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Globe and Mail story ...

Native community decries 'tax grab' at diamond mine - Ontario's new 13-per-cent levy 'lose-lose' for first nations, Chief tells government
ANDY HOFFMAN - MINING REPORTER - POSTED ON 10/04/07

A first nations community located near Ontario's pioneer diamond mine has slammed the provincial government's new diamond royalty, calling it a tax grab that will negatively affect aboriginal residents.

In a letter sent to Ontario Premier Dalton McGuinty, Chief Mike Carpenter of the Attawapiskat First Nation said the provincial Liberals' 13-per-cent levy on diamond mining revenue, unveiled in the budget last month, is a "win-win" for the government and a "lose-lose" for first nations.

De Beers Canada Inc.'s $1-billion Victor project is about 90 kilometres west of the Attawapiskat First Nations community on James Bay. The company, a subsidiary of diamond giant De Beers SA of South Africa, has negotiated an "impact benefit agreement" with the Attawapiskat peoples, agreeing to provide the struggling community with training and education, employment and business opportunities, environmental management and financial compensation from the mine.

Under Ontario's previous tax regime, the Victor project, under construction and expected to begin production in the second half of 2008, would have been subjected to a 5-per-cent tax on revenue under the province's "remote mine" rules. Non-remote mines are subject to a 10-per-cent tax.

Now Victor, expected to generate annual revenue of between $280-million and $290-million at full capacity, will be subject to a 13-per-cent royalty.

"You and your officials are well aware that the only diamond mine in Ontario, and thus the only one to be immediately impacted by your decision, is located in the traditional territory of the Attawapiskat First Nation. Given the obvious importance of this project to our community and to future exploration in our lands, we should have been consulted," Chief Carpenter wrote in an April 4 letter to the Premier.

"This increase constitutes little more than a tax grab by your government that will not benefit our first nation or others," he said.

Although the Victor project is the first Ontario diamond mine, projects in other provinces and territories are producing enough diamonds to place Canada among the top five producers in the world. Some diamond consumers even seek out Canadian gems because they are mined under more ethical conditions than those from some areas of Africa.

Jim Gowans, the president and chief executive officer of De Beers Canada, is scheduled to meet today with Ontario Finance Minister Greg Sorbara in hopes of convincing the government to withdraw the royalty or to at least "grandfather" the Victor project, which he said could generate $7-billion for the province.

"The diamond royalty doesn't meet what I call the smell test for fairness. It's a bit surprising because that's one of the theme songs for McGuinty's government," Mr. Gowans said in an interview.

The executive, who has worked for a number of other Canadian mining companies including Inco Ltd., Placer Dome Inc. and Teck Cominco Ltd., said the royalty unfairly singles out diamond mining, and De Beers' Victor project in particular.

"It's very commodity-specific and Canada has had a history of being very measured in its tax regimes around resource development, very predictable and very collaborative," he said.

Mr. Gowans said that under the impact benefit agreement, the Attawapiskat have the potential to participate in the "financial upside" from the Victor project once its capital costs of $982-million are paid off, which is expected to occur during the second half of the mine's 12-year life.

He warned that the new royalty will cut into that benefit.

"This, in effect, transfers the upside from that isolated community back into the government's coffers. The amount of tax they make on one diamond mine in Ontario is not very significant. It is hugely significant to a single isolated first nations community," he said.

If the royalty remains in place, De Beers is likely to redirect much of the $15-million it spends annually on exploration away from Ontario, Mr. Gowans said.

The Ontario budget, which was tabled March 22, said the diamond royalty was needed to make the province competitive with other diamond mining jurisdictions. Indeed, the measure would bring Ontario into line with the Northwest Territories, where the bulk of Canada's diamond industry operates.

The budget said diamonds are different from other commodities because they are not traded on the open market and "require a unique and separate system for determining their value."

Officials from the Premier's and Finance Minister's offices did not return calls seeking comment.

While in Sioux Lookout, INAC Minister Prentice announced the funding for four water plant construction and upgrade initiatives that have been on the INAC books for a couple of  years.

INAC press release ...

