Premier Darrell Dexter is defending the government's decision to ask the courts to dismiss affidavits from people who allege they were abused at the Nova Scotia Home for Colored Children.

Dexter says he sees nothing contradictory about the move while the government plans to set up an independent panel to review abuse accusations from former residents of the Halifax orphanage.

He says the government has the right to fight the class-action lawsuit filed by the former residents while also seeking an appropriate resolution for them before an independent panel.

He says the terms of reference for that panel should be made public within about two weeks.

Liberal Opposition Leader Stephen McNeil says it's embarrassing that the government has instructed its lawyers to try to have some of the affidavits thrown out.

Progressive Conservative Leader Jamie Baillie says it isn't right for a government that says it wants healing to send a legal team to try to suppress the allegations.

Last month the Nova Scotia Home for Colored Children agreed to pay $5 million to dozens of former residents who say they suffered physical, sexual and emotional abuse while living at the orphanage.

The claimants said they'll continue their case against the province.

The Home for Colored Children opened in 1921 as an orphanage for black Nova Scotian children.

Last March, RCMP formed a special investigative team to look into abuse allegations and asked people to come forward.

Forty complainants came forward, who are now living in several provinces including Nova Scotia, New Brunswick, Quebec, Ontario and Alberta. The team visited the witnesses in each location.

In December, the RCMP said the evidence collected was not enough to support criminal charges.

Former residents say they want a full public inquiry into the physical and sexual abuse they suffered at the orphanage.

The home is currently a short-term centre for foster children of all races and cultures. The home also provides outreach services to vulnerable families in the African Nova Scotian community.

According to the Home for Colored Children website, the main funding for the centre comes from the province's Department of Community Services. Additional funding comes from the home's annual telethon and donations from the community.

with files from CBC News