Howard Sapers, officially known as the correctional investigator, said in his annual report Thursday that the Correctional Service of Canada has ignored such recommendations for years.
Sapers turned directly to McLellan this year.
He said drug use is rampant in prisons - in some places three-quarters of inmates inject drugs - and clean needle programs would reduce the spread of diseases such as hepatitis C and HIV.
"It's not a question of whether we condone it or not condone it," he said.
Since infected inmates eventually get released into the community, "this is a public health issue."
He said similar programs in other countries have reduced the spread of disease and shown that giving needles to inmates doesn't mean they'll be used as weapons against guards.
Conservative MP Kevin Sorenson said the prison system supposedly has a zero-tolerance policy on drug use, yet is faced with the idea of providing clean needles.
He said he hopes the government takes into account the concerns of the guards.
"Some corrections officers need gloves to avoid needle sticks while going through searches," he said.
Sapers commended the Correctional Service on setting up a pilot program to provide safe tattoos to prisoners. Primitive tattooing apparatus can also spread disease.
His report also said McLellan should order the correctional service to appoint a deputy commissioner for aboriginal inmates and to change a policy that automatically makes prisoners sentenced to life serve their first two years in maximum security, regardless of the risk they pose.
Finally, Sapers asked McLellan to get the prison system to issue a formal response to recommendations of a report almost 10 years ago by Justice Louise Arbour.
She produced the report after a confrontation in Kingston's infamous prison for women in which male guards forcibly subdued female inmates.
"Canadians expect a system that provides safe, humane custody which is respectful of human rights and supports the offenders' successful re-integration into society," Sapers said.
A spokesman for McLellan said the recommendations will be studied and she will respond in writing later.
The report said there should be a review of the problems facing aboriginals in prison, especially since they make up an inordinate percentage of inmates.
"While 41 per cent of non-aboriginal offenders are serving their sentences on conditional release in the community, only 31 per cent of aboriginal offenders are on conditional release," the report said.
Sapers said the corrections system has responded to many of his previous recommendations, but still falls short in some areas.
"Corrections is a difficult and at times thankless business, yet it is a key element of our criminal justice system," he said.
Sapers also cited a shortage of mental health services in the prison system as a problem that needs to be addressed.
The report was prepared after his investigators looked at 7,000 inmate complaints in the last year, a large number from a federal prison population of only 12,000 people.
Kim Pate of the Canadian Association of Elizabeth Fry Societies, a support group for female prisoners and parolees, said she welcomed Sapers' recommendations.
She said many women in prison are in dire need of mental health programs.
Sapers also said there are issues surrounding younger inmates and elderly prisoners, both growing populations behind bars
The system "continues not to recognize the need to provide special housing programming or other services for young offenders."
© The Canadian Press 2004