Federal government says lack of housing on First Nations strictly a funding issue

During the final hour of a two-day hearing at the Federal Court of Appeal, lawyers representing First Nations and Canada argued whether the matter of water and housing on reserve land was about money or human rights. Canada asserted that when it comes to providing housing, the government “is limited” to providing funding for the homes, making the issue a matter of financial duty. “First Nations manage their own housing,” said one of Canada’s lawyers. “Leadership determines what is to be built, where it is to be built, and how it will be contained.” However, lawyers representing Shamattawa and St. Theresa Point First Nations asked how that could be possible, when the Indian Act had caused the housing shortages that are affecting Indigenous communities in the first place. “There’s such extreme harm that we can say that there’s no way a First Nation would have brought this on itself if it could have afforded it,” said Michael Rosenberg, one of an equally plentiful team of lawyers representing the Nations. The federal government had recently appealed two decisions made by Federal Court Justice Paul Favel in December 2025, when he had concluded that Canada had the obligation to provide Shamattawa and St. Theresa Point First Nations access to housing and clean drinking water. “The lawsuit at its heart is about funding and increased funding, not an abstract separation of right,” said a lawyer representing the Liberal government on Wednesday. Over a phone call, Rosenberg also confirmed to APTN News that, in alignment with that claim, the government was also asking for court costs alongside the appeals. Back in court, he said the communities were not able to properly provide for themselves without financial and structural support from the government, and Canada did, in fact, still have control over all of the houses on a reserve. “Part of what has kept these First Nations in this state [of poor housing] has been Canada’s part in the Indian Act, constructed to deprive them,” he said. Rosenberg argued that according to a report from the Auditor General of Canada submitted to Parliament in 2024, Canada was still in the process of transferring control of housing back to the First Nations. In the report he referenced that the auditor general had also concluded that, “We found that Indigenous Services Canada was at the early stages of transferring control of housing to First Nations, but no overarching policy framework was in place to guide the department’s work in transferring its programs to First Nations communities. “Under the Department of Indigenous Services Act,” the report continued, “Indigenous Services Canada is mandated to work with First Nations to gradually transfer departmental responsibilities to First Nations, including housing. As of 31 March 2023, the Canada Mortgage and Housing Corporation did not have the legislative mandate to transfer its responsibilities to First Nations.” The report also stated that this transfer process “is not imposed” on the First Nations, and they need to want to take over those responsibilities. Rosenberg said many communities have not expressed that interest because they “aren’t able to provide that support,” without money from Canada. He said, according to evidence from the original lawsuit, the Assembly of First Nations (AFN) even “resisted the idea of moving Canada’s commitment to First Nations,” which he described as “divesting itself [Canada] of its own commitment.” Instead, the AFN, a political organization that represents more than 600 First Nations in Canada, has been developing a National First Nations Housing and Infrastructure Strategy, which is a lengthy transition period done in collaboration with ISC, since 2018. The proposed strategy would include transferring control of funding as well. “The success of any recognition of First Nations complete authority over their housing depends on a federal initiative to transfer control of housing programs and services funds that is broadly flexible enough to accommodate the wide range of First Nations preferences,” the national organization stated in a release. This is in part due to “circular funding,” he said, as the government will fund housing projects that require rent, and the rent then paid to the government by members will be dollars collected from government checks. “That is the dynamic here, however it is dressed up,” he said. As of 2025, the AFN was still “urging the federal government to honour its intent to transfer control of the First Nations Housing Market Fund (the Fund) to First Nations control,” in order to properly assume control over housing as a whole. Although Canada has retained that funding, lawyers representing the government said housing is otherwise out of their hands. “Canada does not dispute the importance of housing, which is why [it] has put billions of dollars towards funding on reserve,” one of its lawyers said. “My friend’s submissions today leave this Court with the impression that the record suggests that Canada does, in fact say who can build, what can build, but respectfully that is not the case.” The lawyer said “There is a shared responsibility … Not simply the system which Canada determines, it’s a framework that involves consultation at a policy level.” The three Federal Justices have yet to make a determination. Emma HoneybunOnline Journalist | WinnipegEmma is a Red River Métis with family roots in St. Malo, Manitoba. She graduated from RRC Polytech’s Creative Communications program in 2023 and went on to serve as a community journalist and photographer for the Free Press Community Review until she joined APTN in 2026. Equipped with a strong sense of justice, she enjoys covering stories in the central prairies for a larger audience. Her work has also appeared in Manitoba Inc. Magazine, the Free Press, and RRC Polytech’s student paper, The Projector. Continue Reading