QIA surplus fills development funds vacuum
QC businesses making profits
The Qikiqtani Inuit Association’s source of economic development funding has dried up, at least for now.
Every year the Nunavut Trust doles out cash to Nunavut Tunngavik Inc., which in turn hands money down to the three regional Inuit organizations.
But the agreement to continue transfers for economic development funding expired over the last fiscal year, and it still hasn’t been renewed.
The Nunavut Trust has exerted pressure over the last year to encourage Inuit organizations to curb their spending.
So this year QIA will fill its economic development coffers with most of this year’s $443,000 surplus, with the hope that NTI will eventually kick in some cash too. In the past, regional Inuit organizations like QIA had to give half of any surplus back to NTI.
The substantial 2005 surplus is mostly the result of federal funding that was approved at the very end of the fiscal year, which starts in March. “Literally, we got it in late February,” said Mohamed Docrat, QIA’s director of finance.
That economic development funding will be spent by Kakivak, which administers QIA’s training and development programs.
Over the last fiscal year, Kakivak spent $1.5 million on training and employment projects. It also spent $647,000 on youth programs, and over $1.15 million on childcare programs.
Meanwhile, profits continue to grow for companies held under the umbrella of QIA’s business arm, Qikiqtaaluk Corp.
That marks a shift from about five years ago, when many of the corporation’s now-profitable ventures were money losers.
In 2005 QC posted a net income of over $4.3 million, up from $3.9 million in the previous year.
The organization’s many fingers are dipped into the property management and staff housing business, lucrative construction projects like the Qikiqtani Hospital construction and Resolution Island remediation project, as well as service businesses like the Baffin Gas Bar in Iqaluit and Larga Baffin in Ottawa.
However, income from its operations dropped to around $3.8 million, down from over $4 million in 2004.
That’s partly because of growing costs of hiring QC management staff, partly because of a boost to salaries, and partly because of a first-year loss posted by QC Woodworking.
That company, which is run internally by QC, posted a $60,000 loss. The firm has been contracted to furnish the Government of Nunavut’s new department of justice building, due to be completed in December 2005.
“They work they do is beautiful. It’s just a question of whether they can make money at it,” said Qikiqtaaluk Corp. president Brian McLeod. He says QC will wait a few years to see whether the company is viable or not.
QC also plans to sever ties this year with Natsiq Investment Corporation, a joint-venture between QC and Nunavik’s Makivik Corporation to bring seal-oil capsules to Asian markets.
Last year QC paid about $6,000 a year to keep the seal fat in a Montreal freezer. But the deal with interested Chinese parties never came together.
Health regulations complicated the business and plans to purchase a rendering plant fell through. This year, QC plans to split the differences with Makivik and get out of it.