$23-billion First Nations child-welfare settlement could start being paid next year after lengthy legal battle

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The Federal Court of Canada will review this fall a $23.3-billion compensation agreement on First Nations child welfare that could see money flowing to communities as soon as next year after a fight of more than 15 years.

Details are still being worked out on a separate $20-billion package of reforms to the child-welfare system on First Nations.

If approved by the court, the compensation settlement would be the largest of its kind in Canadian history. The legal battle began in 2007 when the Assembly of First Nations and another advocacy organization, the First Nations Child and Family Caring Society, took a complaint about discriminatory child-welfare funding to the Canadian Human Rights Tribunal.

After a court battle, talks were held between the federal government and class-action lawsuit parties, as well the AFN and the First Nations Child and Family Caring Society. Former Truth and Reconciliation Commissioner Murray Sinclair was also asked in November, 2021, to help facilitate the negotiations.

Canadian Human Rights Tribunal approves $23-billion First Nations child welfare settlement

An original $40-billion agreement, announced in 2022 – $20-billion for compensation and $20-billion for reforms – was revised after the human-rights tribunal raised concerns that the deal did not meet all of its requirements. The latest agreement, which includes $3-billion more in compensation, was announced in April and approved by the tribunal in late July.

The Federal Court will now evaluate the revised settlement agreement on compensation. If it is approved, the process to roll out funds can begin.

Although compensation has been negotiated, talks on long-term reform continues with the parties. In its July decision, the Canadian Human Rights Tribunal said it is still focused on seeing child welfare on First Nations reformed and the elimination of systemic racial discrimination. Zeus Eden, a spokesperson for Indigenous Services Minister Patty Hajdu, says that work is now under way.

Cindy Woodhouse, Manitoba’s regional chief for the AFN who is in charge of the child-welfare portfolio, said pending the Federal Court’s approval, her advocacy organization intends to travel across the country to different First Nations to share information about the compensation process, such as who will qualify.

“We have to go to First Nations people and First Nations communities and go through this thoroughly,” she said. “I really don’t think a lot of First Nations fully grasp the magnitude of this yet.”

The AFN believes 300,000 people will benefit from the settlement, which Ms. Woodhouse said “acknowledges wrong was done to them and their families.”

“We have to do better as a Canadian society,” she said, adding work needs to be done to ensure that families are able to stay together.

Prominent advocate Cindy Blackstock, who is a professor in the McGill School of Social Work and executive director of the First Nations Child and Family Caring Society, lauded the settlement, but said justice can only be achieved when discrimination comes to an end and there are measures in place to ensure it does not happen again.

She calls it a “profound public policy failure” that the federal government needs to pay $23.3-billion in compensation to victims of the First Nations child-welfare system who should have never been discriminated against. Ottawa should also take note for the future, she said.

Ms. Blackstock, who has been at the forefront of the human-rights fight for First Nations children, said that a national policy review on First Nations child and family services from 2000 underscored inequalities in the child-welfare system.

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While the federal government recognized the findings after its publication, Ms. Blackstock said the concerns were not addressed, which ultimately resulted in the long fight before the Canadian Human Rights Tribunal.

“It would have cost in the hundreds of millions of dollars back then to fix,” Ms. Blackstock said. Instead, she added, the federal government will now pay $23.3-billion to the victims, many of whom would not have been discriminated against had the government “done the right thing 23 years ago.”

Ms. Blackstock said long-term reform of the child-welfare system is now going to “cost in the multiple billions because the trauma has piled up on these kids and families as we feared it would.”

This should serve as a “top lesson for every public servant and every politician that comes into office” that doing the right thing “saves you money and it saves people’s lives,” she said.

In 2019, the human-rights tribunal found that Ottawa had wilfully and recklessly discriminated against Indigenous children on reserve by failing to provide funding for child and family services. It ordered the government to provide up to $40,000 to each First Nations child unnecessarily taken into care on or after Jan. 1, 2006. Its orders also covered parents or grandparents and children who were denied essential services.

Ottawa filed for a judicial review of the tribunal decision, saying it did not “oppose the general principle that compensation to First Nations individuals affected by a discriminatory funding model can be made in appropriate circumstances.” But it believed the tribunal erred in its decision, including on monetary compensation to First Nations children, parents and grandparents under the Canadian Human Rights Act.

The Federal Court said in September, 2021, that the federal government had not succeeded in establishing that the tribunal’s compensation decision was unreasonable.

In its decision approving the latest agreement in July, the tribunal noted that the settlement is the largest compensation settlement in Canadian history. It also includes a commitment from Ms. Hajdu to request an apology from the Prime Minister.

Mr. Eden, Ms. Hajdu’s spokesperson, said in a statement last week that the compensation agreement is a critical factor in reconciliation.

“As part of this settlement agreement, Minister Hajdu remains committed to seeking an apology,” Mr. Eden said. “We are also working with partners to ensure long-term reform of the child-welfare system to address systemic wrongs and ensure this discrimination never happens again.”

The next step is for the Federal Court to review the settlement, which is expected to take place in October. Ms. Blackstock said she has every confidence that the court will approve the agreement.

Should the court sign off on it, the AFN intends to reach out to the Prime Minister’s Office to push for an apology.

Marc Miller, who was Crown-Indigenous relations minister before moving to the immigration portfolio in July’s cabinet shuffle, has called the settlement an important part of Canada’s accountability to First Nations children who were discriminated against or removed from their homes.

“If anything, it has raised the importance of addressing an issue that is of generational consequence,” Mr. Miller said in a recent interview.

He said the child-welfare system is a “driver for all the issues that we hear around murdered, missing Indigenous women and girls” and “one of fundamental inequity.”