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At a time when overcrowded federal prisons are preparing for an influx of prisoners as the Conservative government deals more harshly with criminals, the corrections service is also being asked to make major spending cuts to accommodate the government's deficit-reduction demands.

Thursday's budget called for the Correctional Service of Canada (CSC) to trim $295-million from its budget – about 10 per cent of the money it spent last year – by 2014.

Howard Sapers, the Correctional Investigator of Canada, said Friday that he does not know how the corrections service will be able to do it – trim hundreds of millions of dollars in spending while in a growth period made necessary by the federal justice agenda.

The number of inmates in both the federal and provincial systems is expected to rise as the provisions of an omnibus crime bill that was recently passed into law take effect. Among other things, that legislation established a number of new mandatory minimum sentences, restricted the use of house arrest and made it more difficult to get out of jail early, all of which are likely to increase the number of Canadians behind bars.

"We know that they are constructing new cells, we know that they are hiring new staff, we know that they are expecting an increase in population. Obviously all those things are going to cost money," Mr. Sapers said.

Federal prisons, like many provincial jails and detention centres, are already overcrowded and the CSC is having trouble providing timely access to programs and meeting the needs of mentally ill offenders. But, even if the population increases, it will still be required to deliver on its twin mandate of safe and secure custody and timely integration, Mr. Sapers said.

"So it's very difficult to see how they are going to manage all of that at the same time as they cut $300-million," he said.

This week's budget clearly states that the "government has not built a single new prison since 2006 and has no intention of building any new prisons." But, in preparation for the anticipated influx of inmates, and to replace some prisons that are well past their prime, the CSC is constructing 2,700 cells at more than 30 existing facilities. That is the equivalent of about six average medium-security institutions for men.

"When you build new cells you have to staff those cell ranges, you have to feed those new inmates, so there's a whole bunch of things that have to happen," Mr. Sapers said.

According to Statistics Canada, the cost of housing a federal prisoner in 2008-09 was about $118,000 a year. Assuming that the price has not increased since that time, the cost of operating the new cells currently under construction will be close to $320-million.

When asked how the department could cut nearly $300-million from its budget when the growth in the prison population is expected to cost hundreds of millions of dollars, Michael Patton, a spokesman for Public Safety Vic Toews, said prison populations have not been rising as quickly as projected.

He pointed to a recent memo written by Don Head, commissioner of the Correctional Service of Canada, to his staff in which he said: "To date [the inmate]population stands substantially less than our projections. Our projections did not materialize as originally forecasted."

But Catherine Latimer, the executive director of the John Howard Society of Canada, said the provisions in the omnibus crime bill will increase the number of people behind bars. Although the biggest impact on prison populations will be felt at the provincial level, federal facilities will also take in more offenders, she said.

Officials at Corrections Canada "do need to take a serious look at how they can accommodate this serious increase in offenders even before C-10 kicks in," she said, so the cuts to the CSC budget "certainly give me pause."

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