Benefits to First Nations from Hydro deal questionable

Hey there, time traveller!
This article was published 13/09/2016 (3333 days ago), so information in it may no longer be current.

For the past decade, Manitoba Hydro has spent hundreds of millions of dollars to bring northern First Nation communities along as partners in the development of new generating stations. 

These partnerships were trying to accomplish two main goals: first, to ensure First Nations were fairly consulted about the impact of these projects to avoid the destructive and disrespectful mistakes of past dam builds; and second, to ensure those communities received social and economic benefits that would materially improve their lives.

Has it worked? A newly released report from Manitoba auditor general Norm Ricard offers some intriguing food for thought.

Ricard examined Manitoba Hydro’s partnership agreements with four northern First Nations involved in the Keeyask generating station, 700 kilometres north of Winnipeg on the lower Nelson River. A number of concerns were raised.

The auditor was not satisfied the ratification process — by which band members authorize the chief and council to negotiate the parternships with Hydro — was properly managed. In particular, the auditor said Hydro is not doing enough to ensure ratification votes are adequately monitored and verified.

Other concerns were related to payments Hydro made to First Nations.

During the last 15 years, Hydro has paid nearly $170 million to four First Nations — Tataskweyak Cree Nation, War Lake First Nation, York Factory First Nation and Fox Lake Cree Nation — who are partners in Keeyask.

Most ($146 million) went to “process costs.” The remaining money is devoted to “adverse effects” programs.

Process costs help First Nations hire lawyers and consultants to negotiate a partnership agreement, participate in environmental and regulatory assessments and to “make informed decisions about the development project based on independent legal, professional and technical advice,” Ricard wrote.

Adverse-effects programs include infrastructure upgrades on reserve, hunting and fishing programs, educational programs and initiatives to promote language and cultural traditions.

The auditor said Manitoba Hydro is doing a fair job of meeting its obligations under the process-cost and adverse-effects programs. However, there were problems with oversight.

On expenses, the auditor was concerned Hydro was not doing enough to verify claims from First Nations were valid.

Two of the Keeyask partner First Nations were found to have been submitting and receiving payment for ineligible expense claims. In one instance, Hydro paid out travel expenses that were submitted twice. At another First Nation, there were concerns about a $75,000 ceremony to mark the signing of the partnership agreement.

Hydro responded with special audits and has twice introduced new administrative measures that seem to address most of the auditor’s concerns.

However, there is a broader question raised by the auditor’s report: has all this money made any net positive impact on the lives of the people living in the four First Nations? 

The benefits to First Nations and other northerners from the construction of hydro projects are ambiguous. At the back end of construction, there is profit-sharing, although in this uncertain energy market, one has to wonder what profits there are to be shared.

There are jobs to be had in the north during the planning and construction of the dams. However, when the project is completed, only a handful of people are needed to operate the generating equipment. Despite its enormous cost, Keeyask has limited economic spinoffs once it is operational.

We know this because this is the scenario unfolding with the Wuskwatim dam and the Nisichawayasihk Cree Nation.

Prof. Peter Kulchyski, head of the University of Manitoba department of native studies, said the only legacy from the construction of the dam is a training centre, but it is unclear how much of a benefit it provides, particularly when there aren’t many jobs to be had on reserve. On top of this, he said, the dam is still inherently disruptive to the environment and traditional land around the First Nation.

“There are still lots of negative impacts from these projects in terms of the harm it does to traditional lands,” Kulchyski said. “At the same time, there are really very few positive, long-term impacts we can identify.”

Sheila North Wilson, grand chief of Manitoba Keewatinowi Okimakanak, the umbrella organization for northern First Nations, agreed more needs to be done to improve the long-term economic effects of hydro partnerships. She said more needs to be done to not only train First Nations people to work on construction of the dams, but also to educate a new generation of aboriginal lawyers, engineers and environmental experts. “There are still too many people from the south making a living off these projects,” she said.

Making First Nations partners in the construction of multibillion-dollar generating stations is a good and just idea. However, the “partnerships” being offered by Hydro are imperfect. Huge sums of money are paid to First Nations, but far too much of it flows through them and into the pockets of consultants who neither live nor really work in the north. At the completion of the construction phase, there is little in the way of tangible, long-term social or economic benefits.

No matter how you cut it, $170 million should be enough money to dramatically improve the lives of people living in those four First Nations. If we are not accomplishing that, then it’s time to come up with a whole new definition of “partnership.”

dan.lett@freepress.mb.ca