Canada's COVID-19 Economic Response Plan: Federal funding for Indigenous communities and businesses

23 April 2020

On March 18, 2020, the Federal Government announced an $82 billion Economic Response Plan to help the country cope with the effects of the COVID-19 pandemic. As part of this Economic Response Plan, the Federal Government has developed two new funding programs specifically designed to help Indigenous communities, Indigenous organizations, and Indigenous-led businesses during these difficult times. Furthermore, the Federal Government has increased its support for Indigenous post-secondary students who have been affected by the economic impacts of COVID-19.



The Indigenous Community Support Fund ("ICSF")

On March 18, 2020, the Federal Government announced a $305 million Indigenous Community Support Fund ("ICSF") to address the immediate needs of the following groups:

  • First Nations communities (including self-governing and modern treaty nations);
  • Inuit communities in Inuit Nunangat;
  • Métis governing members in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario;
  • Urban and off-reserve Indigenous organizations including Friendship Centres, Métis Settlements General Council of Alberta and Métis in the Northwest Territories.

The purpose of the ICSF is to provide Indigenous communities with the resources needed to improve their public health response to the COVID-19 pandemic. Notably, the Federal Government has not dictated the exact manner in which these funds should be put to use. Instead, recognizing that each community is unique, the ICSF is designed to give Indigenous leaders the flexibility they require to address their community members' particular needs. As examples, the funds received from the ICSF can be used for measures including, but not limited to:

  • Support for Elders and vulnerable community members;
  • Measures to address food insecurity;
  • Educational and other support for children;
  • Mental health assistance and emergency response services;
  • Preparedness measures to prevent the spread of COVID-19.

Communities identified jointly by Indigenous Services Canada, the National Indigenous Organizations and other Indigenous leaders, based on emergency needs, do not need to apply for the ICSF. There is no deadline for communities to take part in the ICSF and funding will flow as quickly as possible through existing agreements. As shown in greater detail in the within map, the ICSF will be apportioned as follows:

  • $215 million for First Nations, allocated to each First Nation based on population, remoteness and community well-being;
  • $45 million for Inuit, which will flow to each of the four land claims organizations through an allocation determined by the Inuit Tapiriit Kanatami and regional Inuit land claims organizations;
  • $30 million for Métis Nation communities, which will flow through each of the Governing Members;
  • $15 million for Indigenous organizations and communities providing services to Indigenous peoples in urban centres or off-reserve such as Friendship Centres, Métis Settlements General Council of Alberta, and Métis in the Northwest Territories.

The ICSF will be distributed differently depending on whether the funds are being transferred to a First Nation, to an Inuit community, to a Metis community, or to an urban or off-reserve Indigenous organization/community. Distribution of the ICSF will take place as follows:

  • First Nations
    • On-reserve and self-governing First Nations will receive funding directly from Indigenous Services Canada;
    • The amount provided will take into account a base amount of $50,000.00 per community, the total population residing in the community, and will be adjusted for remoteness and Community Wellbeing Index scores.
  • Inuit
    • Inuit Nunangat Regions will receive funding directly from Indigenous Services Canada;
    • Distribution of funding among Inuit Regional Corporations will be in accordance with the general regional allocation funding formula agreed to by the Inuit Tapiriit Kanatami Board of Director in December 2019 as noted in Resolution #B20-03-01 of March 23, 2020.
  • Métis
    • Métis will receive funding through existing mechanisms to facilitate the speed at which funding can be received. A standard distribution model was applied to decide how much each region will receive.
  • Urban and Off-Reserve Indigenous Organizations and Communities
    • Indigenous organizations and communities providing services to Indigenous peoples in urban centres or off reserve needed to apply for funding through a call for proposals. The deadline for applying was April 13, 2020 and has now closed.

Funding for Small and Medium-sized Indigenous Businesses and Aboriginal Financial Institutions

On April 18, 2020, the Federal Government announced up to $306.8 million in funding to assist small and medium-sized Indigenous businesses, and to support Aboriginal Financial Institutions that offer financing to these businesses.

Financial support for Indigenous businesses will be provided through Aboriginal Financial Institutions, and administered by the National Aboriginal Capital Corporations Association[1] and the Métis capital corporations in partnership with Indigenous Services Canada.

The funding will allow for short-term, interest free loans and non-repayable contributions through Aboriginal Financial Institutions, which offer financing and business support services to First Nations, Inuit, and Métis businesses. Additional funding will be allocated to help Aboriginal Financial Institutions cover operational expenses and to help the National Aboriginal Capital Corporations Association to increase its operational capacity.

This funding is separate from the Federal Government's new Canada Emergency Wage Subsidy ("CEWS"), which certain Indigenous businesses may also be eligible for. Our colleagues have prepared a separate bulletin discussing CEWS, which we welcome you to read here.

Notably, it is not yet clear when the funding for small and medium-sized Indigenous businesses and Aboriginal Financial Institutions will become accessible. We continue to monitor the situation and are staying updated on all developments daily.

Support for Indigenous Post-Secondary Students

On April 22, 2020, the Federal Government announced an approximately $9 billion support package for post-secondary students and recent graduates. These funds will be allocated towards a number of measures that the have been put in place to assist students and recent graduates who are being affected by the economic impacts of COVID-19.

As part of its plan to support students, the Federal Government has expanded a number of existing programs. Included as part of this expanded programming is the allocation of $75.2 million to provide additional support to First Nations, Inuit, and Métis Nation post-secondary students.

The details of how to access this additional support have not yet been released. Again, we continue to monitor the situation and are staying updated on all developments daily.

Conclusion

The recent funding allocated by the Federal Government to support Indigenous communities, organizations, and businesses during COVID-19 will prove to be important resources during the COVID-19 pandemic. This funding can be used to help communities improve their public health response to the pandemic, to assist Indigenous businesses that are navigating uncertain economic circumstances, and to support Indigenous students who are continuing their education.

Gowling WLG (Canada) LLP's Indigenous Law practice group would be pleased to assist you in with any questions arising out of the Federal Government's new funding programs.


[1] The National Aboriginal Capital Corporations Association is a network of 59 Aboriginal Financial Institutions providing a full range of financial services, loans, and grants to Indigenous entrepreneurs to start new, and to expand existing, businesses.


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