A top court affirmed a 2016 ruling that found the government had underfunded First Nations services in comparison to those for non-indigenous kids.
It paid C$40,000 (31,350, PS23,340), to each child in the on-reserve welfare program after 2006.
Initially, the government stated that it would appeal against the verdict.
It has been subject to intense scrutiny since the discovery of more than 1,100 unmarked graves on the former sites of residential schools.
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Canada’s residential schools system kept Indigenous children away from their families until 1996. Many were malnourished and abused.
According to CBC, a source said that the school system was part in attempts to assimilate native children – forcing them abandon their native languages and to convert to Christianity.
RoseAnne Archibald (National Chief of the Assembly of First Nations) stated that “Money doesn’t mean justice, but it indicates that we are on a healing path forward.”
She added that “the magnitude of the proposed compensation package is testament to how many children were taken from their families, communities,”
The schools housed approximately 150,000 First Nations, Metis, and Inuit children. They were open from 1874 to 1996.
The schools were founded and operated by Christian churches. According to the Indian Residential School Survivors Society, 70% of residential schools were operated by the Roman Catholic Church.
The Vatican announced earlier this year that Pope Francis had agreed for Canada to be part of the reconciliation effort.
However, no official date has been set and the Pope has not offered an apology for the Church’s role despite repeated calls from Canadians.