Prison Privatisation Report International

No. 49, August/September 2002

Published by the Public Services International Research Unit (PSIRU) University of Greenwich, London, England. 

www.psiru.org/justice

This publication is supported by a grant from the Foundation Open Society Institute.

 

IN THIS ISSUE

LESOTHO

COSTA RICA

MEXICO

CANADA

UNITED KINGDOM

THE GROUP 4/WACKENHUT ACQUISITION

AUSTRALIA

UNITED STATES

RECENT PUBLICATIONS

 

LESOTHO

Group 4 proposals to go ahead

 

A proposal to replace Lesotho’s 12 prisons with one privately financed, designed, built and operated prison are due to go ahead (see PPRI #45, 43 & 41). A government spokesperson  would not divulge details but told PPRI that  preparations are “advanced” and a director of Group 4 is due to present a paper to cabinet “very soon”.

 

Once cabinet has discussed the proposal, parliament will have to approve it and also pass enabling legislation. However, since the Lesotho Congress for Democracy (LCD) has 79 of the 80 parliamentary seats, the proposal is expected to proceed smoothly.

 

Group 4's original proposal was to finance, design, build and operate a 3,500 bed private prison at Maseru. The government has not tendered for the prison, negotiating only with Group 4. If the original plan goes ahead, the facility will be the largest private prison in the world. Group 4's proposal was controversial as it by-passed local, low cost initiatives for penal reform and a solution to prisoner overcrowding. Lesotho currently has around 3,000 prisoners.

 

COSTA RICA

Mounting opposition to privatisation

 

There is mounting opposition to the proposed contract between the government of Cost Rica and Management & Training Corporation (MTC) for a privately financed, designed, built and operated prison (see PPRI #48,47,46 &42). It is still not clear whether the project will go ahead.

 

Costa Rica’s president and minister of justice are insisting that financial and legal issues agreed to by the previous administration need revising. Meanwhile, both the Association Nacional de Empleados Publicos y Privados (ANEP) and the Association Costaricense de la Defensa Publica are organising a campaign against the project on the grounds that it would be unconstitutional to contract out custodial services.

 

The president has stated publicly that the 15 year contract is not affordable. MTC is proposing to charge $29 per prisoner per day and would have to receive $27,840 per day, amounting to more than half of the government’s $16.6 million annual budget for the country’s entire prison system. Prisoners currently cost the government between $20 and $22 each per day.

 

The government has until 19 October to finalise terms with MTC, whose lawyer in Costa Rica believes that negotiations are continuing with a view to a contract going ahead. The Consejo Nacional de Concessiones, argues that cancelling the project would have a negative effect on foreign investment in Costa Rica.

 

MTC was chosen as preferred bidder by the previous administration over a Colombian consortium known as Corrections Corporation Latin America (CCLA). CCLA failed in its appeal to alter the government’s decision to negotiate with MTC.

nMonica Nagel, the former minister of justice who implemented Costa Rica’s prison privatisation plan, is now a consultant to the Central Bank for Economic Integration which is researching Central America’s prison systems with a view to possible privatisation.

 

MEXICO

UK influence and four private prisons

 

Four private prisons are being commissioned by the State of Mexico, the largest of the country’s 31states. The State is also tendering for a company to take over a new publicly built prison. According to the State’s director of prisons Wackenhut Corrections Corporation, Corrections Corporation of America, Cornell Companies and Management & Training Corporation (MTC), all US companies, have all expressed an interest in bidding for the contracts. The new prison contracts will be for 18 years and are worth $87.1 million and will provide 4,500 new prison beds in Tenancingo, Tenango del Valle, Ixlahuaca and Zumpango.

 

Previously, the State’s director of prisons said that the authority will maintain prison security while the industry, maintenance and other non-custodial services will be privatised. Officials have visited semi-private prisons in France, examined developments with semi-private prisons in Chile and visited private prisons in the US.

