first_imgAPTN National NewsOTTAWA–A controversial Indian Affairs economic development program accused of knee-capping Aboriginal banks is being reviewed by a Quebec consultant, Indian Affairs Minister John Duncan said.The news comes on the heels of an announcement by a Manitoba credit union that it was pulling out of the $15.5 million loan-loss reserve pilot program because it just wasn’t working.Duncan said Wednesday during question period that the loan guarantee program for on-reserve businesses was under review, but he also defended his department’s decision to shut-out Aboriginal lending banks, known as Aboriginal Financial Institutions (AFIs).“The loan loss reserve pilot program was created to address to address a gap in larger-scale commercial lending. This was an area in which (AFIs) were generally not in,” said Duncan, in a response to a question from NDP Aboriginal affairs critic Jean Crowder.Duncan said that the preliminary results of the review would be used in the “renewal” of the program.Michelle Yao, a spokeswoman for Duncan, said Thursday morning that management consulting firm Auguste Solutions and Associates Inc., based in Chelsea, Que., was reviewing the program.An Indian Affairs department spokeswoman said the consulting firm was also reviewing another program that deals with major resources and energy development.Manitoba-based Assiniboine Credit Union president Al Morin told APTN National News that the loan-loss reserve program was outdated and ineffectual. Morin said part of the program’s problem was the exclusion of AFIs, which have decades of experience giving loans to on-reserve businesses.Alan Park, Chief Executive Officer of TWCC, has said the department was putting Aboriginal lenders in jeopardy by giving mainstream lenders a “golden-brick road” into the on-reserve lending sector through the program.TWCC has also launched a federal court challenge against the department over the program arguing Indian Affairs did not consult before picking seven mainstream banks and credit unions to participate in the program.last_img read more