Half-billion dollar settlement approved for former kids in care in Manitoba

(CTV News File Photo)

WINNIPEG — A judge has approved a settlement for three class-action lawsuits, worth $530 million, over federal child benefit payments that were clawed back by the Manitoba government.

The agreement will compensate an estimated 30,000 children who spent time in child welfare, some of whom have since become adults, for money the province took over a 14-year period.

"It means that each child will receive 100 per cent of their entitlement that was wrongfully withheld from them, plus interest and additional damages," Grand Chief Garrison Settee of Manitoba Keewatinowi Okimakanak, which represents 26 northern First Nation communities, said in a press release Friday. Roughly 90 per cent of kids in care in Manitoba are Indigenous.

"This settlement will give those who experienced child welfare an equal opportunity to chase their dreams and future ambitions," said Mary Derendorf, a plaintiff in the case.

The dispute dates back to 2005, when the NDP government of the day started clawing back a monthly federal benefit called the Children's Special Allowance. The benefit goes to agencies that care for children, and mirrors the monthly Canada Child Benefit cheques given to parents raising children across the country.

In 2019, the Progressive Conservative government stopped the practice, but also tried to ban any lawsuits over the clawback in a bill that was later struck down.

The plaintiffs said the money was supposed to pay for recreation programs, cultural activities, hockey and a host of other items not covered by basic child welfare funding. The province and lawyers for the lead plaintiffs later negotiated. They reached the settlement in March, months after the NDP was back in office.

Court of King's Bench Justice Alain Huberdeau approved the deal Thursday.

"All counsel submit, and frankly I agree that it is fair, reasonable and in the best interests of each of the class members as a whole," Huberdeau said in his ruling.

Kris Saxberg, one of the lawyers for the plaintiffs, said claim forms are to start being processed in January.

"The whole idea of the settlement is to make those children whole from the effects of the (government's) policy, and that effect was to rob them of money that would have been available to assist them during their time in care," he said.

This report by The Canadian Press was first published Sept. 6, 2024.