 

Although the State of Mexico is the first to implement private prisons it was the federal government that called on the Organisation of American States in 2000 to look into the possible advantages of this strategy (see PPRI #34). The federal government is keen to use prisons as a ‘test bed’ for private infrastructure - it is also considering hospitals and schools - and has recently contracted with Partnerships UK, the British government’s privatised consultancy on public private partnerships (see PPRI #40).  Partnerships UK has been helping to set up a task force within the federal government’s treasury department to deal with such projects.

 

Mexico has 21 prisons with a capacity for 8,474 prisoners. As at April 2002 the population stood at 11,650. While some prisons are up to 50 per cent overcrowded others have spare capacity. Other firms involved in negotiations have included Infratec‑Interacciones, N.M.Rothschild, Bouygues Constructions, Precor Banobras, Adtec, Seapsa, and Corrections Corporation of America.


CANADA

Riot at MTC managed facility in Ontario

 

A riot at Central North Correctional Centre, the province of Ontario’s only privately managed prison, occurred on 19 September 2002 (see PPRI #44,40,38,37,35,34 & 32). Around 100 prisoners using a battering ram were prevented from escaping and a cordon of armed Ontario Provincial Police (OPP) including the tactical rescue and canine units had to be stationed around the perimeter.  The disturbance occurred in Pod 4, a 175 bed accommodation unit. The prison is managed by Management & Training Corporation (MTC) of Utah.

 

MTC stated that the riot started after prisoners refused to return to their cells. According to the police, prisoners were also armed with makeshift weapons and crude gas masks as they attempted to storm the facility. The 1,200‑bed facility was subsequently in lock down as OPP and corrections officials carried out an investigation into the incident.

n Staff at the Central North Correctional Centre have voted to join the Ontario Public Service Employees Union (OPSEU) in a bid to improve wages and working conditions. OPSEU currently represents the 5,000 correctional officers working in the province’s publicly run prisons.

 

Announcing the outcome of a vote by MTC staff on 18 September 2002, Dan Marshall of OPSEU said: “Workers at the jail approached OPSEU last year asking for help. Staff were extremely unhappy and concerned with working conditions and staff safety issues inside the facility. We will now be able to begin to address these problems through a structured collective bargaining process.”

OPSEU had hoped to sign the full complement of 258 correctional officers, clerical, maintenance and programming workers. On MTC’s insistence, however, the union will only represent the correctional officers.

Sid Brown, a correctional officer at the jail “For almost a year, we have tried to address with the employer issues such as staffing levels and workload to no avail. Our people do an excellent job, but the pressures are enormous. Now we can work to solve these problems as a united group, with the resources of a union familiar with the work we do.” OPSEU will eventually begin a collective bargaining process with MTC.

 

UNITED KINGDOM

Scottish prison figures reveal poor performance

 

Premier Prison Services-run Kilmarnock prison has the worst disciplinary record of all Scotland’s local prisons (see PPRI #48, 47,44,43,40,37 & 36). Official figures reveal that the number of disciplinary offences increased from 2,685 in 1999/2000 to 3,634 in 2001/02, a rise of 35 per cent over the three year period. Over the same period the prison had the most prisoners with unauthorised absences from, or presence in, any part of the establishment. The number rose from 172 in 1999/2000 to 1,745 in 2001/02. There were seven and a half times more such cases at Kilmarnock than at all the other local prisons combined.

 

In 2000/01 and 2001/02 /Kilmarnock outstripped other prisons in the number of prisoners caught in possession of unauthorised articles and had the most incidents of arson with 24 in 2001/02. Meanwhile, at 142, Kilmarnock also had the most incidents of property damage in 2001/02. However, the justice minister maintains that Kilmarnock sets a fine example to other prisons and his deputy argues that the data is being misinterpreted.


