New Fiscal Relationship grant
Learn about the New Fiscal Relationship grant.
Update
Indigenous Services Canada (ISC) is accepting expressions of interest for the New Fiscal Relationship grant. If your First Nation, Tribal Council or First Nations-led service delivery entity is interested in entering into an NFR grant agreement, contact your ISC regional office's funding agreement lead or the NFR Secretariat at nrf-nfr@sac-isc.gc.ca.
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About the New Fiscal Relationship grant
The New Fiscal Relationship (NFR) grant is an optional funding mechanism that provides predictable and flexible funding to eligible recipients for up to 28 programs and services.
The NFR grant supports self-determination by providing recipients with:
- long-term funding predictability through a renewable term of up to 10 years
- flexibility to design and deliver services to meet community priorities
- flexibility to allocate, manage and use funding to address changing circumstances
- ability to retain unspent funds
- predictable cash flow options with annual payments available April 1 each year
- annual funding escalation based on inflation and population growth, with a minimum growth rate of 2% each year
- reduction in administrative reporting
As of the 2025–2026 fiscal year, 191 First Nations, Tribal Councils and First Nations-led service delivery entities have signed NFR grant funding agreements. Indigenous Services Canada continues to work with many others who are considering the grant.
New Fiscal Relationship grant escalator
To keep up with increasing costs, an escalator is applied to funding for core programs and services provided through the grant.
This means funding is escalated annually based on inflation and population growth.
However, the escalator does not apply to:
- programs like primary and secondary education, which use their own funding formulas
- time-limited funding that goes beyond the core grant amount
Differences between the New Fiscal Relationship grant and block funding
There are some significant differences between the NFR grant and block funding agreements, such as:
- block funding generally has a 5-year term
- block funding is a contribution, not a grant and therefore it comes with more administrative and reporting requirements as well as limitations on eligible expenditures
- block funding recipients have to complete unexpended funding plans at the end of the agreement
- block funding generally does not permit program redesign or provide the flexibility to set the standards and levels of service associated with these programs
- block funding recipients are subject to department-initiated recipient audits and compliance reviews
A new approach to accountability
The New Fiscal Relationship grant is built on a key principle: First Nations and First Nations-led service providers are primarily accountable to their citizens and member First Nations.
Under the NFR grant agreement and recipients’ financial administration laws or policies, accountability is maintained by:
- creating strategic plans that outline their goals, priorities and expected results
- publishing annual reports that show what they’ve achieved
These documents help keep citizens and member First Nations informed about the services being delivered.
Because First Nations report directly to their communities, the amount of reporting required by ISC is reduced by up to 90%.
The New Fiscal Relationship grant and Treaty Rights
ISC's Comprehensive Funding Agreement includes a non-derogation clause which indicates that "nothing in the agreement will be construed to diminish, abrogate from, or prejudice any treaty or Aboriginal rights." The NFR grant is a funding mechanism and does not modify existing treaties or affect Treaty Rights.
Who can apply
The NFR grant was established in 2019-2020 and is available to First Nations under the Indian Act.
Since 2024-2025 the NFR grant’s eligibility has expanded to include:
- First Nation governments referred to in a self-government or land claims agreement
- Tribal Councils
- First Nations-led entities that provide services to First Nations governments or to First Nations citizens of member First Nations.
Eligibility in the NFR grant has been expanded because, in many cases, First Nations have chosen to have programs and services delivered through other organizations, such as Tribal Councils, health authorities and education authorities. These organizations offer expertise that might not be available to individual First Nations.
To be eligible for the NFR grant, these organizations need to be First Nations-led, where member First Nations are involved through participation in the governing body, advisory council or other mechanisms that contribute to strategic plans, budgets and annual reports.
Eligibility requirements
Eligibility for the NFR grant comprises of 2 elements:
Financial administration
First Nations, Tribal Councils and First Nations-led service delivery entities interested in the NFR grant must have in place a financial administration law (First Nations) or a policy on financial administration (Tribal Councils and First Nations-led service delivery entities). A financial administration law or a policy on financial administration outline financial and governance practices that assist in making informed financial decisions.
First Nations meet this requirement by adopting:
- a financial administration law pursuant to section 9 of the First Nations Fiscal Management Act
- a financial administration bylaw pursuant to section 83 of the Indian Act
or - a financial administration law via council resolution and provided to ISC
Tribal Councils or First Nations-led service delivery entities meet this requirement by:
- adopting a policy on financial administration
or - demonstrating that it has equivalent policies or by-laws in place
The elements required for a financial administration law or a policy on financial administration to meet NFR grant eligibility are outlined in the standards set by the First Nations Financial Management Board. To learn more and to see a sample, consult the First Nations Financial Management Board's NFR grant eligibility page.