INAC ANNOUNCES $12.8 MILLION FOR WATER PROJECTS IN TREATY 5 & 9 FIRST NATIONS

SIOUX LOOKOUT, ONTARIO (April 11, 2007) — The Honourable Jim Prentice, Minister of Indian and Northern Affairs Canada and Federal Interlocutor for Métis and Non-Status Indians, today announced $12.8 million for water treatment plant upgrades and construction in one Treaty 5 and three Treaty 9 communities located in Northwestern Ontario.

"Today, I am pleased to announce these projects that will address water quality issues in four communities, including Keewaywin First Nation, one of the 21 communities identified one year ago as most at risk for waterborne health hazards in my Plan of Action for Drinking Water in First Nations Communities," said Minister Prentice.

Indian and Northern Affairs Canada (INAC) will provide funding as follows:

• Approximately $8.9 million for a new water treatment plant at Keewaywin First Nation a member of Treaty #5;
• About $2 million to Fort Albany First Nation for upgrades to the community’s water treatment system;
• About $1.1 million towards a water treatment plant repair project at Attawapiskat First Nation; and
• Close to $800,000 to Moose Cree First Nation for repairs and upgrades to the Moose Factory water treatment plant.

"The government is making substantial progress ensuring there is a reliable supply of safe, clean drinking water in First Nation communities," said Minister Prentice. "Last month I tabled a report in Parliament that details the improvements that have been made over the past 12 months on water quality on reserve. That progress is continuing.

For more information please contact:

Bill Rodgers
Director of Communications
Office of the Honourable Jim Prentice
(819) 997-0002

Media Relations
Indian and Northern Affairs Canada
(819) 953-1160

Backgrounder - Progress on Water Treatment Plants in Treaty 5 and 9 Communities

Keewaywin (Approximately $8.9 million for construction of water treatment plant)

Keewaywin's new water treatment system will be a conventional chemically-assisted filtration system with granular-activated carbon filtration. Construction is expected to begin in January 2008. Keewaywin First Nation is a remote Cree community, 350 kilometres northeast of Sioux Lookout, that is accessible year-round by air. Total membership is 654 people, 354 of whom live on reserve.

Fort Albany (About $2 million for upgrades to the community's water treatment system)

INAC has been working with Fort Albany First Nation and other business partners to repair or replace some key components of the water treatment plant, the low lift station, and the wastewater pumping station. Scheduled completion date is October 2007. Fort Albany First Nation is a Cree community, 450 kilometres north of Timmins and 700 kilometres northwest of North Bay. The community's membership is 3,880 people, with 2,354 on reserve.

Attawapiskat (Approximately $1.1 million towards water treatment plant repair project)

The project involves repairing and replacing some of the key components of the community's water treatment plant. This work will improve the quality of water, and is scheduled for completion in July 2007. Attawapiskat First Nation is 350 kilometres northwest of Moosonee and is accessible year-round by air. This Cree community's total registered population is 2,870 people, 1,454 of whom live on reserve.

Moose Cree (Close to $800,000 for repairs and upgrades to Moose Factory water treatment plant)

In July 2006, an evaluation was conducted on damage to the water treatment plant's intake structure. It was determined that repairs were required to maintain a reliable water supply. While repairs were completed in October 2006, the long-term operation of the intake structure requires additional upgrades, scheduled to be completed during the summer of 2007. Moose Cree First Nation is located 300 kilometres north of Timmins. The First Nation has a membership of 3,632 people with 1,638 on reserve.

North Spirit Lake School News -from the principal

Children and community come together to build a better education and community for the children.

The children and community members have been immersed in model of education that is more a kin to their well being than current educational models

Land based education is key to regaining and retaining all of our traditional values ... our hopes and dreams are connected to the land.

This type of education foster critcal thinking and creativity though patterns, thereby exercising the most important organ in the body, the brain.

For our students, it re-connects everyone back to our values of caring, kindness, love, bravery, courage.

For the Teachers and Teacher's Assistants, it gives them a chance to see children exercise strengths and then more importantly capitialize on these strengths through the integration of the regular school program.

Chief Sally Bunting/Kakegamic  states "that our schools are for our children and they must be given the opportunity to succeed on their terms".  This learning and teaching model reaches our community and students with great success.

This type of educational model cannot operate without the community from all levels, from day care children  to our elders. Therefore all of the commnity is involved in the process as demostrated in the past few weeks.

Every Friday is  planned to close out with community based activities set on the land. Planning is essential and the school and community has to resource the activities. Many of the resources to make the program fluid come existing Welfare, Health or Recreation program, thereby creating community success.