 

Disciplinary offences at Scotland’s prisons 1999‑2002

 

Total Offences

Prison   

1999‑2000

2000‑01  

2001‑02   

% increase 1999‑2002   

Barlinnie

1511

1509

1738

15%

Aberdeen

1020

1017

921

-10%

Edinburgh

1245

1154

1262

1%

Glenochil 1

2238

1381

1695

-32%

Glenochil 2

929

859

650

-42%

Greenock

410

741

524

28%

Inverness

322

328

316

-2%

Perth

1682

1669

2159

28%

Kilmarnock

2685

3499

3634

35%

 

The increase comes largely from the items set out in the tables below:

 

Unauthorised absence from or presence in any part of the establishment

Prison   

1999‑2000

2000‑01  

2001‑02   

Barlinnie

18

11

13

Aberdeen

30

32

22

Edinburgh

39

44

26

Glenochil 1

6

1

3

Glenochil 2

15

18

22

Greenock

4

2

7

Inverness

1

1

0

Perth

125

63

108

Kilmarnock

172

1370

1545

 

Possession of an unauthorised article or quantity of an article

Prison   

1999‑2000

2000‑01  

2001‑02   

Barlinnie

109

149

111

Aberdeen

111

86

66

Edinburgh

143

139

218

Glenochil 1

72

32

38

Glenochil 2

40

29

28

Greenock

162

162

121

Inverness

35

46

50

Perth

116

89

102

Kilmarnock

134

196

273

 

Arson

Prison   

1999‑2000

2000‑01  

2001‑02   

Barlinnie

3

5

10

Aberdeen

7

0

8

Edinburgh

7

5

8

Glenochil 1

6

6

3

Glenochil 2

12

6

4

Greenock

0

3

3

Inverness

1

1

1

Perth

13

3

11

Kilmarnock

12

7

24

 

Possession of an unauthorised article or quantity of an article

Prison   

1999‑2000

2000‑01  

2001‑02   

Barlinnie

109

149

111

Aberdeen

111

86

66

Edinburgh

143

139

218

Glenochil 1

72

32

38

Glenochil 2

40

29

28

Greenock

162

162

121

Inverness

35

46

50

Perth

116

89

102

Kilmarnock

134

196

273

 

Destroys or damages property

Prison   

1999‑2000

2000‑01  

2001‑02   

Barlinnie

77

78

50

Aberdeen

85

40

37

Edinburgh

164

134

107

Glenochil 1

86

69

45

Glenochil 2

128

65

78

Greenock

32

32

29

Inverness

44

40

49

Perth

95

69

62

Kilmarnock

118

82

142

Source: Scottish Parliamentary Reference Centre Document, bib. no. 23024.

Note: Glenlochil 2 denotes the Young Offenders Institution.

 

Scotland’s second private prison

 

A new private prison is to be commissioned for the central belt of Scotland to cope with the increasing number of remand prisoners. The decision by the justice minister flies in the face of the findings of the Justice 1 Committee and the record of Scotland’s first private prison, Kilmarnock (see PPRI #48,47,45-43,40,47 & 36).

 

However, the minister has challenged the Scottish Prison Service to compete for the contract for a second new prison. The minister said: “I want the Scottish Prison Service (SPS) and the trades unions to show that they have the chance to bridge the gap between the private and the public sector on competitiveness. If they can produce for me a robust and credible plan for the second new prison, one which is competitive, offers value for money and delivers the places we need on time, I am prepared to take that project forward in the public sector or as a privately‑built, publicly‑operated prison.”

 

He also announced a £110 million programme over the next three years to upgrade existing public prisons. Overall, the plans will create 1,100 new or refurbished prison places in the public sector,700 new places in the private sector and a further 700 at the second prison.

 

Private absences are secret

 

In a parliamentary question Andrew Turner MP asked the home secretary for the level of staff absence through short term and long term sickness in each prison in England and Wales, broken down by category, in the last 12 months for which information is available. While figures for the publicly run prisons were made available for financial year 2001-2002, prisons minister Hilary Benn replied that “information about privately managed prisons is not available as it is commercial in confidence” (Hansard, 23 July 2002).

 

Premier’s Ashfield criticised again

 

As the prison service continues to manage the privately financed, designed, built and - until 23 May 2002 - operated young offenders institution in south west England, the Howard League for Penal Reform has produced a critical report on the facility (see PPRI #47). Based on visits in October 2001 and May 2002 and interviews with ten boys who had recently been released from the facility, the organisation noted:

n the lack of staffing;

n high staff turnover;

n an unsafe environment;

n the lack of training and experience amongst staff group;

n there is no personal officer scheme;

n no offending behaviour courses;

n insufficient places in education and training;

n poor reception facilities.

