Can the Liberals keep their promise to First Nations youth?

Economist Rob Gillezeau on a $1.7-billion gap in the Liberal funding plan for First Nations education

Prime Minister Justin Trudeau, centre, attends a meeting of the First Ministers, First Nations, Inuit, and Metis Leaders in Vancouver, B.C., Wednesday, March. 2, 2016. (Jonathan Hayward/CP)

Prime Minister Justin Trudeau, centre, attends a meeting of the First Ministers, First Nations, Inuit, and Metis Leaders in Vancouver, B.C., Wednesday, March. 2, 2016. (Jonathan Hayward/CP)

Rob Gillezeau is an Assistant Professor in the Department of Economics at the University of Victoria with expertise in economic history, labour economics, and public policy. He previously served as the Chief Economist in the Office of the Leader of the Official Opposition.

Last Thursday, while the Prime Minister Justin Trudeau was being feted with the pomp and luxury of a state dinner in Washington D.C., his government quietly leaked the fact that the Liberal platform had underfunded its promise to First Nations youth by as much as $1.7 billion. It was such a masterful stroke of political damage control by communications staffers that its release was spun into a headline entitled “Trudeau Looking to Improve State of First Nations Education,” and only the journalists at APTN have taken the time to seriously dig into the fiscal sleight of hand.

The anonymous federal source who leaked the information to the media tried to lay the blame squarely on former prime minister Stephen Harper, claiming that his government had “secretly” removed $1.25 billion from the government’s ledgers of which the Liberals could not have possibly been aware. The problem with this claim is that NDP MP Charlie Angus raised this exact concern during the last election campaign, noting that the Liberal plan relied on $1.7 billion of pre-existing funding over the 2016-17 to 2019-20 period that could not be guaranteed. No other political party’s platform relied on this pot of money, nor was there any indication of its existence in the three primary sets of government fiscal documentation: the Main Estimates, the Public Accounts, or the Reports on Plans and Priorities. Even if it were to exist, there was no guarantee that the money had not been re-profiled over a much longer time horizon.

In response to these concerns, the Liberals called New Democrats “desperate,” and argued that they were “mak[ing] false claims” that couldn’t be “further from the truth.” It turns out those New Democrats (and other experts, including Angella MacEwen from the Canadian Labour Congress) were right—and a staggering gap of up to $1.7 billion in the plan for First Nations education funding remains.

The 149-year relationship between Canada’s federal government and First Nations is filled with reneged commitments, unfilled obligations, and broken promises. This election cycle, all parties placed a much greater emphasis on Indigenous policy than in any prior election; New Democrats even went as far as to release a full Indigenous Platform. Strong turnout from Indigenous peoples at the polls last fall, who voted for change, clearly marked a new hope that things would be different this time. Sadly, within six months of its election, Prime Minister Justin Trudeau’s government appears to be laying the groundwork to break an enormously important promise.

This is part of a growing series of substantial costing errors from the Liberal campaign, and it’s symptomatic of a platform that wasn’t rigorously costed or analyzed by experts or the media. Certainly, it is an indicator that journalists should always question costings that rely on pots of money that cannot be clearly identified. However, when it came to light that the Liberal tax plan to give those making between $89,000 and $200,000 a cheque for $670 dollars was underfunded by $1.2 billion, the Trudeau government found the money. If the government can find the money to give a tax cut to Canadians earning six figures, they should be able to find the funds to meet their promise to First Nations youth.

At the end of the day, the Prime Minister or, at the very least, the minister of Indigenous and Northern Affairs owes First Nations an apology. They owe an apology to those who tried to raise the alarm on this startling funding hole, but were instead denigrated and mocked for their concerns. They need to identify why the Department of Finance has been spreading confusing and contradictory information on the topic, and clarify the situation.

And, most importantly, they need to do right by the First Nations children who may continue to suffer because Liberal staffers struggled to understand the nation’s finances. Instead of putting the communications spin doctors on the job of playing down expectations, the officials at the Department of Finance should be hard at work to find the $2.6 billion in funding promised. If they don’t, it’s on the Prime Minister.


Can the Liberals keep their promise to First Nations youth?

  1. Come out,come out all you Liberals and defend the “mis spoken ” stories and slamming of the other Political Parties.Strange they are all so silent when some BRAVE media tells the truth about what this Gov’t is trying to do ‘ by lying to us.

  2. MacLean’s tries very hard to be relevant and credible. Then they post a headline that includes the words “Liberals Keep Promises” in that order. Laughable is what MacLean’s is becoming with such drivel.

  3. You know by the end of the day who gives a crap. We have poured so much money into the education of a selected minority. I say free education for all Canadians and stop the raciest, bias and prejudice behavior of politicians against the majority of people in this country. Equal treatment for all Canadians. We are all Indigious and Native to this land as we are born in this country.

  4. Not the kind of mistake one would expect from a government that claims to be committed to evidence based policy making.

  5. Okay and Emily and Gayle, where are you? Explain this all to us in Justin speak that we can understand. The chiefs complained that Justin ignored them at the Premiers conference and now he hasn’t got the funding for the First Nations’ children’s education he promised. Personally, I don’t see what the problem is. He promised in the campaign to go $10 billion in debt each year. Word on the street is he is up to $30 billion. Why not just up it to $50 billion and give the kids their education money and give all the First Nations the promises he made? What is 10 or 20 billion dollars to him? He loves to spend. Why lie and claim its someone else’s fault. Doesn’t he understand he is the man now. The buck stops with him and his government? He made promises. Legalizing cannabis as well. We could have a real boutique business in that. What is the holdup? He has a majority. It is tourism season coming up. We have a boutique wine tourism business. Our dollar is low. We are ripe for this. Let BC get planting.

  6. Our Bank of Canada does not have vaults filled with electronic cash. As remarkable and repellent to the mind as it may seem, the Bank (owned 100% by the federal government) simply creates money whenever needed by computer entry. It follows that the federal government can actually never run out of Canadian dollars. It can either spend too much causing inflation, or spend too little allowing mass unemployment. Since currently there are 1.4 million Canadians looking for work, it is clear that the federal government is nowhere near expending enough.

    Regardless of the size of the deficit or the debt-to-GDP ratio, the federal government can mobilize any unused resources in the economy, including whatever is needed to keep their promises regarding First Nations education funding.


    1. What is Modern Monetary Theory, or MMT?

    The essential insight of Modern Monetary Theory is that sovereign, currency-issuing countries are only constrained by real limits. They are not constrained, and cannot be constrained, by purely financial limits because, as issuers of their respective fiat-currencies, they can never run out of money. This doesn’t mean that governments can spend without limit, or overspend without causing inflation, or that government should spend any sum unwisely. What it emphatically does mean is that no such sovereign government can be forced to tolerate mass unemployment because of the state of its finances no matter what that state happens to be.

    Virtually all economic commentary and punditry today, whether in America, Europe or most other places, is based on ideas about the monetary system which are not merely confused , they are starkly and comprehensively counter-factual.

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