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Fed stalling hurts GNWT bottom line

Delays cost territory hundreds of thousands of dollars

Nathan VanderKlippe
Northern News Services


Yellowknife (Dec 13/02) - The territorial government is losing hundreds of thousands of dollars to interest payments as it covers money the federal government is reluctant to hand over.

Ottawa owes the GNWT $23 million in aboriginal health care payments this year. But the existing agreement between the two governments expired March 31, and the federal government has been reluctant to negotiate a deal with the territorial government.

The Department of Indian Affairs and Northern Development compensates the territorial government for the basic health care it delivers to Inuit and status Indians every year.

So far this year, the GNWT has paid out more than $11 million for costs Ottawa is supposed to cover. At this point, that means monthly interest payments of about $50,000 -- or as Frame Lake MLA Charles Dent put it, the cost of an extra drug and alcohol worker.

Average that cost over a year -- it could take that long to work out the contract, which would expire again in two years -- and the total annual interest charge to the GNWT works out to $600,000.

A major part of the problem is the way aboriginal health services agreements are constructed. The federal government drafts one master agreement which applies to the majority of Canada, where payments are made to band councils and administrations.

The NWT has a different system. Here, the territorial government administers the program. Because it doesn't fit the mould, the territory gets a rough ride, and the money it is wasting has caught the attention of the federal auditor general, who pointed out the losses in a recent report.

Auditor General Sheila Fraser said the federal government had no right to deny the GNWT interim agreements, which could be signed between the time one permanent agreement expires and the next is signed.

An interim agreement could save the territory money on interest, but so far Ottawa has said it won't sign one.

That has territorial politicians angry.

"Whatever the number is, it doesn't make any sense for us to be spending the tax dollars that we find it so hard to come by on the carrying cost of having to finance these payments for the federal government," said Yellowknife South MLA Brendan Bell.

"It sounds like we've got our work cut out for us, but we'd better do something about it."

"We're taking money out of other programs to put into this one. So yeah, it's a concern," said Dent. "It's important money we can't afford not to have. The feds shouldn't be using us for a bank."

But short of putting the federal government in a headlock, there is little the GNWT can do to urge progress on these agreements, although the auditor general's report does provide some ammunition.

"DIAND is very slow in paying us so we incur the cost," said Finance Minister Joe Handley. "I think the auditor is quite right, it's costing us money."