In a statement accompanying publication of the report, the Howard League accused the operator, Premier Prisons, of “putting profit before the welfare and safety of young people”. The organisation claims that the inability to recruit and retain staff because of the poor pay and conditions is at the root of Ashfield’s problems.  Wing officers at Ashfield start on £15,250 rising to £16,250 whereas officers in public sector jails start on £17,129 increasing to a maximum of £24,497.

The Howard League also noted that the resources which local authority secure units have at their disposal vastly outstrip those available to the prison service and stated that the report was a criticism of “a system which allows such inequalities to exist.”

Children in Prison, provision and practice at Ashfield, Howard League for Penal Reform, August 2002.

n The number of assaults on staff, prisoners and others expressed as a proportion of the population at Ashfield was 74.1 per cent for the year 2001/2, according to the Prison Service Annual Report and Accounts. The 279 assaults recorded meant that Ashfield had the worst record of the four male juvenile prisons. The prison service spent £14.43 million on Ashfield during the year at a cost per prisoner place of £35,447 and cost per prisoner of £38,318.

 

Sodexho’s accounting disaster

 

Shares in Sodexho Alliance, whose subsidiary UK Detention Services Ltd runs prisons and immigration detention centres in England, plunged 30 per cent on the Paris stock market on 19 September 2002. This was caused by what the company described as “serious errors of management as well as accounting anomalies” in the UK which will lead to £20 million less profit for the company’s financial year ended 31 August 2002.

Sodexho has dismissed senior executives from its UK food services and management businesses and criticised its UK auditors PriceWaterhouse Coopers alleging that they “haven’t been sufficiently vigilant.”  The accounting anomalies were discovered at another UK subsidiary, Sodexho Land Technology. “Fiscal year 2002 in the UK will be seen as an accident in Sodexho’s development. It has set our long term objectives back by one year,” stated the company. Sodexho’s financial results for 2002 will be released after the company’s board meeting on 13 November 2002.

 

Money go round

 

Accounts for eight months ended 31 August 2001 - the most recent published in the UK - show that UK Detention Services Ltd (UKDS) had revenues of £17.96 million (£23.1m for the full year 2000) and made a loss of £241,300 (profit of £1.28m for the year 2000). The directors noted that the company’s contracts for Blakenhurst and Forest Bank prisons performed satisfactorily although the contract for Blakenhurst ended on 18 August 2001 and was not renewed. UKDS also incurred start up costs associated with Harmondsworth immigration detention centre that opened after the accounting period on 27 September 2001. The company “continues to incur costs associated with the tendering for contracts to manage additional prisons and immigration centres.” The company had accrued a tax credit of £5,558.

 

Directors’ fees for the period amounted to £260,858 and, on average, the company employed 15 management staff, 671 prison/detention officers, 83 administrators and 27 maintenance staff. The company had made a provision of £170,000 relating to a claim brought by a former employee but the accounts noted that the case had been settled satisfactorily after the accounting period.

 

During the period the company had financial transactions with Agecroft Prison Management Ltd (in respect of Forest Bank) and Harmondsworth Detention Services Ltd. The company’s immediate parent, Sodexho Alliance SA, has a 50 per cent and 51 per cent equity share interest in the companies respectively. Under the detention centre contract for Forest Bank, UKDS received £7.98 million. UKDS also received £632,250 from Harmondsworth Detention Services Ltd for liquidated damages arising from the delay in completing the construction of the facility.

 

n Securicor Custodial Services Ltd delivered a £5 million dividend for its shareholders for the year ended 30 September 2001. The company, which provides prisoner escort, court custody and prison management services, had revenues of £39.13 million (£36.71 in 2000) and a pre-tax profit of £3.69 million (£238,484 in 2000). The company earned £3 million in investment income. After paying the dividend the company made a loss of £1.61 million.

