‘This is fraud’: Indigenous leaders sound off on federal procurement program

A Global News investigation found significant loopholes in a multi-billion dollar procurement program aimed at helping develop First Nations, Inuit and Métis companies.

There are growing calls to overhaul a multi-billion dollar procurement program designed to boost Indigenous business that critics warn is open to widespread abuse by “front” companies claiming to be First Nations-, Inuit- or Métis-owned.

The Procurement Strategy for Indigenous Business (PSIB) program sets aside billions of dollars annually in federal contracts for Indigenous-owned and controlled companies.

But Shannin Metatawabin, the chief executive officer of the National Aboriginal Capital Corporations Association, warned MPs Thursday of multiple cases where Indigenous people were brought onto a project only for others to reap the benefits.

“This is fraud. This is criminal behaviour, and (companies misrepresenting themselves) should be barred from doing any business with the government going forward,” Metatawabin told a House of Commons committee.

“Indigenous identity fraud won’t happen if (the program) is handed to an Indigenous community.”

The hearings came after a Global News investigation, in partnership with researchers at First Nations University of Canada, uncovered significant loopholes with the PSIB.

The program requires that at least five per cent of all federal contracting goes to First Nations, Métis and Inuit companies. It’s a substantial amount of money meant to help Indigenous-owned and controlled companies compete against larger multinational corporations in the lucrative world of federal contracting. The stated goal, going back more than three decades, was to use federal procurement to help build up Indigenous businesses in the name of “economic reconciliation.”

Global News’ investigation found internal government documents going back to the late 1990s suggesting Ottawa was aware that the program could be exploited by “shell companies” and “fronts” claiming to be Indigenous to gain preferential access to government work.