Fraser Institute News Release: $40 billion settlement will likely spur more Indigenous claims

CALGARY, Alberta, Feb. 23, 2022 (GLOBE NEWSWIRE) -- Ottawa’s recent $40 billion settlement of a First Nations claim following a Canadian Human Rights Tribunal decision will likely encourage more organizations and individuals to seek large settlements from governments across Canada, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

“Potential litigants respond to incentives and signals about the odds of victory and the expected size of settlements, which means this latest massive settlement may help produce more—not fewer—claims in the future,” said Tom Flanagan, senior fellow at the Fraser Institute and author of A $40 Billion Settlement for Indigenous Child Welfare: Is Anyone Minding the Fiscal Store?

Announced by the federal government in January, the $40 billion settlement—an unprecedented amount, at least five times larger than any previous such settlement—settled a class action lawsuit with First Nations organizations who claimed that child welfare services had been chronically underfunded.

As a result, the benchmark settlement amount for Indigenous class action suits has risen dramatically.

“As the number and scope of claims for compensation multiply, Ottawa’s Indigenous spending envelope will more closely resemble a program of reparations for past injustice rather than a source of funding to efficiently and effectively address the needs of First Nation communities today,” Flanagan said.

Tom Flanagan, Senior Fellow, Fraser Institute

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians, their families and future generations by studying, measuring and broadly communicating the effects of government policies, entrepreneurship and choice on their well-being. To protect the Institute’s independence, it does not accept grants from governments or contracts for research. Visit