 

During the year the average weekly number of people employed (including directors) was 55 office and management and 1,441 operational. Directors received a total of £602,273 including pension contributions and benefits in kind. The highest paid director earned £136,631. The company is ultimately owned by Securicor plc. Securicor Custodial Services Ltd owns 40 per cent of the shares of Bridgend Custodial Services Ltd, the operator of Parc prison.

 

GROUP 4 and WACKENHUT

More on the acquisition

 

Group 4 Falck will sell its 57 per cent stake in Wackenhut Corrections Corporation within the next six months as long as the price is right (see PPRI # 47). On 9 July 2002 Group 4 Falck’s chief executive officer told Reuters that a “sales process” for Wackenhut’s staffing and corrections subsidiaries had been started. An independent committee of WCC’s board of directors has hired financial advisors to work with the company with respect to Group 4's stated intentions.

 

In the UK, the government’s competition commission has extended the period for its investigation into Group 4's acquisition of the Wackenhut Corporation and the implications for both companies’ custodial services operations in the UK. The commission will now report to the Department of Trade & Industry by 27 September rather than 30 August 2002. Under the Fair Trading Act 1973 only one extension is allowed.

 

On 6 August 2002, the competition commission sent a statement of hypothetical remedies  to Group 4. Its two recommendations were categorised as structural or behavioural. The structural remedies included: disposal of those shares or interests which cause competition problems in the UK leading to the separation of Premier (ie, sale of share holding in WCC); (b) and/or the sale of Global Solutions Ltd [the Group 4 subsidiary that operates the custodial contracts]; and/or the sale of Wackenhut (UK) Ltd to a purchaser or purchasers approved by the Office of Fair Trading.

 

Behavioural measures were suggested in order to address any possible adverse effects on competition in the provision of custodial and transport services. Measures to be put in place might include: a public demonstration of the independence of, and the competition between, Premier and the remainder of Group 4 in bidding for contracts and the provision of written undertakings which will guarantee Group 4's disposal of assets to meet public interest concerns.

 

The commission noted that it had not yet reached any conclusions on the matter, in particular, as to whether Group 4's acquisition of Wackenhut operates, or might be expected to operate, against the public interest.

 

The home office - which contracts with Premier for a range of custodial and other services - has not yet approved the acquisition as required under many of Premier’s contracts. It is awaiting the decision from the competition commission and the department of trade and industry. However, as WCC notes in its 10Q 30 June 2002 filed with the Securities & Exchange Commission on 14 August 2002, if the home office does not grant its approval “Premier Custodial Group’s (PCG) government contracts could be deemed to be in default. If the company is found to be in default, a cure period would normally be made available. If the company does not meet the cure requirements, the UK government may elect to terminate the contract.”

 

Until May 2002, Serco and Wackenhut Corrections Corporation were joint owners of  Premier Custodial Group Ltd and its subsidiaries. As a result of Group 4's acquisition, Premier is now owned jointly by Group 4 and Serco. However, Serco argues that it has the legal right to full ownership of Premier and the matter is now in the hands of lawyers. WCC notes in its 10Q that “Group 4 Falck has agreed that in the event the company is ordered by a court of competent jurisdiction to sell its interest in PCG to Serco at a price below fair market value, Group 4 Falck will reimburse the company for the amount by which the sale is below fair market value, up to a maximum of 10 per cent of the fair market value of the interest.”

n Serco Group plc regards itself as ‘a leading global outsourcing company’ aiming to ‘capitalise on the worldwide trend for governments to seek private sector support in improving the quality and efficiency of public services.’ The company  employs 34,000 staff in 36 countries. Outside of the UK it focuses on continental Europe, North America, the Middle East and the Asia Pacific region.

