Indigenous Services Canada not adequately monitoring and supporting grant recipients: AG report
Indigenous Services Canada (ISC) is falling short in its efforts to transform fiscal relationships with First Nations, according to an Auditor General’s report released May 4.
The report by Auditor General Karen Hogan assessed the outcomes of the 2016 New Fiscal Relationship initiatives between the federal government and Indigenous communities. The AG concluded that ISC failed to effectively monitor $6.5 billion in grants allocated to First Nations. The audit also said that more meaningful progress is needed to fulfill commitments towards Indigenous self-determination and financial partnership.
Policy and monitoring objectives not met
The report found that two key commitments in the New Fiscal Relationships initiatives were not met. First, ISC didn’t input a new policy to help prevent defaults in First Nations communities. Second, ISC didn’t implement a mutual accountability framework between First Nations, their citizens and the federal government.
The report also noted that ISC failed to monitor ongoing eligibility for organizations receiving 10-year grants.
“We found that only 39 per cent of the grant recipients’ files we examined had the required monitoring report for all fiscal years.”
Despite gaps in monitoring, Hogan found that recipients were eligible to receive their grants.
Outcomes not evaluated
The audit concluded that ISC did not properly assess the efficacy of the 10-year grants in closing socio-economic gaps for First Nations communities.
ISC used the Community Well‑Being Index to evaluate the impacts of the grants; however, the index did isolate the effect of the grants specifically, meaning that any positive impacts found could be attributed to other funding initiatives undertaken by First Nations.
“It has been seven years since the first 10‑year grant recipients began receiving funding. In our view, the Community Well‑Being Index was not an effective tool to measure the potential socio‑economic impacts of the 10‑year grants,” the report said.
The report recommended that ISC provide additional administrative support to grant recipients and closely monitor how the grants contribute to closing the socio-economic divide between Indigenous and non-Indigenous communities. Indigenous Services Canada agreed to both recommendations by the OAG report.
Environment Commissioner finds ‘significant gaps’ in Greening Government Strategy oversight
On the same day, Environment Commissioner Jerry V. DeMarco also released a report on the government’s strategy to “green” federal assets and services.
The Treasury Board of Canada Secretariat’s (TBS) oversight of the Greening Government Strategy was found to have significant gaps in advancing climate resilience for federal assets and services.
The report found that the three departments evaluated – Fisheries and Oceans Canada, National Defence, Public Services and Procurement Canada – had been slow to act on recommendations, jeopardizing critical infrastructure such as bridges, roads, and buildings.
The Government of Canada says that “climate resilience is the ability to prepare for, adapt to, and recover from climate change and extreme weather.”
Climate resilience is important for Canada’s national sustainability strategy since it protects the nation’s physical assets, like bridges, roads and ports. The federal government oversees over $100 billion in physical assets.
The audit found that the secretariat provided guidance through a shared website and working group meetings; however, it did not have targeted resources on how to conduct climate risk assessments of critical assets or in climate-sensitive areas such as northern Canada.
Additionally, collected data was often incomplete or inaccurate, and the secretariat did not develop a comprehensive framework for monitoring progress on climate resilience commitments..
Public communication was no better. In the strategy’s first eight years, TBS did not report publicly on climate resilience commitments, limiting public and legislative accountability.
Limited action
The commissioner concluded that the departments assessed – which manage two-thirds of federal physical assets – had trouble turning information into action. While each had begun identifying critical and high-value physical assets, these operations suffered from inconsistent definitions and incomplete reporting.
When it comes to critical assets, the commissioner found a lack of assessments and even fewer resilience plans. Out of 1,623 critical assets, 1,347 had an unknown risk profile. Of the 275 assets identified as at significant risk, only nine had climate resilience plans.
“We concluded that National Defence, Public Services and Procurement Canada, and Fisheries and Oceans Canada assessed climate change risks but made limited progress in implementing actions to proactively enhance the climate resilience of their assets, services and activities,” said the report.
At risk groups left behind
Climate change doesn’t affect everyone equally. “Certain populations, including Indigenous peoples, seniors, children, low-income populations and people with disabilities, are most at risk of being harmed by climate change,” said the report.
Despite this reality, TBS failed to integrate gender-based analysis into its 2024 strategy.
Slow departmental action also failed to account for underrepresented groups in remote and rural regions who rely more heavily on government infrastructure for transportation and income.
Flood hazard mapping program behind on timelines and underdelivering
Meanwhile, Natural Resources Canada (NRCAN), Environment and Climate Change Canada (ECCC) and Public Safety Canada (PSC) were found to be falling behind in flood mapping projects.
The report found that the Flood Hazard Identification and Mapping Program is not on track to reach its 2028 objectives.
The commissioner also concluded that most existing maps were outdated or unusable, putting communities and infrastructure at risk due to inadequate information for flood preparedness and response.
A flood hazard map uses geographical and environmental data to estimate the chances of a flood occurring in a particular area. These maps help developers and policy-makers decide where to build new housing and infrastructure so that hazards are minimized for workers, residents and communities.
For a flood map to be effective in the long term, it needs to account for expected environmental changes and challenges caused by climate change.
Flooding a significant risk for Canadians
According to Canada’s National Risk Profile, 80 per cent of the nation’s highly populated areas are at least partially in a flood hazard zone. The report identified Indigenous and northern communities as particularly vulnerable to flood impacts.
Economically, floods are a costly hazard for Canadians. From 2016 to 2025, the federal government spent an average of $230 million per year on flood relief efforts.
According to the report, flooding is likely to grow more frequent as climate change advances. Canada is at a particularly high risk since our climate is warming twice as fast as the global average.
Unmet objectives
As part of its objectives, the federal government committed to prioritizing flood hazard mapping for high-risk areas and to making these maps accessible to Canadians. However, the report found that completed flood hazard maps were not made accessible to the public. Of the 26 maps produced since 2024, only 11 were publicly available.
Furthermore, NRCAN did not track whether funding was being used to map areas that were meant to be prioritized. Less than half of all maps currently under development evaluate high-risk areas that had been identified in 2022.
Accounting for climate change is an essential step in assessing flood risk, the report notes. Additionally, there is a lack of climate change considerations in PSC’s flood risk awareness portal – a tool meant to help Canadians build resilience to floods.
“The risk ratings to be displayed in the forthcoming flood risk awareness portal online were based on present-day assumptions related to flooding,” said the report. “This means that information in the portal would not be useful to help the public make long-term climate-informed decisions or investment choices that account for flood risks.”
The report noted that NRCAN failed to produce flood hazard maps in a timely manner, and that the department was not on track to produce all funded flood risk maps by its March 2028 deadline.
“On the basis of past program performance and the current rate of delivery of flood mapping projects, Natural Resources Canada was not on track to publish all funded flood mapping projects by March 2028,” the report said.
