Ridding the Indian Act of sexism could cost $400M a year, budget watchdog warns

The budget office says the total cost for the original proposal is estimated to be $19 million for up-front administrative costs and $55 million a year to cover service extensions and tax exemptions. (Shutterstock)

OTTAWA— The parliamentary budget office says efforts to eliminate sexism from the Indian Act which in some cases continues to allow fathers, but not mothers, to pass along their First Nations status could cost more than $400 million a year.

The budget watchdog says legislation to remove the inequality, as amended by the Senate, would effectively extend eligibility for registration under the act to all persons with First Nations ancestry.

The report says the original bill would have made 28,000 to 35,000 additional First Nations persons eligible to register, but the Senate changes would extend that eligibility to 670,000 people, although the budget office estimated only 270,000 would actually claim status.

The budget office says the total cost for the original proposal is estimated to be $19 million for up-front administrative costs and $55 million a year to cover service extensions and tax exemptions.

The cost for the amended proposal is estimated at $71 million in administrative costs and $407 million a year in continuing costs.

The report acknowledges a high degree of uncertainty in the PBO’s numbers, since there is little evidence about how many people might register or want to live on reserves.

“The full annual costs will not be realized until eligible persons are registered, which will take many years,” it said.

Before 1985, the Indian Act favoured men because registered women who married unregistered men lost their status, whereas registered men who married unregistered women retained their status and conferred that status on their wives and children.

There were efforts to remedy the inequity in 1985 and 2010, but a 2015 Quebec court case found that discrimination against Aboriginal women and their descendants was still a problem, prompting the latest legislation.

The budget office looked at the costs by assuming that, as numbers of registered people rose, Parliament would have to proportionately increase funding for benefits to maintain current service levels for health and education benefits. It also assumed that if there is significant migration to reserves, Parliament would also raise funding for programs on reserves. There are also tax exemptions that apply to people with status.

“These program and tax expenditures cost an average of $18,433 a year per resident on reserve, consisting primarily of education, health care, income assistance, and the tax exemption for income earned on reserve.”

The report says, however, that only two per cent of people who gain Indian status from the legislation are expected to move to a reserve. It also says that three per cent of non-status First Nations persons who are assumed to be among those gaining formal status already live on reserve.