Financial performance
First Nations, Tribal Councils and First Nations-led service delivery entities interested in the NFR grant must also meet certain financial performance ratios. These ratios are assessed through an examination of their audited financial statements for the preceding 5-year period. Specifically, recipients must demonstrate that their financial performance over the period has:
- an average fiscal growth ratio of no lower than minus 5%
- an average operating margin ratio of no lower than minus 5%
- an average asset maintenance ratio of no lower than 100%. This ratio does not apply to Tribal Councils or First Nations-led service delivery entities that have less than $500,000 in total capital assets
- a weighted average net debt ratio of no more than 60% or a current year net debt ratio for the most recent year of no more than 60%
- an average interest expense ratio of no more than 5%
How to apply
To begin the eligibility process, a First Nation, Tribal Council or First Nations-led service delivery entity must provide a written request by email to ISC expressing their interest in the NFR grant.
Because the preparation and completion of financial administration laws and policies can take a few months, the deadline to submit an expression of interest to join the NFR grant for the upcoming fiscal year is the end of September.
Interested recipients can also express interest anytime for future fiscal years to begin discussions and work towards meeting eligibility criteria in advance of future deadlines.
Once the expression of interest has been received, officials from ISC and the First Nations Financial Management Board contact the recipient to provide guidance based on their unique circumstances on how to meet the eligibility criteria.
To assist ISC in reaching its eligibility determination, the First Nations Financial Management Board will examine recipients' financial administration laws and policies on financial administration and financial performance, as well as provide opinions to ISC and the recipient on whether the recipient meets the required standards.
To support development of funding agreements in time for the next funding agreement cycle, beginning April 1, ISC works with recipients to complete all steps necessary to meet eligibility criteria and obtain the necessary assessments from the First Nations Financial Management Board by the end of November each year.
Funding included in the New Fiscal Relationship grant
The NFR grant provides core funding through a single Comprehensive Funding Agreement for each recipient. The grant draws from existing ISC funding and reference levels for the following 6 service areas and 28 budget activities:
Health
- Public health promotion and disease prevention
- Mental wellness
- Healthy living
- Healthy child development
- Communicable disease control and management
- Environmental public health
- Home and long-term care
- Assisted living
- Home and community care
- Primary health care
- Clinical and client care
- Community oral health services
- Health systems support
- Health planning, quality management and systems integration
Children and families
- Income assistance
Education
- Elementary and secondary education
- Post-Secondary education
Infrastructure and environment
- Community infrastructure
- Housing operations and maintenance
- Housing capital
- Education facilities operations and maintenance
- Education facilities capital
- Health facilities
- Other community infrastructure operations and maintenance
- Other community infrastructure capital
- Water and wastewater operations and maintenance
- Water and wastewater capital
- Communities and the environment
- Reserve land management
Economic development
- Community economic development
Governance
- Indigenous governance and capacity supports
- Band support
- Band employee benefits
- Tribal council funding
- Individual affairs
- Registration and membership
ISC is working to expand the list of programs eligible to be funded through the NFR grant.
Most core funding programs are included in the NFR grant but recipients can still apply for proposal-based or other contribution funding, which can be provided through set, fixed or flexible approaches for recipients with the grant.
Currently, ISC is the only department with funding eligible through the NFR grant. ISC is working with other departments to identify barriers and develop approaches to overcome them so that funding from other departments might be available through the grant in the future.
How to renew or leave the New Fiscal Relationship grant
Recipients may request the renewal of an NFR grant funding agreement through a clause in the Comprehensive Funding Agreement.
A First Nation may opt-out of the NFR grant and:
- move into another funding agreement model, such as a Self-Government Grant, when they are interested and meet the requirements
- return to a contribution-based agreement
Recipients interested in other funding agreement models are encouraged to reach out to their ISC regional office to initiate discussions.
Support available to help meet the eligibility requirements
Recipients applying for the NFR grant can get free support from the First Nations Financial Management Board.
All recipients have access to:
- the tools developed by the board
- advice and support to help meet and maintain eligibility
Support to build governance capacity
First Nations and Tribal Councils can also apply for project funding through the Professional and Institutional Development Program.
This program is managed by ISC at the regional level and it funds projects that will help to increase governance capacity in areas like:
- leadership
- law-making
- financial management
All First Nations and Tribal Councils are eligible for project-based funding under this program, even if they are not applying for the NFR grant.
Contact us
Reach out to your ISC regional office's funding agreement contact or to the New Fiscal Relationship Secretariat at nrf-nfr@sac-isc.gc.ca to learn more.