Debate on Privately Managed Prisons

March 10th, 2009 at 10:00 am by David Farrar

Some interesting quotes in this Herald story:

Unions representing prison wardens have vowed to fight Government plans to let private companies manage some existing jails.

The Corrections Association says prison officers started on just $18,000 a year the last time prison management was privatised – at the Auckland Central Remand Prison for the first five years after it opened in 2000.

No surprise the union is against. The minimum wage is now $25,000 so I guess they’ll be on at least that. But the part that interest me is this:

But criminologist , who has visited in Australia and the United States as well as the Auckland remand prison when it was privatised, said privatisation worked.

“The private prisons have an atmosphere of vibrancy and enthusiasm which I have never seen in a publicly run prison,” he said.

Strong words.

“The reason they are better is that there are powerful performance incentives built into a good contract to ensure that the private prison will perform according to the requirements of the contract.”

Incentives do matter. We ignore this at our peril.

He confirmed that floor staff at the Auckland remand prison were paid less than their counterparts in public prisons when the remand jail was run by Australasian Correctional Management, a US-owned company that is now called the GEO Group (Global Expertise in Outsourcing).

“What tends to happen is that they pay good money for top operators. They tend to pay less money for the people on the floor, the unskilled people who just open and shut doors,” he said.

“If they show commitment and intelligence and ability, they can rapidly be promoted, which isn’t the case in the public system.”

No wonder they do well. Starting salary is not as important for many, as what salary they can rise to if they perform well.

In his book The Problem of Prisons, Dr Newbold said the Australian company running the Auckland remand prison was fined $50,000 for every escape under its contract, and as a result had only one escape in the five years it ran the jail.

“In 2004, for example, filled to maximum capacity with 360 inmates, the prison had one suicide and only three serious assaults – a low level of serious incidents for an institution of this type,” he wrote. “Only 5.5 per cent of inmates returned positive drug tests, compared with over 20 per cent in the public sector.”

No wonder Labour closed it down. What would be interesting is to find out what the violence and drug testing rate now is in that prison?

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31 Responses to “Debate on Privately Managed Prisons”

  1. OECD rank 22 kiwi (2,744 comments) says:

    Nothing wrong with efficient private management of prisons.

    Bring it on I say.

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  2. jacob van hartog (300 comments) says:

    And the cost was about $5000 per prisoner per year MORE for the private prison ( and that was for the easiest prison, remand).
    They sure werent putting the money in paying the staff more

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  3. grumpy (256 comments) says:

    So Jacob, how much do we pay under the public system for 20% positive drug tests and at will escapes. Perhaps the extra $5000 (if indeed it is that) might be money well spent to have a decent system.

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  4. expat (4,050 comments) says:

    ‘about’ – got any facts, figures?

    ‘They’ also weren’t putting money into paying prison staff cartels who sell drugs into prisons.

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  5. GPT1 (2,116 comments) says:

    The must stunning part of the anti-private prison campaign was the argument that private prisons could bring corruption as they were owned by big overseas companies with lots of money. Riiight, anyway back here on planet earth we have … corruption investigations into corrections officers.

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  6. jacob van hartog (300 comments) says:

    The Auckland remand prison was a brand new building, the only new prison built by National in their 9 years, of course things will be ‘cheerfull’.

    To reduce prison numbers so new prisons werent needed, National introduced the new rule for parole after only one third of sentence served, so that thousands of thieves and drug dealers were emptied out on the streets

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  7. emmess (1,422 comments) says:

    Yup GPT1, that’s a standard tactic of the left
    Bring up worst case scenarios that could happen in theory if their policies are dismantled, but then ignore actually what has happened in reality.

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  8. Manolo (13,522 comments) says:

    Not a surprise the unions are against this.

    The unionists, with Andrew Little in the leading role, will fight any move that fosters property rights, entrepenurial initiatives, and individual responsibility. All these regardless if any of these measures produce better service and working conditions for the workers they falsely claim to represent.

