Globe and Mail

An impoverished First Nation in Quebec says it wants to be allowed to operate without the assistance of the third-party manager sent in more than a decade ago by the federal government, and whose fees, the chief says, are eating up all the funds available for crucial social spending.

Casey Ratt, the Chief of the Algonquins of Barrière Lake, a reserve about 230 kilometres north of Ottawa, said the government will not free his First Nation from the obligation to have a third-party manager unless the council approves the consolidated financial statements the manager prepares. Mr. Ratt said he and the other councillors have refused to do so because Lemieux Nolet Inc., the management company, does not show them those documents.

The government wants “us to sign off on the financial audited statements which we have never seen. We don’t know what they [Lemieux Nolet] have been doing, where they have been [sending] the money to, what they have been paying off, ” Mr. Ratt said at a news conference on Thursday. “We have no idea what surpluses, what deficit situations, we were in last year and the year before.”

It would be foolish to approve the financial statements without written assurances the council will not be held liable for any problems, the Chief said.

It is unknown how much Lemieux Nolet, which Mr. Ratt says takes 10 per cent of all band money as its fees before other expenses are paid, will receive for the work it has done in the 2016-17 fiscal year.

In 2015-16, its fee came to $423,826 – more than $8,100 a week – to manage the affairs of the First Nation, which has fewer than 700 members in total, just 300 to 400 of whom actually live on the reserve. That means the company makes more than most third-party managers across Canada, according to a statement from the Indigenous Affairs department that was obtained by NDP MP Charlie Angus.

“We have not been able to put anything in place for a very long time that would be good for our community because every flexible amount of dollars goes to the [third-party manager] to pay their fees,” Mr. Ratt said. “This is outrageous and it has to stop.”

Claude Moisan of Lemieux Nolet, said the fees are fair because the company won the contract in an open tender. Lemieux Nolet’s staff “work very hard” and put in long hours on behalf of the Algonquins of Barrière Lake, he said.

Mr. Ratt said he has no idea how many employees at Lemieux Nolet work full-time for the First Nation. But, he said, it takes the company, which must approve all expenditures, 48 hours to sign off on every ambulance ride.

The Algonquins of Barrière Lake are suing Lemieux Nolet and the federal government, saying there has been a breach of fiduciary duty, interference with economic relations and negligence. Mediation began in January. But the First Nation’s fiscal year ends in a week, and the chief and council want Lemieux Nolet out by then.

The government did not respond on Thursday to questions about why the Algonquins of Barrière Lake must remain under third-party management, which began in 2006 when the community ran a deficit of $83,000.

The millions paid to third-party managers over the past 11 years would have eliminated that deficit many times over, Mr. Ratt said. Meanwhile, he added, his people live in poverty.

A group of concerned citizens from Ontario, Quebec and the United States visited the community on Wednesday. Shiri Pasternak, an assistant professor at Trent University in Peterborough, Ont., who teaches about Canada and indigenous history, was among them.

“We heard about a man whose house burned down who is living in the basement of that burnt-out house with his family because no new housing has been built,” Dr. Pasternak said.

“We heard about students who were at college who didn’t have enough money to eat because the community couldn’t control the disbursement of funds.”

Third-party managers are required to teach First Nations how to manage their finances. Mr. Moisan said that can only happen when people want to learn. Mr. Ratt said no training has gone on in Barrière Lake.

“There’s issues about why such large fees are given without any end date,” Mr. Angus said. “We have communities that were put under third-party management and seem to be worse in debt after many years. This is a broken system.”