Thank you very much, Mr. Chair. It is a pleasure to be back.
I actually have very brief opening comments today, but I do appreciate the opportunity to appear before the committee to discuss Bill . Today I am joined by Marie-France Kingsley, who is the director of investigations for the Office of the Correctional Investigator.
Though I will be brief in my remarks, I will raise some questions and concerns that we have noted regarding the application, scope and potential administration of Bill C-350, but I do want to declare my limitations at the outset. My office has no expertise in the prioritization of creditors or debt recovery mechanisms. I cannot speak to issues raised by this bill concerning jurisdictional matters or jurisdictional competence, and it is beyond my capacity to comment on matters of constitutionality, or even the compellability of forcing payments in the order of precedence contemplated by Bill C-350.
Hopefully, however, I can be of some assistance in bringing some insight into more practical matters that speak to the capacity and ability of a federal inmate to repay outstanding monetary debts, restitution orders, or victim fine surcharges and still meet their obligations to society while serving a sentence in a federal penitentiary.
As members know, Bill C-350 sets out priorities for debt repayment in cases when an offender is legally entitled to a monetary award. There are current mechanisms in place that allow Correctional Services Canada to register known restitutions and fines levied by the courts against federal offenders. Thousands of such registrations are currently on file. However, obligations arising from civil proceedings, creditors, and even spousal or child support payments, are not routinely noted in CSC's records. Bill C-350 would effectively require Correctional Services Canada to establish a tracking system to administer child or spousal support orders, as well as other debts owed as a result of an award by a court of competent jurisdiction.
It is not clear to me how such a registry would be created, or how much it would cost to implement or maintain. I do question whether we want or expect the federal correctional authority to be mandated to become part of a debt collection scheme. In fact, should it even be CSC's job to verify existing civil debts or other obligations, court orders, or settlements? What if a mistake is made? What if an appeal or variance is granted post warrant expiry? Who would be held accountable or liable? How would creditors register? In the case of debt repayment, is it up to CSC to decide what creditor gets paid first and in what order? One thing is certain, the cost and complexity of administering such a registry can be expected to be significant.
I understand that the need for this bill was based on a couple of high-profile cases. I appreciate that there may be a current impairment in recovering or garnishing monetary awards that may have been received by an offender under federal custody as a result of a legal action or proceeding by a federal court, tribunal, or agency. However, my experience suggests that the publicity surrounding such cases can be significant enough to likely alert any creditors. As we know, creditors usually act very quickly to intercept monetary awards before they can be disposed of by other means.
I am not certain that the creation of a complex and potentially expensive registry is the most efficient or effective way to deal with a few high-profile awards, much less meet court-ordered restitution arrangements, including child or spousal support obligations. In any event, the great majority of offenders in federal custody have very little money and limited capacity to earn while incarcerated. An elaborate recovery scheme is not likely to provide much satisfaction to victims as most debts will likely remain unpaid. Even the courts recognize these realities when imposing fines or making victim restitution orders or surcharges. This is an unfortunate reality, but perhaps also an opportunity to make substantive suggestions for reform.
Let me provide some context. I want to talk for a minute about the capacity of inmates to repay debts or meet ongoing family obligations while serving a federal sentence.
The maximum an offender can earn in a federal penitentiary while gainfully employed was set at $6.90 per day in 1981. It remains the same rate today, over 30 years later, and it has never been adjusted for the cost of living for inflation. Inmates in federal institutions are provided basic institutional clothing and personal hygiene products. Anything over and above that must be purchased by the inmate with their own money.
An established list of goods for purchase is available to the inmate population at a 10% profit margin. In 1981 when the rate of pay was established, a standard basket of canteen items could be purchased for $8.49. By 2005 that same basket of goods was estimated to cost $61.59, representing a 725% increase. Over the past three years, reductions in non-essential health care services previously provided by the Correctional Service has placed an additional burden requiring non-prescription items, such as Tylenol or medicated shampoo, to be purchased through the inmate canteen. For example, a 100 millilitre bottle of Buckley's cough syrup sells for $7.58 inside, more than one day's wages.
Other potential deductions from offender pay include institutional fines, inmate welfare committee funds, social events, and room and board. The top earners who receive overtime, incentive pay, or supplemental income, such as pension payments, are subject to pay for room and board while incarcerated. This amount is not to exceed $5 per day or $50 per every 14-day pay period.
In addition, all inmates must contribute to the inmate welfare fund. These expenses add up to $6 per 14-day pay period and cover things such as television and cable costs, as well as a variety of inmate welfare committee disbursements for organized activities for offenders, as well as inmate donations to charitable groups and legal fees for group actions.
My point here is simply to say that crime does not, in fact, pay. Prison rarely captures the affluent. Most offenders have no savings, and their earning capacity inside a federal institution is extremely limited. There seems little point in diverting earnings that, at best, will only minimally support release. It is not unusual for a released offender to be facing thousands of dollars of accumulated debt and only limited employment opportunities.
The issue that Bill C-350 addresses is an important one. Part of an offender's reintegration should include the satisfaction of debts to the best of their ability. My concern is that the suggested approach may prove both unworkable and counterproductive.
