Fact Sheet - The Proposed Policy on the Transfer of Capital Moneys Through Section 64(1)(k) of the Indian Act
The Department engaged in discussions with internal and external experts as well as a number of interested First Nations to identify options that would provide First Nations with greater involvement in and control over the administration of all their current and future capital moneys.
The proposed Policy on the Transfer of Capital Moneys Through Section 64(1)(k) of the Indian Act is intended to provide interested First Nations with increased flexibility in accessing and managing their capital moneys, enabling them to pursue economic development opportunities more quickly and enhancing their ability to respond to community needs.
This policy is optional. First Nations can choose to use this option or continue to have their moneys managed under the Indian Act. First Nations that decide to opt into this policy can still participate in, and benefit from, any federal government program. Through this policy, First Nations would be able to manage their capital moneys without further involvement of the Minister of Aboriginal Affairs and Northern Development.
How Does a First Nation Assume Control of its Moneys?
Under Section 64(1)(k) of the Indian Act, the Minister “may authorize and direct the expenditure of capital moneys of the band…(k) for any other purpose that in the opinion of the Minister is for the benefit of the band.”
First Nations that wish to obtain control of their capital moneys through this policy must meet certain criteria. These criteria include the development of a trust agreement that meets certain conditions set out in the proposed policy. First Nation community members must approve their First Nation leadership’s decision to obtain control of their capital moneys through a ratification vote. Once the community determines that a transfer of the First Nation’s capital moneys is in its best interest, the final step is for the Minister to approve the transfer.
Direct Access to Trust Funds Means Greater Opportunities
The proposed Policy on the Transfer of Capital Moneys Through Section 64(1)(k) of the Indian Act places decision-making authority over the management of capital moneys in the hands of an independent trust created by the First Nation. Since the Indian Act would no longer apply to the administration of these capital moneys, the First Nation would no longer have to request approval from the Minister to expend the moneys for community projects and other expenses.
This new approach to the management of First Nations’ capital moneys would enhance economic development opportunities and provide First Nations with the flexibility required to respond to community needs.
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