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Housing conditions that led to a state of emergency in Attawapiskat.

Charlie Angus

The federal government is pulling the third-party manager who had been handling the finances of the troubled northern Ontario reserve of Attawapiskat after the community improved health and safety conditions for its residents.

Jason MacDonald, a spokesman for Aboriginal Affairs Minister John Duncan, confirmed Thursday evening that third-party manager, Jacques Marion, is being withdrawn because of progress in reserve management.

Mr. MacDonald said a transition of power will take place over the next two weeks, and the band will revert to "co-management" of its affairs and finances on April 19. That means the band and council will have more control over money and local decisions.

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The community of 2,000 declared a state of emergency in October after a severe housing shortage forced at least two dozen families to live in temporary shelters, some without insulation or plumbing.

The federal government removed control of public funding from the band in November and ordered an audit of its spending.

The decision to bring in a third-party manager was met with much resistance from band officials. They sought a temporary injunction, arguing the imposition of the outside manager threatened irreparable harm by using up funds better spent on housing and other needs. A federal court refused to issue the injunction in February.

Government officials speaking on background Thursday said the third-party manager was being pulled not because he had done a bad job, but rather because the band itself had done a good job in improving the health and safety conditions that had necessitated the outside control in the first place.

NDP MP Charlie Angus, whose riding includes Attawapiskat, said the news surprised the band, which received a letter on the matter from Aboriginal Affairs.

"I spoke with the chief yesterday and there had been no indication from Aboriginal Affairs that the Indian agent had a fixed date in the community," Mr. Angus said. "The news that he was being pulled was a complete shock to the chief."

The move to withdraw Attawapiskat's third-party manager came after both Mr. Marion and the federal Conservatives drew fire for delays in financing.

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They came under heavy criticism after band officials accused them of failing to send money on time to students from the community who are studying off the reserve.

Mr. Marion was late sending the monthly allowance that many of the postsecondary students need for food, rent and expenses, native leaders said.

Mr. Duncan announced earlier Thursday that the money is now in the students' accounts, but critics had said it didn't flow quickly enough.

Mr. Angus had called the delay a major blow to students who managed to escape the terrible housing conditions on the reserve and were trying to get a higher education.

"They're up against major odds to begin with," Mr. Angus had said. "That this money could be monkeyed with in any way to me is just not acceptable."

Mr. Angus had also said the band was cut off from all federal funds in January and February because they refused to accept Mr. Marion's third-party financial management.

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The band tried to scrape together enough money from other sources to get by, but finally ended up "hitting the financial wall," he said.

There were other delays in getting Mr. Marion to release much-needed funds, said Liberal critic Carolyn Bennett. The education breakfast program had to be halted and the main grocery store on the reserve couldn't pay its bills due to lack of funding.

"This is punitive what they've been doing, in dribbling out the money too late, too little, and really hampering the ability of this community to work," Ms. Bennett had said.

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