Grand Chief Abram Benedict addressing reporters at the Chiefs of Ontario First Nations Community Wellness Conference, March 19, 2024. Photo courtesy of Declan Keogh / Chiefs of Ontario Listen to article
Canada’s National Observer: The Indigenous loan guarantee program will have no green strings attached, opening opportunities for controversial development like oil, gas and nuclear projects.
Details of the program, announced in Tuesday’s federal budget, answer questions dogging the program since it was announced last fall in a mini-budget.
The federal Indigenous loan guarantee program will be worth up to $5 billion and will be “sector agnostic,” meaning any sector can be developed, the latest budget revealed.
A finance official told Canada’s National Observer that the decision reflects Ottawa’s commitment to economic reconciliation and self-determination. In practice, the decision avoids telling Indigenous groups how they must pursue their economic development, which historically was the case.
It is designed to even the economic playing field by ensuring First Nations and other Indigenous groups can access loans from banks through a guarantee from Ottawa. Loans were previously hard to secure for Indigenous groups.
The program can also work in conjunction with similar Indigenous loan guarantees in Ontario, Alberta, Saskatchewan and most recently, British Columbia, increasing the amount of capital available for Indigenous economic development.
The contribution by Ottawa will also lower interest rates on loans for Indigenous developers by leveraging Ottawa’s AAA credit rating, which is the highest available.
“This is economic stimulus,” a finance official said, noting that Indigenous resource development should not be limited by credit, capacity or sector parameters set by Ottawa.
The program will cost $16.5 million over the next two years and will be administered by Natural Resources Canada. The monies will support capacity in Indigenous communities and organizations to ensure they can develop and apply for the loan guarantees.
The federal Indigenous loan guarantee program will be worth up to $5 billion and will be “sector agnostic,” meaning any sector can be developed, the latest budget revealed.
Budget 2024 did have some carveouts for clean development, with $36 million over three years to renew the Strategic Partnerships Initiatives’ Clean Energy program.
Climate adaptation gets $100 million less for fire season
In the wake of last year’s wildfire season, Ottawa spent $260 million on response and recovery measures within Indigenous communities.
That amount was far greater than the $145.2 million in budget 2024 that Ottawa committed to spend over five years to develop greater climate resiliency.
The new funding will help Indigenous communities develop greater climate resilience through climate-adapted infrastructure and mitigation strategies, such as fire-retardant siding and roofs, as well as funding for emergency management co-ordinators within communities.
The funding will be administered through existing programs like FireSmart and the emergency management assistance program.
Budget 2024 continues the practice of not building the forecasted financial burden of this year’s wildfire or flooding seasons into the funding, the finance official noted. Instead, the cost of emergency recovery and response for this year’s wildfire season will emerge in the Fall Economic Statement.
Infrastructure gap and on-reserve housing neglected
Ottawa is also committing $918 million over five years, starting in 2024, to narrow the First Nations, Métis and Inuit infrastructure gap, some of which could be used for climate mitigation, a finance official said.
However, development will be at the discretion of First Nation, Métis and Inuit leadership, the official said. Some may want to invest in climate-adapted infrastructure, while others may choose to build as much housing as possible.
The investment goes part way to closing the infrastructure gap by 2030, as promised by Indigenous Services Minister Patty Hajdu. However, it is less than the $349.2 billion a recent report by the Assembly of First Nations said was needed.
Meanwhile, another $75.1 billion is needed to close the infrastructure gap in Inuit Nunangat and $2.7 billion is needed for Métis communities, according to reporting by CBC News.
“As much as municipalities and cities and other communities are facing the struggles, our people have faced this for a long time,” Abram Benedict, grand chief of Akwesasne, told Canada’s National Observer ahead of the budget.
In Ontario alone, around $58.9 billion is needed to close the on-reserve infrastructure margin by 2030 — a gap that is among the widest in the country.
“First Nations across this country expected to see significant investments into on-reserve infrastructure,” Benedict said in a statement following the budget. “Today’s budget fell well short of what’s required to fulfill that promise.”
Three new parks
Three new parks have also been established with ongoing funding in this year’s budget. They include Pituamkek National Park Reserve in P.E.I., a new national urban park in Windsor, Ont., and a national marine conservation area for B.C.’s Great Bear Sea.
- Matteo Cimellaro, Journalist