TORONTO - Critics say the Liberals are turning a blind eye to health-care fraud by not quickly phasing out millions of old health cards following a recommendation from the province's auditor general months ago.

Although there are still 5.7 million old red-and-white cards in circulation, and the auditor estimated last December there are some 300,000 more cards than people floating around, ministry officials told a legislative committee they can't "handle a significant increase in the number of individuals registering for a photo card.''

At the current rate, it will take another 12 years before the cards are replaced by modern photo cards, which were introduced in 1995 to stop fraudsters from abusing the health-care system.

"(The Liberals) are not acknowledging that this is a serious problem,'' said Conservative health critic Elizabeth Witmer. "These are taxpayer dollars that are being misused. The priority has to be to complete this process ASAP.''

While staff are considering allowing people to renew their cards over the Internet, bureaucrats estimate they need up to $130 million to phase out all the old cards within three to five years.

The old cards don't have photo identification or expiry dates, making them a target for fraud estimated at up to $22 million annually. Auditor General Jim McCarter called for the government to "expedite'' the phase-out of the old cards in his December report because of suspected fraud.

A legislative committee is recommending the province extend the expiry date of all modern health cards, which would give the ministry the breathing room it needs to focus on converting the old cards that were supposed to be out of circulation by 2000.

"This is something that they've chosen not to deal with,'' said Witmer, who has an old-fashioned health card herself.

"But these are tax dollars, your tax dollars and my tax dollars, that are going to pay for health services for someone who's using a card fraudulently.''

Premier Dalton McGuinty said the government isn't being complacent about replacing the old cards. Although he still carries an old red-and-white card in his wallet, McGuinty said it's unacceptable that phasing them out has taken this long.

"At the beginning of the 21st century, where we've progressed light years in terms of sophisticated identification technologies, we can and must move faster than that,'' McGuinty said.

"I think it's unacceptable for us to say we're going to complete a transition in 12 years' time.''

But McGuinty said he wasn't sure exactly how the province would go about stepping up the phase-out.

"We're going to have to find a way to move faster,'' he said.

New Democrat Shelley Martel said it's going to be difficult to do that unless the Liberals are willing to spend some money.

Bureaucrats are having a tough time handling constant renewals at the same time as they try to phase out the old cards, she said. The suspected fraud highlighted by the province's auditor general in December should be motivation enough for the government to make this a high priority, Martel said.

"The potential for fraud continues,'' she said. "That's something we can do something about. It has to become a priority for the government, and it has not been a priority.''