OTTAWA—A central piece of the tough-on-crime agenda championed by the Conservative government is going to cost taxpayers more than a billion dollars a year to roll out, says a report from the parliamentary budget watchdog.

Parliamentary Budget Officer Kevin Page released a scathing report Tuesday morning that examined the economic impact of implementing the Truth in Sentencing Act, which limits the amount of time inmates can get for time served while in custody awaiting a trial and verdict.

The report found the increased number of inmates the new legislation will deliver to federal correctional institutions — and the need to build new and bigger prisons to house them all — will cost an additional $618 million annually in operational and maintenance costs, and another $1.8 billion over five years in construction costs.

The report says changing the law will lengthen the average prison stay for an inmate by about 159 days, which would bring the total amount of time in physical custody from 563 days to just under two years.

Longer stays mean there will be an average of 17,058 inmates at any given time compared to an average head count of 13,304 inmates in fiscal 2007/2008, which is the year Page used as a baseline for his study.

The report estimates that would require an additional 4,189 cells, which means an average of $363 million annually over the next five years to expand existing facilities and build new ones.

Public Safety Minister Vic Toews disputed the figures, standing by his earlier claim that officials at Correctional Services Canada told him the initiative would cost $2 billion over five years — which is nonetheless higher than the $90 million price tag he originally disclosed.

Toews also said the federal government had no plans to build new facilities but would construct new cells inside existing buildings.

Page said he received no significant co-operation from Correctional Services Canada since he began looking into the impact of a suite of Conservative law-and-order bills at the request of Liberal MP Mark Holland (Ajax-Pickering) last October.

“There was just no disclosure and I think as a legislative budget officer we want to make sure that we don’t let these things slip by that can generate significant cost pressures going forward,” said Page, who used a probabilistic study and numbers from 2007/08 because the government did not share its methodology.

Page also noted that provinces and territories are expected to have to shell out another $5 billion to $8 billion over the next half decade to handle the increased inflow.

“If we’re changing the Criminal Code, it’s not just for the federal government,” Page said. “It actually has a huge operational and cost impact on the provinces and territories.”

Laura Blondeau, a spokeswoman for Ontario Minister of Community Safety and Correctional Services Rick Bartolucci, said he looks forward to reviewing the report but does not want his province to pick up the tab for a federally led initiative.

Holland called on the government to come forward with the numbers for the rest of its crime and punishment bills for Page to examine and feared the final result would be astronomical.

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“If all of them are implemented, this will bankrupt Canada,” Holland said. “We’re talking about tens of billions of dollars at a time when we’re already running a $50 billion deficit.

“We’d have to cannibalize the health, education, military departments just to pay for all these new prisons and what is so offensive about it is that it was tried in the United States, it was tried in the United Kingdom and these policies were a complete failure.”