As an example, recently the children and parents set nets through the ice and collected the fish. This activity was resourced by the Health program, it integrated the Language and values into the day's activities and then everyone had a big community feast.

Extensions of this is making community crafts at the school on Wednesday evening, where all the community comes to make crafts such a key chains, more importantly the community comes to the school to share and talk about thier stories.

The new principal, Mr. Conrad Bobiwash is one part of the process, as a helper and leader. He comes from Blind River, Ontario near Sault Ste Marie. He has initiated  and led child based and community based programming across North America.

This process is very close to our way of learning and is very natural, thereby fostering individual change and excellence in education.More importantly,  this model teaches all our children and community about the value of education.

From Cultural Survival ....

UN Body Holds Canada Responsible for Corporations’ Actions Abroad

By Mark Cherrington. April 10, 2007, World Indigenous News

In a groundbreaking decision, the United Nations Committee on the Elimination of Racial Discrimination (CERD) has told Canada that it must rein in Canadian corporations operating on Indian land in the United States.

The finding, issued in early March, was in response to a petition filed by the Western Shoshone Defense Project about the actions of Canadian resource-extraction companies operating on the tribe’s land in the western United States. Among other things, the Convention on the Elimination of Racial Discrimination, which has been ratified by both Canada and the United States, requires states to "guarantee the right of everyone ... in the enjoyment of ... economic, social, and cultural rights ... and the right to public health." The Shoshone petition claimed that these are the areas in which the Canadian companies are affecting them.

The petition especially targets Barrick Gold Corporation, the largest gold mining company in the world. Gold mining uses large amounts of toxic mercury and creates cyanide-laced leaching ponds, both of which threaten Shoshones’ right to health. The blasting used to open mining sites destroys sacred areas, which violates the tribe’s cultural rights to culture, and mining roads disrupt wildlife, undermining their traditional ways of finding food. Gold mining also requires vast amounts of water, which dries up springs and other water sources that the Shoshone need for health. The Betze mine alone uses 70,000 gallons per minute, and it is hardly alone. Western Shoshone lands are the third-largest gold producing region in the world, and there are six other Canadian gold companies besides Barrick operating there, with more applications for leases already under consideration.

The Shoshone have targeted Canada in part because the United States has failed to take any action to protect Shoshone lands. On the contrary, the U.S. government has declared most of Shoshone territory to be federal public land open to resource extraction and other commercial activities. The treaty protecting the original Western Shoshone territory—some 60 million acres from southern Idaho to California’s Mojave Desert—is still valid, but the government has gotten around the treaty by invoking a principle it calls "gradual encroachment." This legal tautology has been discredited by the Inter-American Commission on Human Rights, but the United States has ignored those findings.

In fact, the government has been seeking ways of making their lands even more available to encroachment. Until now, extraction industries have been operating under a federal lease arrangement, but in 2004 Republican congressman Richard Pombo introduced an amendment to a budget bill that would allow foreign companies to buy this "public" Shoshone land for $1,000 an acre. (The bill was passed by the House of Representatives but defeated in the Senate.) And a second bill, introduced by Republican congressman James Gibbons (now governor of Nevada), would have offered more than 60,000 acres of Shoshone land for sale to the Canadian company Placer Dome, now owned by Barrick Gold.

The racial discrimination treaty is a binding agreement for Canada, which, like all state parties, has to submit to biannual review by the CERD Committee, the treaty’s enforcement body. CERD reviews the country’s report (and any accompanying unofficial "shadow reports" like the Western Shoshones’) and issues observations and recommendations like the one regarding Canada, which read in part: "The committee encourages the state party to take appropriate legislative or administrative measures to prevent acts of transnational corporations registered in Canada which have a negative impact on the enjoyment of rights of indigenous peoples in territories outside Canada. In particular, the committee recommends to the state party that it explore ways to hold transnational corporations registered in Canada accountable."

Will Canada act on that recommendation? One hopeful sign in that regard is a report published on March 29 by Canada’s National Roundtables on Corporate Social Responsibility and Canadian Extractive Industries in Developing Countries. Among many recommendations in this comprehensive government report, are several that stress the need to protect the rights of indigenous peoples in the areas where Canadian companies operate.

