MacKay said the government will soon announce who receives funds to participate in the program that aims to help sex workers transition from the trade, but he didn't provide a time frame.
The plan is an off-shoot of the government's Protection of Communities and Exploited Persons Act, which became law last year and makes it an offence to buy sexual services or communicate for that purpose.
It was created after the Supreme Court of Canada struck down the country's prostitution laws.
Sex workers said the law puts them in harm's way by preventing them from speaking with and screening clients, while sex-worker advocates, aboriginal leaders and law enforcement officials said $20 million is not enough money to help people leave the sex trade.
"Our challenge is, of course, to have a criteria that will determine how that funding is delivered, but it is certainly our hope to start making these specific contributions to various programs in the very near future," said MacKay, who was in the Victoria-area community of Esquimalt for a separate announcement.
"We were, I don't want to say overwhelmed, but certainly over-subscribed for that amount of money," he said.
MacKay did acknowledge concerns have been raised about the size of the fund, but said it's the first time a federal government has attempted this type of program.
"Some may say $20 million for a problem this large, a country this large, a population our size, but it's important to note this is the first money, this is the first federal investment specific to the effort to help, predominantly women, but vulnerable Canadians leave prostitution," he said.
At federal justice committee hearings last year aboriginal women, police officials and former prostitutes denounced the five-year $20-million pledge as insufficient.
Former Calgary police chief Rick Hanson called the money "woefully inadequate," and Michele Audette, president of the Native Women's Association of Canada, said "$20 million is peanuts."
But MacKay said the "exit strategy" will support existing programs and partner with other groups working to help people leave the sex trade.
MacKay made the comments at a Boys and Girls Club Services of Greater Victoria youth centre when he announced funding of $300,000 over the next three years to support a program for young offenders' returning to society through meaningful work and life experience.
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