    The unionists are staunch socialists determined to equalise us all in mediocrity. Their aspirations are pathetic or non-existent.

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  9. Kimble (4,428 comments) says:

    The unions dont want pay increases to be based on skill or the quality of work. Because skilled people tend not to need unions to negotiate for them. If someone got to their position in life without a union, they are unlikely to seek the unions patronage.

    In fact, self made people will aggressively oppose the unions efforts to appropriate part of their ongoing income for doing nothing at all.

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  10. Inventory2 (10,273 comments) says:

    No Manolo, you’ve got it wrong – Little’s the Labour President now, not a union boss – oh, that’s right, he’s BOTH isn’t he – funny that ;-)

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  11. Scott (1,765 comments) says:

    I totally agree with the thrust of this thread DPF and I agree with Greg Newbold’s comments. As I have mentioned before, I was part of a group that took chapel services at Auckland remand prison and I was impressed by the professionalism of the staff. The facilities were very good, as can be expected of a new prison. But the contrast with Mt Eden prison next door couldn’t be greater.

    I think private prisons are definitely worth another go. Another excellent policy by the national government.

    I don’t know how others feel but I feel so much better with sensible, common sense politicians in power. With the Labour government we had almost every week another abomination of a headline. Prostitution is legal! We want to lower the age of consent to 12, Phil Goff proposed that! No you can’t smack your children! Just one bit of nonsense after another.

    I don’t think we should ever elect Labour again, until they repent of the politically correct foolishness of which they have imbibed so heavily.

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  12. philu (13,393 comments) says:

    then there is this side of the prison debate..

    http://whoar.co.nz/2009/despite-a-crashing-economy-private-prison-firm-turns-a-handsome-profit/

    phil(whoar.co.nz)

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  13. philu (13,393 comments) says:

    and i spoke a while back to a pot grower who spent some time in the privately run prison at mt eden..

    ..he said he was terified in there…cos the inmates ran the place..

    ..there was hardly a screw to be seen..

    ..as the spokesman for the screws pointed out on telly this morning..

    ..private prisons make their money by paying low wages..and running minimal staff..

    ..the pot grower i spoke to said he was grateful to be sentenced..

    ..and handed back to the state prison system..

    phil(whoar.co.nz)

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  14. Andrew W (1,629 comments) says:

    They should sentence more pot growers/smokers.

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  15. david (2,555 comments) says:

    well phil, your pot-growing friend might just have to make a choice. On the one hand he could turn over a new leaf (pun intended) and get a proper job which contributes to society through the tax system and through the productivity of his effortsd, or he could choose “terrified”. No brainer really (pun also intended)

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  16. Nigel (510 comments) says:

    What is the financial incentive for a privately run prison to reduce re-offending, it’s a bit like employing people to kill possum/deer etc, you don’t want to be to successful or the work dries up.
    IN saying that, I’m actually for a mixture of Private / Public, but I’m wary of moving to fast, I just hope National are careful.

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  17. expat (4,050 comments) says:

    The pot grower was scared that he’d get heavied by the crims for free stash or he’d get the bash whereas normally he’d get his mates to slip the guards a few ounces in return for a cushty we cell.

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  18. burt (8,206 comments) says:

    philu

    To be honest, I don’t really care what a pot grower thinks of his time in prison. Ignoring our own views on pot – growing it is illegal and therefore your pot growing mate falls under the heading of “Freedom removed for illegal activity”.

    You might be able to make a case for looking after the rights of criminals and it may be based n your view of the crime they committed – the law however hasn’t got your subjective position. He broke the law and was locked up…. end of story.

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  19. getstaffed (9,186 comments) says:

    phil, flag your pot grower ‘friend’. You did time (for holding up a chemist at knife or gunpoint wasn’t is?). What was your experience?

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  20. Redbaiter (13,197 comments) says:

    NZ’s prisons are a non functional disaster and the problem has to be fixed.

    Anyone with any stake in retaining the status quo should shut the fuck up on the basis that they have not one iota of credibility.

