OTTAWA—Indigenous communities will find themselves with a long-term funding commitment in next week’s federal budget worth hundreds of millions of dollars to address the most acute housing situation in the country, say sources familiar with the measure.

The housing shortage in Indigenous communities has meant that homes are often overcrowded and in desperate need of repairs — a combination that also has health consequences.

The Liberals have promised unique housing strategies for Inuit, Metis and First Nations communities to go along with the 10-year, $225-million plan unveiled last year to fund groups that help house Indigenous Peoples off-reserve.

The strategies would be distinct from the national housing strategy, which calls for $40 billion in promised federal and expected provincial spending on new units and a new housing supplement.

Sources with knowledge of the government’s plans for the budget, speaking on condition of anonymity about details not yet made public, say the government will move first on long-term funding plans for Inuit and Metis housing, where consultations are more advanced and the logistics of providing funding is simpler.

The budget is also expected to signal a shorter-term plan — in the range of three to five years — for First Nations housing as all sides finalize consultations on a long-term plan.

The funding would build upon and be similar to last year’s spending pledge of $300 million over 11 years for housing in the North, which went to territorial governments.

This time, however, the government would provide funds directly to individual band councils, building on recent Liberal promises to “advance Indigenous self-determination, including the inherent right of self-government,” such as the Canada-Metis Nation Accord signed last April.

The long-term funding deal would also replace annual funding agreements that have limited the efforts of communities to manage a housing crisis.

There are also hopes the government boosts funding for urban Indigenous people, about one in 15 of whom will experience homelessness, compared to one in 128 for the non-Indigenous population.

“The majority of Indigenous Peoples live in urban settings and therefore it is crucial to allocate new funding to address the significant housing challenges facing urban Indigenous Peoples in Canada,” said Jeff Morrison, executive director of the Canadian Housing and Renewal Association.

Census figures released last year found 324,900 people who reported an Indigenous identity lived in a home that was in need of major repairs — about one-fifth of the total Indigenous population.

The Indigenous population is growing faster than the non-Indigenous population, Statistics Canada noted — a pace that would only further exacerbate the overcrowding in some communities.

The situation was most dire among Inuit in the North: two-fifths of the Inuit population lived in overcrowded homes in 2016, the census found. A Senate report last year described up to 15 people — multiple generations of the same family in some cases — crammed into small, crumbling three-bedroom units in many Inuit communities.

Overcrowding has also contributed to higher levels of domestic violence and abuse, as well as health problems such as tuberculosis, the infection rate for which is 250 times higher in Indigenous communities than in the non-Indigenous population.

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The housing funding would work in tandem with other measures the Liberals have signalled will be in Tuesday’s budget, including money to address child welfare on reserve and health issues.

Indigenous Services Minister Jane Philpott has said the budget would close the funding gap for child welfare agencies on reserves to cover the actual cost of programs to keep families together. Earlier this month, the Canadian Human Rights Tribunal issued a fourth order against the government for proper funding of child and family service programs.