Programs for First Nations on Reserves

Opening Statement to the Senate Standing Committee on Aboriginal Peoples

Programs for First Nations on Reserves

(Chapter 4—June 2011 Status Report of the Auditor General of Canada)

5 February 2014

Michael Ferguson, CPA, CA
FCA (New Brunswick)
Auditor General of Canada

Mr. Chair, thank you for this opportunity to discuss housing on reserves, particularly with respect to what we reported in Chapter 4 of our 2011 Status Report—Programs for First Nations on Reserves. With me today is Jerome Berthelette, the Assistant Auditor General responsible for the Aboriginal file, and Frank Barrett, the Principal responsible for the audit.

I should note that our audit was substantially completed on November 1, 2010. We have not audited any actions taken since then.

Our 2011 audit followed up on a wide range of previous audits affecting First Nations. It identified some progress in implementing some of our recommendations. Overall, however, we concluded that Indian and Northern Affairs Canada (now Aboriginal Affairs and Northern Development Canada), the Canada Mortgage and Housing Corporation, and Health Canada had not made satisfactory progress in implementing our recommendations. Conditions generally did not improve for First Nations in each of the areas we audited and in some cases became worse. For example,


With respect to housing, we audited the government’s efforts to address housing shortages on reserves and its efforts to address housing in need of major repairs. In a 2003 audit on the subject, we noted that Indian and Northern Affairs Canada estimated a shortage of about 8,500 housing units and that about 44 percent of the existing housing required renovations. In our 2011 audit, we re-examined the extent of the housing shortage and the number of houses in need of significant renovations to protect the occupants’ health and safety.

We noted that investments in housing had not kept pace with either the demand for new housing or the need for major renovations to existing units. According to unaudited data provided by the Department, the housing shortage on reserves worsened since our 2003 audit because of increases in the demand for housing, the number of housing units having to be replaced, and the number of units requiring significant renovations for health and safety reasons.

At the same time, since 2003, the average cost to build or renovate each house rose significantly. In the 2008–09 fiscal year, new houses constructed on reserves amounted to only 30 percent of the existing houses that needed to be replaced.


We also audited what the government has done to address the problem of mould in houses on reserves. The Department has identified the main factors contributing to mould in housing as a lack of proper care and maintenance, inadequate air circulation and ventilation, poor site selection and drainage, overcrowding, and improper construction. For several years, mould contamination has been identified as a serious health and safety problem in First Nation communities.

In our 2003 audit, we found that Indian and Northern Affairs Canada, the Canada Mortgage and Housing Corporation, and Health Canada had organized and were participating in a committee to address the mould problem. In 2008, after consultations with First Nations, the three organizations developed a National Strategy to Address Mould in First Nations Communities. Since the adoption of the strategy, the organizations had worked to increase awareness of the causes of mould on reserves and provide more training for addressing the problem.

In our 2011 audit, we found that progress was still not satisfactory. Despite having developed a strategy, we found that the three organizations had not

As with other subjects we audited, we found that progress toward improving housing on reserves was not satisfactory.

Mr. Chair, as a preface to our 2011 audit, we identified what we believe are structural impediments to making significant progress toward improving conditions in First Nations communities. We identified the following four impediments:

We believe these structural impediments severely limit the delivery of public services to First Nation communities and hinder improvements in living conditions on reserves. In October 2011, the Deputy Minister of Aboriginal Affairs and Northern Development called this preface “the best piece of analysis on First Nations issues in decades.”

This Committee may wish to ask officials at Aboriginal Affairs and Northern Development Canada whether their views regarding the structural impediments remain unchanged and what the government would need to change, including direction, policies, and legislative reforms in order to address these structural impediments.

The Committee may also wish to ask the three organizations involved with housing on reserves what progress has been accomplished since our 2011 audit to address the housing conditions, shortages and mould issues on reserves.

Mr. Chair, this concludes my opening statement. We would be pleased to answer the Committee’s questions.