Flawed funding found to be discrimination against First Nations children and families

First Nations Child and Family Caring Society of Canada et al. v Attorney General of Canada [2016] CHRT 2 (26 January 2016)


In a significant decision handed down by the Canadian Human Rights Tribunal, it was found that the Canadian Government discriminated against First Nations children and families living on reserve and in the Yukon Territory by failing to provide them with equitable child welfare services.


The Canadian federal government department, Indian and Northern Affairs Canada (INAC), is responsible for managing the First Nations Child and Family Services Program (the FCNFS Program) and a number of other provincial and territorial agreements, which provide funding for child and family services to First Nations children and families living on reserve and in the Yukon Territory.

The First Nations Child and Family Caring Society of Canada and the Assembly of First Nations (the Complainants) made a complaint against INAC pursuant to section 5 of the Canadian Human Rights Act, which provides that it is a discriminatory practice in the provision of services available to the general public to deny or deny access to a service or adversely differentiate any individual on a prohibited ground of discrimination.

The Complainants alleged that INAC had provided inequitable and insufficient funding for the child and family services for First Nations children and families on reserve and in the Yukon, and therefore discriminated against them on the basis of their race and/or national ethnic origin.


The Tribunal found that the complaint was made out in that there was sufficient evidence to establish a prima facie case that INAC had discriminated against First Nations children and families living on reserve and in the Yukon.

The Tribunal noted that INAC provided not only funding, but policy and oversight, which allowed it to have a direct impact on the provision of the child welfare services. As such, the Tribunal found that INAC’s design, management and control of the FNCFS Program resulted in a denial of services and adverse impacts to many First Nations communities on reserve.

The Tribunal also found that the adverse impacts in the provision of child and family services to First Nations communities perpetuated the historical disadvantage and trauma suffered by the First Nations people, in particular as a result of the Residential Schools system (a historical Canadian policy with some similarities to the Stolen Generation policies in Australia). 

Flawed funding formulas

The FNCFS Program was developed to address concerns over the lack of child and family services provided by the Provinces to First Nations reserves. The aim of the FNCFS Program was to ensure that First Nations children and families on reserve and in the Yukon received the assistance or benefit of culturally appropriate child and family services reasonably comparable to the services provided to other provincial residents in similar circumstances. 

The Tribunal found that the two main funding formulas used by INAC for the FNCFS Program were based on flawed assumptions and population thresholds which did not accurately reflect the actual service needs within many on-reserve communities. This created funding deficiencies, particularly for small and remote agencies which did not meet the population threshold.

There was also no adjustment of the funding formulas (or of other related provincial agreements) to account for inflation or increased costs of living over time. This not only created a further shortfall between the funding provided and the actual amount required, it also meant there was a disparity with funding for child welfare services off reserve, which accounted for these increased costs.

As well, the funding for operations and prevention (services to maintain children in their family homes) were provided on a fixed cost basis, while maintenance budgets for taking children into care were covered at cost. This meant if a FNCFS agency did not have the necessary funds in its operations budget, the only option to provide the relevant services was to bring the child into care. This therefore created an incentive to remove children from their families.

Lack of coordination and Jordan’s Principle

The Tribunal also found that there was a lack of coordination between federal programs on First Nations reserves which resulted in service gaps, delays and denials. This was exacerbated by INAC’s view that Jordan’s Principle only applies to inter-governmental disputes and to children with multiple disabilities.

Jordan’s Principle provides that where a government service is available to all other children but a jurisdictional dispute arises between federal and provincial/territorial governments or even between departments in the same government as to who is responsible for providing the service to a First Nations child, the government department of first contact pays for the service (and can later seek reimbursement from the other governments or departments if required). This is intended to prevent First Nations children from delays and denials of service. The Tribunal held that Jordan’s Principle applies to all First Nations children, and INAC’s narrow interpretation and implementation of the principle contributed to the overall adverse impacts suffered by First Nations on reserve.

Failure to reform

Despite numerous reports and recommendations pointing out these issues, INAC failed to significantly modify its FNCFS Program. The Tribunal noted that reforms introduced by INAC did not resolve the adverse impacts caused.


The Tribunal ordered INAC to:

  • cease its discriminatory practices;
  • reform the FNCFS Program and related provincial agreements to reflect the findings in the decision;
  • cease applying its narrow definition of Jordan’s Principle; and
  • take measures to immediately implement the full meaning and scope of Jordan’s Principle.

The Tribunal reserved its ruling on further remedies sought by the Complainants, including how immediate and long-term reforms can be best implemented, compensation for those affected by the discriminatory practices, and allocation of costs, pending the provision of additional information from the parties. At the time of writing, the final decision on these outstanding remedies has yet to be made.

The Canadian Government has stated it will not appeal the decision.


This decision sets an important precedent and should give pause to other countries such as Australia to reconsider the funding of services to their Indigenous populations. However, Australia’s equivalent racial discrimination provisions contained in the Racial Discrimination Act 1975 (Cth) and related state and territory legislation do not impose the same obligations on governments to ensure substantive equality, unless the obligation can be characterised as a “special measure”. Notwithstanding, the case acts as a reminder that the provision of funding – and the formulas used to calculate such funding – can have a significant impact on the quality and accessibility of services being provided.

The full text of the decision can be found here.

Sun Hoon, Solicitor at King & Wood Mallesons.