Sources and Further Reading:

• The National Roundtables on Corporate Social Responsibility
   
• UN Committee on the Elimination of Racial Discrimination

Sandy Lake First Nation is undertaking a review of their governance structure to find out if Sandy lake First Nation Band Members want more involvement in directing the actions of the Chief and Council.

Visit their new web site at http://sandylake.firstnation.ca/governance/ for more information about this exciting undertaking.

The purpose of the Sandy Lake Governance project is to create a system of governance that receives a mandate from, and is accountable to the membership, using traditional and contemporary ideas.

The important part of creating a governance system is to ask the community people what a governance system should look like and what it should include.

So the governance project is holding small group sessions (focus groups) to find out how Sandy Lake membership want the leadership to act.

During the consultation process, community members are asked to consider the following questions:

1. What community values and principles should steer the way leadership operates in Sandy Lake?
    
2. In the past, what worked well in how the leadership governed the people in Sandy Lake?
    
3. What works well now in the way that the Chief and Council govern the community?
    
4. What changes would you like to see made in order to ensure a leadership system that is:
   1. open
   2. accountable
   3. effective for a long time?
       
5. In governing ourselves, how can we include community Youth? Women? Elders?
    
6. How can leadership be:
   1. fair ( being just and equitable)
   2. supportive but not dominating
   3. traditional and yet innovative?
       
7. How should the Chief and Council be:
   1. directed by the community
   2. responsible to the community?

For more information or to provide feeback on the Governance Project, you can reach the Project Coordinator Ennis Fiddler by:

Ennis Fiddler
Box 375
Sandy Lake, Ontario
P0V 1V0
Phone: (807) 774-1098
Email: ennisfiddler@knet.ca

Notice from the Anishninaabe Peace & Justice Coalition...

This is to let you know about important events happening this Wednesday morning April 11.  The family of Max Kakegamic and their lawyers will be making a presentation to the Kenora Police Services Board at 9 a.m., followed by a press conference and a walk down Main St. from City Hall to Matheson St. site of Kakegamic’s death.  As always, the family appreciates the presence and support of Anishinaabe Peace & Justice Coalition supporters and other concerned Treaty 3 and Kenora citizens.

NAN and Aboriginal Legal Services MEDIA ADVISORY ...

PARENTS OF MAX KAKEGAMIC TO ADDRESS KENORA POLICE SERVICES BOARD

THUNDER BAY, ON, Tuesday April 10, 2007: Margaret and Isaac Kakegamic (Kakekagumick), members of Nishnawbe Aski Nation (NAN) together with their legal counsel and NAN Deputy Grand Chief Alvin Fiddler will address issues arising from the failures of the Kenora Police Service (KPS) in investigating the death of their son Max Kakegamic during a KPS Board meeting tomorrow morning.

DATE: Wednesday April 11, 2007
TIME: 9:00 a.m.
LOCATION: Kenora City Hall, City Hall Council Chambers, 1 Main Street South, Kenora, ON P9N 3X2

North Spirit Lake First Nation community member Max Kakegamic was killed on the streets of Kenora, ON October 4, 2000. When the case went to trial January 2004, charges against the only suspect were stayed because of irregularities in the investigation. KPS members Lloyd White, Tom Favreau, and Chris Ratchford were cited for police misconduct in a February 2004 ruling by Superior Court Justice Peter Hambly.

KPS confirmed with NAN shortly after the 2004 judgment the investigation into the death of Max Kakegamic would not proceed. In January 2007 Ontario’s Chief Coroner denied the family’s request to hold an inquest.

The Kakagamics will make a statement to media following their presentation to the KPS board at approximately 9:10 a.m. The Board meeting is open to the public.

For more information please contact:

Jenna Young, Director of Communications, Nishnawbe Aski Nation, (807) 625 4952 or (807) 628 3953 mobile

Kimberly Murray, Executive Director, Aboriginal Legal Services, (416) 408 4041 ext. 225 or (416) 219 8569 mobile

The Northern Development Councils (NDCs) invite you to participate in a dialogue on Growing and Strengthening Northern Business on Thursday April 12th at the Forest Inn. The dialogue session will take place from 11:30 am until 1:00 pm. Lunch will be served. Deadline for registering for this session is noon today (Tuesday, April 10).

The Northern Development Councils have developed 17 strategies to review and provide comment on.

