QIA fiscal year ends with $5 million
Highlights from the annual report include price of iron projections
Karen K. Ho
Northern News Services
Monday, October 26, 2015
NUNAVUT
Members of the Qikiqtani Inuit Association are concerned about the price of iron right now, but whether it will effect future benefit payments is something out of their control.
Qikiqtani Inuit Association president P.J. Akeeagok and his daughter serve snacks at the 40th anniversary community feast in Iqaluit. The Association recently announced a $5.6 million surplus, down from $18 million from last year. - photo courtesy of the Qikiqtani Inuit Association |
"Iron ore prices are a global commodity that fluctuates based on demand of the world," president PJ Akeeagok told Nunavut News/North. "We're always monitoring because there's provisions directly in the IIBA (Inuit Impact Benefit Agreement) that speculate (on it)."
The designated Inuit organization recently released its 2014-2015 annual report, which noted that the QIA finished the fiscal year with a surplus of $5.6 million, down from $18.8 million from the previous year. Akeeagok said the difference was largely due to the one-time kickstart payment of $20 million from the IIBA with the Baffinland Mary River project.
"There are mechanisms in place that allow the association to still receive amounts until they get into production," he said. "Those are kind of already structured directly in the IIBA, so both the company and the association know exactly leading up to production the royalties we'll be receiving."
This year, the association received just over $3 million from the agreement, which Akeeagok said wasn't a shock because it was a preset number and had nothing to do with the current price of iron ore.
In terms of any impact on the association's operations, Akeeagok said one of its subsidiaries, the Qikiqtaaluk Corporation, was entirely self-sustaining and generated revenues for other activities.
And when it comes to royalties from production at Mary River, Akeeagok said they can't actually use them until a spending policy is drafted first.
"Any royalty that we receive is in a restricted reserve fund garnering interest," he said. "We can't touch it until we actually have a very solid revenue resource policy in terms of priorities that Inuit want to see those funds to be used for."
Akeeagok said figuring out these key priorities, whether they're things like mental health or language programs, will involve community consultations.
"There's a lot of work ahead of us in terms of establishing this standpoint," he said.
Akeeagok said the policy will also have long-term implications beyond Baffinland's current operation.
"It's all Inuit-owned lands that we have within our region that potentially, if there's a mine being built," he said. "Any funds, not just from Mary River, but from future projects, will be guided by this."
Akeeagok doesn't have a timeline for his organization will have this completed, but said it's being worked on a continuing basis internally and he hoped that it would be a definite priority in the next few months.
When it comes to the organization's ability to improve employment and assist startup businesses, Akeeagok acknowledged the large drops in funding from the Department of Aboriginal Affairs and Northern Development were affecting the association's ability to do outreach and carry out its programs.
The association received $319,023 from the federal department this year. This was much less than the $571,406 received in 2014 and less than half of the amount of $704,687 in 2013.
However, Akeeagok said that there was no correlation between these funding cuts and the organization's cost-cutting measures. While spending on program assistance grew by $1.6 million, the association's reductions in wages, benefits and non-salary operating expenses totalled almost $1 million.
"Those were just the result of very strong, efficient government systems," Akeeagok said.
The report also states that the association's subsidiary Kakivak Association spent $1.25 million on business support programs, including $235,000 on its economic opportunities fund.
The organization spent $1.28 million on its training and youth programs.
