NTI trims $1 million from next year’s budget

GREG YOUNGER-LEWIS

The leader of Nunavut’s land claim organization pledged to keep Inuit services as he prepares for $1 million in cutbacks over the coming year.

Nunavut Tunngavik Inc. approved cost-cutting measures in their $44.6 million budget at their annual general meeting last week in Rankin Inlet, after hearing that previous spending by Inuit organizations was putting funding for future generations at risk.

After the meeting, NTI president Paul Kaludjak said it was too early to know where they will trim their annual expenses.

But he said he hopes to avoid cuts to social funding, such as the hunter support program, which Inuit use in order to buy skidoos and ammunition.

He said other programs, such as travel subsidies for grieving families and financial assistance for elders, will also remain untouched.

“Those are more important to our beneficiaries,” Kaludjak said. “I prefer myself to look at internal operational requirements.”

Some spending increases will still occur. Under NTI’s financial strategic plan, regional Inuit organizations and others funded by the land claim are allowed to increase their budget three per cent every year, without having to put in a request for additional funding.

That means the regional Inuit organizations and Nunavut Heritage Trust, will each receive between $40,000 to $120,000 more in the 2005-06 fiscal year. Under the strategic plan, Nunavut Trust is expected to hand over about $34 million for this year’s budget.

But most organizations asked for more, on top of the allowed amount, citing increasing operational costs. The largest lobby for more money came from Atuqtuarvik Corp., who wanted about $8 million to top up their lending capital over the next year.

The additional $10.7 million in requests pumped the budget up to $44.6 million.

However, delegates accepted recommendations from NTI staff that they should only allow the extra spending if the Nunavut Trust can afford it, or they can find the money elsewhere.

Archie Angnakak, chair of the trust, said he was “very pleased” with the thrifty approach that NTI ended up taking.

Angnakak had set the tone for budget discussions earlier in the week, when he warned that current spending by NTI and the Inuit organizations could eventually eat into the capital of the trust.

The trust was set up in 1993 under the land claim to handle $1.2 billion in federal transfers to funds NTI with interest from the capital of the transfers. If spending reaches into the capital portion of the trust, Angnakak predicts that they will miss their target of having $1.1 billion set aside by 2007, when the transfers stop.

NTI’s finance department reported during the meeting that their 2005-06 budget will likely throw the trust’s savings plan off by one year. That means the trust will have about $1.1 billion by 2008.

“The trust is very safe,” Angnakak said during a break. “[But] if we don’t take action right now, we’ll be hurting 10 years from now.”

“We’re going to work together in dealing and adjusting to the current times which are kind of tight.”

Angnakak suggested that the Nunavut Trust will likely withhold the additional funding for NTI if the trust continues to get lower-than-average returns on its investments.

But he said that a joint committee of trust members, NTI staff and politicians would have a better idea of what they could afford by the end of the month.

Angnakak said there was no plan for NTI and other Inuit organizations to repay their $126 million loan to the trust. He said the trust will absorb the loan from putting money aside from profitable years.

To boost their flagging finances, NTI has decided to hire two new staff in charge of fundraising, to tap into federal, territorial and other funding programs. However, the new employees aren’t expected to bring in new money until next year.

NTI administration said they were already reducing travel expenses by holding teleconferences more often, instead of flying to various communities.