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  21. Rex Widerstrom (5,349 comments) says:

    philu says:

    ..private prisons make their money by paying low wages..and running minimal staff..

    And everyone who isn’t a heartless capitalist spends all day smoking pot and bludging. You know better than to peddle generalisations, phil.

    Why don’t you try listening to the people who actually work in the system? Greg Newbold knows a hell of a lot more than I do and he says it can work. I visit a privately run prison (Acacia) and a number of state-run prisons ranging from maximum to minimum security prison farms and talk with prisoners (and occasionally staff and superintendents) and it’s clear to me it can work.

    Or listen to the independent Inspector of Custodal Services, who visits both state and private prisons. Acacia used to be run by a company called AIMS. In short, they were appalling by any measure. But rather than be saddled with incompetence – as Judith Collins has found that she is – the government were able to re-tender the contract. The Inspector visited after 18 months with the new operator (Serco) and concluded:

    The broad conclusion is that the change of operator has been a very positive move. The performance of the prison had improved in numerous tangible ways. Indeed, as was stated at the Exit Debrief, Acacia was on the cusp of becoming a very good prison. Of course, there were also problems. Paradoxically, the prison regime was in some respects fragile precisely because the new operator had been trying to make some quite radical changes before the supporting management processes and resource infrastructure were yet robust enough to support them. This was pointed out at the Exit Debrief (early December 2007), and Serco immediately commenced to respond constructively.

    See that? “Responded constructively”. Not “said he’d keep his job no matter what and the Minister could take a running jump, and was supported by other public servants with their arses to cover”… but actual accountability.

    And no, it’s not because Serco is a warm, fuzzy organisation. They’re a money making concern but they also know that to retain the contracts they have in Australia, the UK and (I think) elsewhere, they need to keep politicians and the public happy.

    So they suggested that the government pay them on peformance, to be measured on things like successful rehabilitation, lack of violence etc. To quote the Inspector again:

    The contract for prison services is extremely detailed. The contract (with a few necessary exclusions for security reasons) is publicly available on the Department of Corrective Services website. It consists of 116 pages and there are another 280 pages of Schedules covering matters such as contract fees, Serco’s operational philosophy, the ‘operational service requirements’ and performance measures…

    In addition to complying with the specific provisions of the contract, Serco must, of course, comply with the Prisons Act, other pieces of legislation and all subsidiary legislation (especially the Prisons Regulations) passed by Parliament. It must also comply with the Department of Corrective Services Operational Guidelines and Policy Directives. In addition, it must develop its own prison operating manuals and submit these to the Department for approval…

    However, the monthly fee is not initially paid in full. Five percent of the monthly fee is withheld by way of a ‘Performance Linked Fee’.16 At the end of the operation year, the Department then calculates how much of this fee should be paid to Serco, based on its performance in meeting certain targets over the year as a whole.

    The 12 PLF performance measures, which are monitored by the Department of Corrective Services, cover the following matters: serious assaults, serious acts of self harm by prisoners, accurate completion of incident reports, the number of positive urinalysis tests, meeting agreed staffing levels, completing sentence planning reviews on time, delivering treatment programs on schedule, education and training targets, the management of social visits, providing prisoners with structured activities for 30 hours per week, and the proportion of Aboriginal prisoners in standard and enhanced accommodation. Five percent of the total PLF (up to a maximum of $250,000) is set aside for a separate payment to reflect ‘innovation’.

    The contract also provides specific penalties (‘abatements’) in the event that a ‘specified event’ occurs. The penalty is $100,000 (plus a CPI increase) for any escape, loss of control or death in custody (other than from natural causes). Lesser abatement amounts of $20,000 apply to serious failures to report information and failures to comply with ‘Performance
    Improvement Requests’ made by the Department.

    Apologies for the length of quoted passages but I wanted to include it all because there is a proven blueprint for a successful private prison. One which I hope National will adopt if it decides to take that course.

    It provides positive incentives for successful prisoner rehabilitation and health care, and disincentives for cock ups. Now imagine if that regime applied to Barry Matthews… he’d be paying Judith Collins to come to work, rather than walking away with 375,000 of our dollars each year while raising his middle digit to the Minister.

