‘An important step’: Feds pledge up to $40B to compensate First Nations kids, reform child welfare

Settlement not reached but announcement sets the stage for potential resolution by end of December

Child welfare

Crown-Indigenous relations Minister Marc Miller, seen here with Indigenous Services Minister Patty Hajdu, said talks are "fragile" and ongoing. Photo: APTN


The federal government is pledging up to $40 billion to compensate First Nations kids and reform the child-welfare system.

While it’s an “important step” toward resolving the nearly 15-year-old legal battle, Cindy Blackstock told APTN News there remain legal issues to hash out before a deal is reached.

“I’m happy that those children are finally going to get the compensation they deserve—it looks like—but that compensation won’t be coming for several months,” said Blackstock, executive director of the First Nations Child and Family Caring Society, on Monday.

“The more important piece is that the government ends its ongoing discrimination in First Nations child and family services and Jordan’s Principle and that it reforms the department so that it never does this to another generation of kids.”

Blackstock, the Assembly of First Nations (AFN), Chiefs of Ontario, Nishnawbe Aski Nation and their lawyers have been in confidential negotiations with the Canadian government to reach an umbrella settlement in a national class-action lawsuit and a long-standing human rights complaint over the underfunding of First Nations child welfare.

In 2016, the Canadian Human Rights Tribunal found Ottawa racially discriminates against First Nations kids living on reserves and in the Yukon by knowingly underfunding the system. The tribunal ruled further in 2019 that the discrimination was “wilful and reckless” and a “worst-case scenario” under federal human rights law.

It ordered Canada to pay the statutory maximum of $40,000 to victims of discrimination and some family members. The federal government sought judicial review of the decision but lost in Federal Court.

Justice Paul Favel ruled the tribunal “reasonably exercised its discretion” under the human rights act “to handle a complex case of discrimination to ensure that all issues were sufficiently dealt with.”


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Canada launched what it billed as a “protective appeal” of Favel’s decision but promised to try and reach an out-of-court settlement by December 2021. Talks started in September 2020 with former Federal Court judge Leonard Mandamin as mediator.

Former Truth and Reconciliation Commission chair and senator Murray Sinclair was brought on as facilitator last month.

The $40 billion, which was first reported by The Globe and Mail, will be part of Tuesday’s economic update, the government said in a release.

“Our discussions remain progressive and productive,” said ministers Marc Miller and Patty Hajdu in a joint statement. “We must emphasize that there are more steps to be taken until the monies will be paid. We expect to provide further details on the outcomes of our discussions by Dec. 31, 2021.”

An agreement in principle has not been reached and would have to be ratified by the Federal Court. But a press release issued by the AFN suggested a deal may be close.

“The magnitude of the proposed compensation package is a testament to how many of our children were ripped from their families and communities,” said National Chief RoseAnne Archibald. “Money does not mean justice, however, it signals that we are on the healing path forward as we finalize long-term reform.”

Blackstock couldn’t comment directly on the talks due to confidentiality provisions, saying only that finer details of any proposed settlement would still have to be worked out.

These details include how far back will victims be compensated, who would qualify, how they could opt-in, how much money would go toward compensation and how much cash would go toward reform.

Miller told reporters Monday “roughly half” of the cash would go to compensation and the other half toward reform.

“But these discussions are things that are going to occur among the parties and I can’t go into any more detail than that,” he said. “I want everyone to be conscious of the fact that there still are some very fragile discussions underway.”

Blackstock said “this should be a landmark lesson” for the government that delaying action and justice only increases both the eventual harm and the ultimate cost.

“This $40-billion figure should really tell people how deep the discrimination is that was going on,” she said. “Not only can First Nations youth and families not afford them to kick this downstream, but the country can’t afford it either, because we’re going to hold them accountable.”

Justice Minister David Lametti said he’s “optimistic” a deal will be in place by the deadline when asked on Nation to Nation on Dec. 2.

The parliamentary budget office previously estimated it could take $15 billion to comply with the 2019 order to compensate victims of the child-welfare system.

Online Journalist / Ottawa

Brett is a member of the Chippewas of Kettle and Stony Point First Nation in Ontario. He grew up in Ottawa where he obtained an English degree from Carleton University. Brett is a creative writer, poet, and journalist. He joined the Ottawa bureau for APTN News in December 2019 as a digital reporter.