OTTAWA, Canada—The scent of burning sweetgrass drifted through the auditorium as Ovide Mercredi, Canada's top Indian leader, stood before the microphone with tears in his eyes.

Reconciliation does not only involve forgiveness,” he told the hushed crowd of about a thousand natives, Church leaders and government officials before him. “It's about atonement, it's about justice, it's about correcting mistakes that have been made and setting things straight.”

Those words were spoken at a December 1995 meeting. But a year later, little headway has been made in setting things straight for the country's 800,000 natives, many of whom live in Third World conditions. The reason, according to observers: Five centuries of paternalism and attempted assimilation are hard to undo.

Broken treaties, theft of aboriginal lands, impoverishment and disempowerment are among the ghosts of the past that continue to haunt Canada's natives, most of whom live on reservations.

But a key to the reconciliation sought by Mercredi and other natives may be found in the long-awaited report issued last November by a specially appointed federal government commission. For Father Doug Crosby, general secretary of the Canadian Conference of Catholic Bishops, the report marks a “prophetic moment” in Canadian history.

The federal inquiry conducted by the Royal Commission on Aboriginal Peoples cost $58 million, making it the most expensive in Canadian history. It sought to answer a question that seemed simple enough: What are the foundations of a fair and honorable relationship between aboriginal and non-aboriginal Canadians? The process took the commission a full five years, hearings from coast to coast and more than 400 recommendations to answer.

“The legacy of Canada's treatment of aboriginal people is one of waste,” claimed the seven commissioners in their five-volume, 3,500-page report. “Wasted potential, wasted money, wasted lives.” The legacy could be measured in statistic after statistic, they said: “In the rates of suicide; of substance abuse; of incarceration; of unemployment; of welfare dependence; of low educational attainment; of poor health and poor housing.”

Successive federal governments were not alone in creating the legacy. The Roman Catholic, Anglican, United and Presbyterian Churches helped carry out the governments'policy of assimilation in the Church-run Indian residential schools. But the attempts failed, and aboriginal culture and identity remain as strong as ever.

While the Churches have publicly apologized and launched their own “healing” programs with native groups, the federal government refuses to accept responsibility for abuses at the schools. In recent years, hundreds of the estimated 150,000 former students have come forward with stories of physical and sexual abuse. They want apologies and compensation. The government argues that the Churches were contracted to do the job, but the Churches say it was the government that set policy and provided direction.

Catholic religious orders ran 60 percent of the residential schools, which opened in the late 1800s. Their number peaked in 1946 at 76, 45 of which were linked to the Catholic Church. Most of the schools were closed in the 1960s.

The commission's failure to call for an apology by the federal government is a glaring omission in an otherwise comprehensive report, say critics, especially since the commission itself had acknowledged that the residential school system was the Canadian institution that “caused the greatest damage to the traditional aboriginal family.”

“Children as young as 6 years old were removed from their families for 10 months of the year or longer,” it said. “They were forbidden to speak the only languages they knew and taught to reject their homes, their heritage and, by extension, themselves.”

Commissioners agree that the “terrible facts” need to be recognized and call for a public inquiry into the schools. “Only by such recognition and repudiation can a start be made on a very different future,” they say.

But many fear an inquiry will only give the government an excuse not to take action on the report's recommendations. Gerald Kelly, coordinator of the National Catholic Working Group on Residential Schools, says an inquiry could prompt the government to “stay out of the process of healing and reconciliation for another number of years.”

Lauded by natives and the major Churches, the commission's 440 proposals are aimed at forging a new relationship between aboriginals and non-aboriginals. But the price may be too high for most Canadians: an increase of up to $2 billion a year in the current annual spending of approximately $5 billion. The extra money would be earmarked for improved housing, health and employment for aboriginals.

At a time of spending cutbacks, however, more money for natives is not a priority. Indian Affairs Minister Ron Irwin has said the money spent on the commission, set up by the previous government, would have been better spent on much-needed aboriginal housing.

The government also showed its indifference to commissioners by thwarting their attempt to release the long-awaited report in several stages in a bid to keep aboriginal issues in the public eye. Instead, the government decided to deposit the entire 13-pound report on the doorstep of Canadians at one time.

Officials'cool reaction to the report leaves Church and aboriginal groups fearing the feds will either shelve the report entirely or not implement its major recommendations. “This is not a time to drift with the tide, it's a time to set a new course,” said Father Crosby. Added Ed Bianchi, coordinator of the Aboriginal Rights Coalition, established by the major Churches: “This report deserves serious attention.”

But the public is split on the issue. A poll taken after the report's release showed that 51 percent of Canadians believe Indian self-government will bring no changes in living conditions on reservations or will make them even worse.

However, Indian leader Mercredi urged the government not to ignore the report. “This is your last chance,” he said. The report provides “the best chance in this century to offer hope to the aboriginal people.”

But the federal government has apparently chosen to ignore Mercredi and his organization. Even while the commission was preparing its report, the government was busy negotiating land and resource claims with local Indian groups on a piecemeal basis, which fracture relations among many of the 600 Indian bands and their national voice, the Assembly of First Nations.

The Churches, however, through their Aboriginal Rights Coalition, continue to lobby in support of aboriginal self-government and other key recommendations of the report. “Our hope is that this report will help us identify the concrete steps that Canadians can take to ensure a more secure and healthy future for aboriginal communities,” said Dr. Alexandra Johnston, president of the Canadian Council of Churches.

Added Crosby of the Catholic bishops'conference: “We are committed to working in solidarity with aboriginal peoples. That commitment is grounded in the Gospel's demand for justice and action.”

But the Churches may have to speak often and loudly from now on just to keep the report from drifting into obscurity. As a prominent political scientist recently observed: “It seems to me it's fallen off the end of the earth.”

For Mercredi and his people, the royal commission has paved the way for a process of the reconciliation and healing they say is long overdue. Supported by the Churches, it's a door they hope to keep open.

Art Babych is based in Ottawa.