Nunavut Trust cool to NTI request for $10 million more Inuit organizations threaten land claim capit

GREG YOUNGER-LEWIS

RANKIN INLET — Faced with demands to increase spending, Nunavut Tunngavik Inc. was handed a stark ultimatum by its money-holders this week — cut programs and find other sources of cash, or else you put future funding in jeopardy.

The Nunavut Trust, the main source of funding for NTI, sent the missive directly to Nunavut’s Inuit land claim organization on the opening day of NTI’s annual general meeting on Nov. 2 in the Simon Alaittuq School gym in Rankin Inlet.

NTI and its various Inuit organizations owe the trust almost $116 million, after overspending for nearly a decade, according to financial statements from 2003. The trust expects the debt to double in the next decade, if the spending doesn’t slow.

The trust was set up in 1993 to handle $1.2 billion in transfers from the federal government under the land claim.

At the current rate of spending, the trustees are concerned that they will likely fall short of the $1.1 billion that they hoped to have accumulated by 2007.

Archie Angnakak, chair of the trust, hinted that there could be tougher times ahead, where the trustees won’t be willing or able to continue funding NTI’s spending.

“A lot of the time we can’t keep up,” Angnakak told the delegates in Inuktitut.

“This is going to have a lot of effects on the future… We would break our own rules.”

Angnakak’s presentation clashed with growing pressure on NTI to pump up this year’s proposed budget to nearly $45 million, about $10 million more than last year.

Atuqtuarvik Corp., a lending group created by NTI four years ago, lobbied for the lion’s share of the added funding, saying that their $70 million core funding is running low, and that more Inuit businesses need their help.

Atuqtuarvik said they need at least $8 million for “recapitalization,” essentially a renewal of the pot of money they use to invest and give as large-size loans to new and expanding Inuit-owned businesses. They currently have about $13 million left in their coffers, but lend an average of $800,000 per month, leaving them broke in less than a year.

Ken Toner, the lending group’s president, explained how the money was being spent before delegates voted on the budget.

“The idea here is to provide Inuit businesses with inexpensive money,” Toner said, referring to how the group doesn’t ask for profits from the shares they buy in companies.

“What we want to do is try to help Inuit businesses get established.”

Atuqtuarvik has equity in Inuit-owned businesses, and loans to regional development corporations, totaling more than $57 million. About one-third has gone to building the new Baffin Regional Hospital in Iqaluit and the new health facility in Cambridge Bay.

To date, the group has offered loans of $150,000 or more to 32 companies in housing, tourism, retail and other industries. They say the loans and investments have created 298 jobs for Inuit.

Toner said they usually invest in start-up companies after giving them a loan, in order to help them with the cash flow in the first few years.

Atuqtuarvik wasn’t the only organization looking for more. The three regional Inuit associations and community liaison officers wanted more than $600,000 in additional funding. NTI planned to reduce its own operational budget by about $45,000.

James Eetoolook, NTI’s vice-president and acting vice-president of financial issues, was optimistic that the budget with Atuqtuarvik’s sizeable request would be approved, despite warnings from trustees.

Eetoolook said the funding situation with the trust was “stable,” although he expected Inuit would “feel” the effects of budget pressures in coming years.

“I think all of us are aware that some years are going to be tight,” he said during a break in the meeting. “This is the way of the world.

“Some years we’re not going to get all the money we want, but we’re going to survive.”

Eetoolook said NTI wouldn’t be able to find extra sources of funding besides the Nunavut Trust for at least six months.

He also turned down the idea of investing in mining and mineral exploration companies, as suggested by one delegate, Ross Pudluk, a Qikiqtani Inuit Association community director for Resolute Bay.

Voting results on the budget, which had to be finalized by the end of the meeting on Nov. 4, were not available by press time.