Métis Nation Economic Development Strategy John Weinstein Métis National Council The focus of today’s discussions will be the Métis Nation Economic Development Strategy. Work on the Strategy began in 2009 with the first of three Métis Economic Development Symposiums that brought together Métis leaders and management of Métis Nation economic development corporations, the Federal Minister of Indigenous Affairs, then the Hon. Chuck Strahl, and his counterparts from the five western-most provinces, and industry representatives to discuss best practices and collaborative approaches in support of Métis Nation economic development goals. When we started the Symposiums, there was a Métis Nation capital corporation in each of the prairie provinces but none in Ontario and B.C, There was one equity capital provider, the Clarence Campeau Development Fund in Saskatchewan. There were no impact benefit or collaboration agreements between industry and Métis communities and mounting frustration over the lack of progress on major projects consultation and accommodation resulting from the delayed and inconsistent application of Duty to Consult to Métis communities. The MNC’s Governing Members were heavily involved in skills development and employment programming and administered about $50 million annually in funding under the Aboriginal Skills and Employment Training Strategy or ASETS. The initial Symposium in 2009, followed by ones in 2011 and 2015, and many engagement sessions across the Métis homeland in between, contributed to a growing awareness of the impressive track record of the Métis Nation governments and their affiliated institutions in business and labor force development and the power of collaborative approaches and partnerships with the Métis Nation, governments and industry in overcoming challenges and capitalizing on opportunity. The Symposiums and regional engagement sessions served as showcases for the progress that was being achieved in many areas and encouraged similar initiatives across the Métis Nation homeland.
¡ 2 ¡ The gap in the network of capital corporations was partially filled when the Province of Ontario committed to capitalize the Métis Voyageur Development Fund. The MNC and the three capital corporations on the prairies also worked with the federal government to establish a fund that would enable the capital corporations to enter the mid-range loan market of $250,000-$1 million, something that had been blocked by the $250,000 cap on their loans. New Métis Nation equity investment funds were emerging as well such as the Métis Economic Development Fund in Manitoba. Many of the major corporations participating in our engagement sessions were concluding collaboration agreements with Métis communities enabling their greater participation in projects ranging from gold mines in Ontario, hydro transmission in Manitoba, uranium mines in Saskatchewan, and oil and gas projects in Alberta and BC. The important work of the Métis Nation ASETS holders and educational and training institutes in forging labour market partnerships including projects under the Strategic Partnership Fund were showcased. The findings and recommendations coming out of the MEDS process are contained in the four MEDS reports in your kits. They break down into the four key components of the Strategy: business development including access to capital and procurement; labour force development; expanded participation in major projects; and strengthening Méts Nation economic development institutions. By the time of the third Symposium in 2015, the federal government and the Métis Nation were prepared to formalize and strengthen the work on the Strategy and these four key elements in the form of a Métis Economic Development Accord that was signed at MEDSII in 2015 by Minister Valcourt and President Chartier. Later that year during the federal election campaign, the Liberals committed to spend $25 million for developing and implementing the Strategy and indeed federal Budget 2016 provided for $25 million for the Métis Nation Economic Development Strategy, the first time the Métis Nation was ever specifically identified in a federal budget and testimony to the successes which were being achieved in the economic development sectors. The funding from Budget 2016 is being used in various ways to develop and implement the Strategy.
¡ 3 ¡ I say “develop and implement” because even as some of the objectives are being achieved, new opportunities and needs are surfacing that requires us to modify the Strategy in areas like clean growth, a key feature of Canada’s climate change strategy, and housing. Some of the funds are being used to support growth of the capital corporations which, on the prairies are still working off the initial capital from the 1980s and early 90s, capital which they have rolled over many times over in new loans. We will be hearing from the management of some of these corporations shortly- Steven Morse from Ontario, Mike Ivy from Alberta and Tristant Zachow from Saskatchewan. Part of the funds went to filling the final gap in the network of capital corporations and we’re all looking forward to hearing from Dale Drown Métis Nation BC on the steps they are taking to launch their capital corporation. The Strategy also seeks to support the growth of equity capital groups that respond to the demand for long-term patient capital from growth-oriented Métis businesses. We will be hearing from the CEO of one of these equity capital providers, John Coutris of the Métis Economic Development Fund. Another dimension of equity investment that is being addressed by the funding involves the Governing Members themselves. It should be remembered that Governing Members are growing significant assets of their own, including businesses, and are in a position to undertake projects that will not only add to their assets and provide income stream but also generate training, employment and contracting opportunities for their people. Al Benoit of the Manitoba Métis Federation will take us through some of the projects being planned by the MMF. Governing Members can also leverage their relationship with government and industry and capitalize on investment opportunities that wouldn’t be available to individual entrepreneurs. Marc LeClair in the procurement session will show how the MMF has leveraged its relationship with Manitoba Hydro to generate significant contracts for its construction arm N4. Part of Budget 2016 funds is going to MNC to work with Governing Members and their economic development corporations on economic policy including this forum and future engagements with industry and government.
¡ 4 ¡ With the assistance of Myers Norris Penny, we have been working on another investment opportunity particular to the Governing Members or their financial institutions that would enable them to take an equity interest in major resource development projects through equipment and infrastructure used in these projects. In its report to the MNC that is included in your kits, MNP identifies those banks, credit unions and private equity groups that would provide financing for key pieces of equipment and infrastructure for these projects that include minority Métis ownership and a long-term service contract with the developer. A number of Governing Members have informed me of offers for this type of equity participation from major project proponents crossing their territory so it is something we will be keeping an eye on, again a source of valuable assets and income stream for the Governing Members. The MNC has also been working with MNP on long-term sustainability of loan capital providers. A logical starting point for this is the Business Development Bank of Canada which has an Aboriginal Business financing unit with a mandate to make loans to Aboriginal entrepreneurs as well as to invest in Indigenous economic development corporations. BDC has not fulfilled the second part of that mandate, preferring to restrict itself to loans to individual Indigenous businesses. It has done syndicated lending with our capital corporations but it has tendency to cherry pick or some would say poach the stronger clients of capital corporations while avoiding the higher risk clients. This poses a real threat to developmental lenders such as capital corporations who need a mix of low and high risk clients to survive. We have approached BDC with a number of proposals to facilitate their investment in capital corporations. One involved them buying the loans of capital corporations which would continue to administer them for a free and whose capital would be freed up to make new loans. After expressing interest, BDC backed down and proposed another pilot which basically amounted to a form of expedited syndication of loans which would significantly boost the volume of loans but wouldn’t compensate the capital corporations for their additional work.
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