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The Canadian Press

OTTAWA _ A new report suggests Canada's native education system is in shambles _ the result of chronic underfunding, reporting gaps and a lack of standard budget planning.

NDP MP Charlie Angus requested the independent review from Parliamentary Budget Officer Kevin Page.

The report Monday finds that Indian Affairs shortchanges more than 800 schools on reserves by at least $169 million a year _ cash needed to keep up basic repairs.

It also points out that new construction has dropped under the Harper government. An average of 35 schools were built each year under Liberal rule compared to just eight completed in the three years since the Conservatives took power, says the report penned by two financial analysts in Page's office.

Moreover, Indian Affairs siphoned another $122 million between 2003 and 2008 from school projects to other undisclosed funding priorities.

The report suggests the government ``may wish to fence'' such monies to ensure they aren't shifted to other projects at Ottawa's whim.

It also found that Indian Affairs lacks any clear national framework for assessing the state of its schools and what it costs to maintain them.

According to the department's spotty records, less than half of its 803 schools are listed in good repair. One-quarter are in poor condition and almost 21 per cent are listed as ``not inspected.''

``In the absence of capital budgeting methodology, it is unclear what financial due diligence is carried out ...prior to approval of monies for school infrastructure....,'' the report concludes. The related federal budget was almost $244 million in 2007-08, it says.

Indian Affairs Minister *Chuck* *Strahl* says an extra $200 million is committed to school projects this year under the Conservative economic action plan.

The cash will help fund 10 new schools and three major upgrades _ all prioritized by regional staff who work with First Nations, Strahl said.

``It's not like it's arbitrary. Those lists are done working with the regions, working with First Nations to set (an) ... infrastructure framework priority list. And when that comes to me, I just approve them all absolutely as I was given them.''

The Harper government has spent $624 million on 118 school repairs and upgrades since 2006, say figures released by Indian Affairs. Projects include eight new schools and nine others that are under construction.

Native leaders say federal spending increases capped at two per cent a year don't come close to meeting the needs of a young and growing population on reserves across Canada.

The national Assembly of First Nations says at least 40 communities have no school and that many more need major repairs.

Strahl could not immediately confirm the numbers. But he discounted the report's suggestion that federal funds allocated for reserve schools be locked in so they're not raided for other needs.

``In my opinion, you can debate the amount of money that we need to spend _ and I think that's a good debate _ but putting it in a lock box, in my opinion, is not wise. ...For many of these communities, (Indian Affairs) is the only funding source for a whole variety of projects.

``You...may have to put in a water treatment plant to make the school work. But if you lock-box it, you can't use any discretion and you'll be back in Parliament repeatedly trying to transfer funds ... it's just not practical.''

Angus, whose Timmins_James Bay riding includes some of the poorest reserves in Canada, says federal handling of native education funds is ``an absolute disgraceful farce.''

``To be responsible for 800 schools you need a capital methodology,'' said the former school board trustee.

``You need a long-term plan and it has to be a transparent plan so the communities can know where they are in the list, how much money is going to be invested per year, so that when schools have to be replaced or emergencies happen, there's a funding envelope.

``That is the standard in every school board jurisdiction anywhere _ except with Indian Affairs.''