The federal cabinet has approved a $1.9-billion deal to compensate former students at native residential schools, many of whom suffered physical and sexual abuse.

"This government recognizes the sad legacy of residential schools," Indian Affairs Minister Jim Prentice said Wednesday in the Commons.

Indian Affairs Minister Jim Prentice announces in the Commons Wednesday a deal to compensate former students of native residential schools.
Indian Affairs Minister Jim Prentice announces in the Commons Wednesday a deal to compensate former students of native residential schools.
(Tom Hanson/Canadian Press)
"We hope that today's announcement will bring closure to former students and their descendants. The settlement is just and honourable."

The deal offers any former student a lump sum of $10,000 each, plus $3,000 for each year spent in the schools. It is estimated there are 80,000 people alive today who attended Indian residential schools, according to Statistics Canada.

Those who were age 65 or older as of May 30, 2005, are immediately eligible for an $8,000 advance payment. Descendants of those who died after that date can also apply for compensation.

The average age of the former students is 60, but many are sick and living in poverty. Native leaders and the opposition are pressuring the government to fast-track cheques to the sick and elderly.

Former students who say they were sexually or physically abused can file separate claims to seek additional compensation.

Thousands of former students have already filed claims against the government.

This final deal builds on the agreement in principle reached last November when the Liberals were in power.

It must still be approved by courts in several provinces.

For decades, natives had been fighting to have the government recognize the abuses they suffered in the school system that Ottawa supported financially between the 1870s and 1970s.

Tens of thousands of First Nations young people were taken from their families for months at a time and deprived of their culture and many were sexually or physically abused by school staff.

In 1998, Ottawa acknowledged that there was widespread abuse at the schools and offered an apology to the victims.