    And the cost? One last quote from the Inspector:

    The Department estimated that it would have cost around $8 million extra per year for Acacia to be brought into the public sector and this office estimated that the figure would be around $15 million

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  22. Scott (1,765 comments) says:

    Good post Rex- makes a lot of sense-thanks for that.

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  23. gd (2,286 comments) says:

    The Socialists mantra is everything private bad everything State run good

    We will never ever change them they are stuck in a time warp the worlds moved on but they havent

    But aint it great All the while the Socilaists and their dumbarse supporters are moving further away from middle NZ and all the while the NATs/ACT/MP/Dunny are moving up the polls

    And it will continue as the Socialists cant/wont change

    Lets just be grateful that we have at least one possibly two decades of Nat lead government to look fwd to

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  24. jacob van hartog (300 comments) says:

    Gd , the private prison cost more per inmate to run than the state prisons.

    remember too that Liam Matthews was killed while being transported in a PRIVATE run prison van but free enterprise doesnt provide a better service

    That what you righties say every thing private good , state bad and ignore the evidence – private banks and hedge funds have practically destroyed the capitalist system.

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  25. PaulL (5,954 comments) says:

    jacob: please provide a quote. Sorry, you’ve joined the list of lefties whom I disbelieve due to excessive lying in the past. You can keep repeating it, but I’ll be needing a link or a study or something that stacks up. My recollection was that the private prison was cheaper to run, and I’m afraid your assertion at this point in time has less weight than my vaguely remembered recollection.

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  26. burt (8,206 comments) says:

    PaulL

    jacob van hartog still thinks Cullen was a competent finance minister. He simply believes the party lines he’s told to believe. There is no hope for him – ignore him.

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  27. LUCY (359 comments) says:

    Jacob you are talking shit! Subprime mortgarges bought in by the left (and yes, some greedy bankers took advantage of the environment that flourished due to the policies that were instigated) are responsible for the finacially mess we are in. And dont forget the generation of “its my right, Im entitled” that was educated by the left and now has to come to terms with the fact they were had.

    Private prisons work. The private sector by large works. Is it perfect? No. But it is better than anything else we have, or have had.

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  28. village idiot (748 comments) says:

    The ultimate measure of success for a State-run prison is to have no inmates.
    The ultimate measure of success for a privately-run prison is to have no inmates.
    Wait a minute …

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  29. stephen (4,063 comments) says:

    Thanks Rex, but is there a link to all that somewhere?

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  30. sethpecekajus (5 comments) says:

    not a fan of the idea, It seems akin to slavery, if i were to be sent to prison i would expect that by breaking the rules of the state, that it would be the state that deals with my incarceration, not some private entity, As we have all probably seen on those american shows about prisons, feeding a prisoner 19 cents a day what the hell kind of food is that, surely it can’t much above the gruell of oliver twist fame. The real problem is that it cost’s 70000 a year to lock someone up wtf!?, why we can’t seem to be able to make automated prison with a shop in it is beyond me, every single cell opens for a bit guy go’s to the shop buys a feed (with wrist bracelet or something like that)goes back to cell eats food has a shower gets 20 mins exercise, back in cell, how hard can it be, not to mention the wages the guards get, no wonder so many drugs and weapons make it inside how motivated would you be if you were earning a double the dole income to be honest and corruption free, yea right given all the abuse from the inmates, the phyisical dangers of the job how could you not be open to a little bribery. I wonder if this would pan out like the power companies’ sell off years ago, scalp the public for all they’re worth and cry poverty when the infrustructure falls to bits.

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  31. philu (13,393 comments) says:

    sorry lucy..you are talking the shit..

    so..the poor pulled down the american economy..?

    ..really..?

    http://whoar.co.nz/2009/corruption-us-how-wall-street-paid-for-its-own-funeral/

    nah !..lucy..

    ..the vultures ate themselves..

    ..phil(whoar.co.nz)

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