to monitor the effectiveness of major cash infusions. There has been little post-hoc investigation into whether multibillion-dollar compensation packages have positive financial and social effects, and major collaboration agreements with corporations too often go unexamined; the same is true for postsecondary funding, language revitalization supports, counselling interventions, land-claims agreements and the like.

Some federal expenditures do work – college and university funding, along with modern treaties and self-government agreements, appear to have solid outcomes. But others appear to do little more than paper over continuing Indigenous crises, and worse, we don’t really know, because we don’t research them enough.

Governments are not particularly good at dealing with truly wicked problems – that is, complex and multi-dimensional issues. Canada and the global community are discovering this on climate change, to our collective dismay. The crises in Indigenous communities reflect a vast array of processes – including occupation of lands and Indigenous dispossession, racism, colonialism, assertion of cultural superiority, technological transitions, religious dominance, political marginalization and economic transformation. It is unreasonable to believe that a set of government programs, however well-funded and well-meaning, will in a short period of time address all of those highly disruptive forces.

Given the failures of state programming toward Indigenous autonomy, the country – which apparently has learned little from the residential school revelations – must listen more intently to Indigenous peoples. The message from their political leaders is simple: They need and deserve greater autonomy. Government funding must continue, or even expand, but Ottawa’s strings must be cut. Indigenous governments are best suited to defining their most urgent needs and priorities, spending the money and reporting publicly to the audience that matters most: their members. Federal bureaucracies, including but not limited to CIRNAC and ISC, need to be dramatically reconceptualized and restructured.

The predictable pushback to such a strategy would be the hoary claims that Indigenous groups are less than forthcoming in terms of financial accountability. But the reality is that few Canadians appreciate that most First Nations are extremely open about their financial affairs, and candidly discuss small details of budgets, salaries and expense accounts with members. Still, since the funds are provided by the Canadian public, a legitimate measure of accountability is required by the federal government. This could be achieved through an Indigenous auditor-general providing annual reporting to Parliament.

In clinging to its traditional approach, Ottawa could triple its Indigenous affairs spending tomorrow, and still not see a miracle turnaround in Indigenous social, cultural and economic conditions. Or it could do something much more difficult and meaningful: admit the failure of the state-driven approach of the past 70 or even 150 years, trust Indigenous communities, and transfer real authority to First Nations, Métis and Inuit governments.

Changing the core fabric of this relationship will take years, if not decades, but it is clearly time for Canada to start. Chronic problems demand dramatic, transformative approaches. Indigenous peoples know what is best for them, and are the only ones who could oversee such a successful revitalization.

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