Uncertainty clouds fate of $40B First Nations child welfare agreement

The fate of the $40 billion First Nations child welfare settlement agreement is up in the air after the Canadian Human Rights Tribunal questioned whether the terms of the deal meet the conditions of its pivotal discrimination ruling.

At issue is whether the individuals covered by a $20 billion portion of the deal — which was finalized by Ottawa, the Assembly of First Nations (AFN) and class action lawyers last July — are the same individuals the tribunal said should be compensated for the discrimination they suffered.

"It would be great if this settlement could work, if possible, especially that it is First Nations-led," the tribunal wrote in a Sept. 21 letter to the parties following two days of hearings.

"But I also see a major issue."

WATCH | The long wait for compensation

In the letter, the human rights panel asked whether there is a "possibility that the agreement was negotiated based on a premise that departed from the tribunal's findings and orders."

That question is delaying by weeks the implementation of the compensation plan agreed upon by the federal government and the AFN. It could also put the entire settlement — the largest in Canadian history — in jeopardy.

Before compensation can be paid out through the deal, the tribunal has to decide whether the agreement is too narrow because it leaves out children who were not in federally-funded child welfare placements.

Those children were removed from their homes, families and communities and put into "kinship care" — meaning they were placed with extended family or family friends.

In its letter to the parties, the human rights panel said it's not prepared to make a "quick decision sacrificing sound decision-making."

The tribunal will release its decision to the parties once its panel completes its ruling. That ruling is expected sometime after Oct.12 — the final deadline for Ottawa and AFN to respond to the tribunal's questions.

"I'm kind of appalled because everything is in a standstill," said Zach Trout, a father from Cross Lake First Nation in Manitoba who was one of the lead plaintiffs in a class action lawsuit that became part of the settlement agreement.

"We are the ones who have suffered for far too long. Still today, we still suffer."

Trout filed a lawsuit in 2021 against Ottawa for failing to provide proper health support for his two children, Sanaye and Jacob, who suffered from a rare neurological disorder called Batten disease. Both children died before age 10.