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A man in Attawapiskat tries on gloves delivered by the Canadian Red Cross.Johan Hallberg-Campbell/Red Cross

Ottawa responded to the Attawapiskat Cree's plea for more housing by promising Sunday to ship the impoverished community an additional seven modular homes, bringing the total to 22.

However, amid efforts to ease the housing crisis, community leaders continue to clash with the Harper government over its decision to take over the band's finances earlier this month.

Ottawa has blamed the community's problems on financial mismanagement of roughly $90-million in federal funds spent in Attawapiskat in the past five years.

Aboriginal Affairs Minister John Duncan insisted Sunday the community has now agreed to co-operate with a federally appointed third-party financial manager – a claim band Chief Theresa Spence vehemently denied.

"She's agreed to working with the third-party manager, and that's all we need," Mr. Duncan told CTV's Question Period. "We just need collaboration. It just makes things go that much more quickly."

The Harper government has "an admirable track record" of dealing with problems in Attawapiskat and other communities, he added.

The government also said it will deliver seven additional trailer homes and get started on a $500,000 renovation of a community building to house residents in the remote 5,000-resident James Bay village, where hundreds of people are living in wooden-framed tents, moldy homes and other cramped quarters, often without toilets or running water, as winter sets in.

Ms. Spence, however, said the third-party manager still isn't welcome in Attawapiskat.

She added that the community appreciates Ottawa's help, but she wondered where Mr. Duncan's helping hand was in late October, when she declared a state of emergency.

"I'm not trying to create conflict here," Ms. Spence said in a telephone interview. "We're supposed to be focusing on emergency measures, and I'm glad [Mr. Duncan is]doing that right now. But he should have done that right after we declared an emergency, not after a month."

Ms. Spence likened Ottawa's decision to put the band's finances in the hands of a "third-party" manager to arresting a victim at the scene of an accident.

"It's like calling an ambulance because there's an emergency situation, and then they send in the police to arrest you," Ms. Spence said. "That's what he [Duncan]is doing to me right now."

The band has refused to let the manager anywhere near the community. And Ms. Spence insisted that hasn't changed.

Attawapiskat has repeatedly urged federal officials to audit its books if they suspect mismanagement. But Ms. Spence said they haven't taken up the offer.

"We have nothing to hide," she said.

Over the weekend, the Red Cross flew in wood stoves, composting toilets, plastic sheeting and other supplies.

The dispute has shone a spotlight on deteriorating living conditions in dozens of remote native reserves across Canada, where overcrowding and poverty are endemic.

Mr. Duncan's handling of Attawapiskat has become a "farce," said NDP MP Charlie Angus, who represents Attawapiskat in the House of Commons. First, the minister underestimated the number of modular homes needed, and now he's claiming wrongly that the band has agreed to work with the third-party manager, he said in an interview.

"It's raising a lot of questions about his fundamental incompetence in the handling of this file," he said. "This has been going on for far too long. This is a tragedy unfolding, but we should be at the point of resolution."

Longer term, Mr. Angus wants Ottawa and the province to start talking about sharing the economic benefits of the development of nearby diamond mines and other resources. That's what Hydro-Québec did with the Cree on the Quebec side of James Bay as it built massive hydroelectric projects.

Under De Beers' deal with the Attawapiskat, according to Tom Ormsby, the company's director of corporate affairs, the diamond miner pays about $2-million a year for the use of traditional lands, with the payments going to the chief and council, and also provides jobs and training programs.

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