In the half year to 30 June 2002, revenues were £625.9m, an increase of 19 per cent over the same period in 2001. Gross profit increased 13.3 per cent to £71.1 million and pre-tax profit increased 16.4 per cent to £28.4 million. As well as the company’s involvement in prisons and electronic tagging its justice ‘market’ includes providing support and operational services to other agencies in the criminal justice system, in particular the police.

n Wackenhut Corrections Corporation is still 43 per cent owned by investors other than Group 4  Falck and is still publicly traded. According to WCC’s 10Q, 30 June 2002, its domestic revenues for the half year were $225.3 million compared to $226.3 for the same period in 2001 and international revenues were $56.1 million compared to $50.4 million in 2001.

n The insurance problems that have befallen prison operators in the UK (see PPRI #47) mean that Premier Custodial Group’s property insurance premiums will increase ten fold from October 2002.

 

AUSTRALIA

Victoria sets new contract standards

 

The government of Victoria has set new performance conditions for the two remaining private prisons, Group 4-run Port Phillip Prison and Australasian Correctional Management’s Fulham Correctional Centre (see PPRI #45,42,37-34 & 28-15).

 

The government’s position is that although it is ‘locked in’ to 20 year contracts with the companies, “the contracts provide for regular reviews of the prison services agreement,” said corrections minister Andre Haermeyer in a media release, 12 September 2002.

 

 “We have used this review to set new prison standards which were recommended by the auditor-general and the Kirby inquiry into private prisons. This has provided us with the opportunity to set tough, more qualitative standards and to achieve some continuity of standards so we can have one prison system and not three. Whilst the government believes the ideologically driven prison privatisation policies of the [former] Liberal and National parties were against the public interests, I have always been emphatic that we would not tear up legal contracts. We will honour our contractual obligations and will hold the private operators to theirs. We are determined to ensure taxpayers get the best deal from private prison agreements by improving these inflexible  ... contracts and adapting delivery outputs to reflect good prison practice,” said Mr Haermeyer.

 

Among the new standards that contractors will have to provide are:

n a significant expansion of urine analysis testing for drugs;

n a more rigorous approach to public safety and prison security tor educe the number of escapes and walk offs from work gangs;

n 100 per cent compliance with minimum staffing rosters with qualified staff;

n better procedures for detecting weapons and contraband;

n a heightened focus on security intelligence to prevent incidents;

n a greater focus on rehabilitation and repatriation of prisoners;

n more management planning to reduce prisoners’ self-harm;

n a holistic approach to health services, including better detection and treatment of prisoners with chronic health problems.

 


Victoria’s PFI County Court

 

The government of Victoria has opened the state’s first privately financed, designed, built and operated court complex. Located in Melbourne, it is Australia’s largest court complex. The Liberty Group has a 20 year contract. Finance is provided by ABN AMRO Australia; construction was by Multiplex; security is being provided by AIMS Corporation; and Honewell  and InterForm provide IT and buildings maintenance. A government brochure states that the new facility “is the most significant social infrastructure project to commence unde the Victorian government’s Partnerships Victoria policy ... it is a blueprint for working in partnership to deliver innovative solutions and value for money.”

n The government of Victoria is facing increased hostility to private finance initiative/public private partnerships. In May 2002, the state Labour party conference passed a resolution prohibiting private sector ownership of prisons, schools, hospitals and other infrastructure. They have also called on the government to hold an inquiry into the policy. The treasurer, John Brumby, has agreed to a review but not on the terms called for by the grass roots party.

 

Detention centres will remain private

 

The Australian Protective Service (APS) has withdrawn from the bidding process to operate  Australia’s detention centres (see PPRI #46-44 & 42-36). The only public sector agency competing for the contract was pulled from the bidding by the federal police commissioner. The APS merged with the Australian Federal Police (AFP) in July 2002 and the AFP has increased responsibilities to enhance Australia’s counter-terrorist capabilities.

 

This leaves just Australasian Correctional Management (ACM) which currently holds the contract, Group 4 Falck Global Solutions Ltd - both owned by Group 4 Falck - and Management & Training Corporation (MTC). The three companies are bidding for an initial three year contract worth more than A$104 million per year. The contract could be extended for a further four years.

