The cost of building a new federal inmate hospital in New Brunswick has surged to $1.3 billion, more than triple the original $400 million estimate announced in 2021, according to federal documents and senior government sources.
The funding, approved by Treasury Board in December 2024, has not yet been made public due to ongoing bidding with construction firms. Despite widespread budget tightening across departments, the project reportedly survived Ottawa’s expenditure review ahead of the November 2024 federal budget.
The planned 155-bed bilingual facility will serve men and women in the federal correctional system, offering both mental and physical health care. It will be located on the grounds of Dorchester Penitentiary in southeastern New Brunswick, replacing the 53-bed Shepody Healing Centre, which officials have long criticized as outdated and unsafe.
“We have isolation cells that look like dungeons. The windows are deficient. The space is cramped,” said Dr. Louis Thériault, a psychiatrist at the current facility. “Of all treatment centres across the country, we are in the worst situation.”
The new hospital falls within the Beauséjour riding of Minister Dominic LeBlanc, who confirmed last year that the project’s cost would exceed original projections — comparing it to the Confederation Bridge, built in 1997 for roughly $1 billion.
“The scale of this project is very much in that range,” LeBlanc said at the time.
Federal documents obtained by Radio-Canada under the Access to Information Act show that when LeBlanc was public safety minister in 2023, he was informed of rising costs but directed officials to maintain the full scope of the project.
“At that time, [Correctional Service Canada] was asked not to reduce the scope of the project,” wrote Commissioner Anne Kelly in a briefing note.
According to Correctional Service Canada, the new hospital will address complex clinical and psychiatric needs of inmates nationwide. The Dorchester Penitentiary, which opened in 1880, will continue operating alongside the new centre, expected to be completed by 2032.
If finalized at $1.3 billion, the facility would be among the most expensive correctional health projects in Canadian history, highlighting the growing cost of modernizing the country’s aging prison infrastructure.
