Indigenous Services minister overrules senior bureaucrat on Neskantaga water probe

That contradicted a commitment Miller made to Moonias that the terms of the investigation would be co-developed with the chief and council. 

“What we agreed on is to work together and develop the TOR [terms of reference],” Moonias told CBC News. 

“What I received was more of a unilateral approach, so I wasn’t really happy about that.”

‘It felt like it was a slap in the face’

Neskantaga First Nation, a northern Ontario fly-in community, has been under a long-term drinking water advisory since 1995.

Multiple sources with knowledge of the minister’s decision — who spoke with CBC News on the condition they not be named — said Miller learned of the contents of Scotton’s email later in the day.

“I felt like it was a slap in the face,” Moonias said.

Miller emailed Moonias late Thursday evening to address the community’s concerns.

“I have seen those emails and would like to clarify that my commitment to you is to work with you on both investigations to ensure you are comfortable with next steps, supportive of the final terms of references, and involved in the decision on whoever is hired to conduct the third party review,” Miller wrote.

“The emails that were sent do not make that clear and I wanted to reach out personally to clarify these points. These investigations result from your asks, and I wish to work closely with you to ensure that they are done properly.”

Scotton proposed two studies — one on the business practices of contractors, project management and engineering firms, the other on Neskantaga’s water and public health crisis.

Selected third party investigator managed Neskantaga’s finances for years

Neskantaga evacuated nearly all of its members in mid-October to Thunder Bay, 450 km south, after the discovery of an oily substance in the community’s reservoir cut the reserve off from its supply of running water. Indigenous Services Canada said the substance was a non-toxic mineral oil coming from a distribution pump in the reservoir and repairs are underway.

It was the latest in a string of setbacks that have delayed the completion of the promised upgrade to Neskantaga’s water treatment plant, which is now years overdue. 

Moonias wrote to Miller on Oct. 22 demanding “an immediate investigation into business practices of contractors [and] engineering companies” hired to fix problems with the water supply that only got worse over the years.

Miller replied on Nov. 6: “We agree that this is important and would like to work with you and other communities and organizations to undertake this.”

On Thursday, Scotton wrote Moonias to inform him the terms of reference for the investigation “will be finalized with the consultant firm (MNP) shortly.”

Scotton also told the chief his “personal involvement in the study is very important.”

The choice of MNP, a national business consulting firm, offended Moonias because it used to be Neskantaga’s third-party manager — a body hired by the federal government to take over the financial management of First Nations deep in debt.

According to documents obtained through the information access law, MNP was paid $200,000 by the First Nation each year for the 16 years it managed Neskantaga’s finances.

The community said it does not want MNP as a third party investigator since it cannot be impartial, given its previous work with the First Nation. 

“I want to make sure it’s a real impartial investigation,” Moonias said.

Scotton wrote to Moonias that the objective of the special study into the business practices of construction, engineering and project management firms involved in major capital projects is to strengthen the internal controls and oversight practices of First Nations and Indigenous Services Canada. 

She said the focus would be on a range of major capital projects approved and funded for northern and remote First Nations in Ontario from 2016 to 2021. 

Scotton also said the study would include interviews and a review of documents. It would look at current business practices, resources available to First Nations, project management structure, financial and administrative controls, departmental process for reviewing and approving projects and the extent to which action already has taken place to address previously identified problems.

The investigation into business practices would start the week of Dec. 6 and be completed by Feb. 25, 2022, she wrote. The study into Neskantaga would start the same week, but would be finished by the end of next March.