The strategies were narrowed down from recommendations taken from over 100 studies and reports on Northern Ontario. Some of the strategies look at improvements to community infrastructure, transportation systems, health care, improvements to existing resource sectors, new technology, research and education, and tax incentives, just to name a few.

Public input will be summarized by the Northern Development Councils and presented to the Minister of Northern Development and Mines for review and consideration in developing new programs to assist Northern Ontario … your input is invaluable! Your input will help the NDCs to prioritize the strategies and finalize recommendations to the Minister of Northern Development Mines.

If you are unable to attend a public consultation session in your area, please complete our online survey at the following web site to ensure your comments are included. The survey closes April 22, 2007.

http://www.econsultation.mndm.gov.on.ca/takeSurvey.asp?surveyID=123

Please distribute within your organization and to your contacts. All feedback is welcomed.

Contact Information ....

Florence Bailey
Northern Development Officer
Coordinator, Northwest -- Northern Development Council
Ministry of Northern Development & Mines
62 Queen Street, Box 147
Sioux Lookout, ON  P8T 1A2
(807)737-1616
(807)737-3419  fax
(807)737-6692  cell
florence.bailey@ontario.ca
www.mndm.gov.on.ca

INAC press release ...

INAC announces more than $46 million in Infrastructure at Pikangikum First Nation

            OTTAWA, April 10 /CNW Telbec/ - The Honourable Jim Prentice, Minister of Indian Affairs and Northern Development and Federal Interlocutor for Métis and Non-Status Indians, today announced in a visit to the community more than $46 million to improve infrastructure at Pikangikum First Nation.

            "Canada's New Government is pleased to invest in improving living conditions at Pikangikum First Nation. We are committed to assisting the First Nation in its efforts to become a healthier, and more sustainable community."

            Canada's New Government through the Regional Major Capital Plan for Ontario of Indian and Northern Affairs Canada (INAC), has identified close to $41 million over five years (2007-2008 through 2011-2012), to address infrastructure issues at Pikangikum. These include:

• $18.2 million to build a new school for Kindergarten to Grade 12;
• $12.9 million to complete an upgrade of the current diesel generation system, as well as to connect Pikangikum to Ontario's hydro grid;
• $9.7 million to expand and improve water and wastewater systems; and
• close to $200,000 to assess and remediate environmental issues in the community.

            Prior to this five-year investment, INAC has also provided approximately $5.4 million in 2006-2007 to assist Pikangikum with improvements to community infrastructure, including:

• $3.9 million for equipment and material to build new homes, and repair existing homes;
• $740,000 for water system repairs; and
• more than $725,000 to upgrade the diesel-generating plant, and for preparation work to connect Pikangikum to Ontario's hydro grid.

            Pikangikum First Nation is located approximately 90 kilometres north of Red Lake, Ontario, and approximately 80 kilometres east of the Ontario-Manitoba border It has close to 2,100 members with 2,000 on reserve. The community is accessible year-round by air, and by ice road during the coldest months of winter.

            This release is also available at: www.inac.gc.ca.

-30-

/For further information: Bill Rodgers, Director of Communications, Office of the Honourable Jim Prentice, (819) 997-0002; Greg Coleman, A/Director Executive Services and Communications, INAC Ontario Region, (416)973-2281; Media Relations, Indian and Northern Affairs Canada, (819) 953-1160/

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Yahoo news item ...

Tories promise help for poorest native reserves
Tue Apr 10 - By Sue Bailey

OTTAWA (CP) - Indian Affairs Minister Jim Prentice says he will soon announce more plans to improve native housing as part of a focused effort to help Canada's poorest reserves.

The Conservatives nixed the former Liberal government's $5-billion Kelowna Accord, but Prentice said he will "get results" for aboriginal people where the Liberals failed.

"Certainly there is a need for housing, and there will be housing announcements in the days ahead."

Prentice spoke Tuesday during his first visit to Pikangikum, an Ontario reserve about 300 kilometres northeast of Winnipeg plagued by suicides where most residents lack indoor plumbing.

The Ojibwa community will receive $40 million over the next five years to connect it to the regional electrical grid, improve water and sewage services, and build up to 40 new houses and a new school.

