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Ten-month-old Mylee stands in her crib in her home in Attawapiskat, Ont., Dec. 17, 2011. There are no plumbing or sanitary facilities in her residence.

A warm, safe place to sleep in. Clean drinking water. Affordable food on the table.

Many Canadians consider these to be the basic necessities of life. But for the people living on the troubled aboriginal reserve of Attawapiskat, it's still on their Christmas wish list.

About 20 families are expected to escape their ramshackle homes on Dec. 23 and move into a healing centre that will serve as a temporary shelter, according to the Red Cross.

The centre is four kilometres outside the village, but the international aid agency is looking at setting up shuttles for residents who are concerned about the distance, said John Saunders, Ontario director of disaster management.

"Some of the living conditions here with the shacks that we're seeing here are pretty extreme," he said. "But at the same time, it's certainly not unusual to many [aboriginal]communities across the country."

Emergency supplies continue to pour in – including washing machines, detergent and blankets – but they aren't enough to overcome the overwhelming problems plaguing the first nations community in northern Ontario as winter takes hold.

Large families remain crammed into cold, mould-stained shacks with no bathroom or running water. More than 90 people live in an old construction trailer with no smoke alarms and doors that are padlocked at night to keep vandals out. Staples like oranges cost more than $10 for a three-pound bag at the local grocery store – when it's on sale.

Yet just 80 kilometres away, a mining operation is extracting diamonds from the ground.

Sadly it's not the only first nations community in Canada that's suffering under such deplorable conditions, said interim Liberal leader Bob Rae, who toured the reserve Saturday with aboriginal affairs critic Carolyn Bennett.

"We talk a lot about the Third World, we talk about Haiti, we talk about poverty in other parts of the world," he said. "This is our Third World. It's right here at home. These are our fellow citizens."

A young woman coming out of the grocery store spent $250 on condensed milk, diapers and "not a heck of a lot" with one baby at home and another on the way, he said.

Mr. Rae said he disagrees with Prime Minister Stephen Harper's approach to hand control of the band's finances to a third party.

"It's a continuation of the colonial attitude," he said. "There's a need to work with people on finding solutions, but bringing in third-party folks – even the former auditor general Sheila Fraser said that third-party administration is full of problems, that it didn't work and it wasn't a sustainable solution."

Attawapiskat Chief Theresa Spence, who is seeking to block third-party management with a court injunction, isn't the only resident who's angry with the federal government.

Willie Sproule, 71, who works at the store, said he's fed up with Ottawa's neglect of first nations communities.

"I'm ashamed to be called a white man," said Mr. Sproule, who has lived on the reserve with his aboriginal wife for 20 years.

When it was revealed that Defence Minister Peter MacKay had racked up steep travel expenses, he wasn't treated the same way, he added.

"They want third party here," he said. "They should put third party in Ottawa."

Ottawa has transferred about $90-million to the 3,000-member first nation over the past five years, and Mr. Harper has said he has not seen adequate results for the money.

The federal Tories insist the reserve remain under third-party management, but say Jacques Marion of BDO Canada will only stay in place until the housing crisis is under control – likely just a few months.

The government wants the housing plan well under way by the end of next March. At that point, the third-party manager could relinquish control of the band's finances and a full audit of the last five years of spending would start.

The band chief and council have agreed to the audit, if only to prove Mr. Harper and others wrong in their stated belief that the band has mismanaged its money. They continue to refuse to allow Mr. Marion access to the reserve.

Many bands placed under third-party management spend years in that situation, only to see their underlying problems remain unresolved or even deteriorate further. Evaluations by the auditor-general, outside experts and government analysts have all said the third-party system is deeply flawed.

While many would be shocked by the conditions in Attawapiskat, the housing crisis doesn't appear to have dampened the community's holiday spirit.

Five-year-old Verna Lahtal, who lives with 20 other people in a two-room house, was all smiles as she showed off the Christmas tree she made out of brightly coloured bits of construction paper.

The community will find a way to celebrate the season, said Ms. Spence. Tom Jackson is expected to bring some holiday cheer next week with a concert on the reserve.

"Even though we face hardship, we still celebrate life," she said. "We're not going to give up."