The federal government is increasing its spending on post-secondary education, community infrastructure and the health of Indigenous people in a clear attempt to quell criticism over its handling of serious issues that continue to plague First Nations and Inuit communities.

This year's budget adds a further $3.4 billion over five years for areas of "critical need," in addition to the $8.4 billion pledged in 2016.

"We have made significant investments that we think will make a difference," said Finance Bill Morneau in a budget news conference.

Education and skills training are part of that spending, with $219 million allocated over the next five years.

Of that, $90 million will go to the post-secondary student support program over the next two years. The government estimates the money will support the financial needs of more than 4,600 First Nations and Inuit students.

The Liberals' 2015 election campaign promised to add $50 million annually to the program, but the money was left out of the government's first budget last year. The Trudeau government has faced criticism for that omission from Indigenous groups that estimate 10,000 students are on the waiting list for funding to help them advance their education and get training.

Canada's Indigenous population is growing rapidly, with about half under the age of 25.

In addition, the budget will provide $25 million over five years to Indspire, a charity that helps Indigenous students go to post-secondary institutions and find jobs, and another $104 million in development and training, adult education and reducing employment barriers for young people living on reserves.

Mental health, drug addiction

This year's new money includes $828.2 million for First Nations and Inuit health, with $118.2 million to support mental health programs and $15 million to fight drug addiction.

The budget also sets aside $1.1 billion for "improving Indigenous communities" where there's a huge need for adequate housing, better health facilities, new schools and safe drinking water.

So far, 18 long-term drinking water advisories have been lifted in First Nations, with 71 still to go.

The budget promises that all of the remaining long-term advisories will be cleared up by March 2021.

There's also additional money to help northern and remote Indigenous communities switch away from diesel power generation. Diesel fuel is used widely for heat and electrical power in remote communities, but it's expensive and bad for the environment. The budget sets aside $715 million over 11 years, some of it new money, to help communities develop renewable energy or to hook up to existing electricity grids so they can move away from the fuel.

Children's welfare funding

But while the budget pledges to "further its relationship with Indigenous people" there is no new money for the First Nations child and family services program.

Last year's budget set aside $634.8 million over five years for that, but the Liberals have come under fire for being too slow to get money out the door to help children and families in need.

Last year, a Canadian Human Rights Tribunal ruled Canada discriminates against First Nations children compared with what other children receive under provincial programs. That tribunal is holding a hearing this week to examine why Ottawa has yet to abide by its decision.

This year's budget document doesn't mention the program.

A spokesperson for Indigenous Affairs Minister Carolyn Bennett said that's because there was no change to the $635 million already allocated in last year's budget that's rolling out as planned.

First Nations Child Welfare 20160915

Cindy Blackstock, executive director of the First Nations Child and Family Caring Society, says she is disappointed the government didn't choose to speed up increased funding for First Nations child welfare. (Sean Kilpatrick/Canadian Press)

James Fitz-Morris said in an email to CBC News that the 2016 budget set out how funding for child welfare will increase annually for the next five years, starting with $71.1 million in 2016-17 increasing to $176.8 million a year by 2020-21.

Last July, the department announced an additional $382 million to implement Jordan's principle, to ensure equal access to health care and social services for children over the next three years.

But Cindy Blackstock, head of First Nations Child and Family Caring Society, is disappointed there's no additional money in this budget to more quickly help kids in troubled family situations.

"Nothing in there despite three legal orders for the government of Canada to comply and make sure this generation of First Nations children isn't unnecessarily removed from their families because of Canada's inequitable funding," said Blackstock.

"That discrimination continues today."

'Continuing dialogue'

Morneau told reporters that sorting out that thorny issue is going to take time.

"You'll see a continuing dialogue, and a continuing focus in our discussions with all those engaged, so we can make sure we have adequate resources that we can actually make the difference we're expected to make," Morneau said.

Assembly of First Nations National Chief Perry Bellegarde said the budget makes "important and positive investments" to help close the socioeconomic gap for First Nations, but he urged the government to move faster to ensure real results on the ground.

"I'll be happy when the gap is finally closed and First Nations enjoy the same quality of life as other Canadians," he said. "First Nations can help this government deliver results because we know better than anyone the needs and priorities for our peoples. We can work together to deliver those results and we have to move now."

He also welcomed additional resources to support and archive Indigenous languages.

Corrections

  • This story has been updated from a previous version that stated the government was budgeting $45 million over five years to help northern and remote communities transition off diesel fuel. In fact, the full amount is $715 million over 11 years.
    Mar 22, 2017 6:09 PM ET