Indian Affairs confirmed last December that just 43 of the reserve's 431 homes have running water or indoor toilets. About half the houses are literally falling apart and are overcrowded by a youthful and growing population of 2,200.

Many residents haul water in jugs from a water treatment plant or simply boil lake water to make it safe. In a scathing report last fall, a regional medical officer of health warned of a potentially disastrous outbreak of related disease.

Work to hook up houses to the water treatment plant was stalled in 2001 when the then-Liberal government took control of band finances, even though they were in order, citing the reserve's failure to deal with a bleak range of social problems.

A Federal Court judge later ruled in the band's favour.

Residents were told not to hang Christmas lights last year because an overworked diesel generator - Pikangikum's main power source - couldn't take the extra energy drain.

The reserve has long been a symbol of native poverty and despair, where suicide rates are among the world's highest.

Extending basic electricity to the community is top priority, Prentice said.

"That has actually been the critical impediment that has held this community back. They can't get on with the other things that need to be done because there's no electricity.

"We're going to start with that, get it done, then over the course of the next five years we've budgeted to improve the housing stock, build the school and do all the water and sewer connections. That's how we're going to approach these kinds of communities."

The spending announced Tuesday is not newly budgeted cash, but has been prioritized for Pikangikum based on urgent needs outlined by band leaders, Prentice said.

He has asked for a report from Indian Affairs on what happened to $7 million spent by the Liberals in a failed attempt to hook the reserve up to the power grid starting in 2000.

Furious chiefs attacked the Conservative budget for its limited new spending to lift native living standards, calling it the "stone soup budget."

But Prentice reiterated Tuesday that Ottawa's outlay for native programs is a "significant" amount that will top $10 billion this year.

"And in places such as Pikangikum where there are priority needs, we are moving to address them."

Amid graffiti-scrawled buildings and obvious hardship, Prentice said he was graciously received during a one-day trip to the reserve.

"There's an enormous amount of pride in the community."

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Canadian Press story ...

Feds to spend $40M for electricity, new school on troubled Pikangikum reserve
Sue Bailey, Canadian Press - April 09, 2007

OTTAWA (CP) - It may be more than three months late, but Christmas is coming to the troubled Pikangikum reserve.

The northern Ontario First Nation where residents were told not to hang Yuletide lights last year due to power shortages is to receive just over $40 million in new federal funds.

Indian Affairs Minister Jim Prentice will confirm the cash injection Tuesday, said a government official who asked not to be identified. It's to be announced as Prentice makes his first, day-long visit to the remote reserve about 300 kilometres northeast of Winnipeg.

The money is to help connect houses to the regional electricity grid, improve water and sewage services, build a new school and up to 40 new homes.

Pikangikum has made global headlines for one of the world's highest suicide rates. Its rotting sprawl of run-down, graffiti-covered houses is a stark reminder that Third World poverty is a reality in Canada's most neglected native enclaves.

Many Pikangikum residents have no running water and rely on outhouses that freeze and overflow in winter. They draw electricity from an overworked diesel generator. About 700 children in the community of 2,200 are overcrowded into a school designed for 350. Organized recreation for a growing population of restless teenagers is badly needed.

They live in conditions that most Canadians can only imagine.

One of the most recent reports to leave the federal government red-faced was delivered last fall by a regional medical officer of health based in Kenora, Ont.

Dr. Pete Sarsfield raised alarms about water-related illness, skin diseases, ear infections and lice. He said the slow pace of federal action would never be accepted elsewhere.

"The conditions in Pikangikum would not be tolerated in our suburbs or rural areas," he told The Canadian Press last December. "It simply would not be allowed."

Angus Toulouse, Ontario vice-chief for the national Assembly of First Nations, said any new spending in the community is "tremendously needed" and long overdue.

Work to connect homes to the water treatment plant has been stalled since 2001, he noted. That's when the former Liberal government took over the band's finances - even though the books were in order - citing the band's failure to tackle an array of social problems, including domestic violence and a suicide rate that eclipsed the Canadian average.

"Just coming into the community, you can see the despair," he said in an interview.

"It's disgusting that in this day and age, that's the standard living condition in many of our impoverished communities - especially in the remote North. Out of sight, out of mind.

"I can only continue to express a real need for the government to take a global look at the needs that are there, and not individually zero in on one community."