Thank you once again for the invitation to meet with you today. I look forward to your questions.
The challenge that I heard you articulate was more in terms of the CSC. I think you said that Bill would effectively require CSC to establish a tracking system to administer debts that are owed. Is that your main concern?
As I read the bill, I see that if an award is made from the federal government to an offender, an inmate, this bill lays out who would be paid first, second, third, and fourth, and when all of these things were paid out, then the remaining moneys would go to the offender.
I'm seeing the Government of Canada, the crown, paying out the money, but what you're saying is that as the bill reads right now, it would be up to CSC to determine who else is owed money in this list of people who would get paid before the offender would. So you're seeing this as a problem because now CSC has to find out whom the offender owes money to. Is that correct?
CSC would have to register both the income and the expense or the monetary award and the debt. Then they would have to administer payments. There is a schedule contemplated in the bill, but it's not clear to me, for example, what would happen if an inmate received a structured settlement. It's not clear to me, as I said, what would happen if there were a change or an appeal or a variance at some later date.
It's also not clear to what extent CSC would be responsible for maintaining the accuracy and the currency of that, and perhaps even for posting warrant expiry. It's also not clear what would happen during the period of time when an offender might be on conditional release in the community, let's say on day parole, and working and having another source of income.
It's also not clear what would happen and how funds would be received and disbursed if there were an out-of-court settlement or if there were a settlement resulting from CSC's negligence, for example, if there was a claim against the crown regarding the destruction of personal property. It's not clear to me whether even the drafter of the bill would have contemplated that.
If an inmate is transferred from one institution to another, for example, and has a radio that's worth $50 and the radio is broken during the transfer and it's clearly CSC negligence that caused that damage, then if that offender is given $50 or another radio, that's a monetary award from the crown. How would that factor into further disbursements? Those are everyday, practical considerations. The principle of debt recovery, as you say, is not the issue; but the operational challenges, I think, are considerable.
The experience in the United States, as you can appreciate, is very uneven. There are several different approaches. Some of the approaches we're familiar with include things such as debt counselling at intake. An offender who is newly admitted to a prison, as part of that admission process, will undergo some discussion about debt and the ability to repay. Some even enter into assisting the inmate in negotiating debts, recognizing that a financial burden is often a huge barrier to successful reintegration.
There are other U.S. schemes that involve housing placements and overcoming challenges such as security deposits on monthly rents and things like that. There are various approaches at various state levels across the United States.
The second part of your question was really about, as I understand it, whether there is a process we would see CSC implementing to do the same—
I'm assuming that the obligation of the CSC, when we're looking at it, would fall under that same proposed section, where it carries on and talks about “pursuant to a legal action or proceeding against Her Majesty in right of Canada, or an agent or employee”, meaning against Her Majesty, an agent, or an employee, which would be the CSC, I guess.
I'm trying to find in here where that burden would shift over to CSC in actually administering the program or the payment structure, because the final subsection 78.1(4) reads:
Any amount of the monetary award referred to in subsection (1) that remains after all payments have been made in accordance with subsections (1) to (3) shall be paid to the offender.
What it says to me is that there's an award, a settlement made to the inmate. Then they determine if there's any money owed, either through paragraph 78.1(1)(a), child or spousal support, or (b) as owed pursuant to a restitution order, (c) or a victim surcharge, or (d). Then if there's anything left, it gets paid to the offender.
I'm having a hard time seeing where.... It's not CSC that's cutting the cheque. I brought this up with the last witnesses. The CSC wouldn't be cutting the cheque. I'm not sure CSC would actually be getting the money. It would seem to me that if the inmate is granted a settlement in a court or a proceeding, whether that's a publicly disclosed thing or an out-of-court settlement, whoever actually comes up with the agreement or the settlement would then hold those funds and would also be the ones with the obligation to settle out paragraphs 78.1(1)(a), (b), (c), and (d)—and not CSC.
Maybe I'm interpreting that a little differently from you, but I don't see the money going to CSC first, and then CSC handing it out under (a), (b), (c), and (d). Am I missing something there?
You know, I'm not sure.
In this case, the cheque would be cut by the crown to the offender. The offender doesn't have access to the bank the way you and I would, or frankly, even the way an offender might if he were on conditional release in the community. An in-custody offender would have a different circumstance from an offender serving a similar sentence for a similar crime, but only he had now been released on day parole or full parole.
In any case, if the offender is in custody, they have very different access to their account, and CSC controls that. If it weren't CSC being administratively involved, it begs the question, who would be? The court can't reach into that offender's account. The creditor obviously can't, or they would already have done so if there were a mechanism for them to do that. The cheque gets deposited on the offender's behalf, but administratively, CSC is looking after that offender's bank account.
It's not like you and me just going to a chartered bank or to an ATM.
I don't think I gave any indication of the numbers. There have been 2,100 plus registered awards so far this year. I can certainly provide the committee with the number of claims against the crown relating to personal property, for example. My suggestion was that there may be very few who have significant awards, but there are certainly many claims against the crown that are brought every year and several hundreds that are successful every year.
