First Nations Child Welfare: Compensation for Removals

In September 2019, the Canadian Human Rights Tribunal (CHRT) ordered Canada to pay compensation to First Nations children and caregivers who were affected by the on-reserve child welfare system.

The Government of Canada has applied for judicial review of the CHRT decision, which could result in the compensation order being dramatically narrowed or voided entirely. This report estimates the cost of complying with the decision as it relates to children taken into care.

The preliminary estimate of Indigenous Services Canada (ISC) was that 125,600 people are eligible for compensation totalling $5.4 billion. Based on the PBO’s assumed legal interpretation, the PBO estimates that 19,000 to 65,100 people are eligible for compensation in a range of $0.9 billion to $2.9 billion. Both estimates assume compensation is paid by the end of 2020.

The PBO expects fewer people to be eligible primarily because we assume that children placed within their extended family or community are not eligible for compensation.

Our estimate is presented as a range, as it is unclear what proportion of children will be excluded, either because the CHRT deems that their removal was necessary, or that their family benefited from prevention services. This report examines a number of scenarios under which these two eligibility criteria might be applied, and their possible impact on eligibility for compensation.

The Government of Canada has indicated that it intends to compensate those harmed by removals through the settlement of a class action. There may be significant barriers to a successful class action, which could result in fewer families receiving compensation. In addition, compensation for each removed child would not necessarily be more than the amount awarded by the CHRT.