Hon Judith Collins
Minister of Corrections

26 November 2009
Media Statement

Law change allows private prison management

Private sector management of prisons will bring greater innovation, efficiency and cost effectiveness to the corrections system, Corrections Minister Judith Collins said.

The Corrections (Contract Management of Prisons) Bill 2009 passed into law today. It allows competitive tendering for the contract management of prisons on a case-by-case basis.

“The Government is following through with its election pledge to introduce contract management to some New Zealand prisons,” Ms Collins said.

“It is crucial that we deliver the very best corrections service for New Zealand. To achieve this, I believe we shouldn’t limit our choices.

“In order to have a world-class corrections system, we need exposure to world-class innovation and expertise. Ideas from private managers will benefit the entire prison system.

Legislation provided for the private management of prisons in 1995, but this was repealed in 2004 by the Labour-led Government. This saw the end of the private management of the Auckland Central Remand Prison (ACRP).

The Department of Corrections adopted many of the private manager’s innovations when it took over the prison again in July 2005.

The Australian experience shows significant cost savings can be made under private management. In NSW, private prisons cost 32 percent less per prisoner than public prisons while in Victoria they cost 11 percent less than public prisons.

“Cost is a factor, although it is more important that we have effective and safe prisons than cheap ones,” Ms Collins said.

“Public safety is the top consideration in all decisions made about the management of offenders.”

The Department of Corrections’ Chief Executive would be responsible for prisons under both public and private management. Contractors’ performance will be overseen by prison monitors, and contractors will be subject to strict reporting requirements.

Privately managed prisons will be subject to the Official Information Act. The Office of the Ombudsman will have access to privately managed prisons on the same basis as government departments.

Ms Collins said that a decision about which prison or prisons may be tendered will be made early next year after which the tender process would begin.

ENDS