OTTAWA -- The Canadian Human Rights Tribunal says a $40 billion child welfare settlement agreement the federal government reached with First Nations doesn't meet all the requirements of the tribunal's orders.

The panel is urging the parties to continue negotiating in a decision released today.

In 2019 the tribunal ordered Ottawa to compensate children and families three years after ruling that Ottawa had discriminated against First Nations children for years by not properly funding child welfare services on reserves.

The federal government, Assembly of First Nations and lawyers for two related class-action lawsuits, announced a deal to pay that compensation in January.

It initially awarded $40,000 to each child and their families who suffered.

However the tribunal is concerned with the timeline claimants have to opt out of the compensation and whether all children will receive the full amount.

Assembly of First Nations regional chief Cindy Woodhouse says the tribunal's decision is devastating and federal ministers also expressed disappointment.

This report by The Canadian Press was first published Oct, 25. 2022.