Indigenous Services Minister Jane Philpott says she has concerns with Manitoba's plans to reform its First Nations child welfare system.

Specifically, the minister told CBC she believes incentives to encourage non-Indigenous families to adopt First Nations children should be avoided so as not to replicate mistakes of the past.

Philpott, who described the state of the child welfare system in Canada as a "humanitarian crisis," said the federal government is determined to work in concert with the provinces and Indigenous peoples to create a system that keeps more First Nations children in their communities.

Indigenous people make up 17 per cent of Manitoba's population, but Indigenous children are over representated in government care, accounting for almost 90 per cent of the 10,700 children in the province's system.

The Progressive Conservative government in Manitoba is pushing ahead with reforms, with a special committee expected to present recommendations this spring.

As the system is currently structured, most child welfare agencies obtain part of their funding for each First Nations child they place in care, creating what some see as a financial incentive to take kids from their families. Manitoba has sought to dismantle such a system by granting block funding to agencies — entirely independent from the numbers held in care.

Promoting guardianship

But, the province is also introducing adoption supports, promising legislation that will include subsidies to promote the legal guardianship of foster children, something that has First Nations leaders worried.

"This is putting children at risk of being in non-Indigenous homes permanently," Cora Morgan, the Assembly of Manitoba Chiefs' family advocate, recently warned.

"When probably close to 90 per cent of our children are placed in non-Indigenous homes, and they're not having access to culturally appropriate services or meaningful connections to culture and identity, then I have trouble with that."

In an interview with CBC News, Philpott said she will raise similar concerns when she meets with her provincial counterparts in Ottawa later this month for an "emergency meeting" to discuss Indigenous child welfare across the country.

"My understanding of the [Manitoba] system to date suggests there is need for reform. I'm not sure the ways of getting there are — that we necessarily see eye to eye on how to get there," she said.

"Instead of paying a non-Indigenous family, is there not a way that the baby, infant or child could stay in the community surrounded by their language, culture and family in a kinship model or with a grandparent who is willing?"

Philpott said history dictates that removing First Nations children from their communities can have devastating consequences. And, with more Indigenous children currently in care than there was at the height of the residential school era, co-ordinated action is needed now more than ever to combat intergenerational trauma, she said.

"This is very disturbing because we know the same kind of effects of what happened to children who were removed from their families and put into residential schools, or scooped from their families in the 1960s."

Manitoba Families Minister Scott Fielding says there are some misconceptions about the province's plans to provide financial supports for guardians. (Bryce Hoye/CBC)

In a statement, Manitoba Families Minister Scott Fielding — who is tasked with overseeing the overhaul of the child welfare system — said there are "misconceptions surrounding the Manitoba government's planned reforms."

"Our first priority is to keep children with their families and in their home communities. If reunification with a parent is not possible due to safety or other reasons, the next hope is to place the child with a relative.

"Under the current system, foster parents receive subsidies, but those payments stop when someone assumes legal guardianship, including kin. Subsidies would create incentive for relatives to become permanent guardians, which would create the lifelong connections we know are crucial to create better outcomes for children," Fielding said.

"I met with minister Philpott [late last month] and look forward to further discussion and clarification at our emergency meeting with our counterparts in January."

'Room for change'

Ottawa is eager to devolve the provision of child welfare services to Indigenous groups as part of a larger push to encourage self-governance. To that end, budget 2018 will include a boost in funds for that express purpose, Philpott said.

And, in December, at a special chiefs meeting, Philpott penned a memorandum of understanding with the Assembly of Manitoba Chiefs that will begin the process of developing a joint federal-Indigenous plan for welfare services with the goal of transitioning away from a provincially run system to First Nations control.

"I think there's a lot of room for change there," she said. "We've seen a tremendous interest from the Manitoba chiefs ... to really claim their right to take care of their own children."

Chief Kevin Hart, an Assembly of First Nations regional chief who hails from Manitoba, has long said the province should get out of the business of taking Indigenous kids.

"They're apprehending our children because of poverty. We're being set up for failure. We have to say enough is enough. Our children deserve to be at home," he said in an interview with CBC News last year.

"They need to take a step back and we need to take that jurisdiction away. Because in Manitoba it's a billion-dollar industry," he said, referencing the amount of federal dollars that flow to the provincial system to care for First Nations children.

Philpott also raised concerns about the provincial government clawing back Canada child benefit cheques intended for First Nations families that end up in provincial coffers because those children are held as wards of the state.

"There are real challenges around whether the money actually gets to the care of the kids as it ought to ... families have a right to that resource."