OTTAWA -- The Aboriginal Affairs department should remove the two per cent cap on annual funding increases for reserve programs and services, a Senate committee recommended Tuesday.
In its findings, the Standing Senate Committee on Aboriginal Peoples said reserve funding needs to account for inflation in First Nations communities and the growing aboriginal population.
Aboriginal people remain the fastest-growing population in Canada.
The committee's recommendations also include a call to create a new ministerial loan guarantee program to help pay for infrastructure on reserves.
The report acknowledges that federal funding alone won't allow First Nations to meet infrastructure needs, but said the government could make more progress if it can help communities leverage financing.
The Senate committee began its work in November 2013, which involved visiting communities to study challenges first-hand.
It heard from more than 80 witnesses including individual First Nations members, aboriginal organizations and federal agencies.
"People took us into their homes; this was not always easy," Conservative Sen. Dennis Patterson told a news conference.
"We saw homes with mould ... we saw condemned homes that people had moved back into because there was no other place to live. But we were impressed by the resourcefulness of the communities and the community members."
Liberal aboriginal affairs critic Carolyn Bennett said she wants the federal government to act on the recommendations.
"This is an all-party committee dominated by Conservatives, they had to admit that this is truth," Bennett said.
"Canadians expect fairness and equal opportunity, and this is now increasingly embarrassing that we have a population in Canada living in third-world conditions."
The report demonstrates the upper chamber is still doing important work, Patterson said, even as it endures scrutiny and criticism over the controversial travel and housing expenses of some members and allegations of personal misconduct by others.
Conservative Sen. Scott Tannas, who was also part of the committee, agreed.
"This is the important work that we do, this is what gets a senator out of bed these days," Tannas said.
"It is valuable, it is important and we put our heart and soul into it, and our brains."