Toulouse is cautiously optimistic that the $40 million may help take the edge off some of Pikangikum's most pressing infrastructure needs. But he said it won't be enough to keep pace with long neglected repairs, maintenance and the burgeoning demands of a growing population.

The Tyee - Reconciling with First Nations series

Award winning writer Sandra Shields reports on how Aboriginals and non-natives are working out new relationships -- and grappling with old injustices -- in classrooms, timber forests, and negotiating rooms of the Fraser Valley. Shields wanted to see how First Nations people in British Columbia might achieve a more just and equitable relationship with the descendents of their European colonizers.

She emerged from the process cautiously hopeful, sensing "a lightening" in relations, "at least provincially" - but at the same time saying, "This is really just the beginning."

"People who are experts in reconciliation talk about the need to be clear about what really happened, to find ways to address injustice, to root it out, to find ways of sharing power differently. That's generations of work," says Shields. "Thank god we are embarking on it, but there is a lot of work ahead of us and it will require an enduring commitment on all parts."

This special four part series is funded by a Tyee Fellowship for Solutions Reporting.

Part 1:

'We Weren't Supposed to Survive'

Part 2:

Beyond 'Teepees and Igloos' Reconciling with First Nations begins in the classroom.

Part 3:

Sharing the Forests - In new timber deals, what are First Nations really getting?

Series Background information:

• Reconciling with First Nations: A Reader-funded Solutions Series
   
• about the Reconciling with First Nations series
   
• Listen to audio: Kathryn Gretsinger interviews Sandra Shields about First Nations reconciliation.

From Winnipeg Free Press ...

Feds warned on native funding - Spending cap is eroding services, minister warned in pre-budget briefing document

Sun Apr 8 2007 - Paul Samyn - paul.samyn@freepress.mb.ca
 
OTTAWA -- Indian Affairs Minister Jim Prentice's department issued a pre-budget warning that a growing cash crunch for basic services is shortchanging the country's growing First Nations population.

Federal documents obtained by the Free Press show departmental officials red-flagged the long-term impact of a two-per-cent cap on funding increases that has resulted in less money for capital projects like schools, housing and welfare.

The tracking of the cumulative effect of the government's failure to keep up with both inflation and native population increases shows that funding for basic services is down six per cent in real terms from 1996 to 2006.

And that shortfall, the department says, comes with a price:

• erosion of on-reserve infrastructure;
• health and safety issues;
• risk of legal exposure;
• inability to match provincial standards.

According to the department, maintaining a two-per-cent cap on funding increases results in a $50-million shortfall each year, whose cumulative impact is now more than $300 million less in real terms.

The warnings issued in November 2006 and February 2007 follow a secret memo to Prentice that was prepared for him when he took over the department after the Tory election win in 2006.

"Numerous policy and program pressures are beyond the capacity of the substantial $6-billion departmental budget which primarily funds provincial-type services for northerners and First Nations on-reserve communities,'' says the three-page briefing for Prentice.

Prentice has been under fire from aboriginal leaders in two successive budgets. The first Tory budget essentially gutted the $5.1-billion Kelowna accord for aboriginals, while natives barely merited a mention in the second budget with only $370 million in new spending over three years announced. Prentice's budget will rise by less than 0.6 per cent this year to $6.3 billion.

Prentice has repeatedly argued after the Mar. 19 budget that total government spending on aboriginals will top $10 billion this year -- which he says is $1 billion more than the Liberals ever spent.

Prentice spokeswoman Deirdra McCracken said the documents reflect a long-standing cap on funding increases that began while the Liberals were in power. But McCracken said more money will not solve the problems facing First Nations and that Prentice is looking at structural changes to improve their lives.

"What Minister Prentice has said from the beginning is that the solution to improving the lives of First Nations is not pouring more money into the top of the funnel," she said.

However, Liberal native affairs critic Anita Neville said Prentice is misleading Canadians by rolling in money spent on native land claims and other legal obligations to reach his $10 billion spending total.

Neville (Winnipeg South Centre) said the documents make clear the extent of the real problem facing First Nations, which Prentice is not prepared to admit to or take deal with.

"The bureaucracy is giving him the real picture and what he is doing is not responding,'' Neville said.

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Breaking down the numbers - HOW has Indian Affairs dealt with a two-per cent cap on funding increases? 