Do we have the numbers?
For 2006-2007, the fiscal year ending March 31, 2007, there were 722 cases claiming almost $2.6 million against the crown. Of that total, about $280,000 was paid out. That excludes all monetary awards under $1,000, and several of the monetary awards are under $1,000 because of the nature of the claim. By 2010-2011, that number had grown to over 1,200 cases or claims against the crown. They were claiming a total of $4.2 million. In that case, there were seven cases over $1,000, amounting to just over $10,000. The remainder of the cases were monetary awards of an amount less than $1,000.
I'm sorry if I misspoke in suggesting that there were few.
Yes, and I think that's where we've seen the challenge when we're talking about offenders.
When we're talking about people who aren't offenders and who are living in general society, there are ways for spousal support and child support to be collected. We've heard some conflicting testimony, but I think, by and large, what we've heard, unfortunately, is that there is no mechanism for offenders to be forced specifically to pay child support, spousal support, and then it goes on. We heard testimony in terms of restitution or other outstanding moneys that are owed.
Here's another question on something that we've heard come up as well. One of the witnesses we had, Mr. Toller from CSC, mentioned that if legal counsel determined there was a legal basis to consider that CSC might be liable, and if they've incurred damages, then an out-of-court settlement might be reached. Do you know whether out-of-court settlements would be included in the monetary awards that are affected by Bill ?
As with a lot of legislation, it's always in the details as to how it's going to be administered. When I would look at it, not being an expert in correctional law as Mr. Sapers or others would be, I wondered how these payments would actually be made. How would the Correctional Service of Canada make the payment? How would they know to whom they were to make the payment, because a recipient of a restitution order would be a victim of crime? The victim would have to be made aware that they could advise the Correctional Service of Canada that they had an amount owing and Correctional Service of Canada would have to find some mechanism to track that payment.
I'm familiar with Mr. Toller's testimony of last week, when he was indicating that they have an offender management system that does some of that, but maybe there's a need for more details about how that would be accomplished.
With respect to surcharge orders, those would be owed to a province. A province would also have a mechanism, or vice versa, the Correctional Service of Canada would have to be aware that a particular province hadn't received a surcharge amount owing and ensure that it would be able to pay them that amount out of an amount that the crown would be paying to the offender.
These are small details, but as I said, without any of those changes the bill should be administrable in the spirit that the sponsor intended.
Okay, well then, I'll check my information source.
There was a big discussion here at the last meeting about the civil rights of offenders, because we had a lawyer here who specialized in those cases, which sort of relates to the whole issue of how you get the money from a settlement to the creditors.
When an offender wins a settlement, does that money end up in the offender's personal bank account at the moment? Is that how it would work at the moment: it would end up in the offender's personal bank account as opposed to some account he or she may have within the penitentiary or Correctional Services Canada? Or are all the offender's assets under the purview of Correctional Services Canada?
At what point are some of the offender's assets outside the realm of the Correctional Service Canada or of the government? I'm not a lawyer, so that's why I'm asking this question which you might find a little simplistic.
Are all of the offender's assets suddenly taken away from him or her and are under the control of Correctional Service Canada?
I should backtrack to the sentencing process. In many cases, in order to mitigate the sentence, an offender who can pay in situations where damages or losses have been suffered and restitution is a logical sentence, will voluntarily indicate that they would like to make restitution. That will, hopefully, mitigate their sentence. In those cases, sometimes probation may be an appropriate sentence. It always depends on a number of factors, such as the seriousness of the offence, the offender's record, and so on.
Some of the research done by the Department of Justice over several years has indicated that, where restitution is volunteered by the offender, it is paid more often than when it's ordered by the court. In situations where a court is sentencing an offender, and there's no offer to make restitution, perhaps because of an inability to pay or other reasons, the court may order restitution. The crown may ask for restitution, or the court can do it on their own motion, but they're going to take into account a whole variety of factors, again, in terms of what the appropriate sentence is. So it could be that restitution isn't going to be appropriate for the nature of the offence, and a consideration—not a determinative consideration, but it is certainly a valid consideration—is ability to pay. The courts know that if they order restitution to be paid by an offender who has no means of paying it, it's not assisting either the offender's rehabilitation nor assisting the victim in getting the reparation they seek.
So then moving on to the situation—
I'm advised by the clerk that the actual motion does then become public. That's the advice I'm receiving from the clerk at this point, and it's certainly now public.
Voices: Oh, oh!
The Vice-Chair (Mr. Randall Garrison): On the advice of the clerk, this request was communicated to the Department of Justice, which declined to provide additional witnesses because of their possible future involvement in any constitutional litigation resulting from the bill.
I'm not intending to open debate on this point, but as an explanation—and also as a courtesy, I think, to our witnesses, who may have felt somewhat besieged by the questions—this was a decision made by officials other than the witnesses who have appeared.
We thank you for appearing today. If you have any further thoughts or comments that occur to you after you leave, you could certainly submit them to us in writing.
Ms. Doré Lefebvre.