Manitoba's use of federal money for Indigenous kids in care was a 'money grab,' court hears

A civil trial at Manitoba Court of Queen's Bench focuses on whether the province of Manitoba was right to force child welfare agencies to remit federal funding earmarked for Indigenous children in care to the provincial government.

Youth who became homeless after leaving family services system says cash could have helped her get housing

For more than a decade, federal funding earmarked for Indigenous children in care was taken by the Manitoba government, which is ultimately responsible for paying for permanent wards of the system. (Franck Fife/AFP via Getty Images)

The Manitoba government orchestrated a "money grab" when it forced child welfare agencies to hand over hundreds of millions of federal dollars that were earmarked for vulnerable Indigenous children in care, a lawyer argued in court Tuesday.

A civil trial between 19 Manitoba child welfare agencies and Indigenous groups and the province of Manitoba began in Court of Queen's Bench Tuesday morning. The proceedings are being heard virtually.

At issue is whether the province was right to force agencies to remit monthly federal funding of $456 to $783 per child to the provincial government. The former NDP government enacted the policy in 2006, which forced agencies to send cheques to the province monthly.

The governing Progressive Conservatives eventually ended the practice in 2019.

The policy was intended to "save a bit of money … by claiming the federal [Children's Special Allowance] benefits to offset their maintenance costs," but "we call it a money grab," said lawyer Kris Saxberg, who is representing the 19 agencies.

"That's the question — is it the policy to save some money that some bureaucrat has come up with?"

Saxberg gave his opening remarks to the court Tuesday, with two people who were previously in child and family services care sitting in a boardroom across from him.

He referenced a video from the Metis Child and Family Services Authority, in which youth who grew up in the system spoke about the devastating impact it had on their lives. One of the people in the video said she became homeless after aging out of care.

Judge James Edmond is overseeing the civil trial, which continues Wednesday. (Ryan Cheale/CBC)

"When I first aged out of care I had nothing, and I guess no one was there to really help me, and then I lost all my furniture when I got kicked out. And that's when I became homeless," said Autumn Chisholm-Bear, 21, who recently aged out of the system.

Chisholm-Bear, who spent five years in care, said in the video having access to the funding earmarked for her would have helped her get her first apartment.

The video was not admitted to court as part of the evidence submitted, but Saxberg said the stories included in the video must not be forgotten.

'The child is deprived': affidavit

Prior to the enactment of the policy in 2006, some agencies would put a portion of the federal funds in a trust for children to access when they aged out of the system.

The province contends that since the government was required to pay for children in care, the federal funding was Manitoba's to keep. The diverted funds were put into the province's general revenues. If an agency didn't remit the payments, it would lose provincial funding.

"The province has taken a benefit from children that they had before, and that some children still get, and taken that benefit for themselves," Elsie Flette, the former CEO of the Southern First Nations Network of Care, said in an affidavit presented in court.

"And there has been no subsequent benefit put into maintenance to offset what they're taking."

Flette had previously filed a statement of claim proposing a class action lawsuit on behalf of Indigenous children in care who had their federal funding taken by the province.

"The child is deprived of certain things … and we see that because we get the money for the federal kids. We see the additional things we can purchase for those children and the benefits that that money provides," Flette said.

The province hasn't presented its arguments yet. The Assembly of Manitoba Chiefs will make submissions Wednesday.

Judge James Edmond is overseeing the civil trial.

Manitoba's use of federal money for Indigenous kids in care was a 'money grab,' court hears

1 year ago
Duration 1:51
The province of is being accused of orchestrating a 'money grab' when it forced Child and Family Services agencies to hand over hundreds of millions in federal dollars — meant for Indigenous children in care.


​Austin Grabish is a reporter for CBC News in Winnipeg. Since joining CBC in 2016, he's covered several major stories. Some of his career highlights have been documenting the plight of asylum seekers leaving America in the dead of winter for Canada and the 2019 manhunt for two teenage murder suspects. In 2021, he won an RTDNA Canada award for his investigative reporting on the Canadian Museum for Human Rights, which triggered change. Have a story idea? Email: