Crown Investment Corporation (CIC) critic Cathy Sproule questioned the management of money loaned from the First Nations and Métis Fund (FNMF) during question period in Regina on Monday.
“What we’re looking to ask the government about is investments that were made in companies that basically failed,” Sproule told reporters.
“And we’re trying to figure out how many jobs were actually created because that was the purpose of the fund in the first place, and secondly what plans the government has to recoup those investments.”
In 2006, the CIC announced it would provide up to $20 million for the newly-created FNMF. The mandate of the fund, which was established under an NDP government, was to make investments of between $1 million and $3 million in new or expanding businesses that were majority-owned or controlled by First Nations or Métis people.
“The FNMF will help create economic development opportunities and jobs in our province for First Nations and Métis people,” then-minister of CIC Maynard Sonntag said at the time.
But Sproule questioned whether or not the fund met that mandate, specifically referencing an investment the CIC made in 2013.
FNMF financial statements show two separate investments worth a combined $1.8 million in Infinite Investments Inc. The statements show Infinite Investments Inc. used the money to provide a loan to Brigden Welding, listed as Force Energy Services in later statements.
The statements show that as of May 31, 2019, the FNMF had written down the original investments in Infinite Investments Inc. to a combined total of $251,220.
“How many jobs were created for Indigenous people with the $1.8 million invested?” Sproule asked CIC Minister Joe Hargrave on the floor on Monday. “What’s the plan to get that $1.8 million back?”
The statements also show the FNMF has suffered total comprehensible losses of a combined $5.97 million between 2013 and 2019.
The fund is managed by Saskatoon’s Westcap Management Ltd. which the statements show was paid $1.61 million in management fees over the same time period (earlier statements are not available online).
Hargrave, however, disagreed with Sproule’s take on the success of the fund’s mandate.
“I think it was successful in creating a lot of opportunity for First Nations that they would never have gotten,” Hargrave said. “It brought some optimism and some positivity.
“Does every business succeed? No, they sure don’t.”
He said the downturn in the oil and gas industry and the fall of potash prices took a toll on prospects.
“There’s a few million dollars out there that we won’t recover. But there’s business out there that weren’t First Nations or Métis dropped off, as well. A lot of these investments they were looking at, at the time, were good investments.”
He called Brigden Welding a “very good opportunity” and “pretty good investment” at the time.
Sproule, meanwhile, said her party plans to continue pressuring the government on the file.
“I don’t know if we’ll get answers for that, and that’s our job as the Opposition is to get the answers to those questions so that people understand how these taxpayer dollars are, in my mind, not being well spent.”
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