 

More escort contract conflict

 

Western Australia’s privatised court security and prisoner escort service “is costing the community dearly” according to attorney general Jim McGinty (see PPRI # 48). Costs in the first year were A$16.3 million and are expected to be A$18 million for 2001-2002. The original bid from Corrections Corporation of Australia (now Sodexho subsidiary AIMS Corporation) was just A$11.7 million for the first year.  “I have no doubt that this was a contract rushed into by the previous government for ideological reasons,” Mr McGinty told The Australian, 23 August 2002. The service was contracted out for five years in 2000 and the contract allows increases for reasonable extra costs incurred by the contractor. One expense that has caused controversy is A$74,000 for corporate travel.

 

“The relationship between AIMS and the department of justice over this contract has reached very low levels and there is now a lack of trust and confidence in the contract,” the attorney general told the West Australian on 23 August 2002.  The contract has been criticised by Western Australia’s inspector of custodial services.

 

However, John Cooper, managing director of AIMS Corporation issued a statement on 27 August 2002 saying that “cost blowouts arising from the actions of our company are entirely without basis. What has occurred is that the demand for services and costs beyond our control have risen significantly from the original estimates at the time of tendering.”

 

Queensland: ACM renews Arthur Gorrie contract

 

Australasian Correctional Management (ACM) has been chosen by Queensland department of corrective services as preferred bidder in its attempt to renew the contract to operate the 710 bed Arthur Gorrie Correctional Centre in Brisbane (see PPRI #46-43 &41). If negotiations are finalised the new five year contract will commence in December 2002 and will be worth some US$13.3 million per year in revenues. There will also be an option for a further five year extension. ACM has managed the facility since it opened in 1992.  The other bidders for the new contract were Management & Training Corporation (MTC), AIMS Corporation (Sodexho) and Group 4.

 

UNITED STATES

 

New coalition formed

 

A new coalition opposed to prison privatisation has been formed in the US. Citizens Against Private Prisons of North America (CAPP) was formed from an initiative in July 2002 by Corrections USA (CUSA) and the California Correctional Peace Officers Association.

Ken Kopczynski of the Florida Police Benevolent Association (FPBA) is CAPP’s chairperson. Announcing CAPP’s launch on 2 August 2002 he said:“This is a historic moment in the battle for public safety and against yet another industry whose only motivation is profit. Incarceration for profit has been, and always will be, a bad idea. The expertise and commitment of the members of  CAPP is unsurpassed.” CAPP claims that it will organise local communities, educate decision makers and debate the for-profit prison industry wherever and whenever the corporations attempt to get new contracts. CAPP will also work to dismantle the private prison industry “wherever and whenever it can”.

 

Federal concerns about private prisons

 

The Federal Bureau of Prisons is concerned about the ability of the private sector to accommodate medium and high security prisoners as well as the comparative costs of operating private versus FBOP-run prisons.  These, and other concerns, were expressed in a letter from the FBOP to Senator Don Nickles earlier this year. Set out below is the FBOP’s letter.

 

U.S. Department of Justice

Federal Bureau of Prisons

Washington, DC 20534

 

June 20, 2002

 

The Honorable Don Nickles

United States Senate

Washington, DC 20510

 

Dear Senator Nickles:

This is in response to your request for the Bureau of Prisons (BOP) to reply to a letter you received from Richard Loud, President, Corrections U.S.A., regarding prison privatization.

 

The Bureau has contracted with the private sector for the confinement of  certain Federal inmates for decades. The BOP started contracting with the private sector for space in non‑secure, community‑based halfway houses in the 1960's. In the mid‑1980's, we began contracting for bed space to confine low‑security, non?U.S. citizen inmates with relatively short sentences. That effort gave our agency the needed flexibility to manage a rapidly growing inmate population and to help control crowding.

 

With the ongoing growth of the Federal inmate population, the Bureau's utilization of private sources for secure bed space has grown significantly in the recent past. We contract for private corrections beds to complement the facilities owned and operated by our agency.

 

Currently, the Bureau has approximately 13,500 inmates in secure adult facilities operated by private corrections firms (through direct contracts with the private prison or through intergovernmental agreements in which the local government contracts with a private prison company).