Departmental documents show reallocation has been a key part of the coping strategy with the following basic services seeing the following cumulative reductions by 2005:

• capital is down $293 million
• housing is down $81 million
• income assistance is down $51 million
• post-secondary education is down $13 million.

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From Saskatoon Star Phoenix

Unrealistic funding cap hurting First Nations
Doug Cuthand, The StarPhoenix
Published: Friday, April 27, 2007

There is a "secret" document circulating that shows the federal government knew about the state of First Nations living conditions and budget shortfalls prior to its latest budget.

It warns the minister of Indian Affairs about the damage that a cap of two per cent on First Nations funding has created, including the serious cumulative impact it has on the health and safety of people. The internal department memo outlines the need to respond with a one-time payment of $500 million and an annual budget increase of $50 million thereafter.

Budget increases for Indian Affairs were limited to two per cent a year, starting in 1997. The rate of population and price increases has been four per cent annually for the same period. Indian Affairs receives an annual budget of about $6 billion, which, as the report points out, is four per cent of total federal expenditures.

As a result of the cap, certain statutory budget items that have grown in size have to be covered by diverting money from other areas. For example, tuition agreements with provincial schools increased $100 million in 2005. This is a statutory item that must be paid. But in order to pay this increase, money had to be taken from non-statutory items such as capital and housing spending.

The report also mentions that First Nations have coped with the shortfall by limiting growth in various areas, including staff salaries and benefits. Nothing was mentioned about the salaries and benefits of Indian Affairs staff. However, the report's appendices noted that First Nations' employees benefits are funded at 12.5 per cent, compared to 20 per cent for Indian Affairs employees.

The memo warns the minister that continuing with the cap is costly in terms of eroding on-reserve infrastructure, deteriorating health and safety of people, risking legal exposure and making it hard to maintain provincial standards.

Only 23 per cent of the budget spending is considered "discretionary" -- meaning the money can be allocated to other items. The bulk of the department's budget consists of "transfer payments," or money for provincial-type services such as child and family services and education.

Also considered discretionary and being cut back are "transformative programs" such as post-secondary education, housing and economic development, which are meant to improve socioeconomic disparities. This means that the department's budget is focused on basic maintenance, not development.

The report also notes that the department's northern affairs branch is unable to respond to pressures of economic growth and resource development.

There are funding pressures associated with "extraordinary" items such as the "Kashechewan emergency." In addition, over the past five years the department has had to reallocate funding to cover federal government priorities such as the environmental cleanup of contaminated sites.

The result of this cap on spending is that the budget is woefully inadequate to respond to the basic services First Nations communities require. The following is the result of reallocating funds: Capital is down $293 million, housing is down $81 million, income assistance is down $51million and post-secondary education is down $31 million.

This is a sad reflection of how some people are made to bear the brunt of funding cutbacks at a time of budget surpluses.

This report did not come from a group of disgruntled political leaders. It came from within the department, by the very bureaucrats who administer Indian programs. They know from the inside the sorry state of first Nations finances.

When the folks at the colonial office get worried, then First Nations know we are in real trouble.

The attachments to the report are dated Feb. 2, although the report itself isn't dated. Diedra McCracken, Indian Affairs Minister Jim Prentice's spin doctor, told me that this was an old document presented to Prentice when he took over the portfolio. If that's the case, two budgets have been presented without the minister responsible acting on advice from his officials.

In any event, the report's call for a one-time increase of $500 million and annual increases of $50 million were not followed. Instead, there was a miserly increase of $370 million in new money, which is to be spent over three years. There was $300 million for a housing trust, but even its administration is yet to be worked out. This was a bright spot in the budget and a welcome change from band-owned housing.

Prentice was running around the hinterlands this month, generously announcing money for capital projects. Among the announcements was $14.5 million for Saskatchewan alone. In light of the fact that close to $300 million was taken from capital spending last year, it appears that Prentice was bribing us with money we rightfully should have got in 2006.

Most of the funding went into constituencies held by opposition MPs. Strange, that. Maybe it's starting to dawn on the government that the aboriginal vote means something.

But this issue cannot be dismissed as merely partisan. The cap was put in place under the Liberals and continued by the Conservatives. Both have some explaining to do.

We have First Nations in debt and under-funded today. It's time to take a serious look at providing adequate funding for First Nations and not place us in a position where our leaders have to beg for basic services.