 

We have had success in contracting with the private sector for the confinement of minimum‑security and low‑security inmates (populations for which the private sector has established an acceptable record). We have concerns with privatization for the confinement of inmates classified as medium‑security or high‑security, in accordance with Federal classification standards.

 

Over the years, the private sector has had significant problems with the incarceration and management of medium‑security and high‑security offenders. In particular, the private sector has not demonstrated the ability to manage high‑security sentenced inmates for long‑term confinement, though they have held such offenders as short‑term detention cases.

 

The Bureau carefully evaluates past performance prior to making a contract award for private secure corrections services. Likewise, the Bureau has implemented a comprehensive oversight process to monitor contractor performance after award. The Bureau also assesses a contractor's financial condition, including a routine review of financial information, as a way to determine responsibility prior to contract award and the exercise of each contract option. Contracts also include a bankruptcy clause which requires the contractor to notify the Bureau within 5 days of initiating bankruptcy proceedings.

 

With regard to cost efficiencies, a recently‑completed comparison of the cost of the privately‑operated prison in Taft, California, with similar Bureau facilities found that the BOP institutions were somewhat less costly than the private facility.

 

I trust this information will be useful as you continue to examine prison privatization. Please contact me if I can provide more detailed information or be of any further assistance.

 

Sincerely,

 

Thomas R. Kane, Assistant Director for Information, Policy, and Public Affairs

 

RECENT PUBLICATIONS

 

El Programa de Concesiones de Infraestructura Penitenciara, Javier Peirano Novoa and Verónica Cáceres Cortés;  La Arquitectura Penitenciaria  de Nueva Generación, Carlos Alejo Garcia Basalo, Revista de Estudios Criminológicos y Pentienciarios, Ministerio de Justicia, Gendarmeria de Chile, Numero 4, Mayo 2002.

Two articles dealing with current developments with Chile’s semi-private prisons.

 

Tales of a private prison: Writ in Women’s Lives, Amanda George, in HECATE, Vol 28, no1, 2002 PO Box 6099, St Lucia, Brisbane, Queensland 4067, Australia.

Briefly outlines the experience of women prisoners at the Metropolitan Women’s Correctional Centre (MWCC) in Melbourne. MWCC is now in the public sector.

 

Administrative Accountability in Prisons, Kathy Bagot, Australian Journal of Administrative Law, Vol 9, May 2002.

“Court based remedies are inadequate mechanisms to keep contractors accountable because of  ...  legal difficulties and, even more importantly, because of the financial and practical obstacles  for prisoners. Governmental action to establish administrative mechanisms to make contracting out more open and accountable is essential.”

 

Protection of prisoners’ Rights in Australian Private prisons, John Rynne, in Prisoners as Citizens, Brown & Wilkie, eds, The Federation Press, 2002.

A discussion identifying the various options prisoners have to ensure that their basic rights are protected.

 

Acacia Prison, Annual Report 2001/2002, Australian Integration Management Services Corporation Pty Ltd, (AIMS Corporation), June 2002, www.aimscorp.com.au

This is not a government of Western Australia report but the first annual report produced by the company operating the Acacia prison.

 

CSC: Merchant of Misery and Misfortune by Roger Hummel, Prison Legal News, Vol. 13 No. 8, August 2002.

A profile of Correctional Services Corporation (CSC) from the company’s early history through to recent financial problems.

 

How Many Immigrants Must You Imprison Too Turn A Profit? May La Vor, A Globe of Witnesses, August 2002, www.thewitness.org/agw

This article analyses the US private prison’s industry increasing dependence on new immigration detention contracts. “Similar to the failed war on drugs, the war on terrorism is simply a mechanism to increase law enforcement powers and scapegoat immigrants and people of colour in the name of public safety/national security.”

 

Locking away profits: capitalising on immigrant detentions has turned into a booming business for Lehman Brothers, Karen Juanita Carillo, Color Lines, Fall 2002, www.arc.org/C_Lines/ArcColorLines

This article describes current developments in the US and profiles the role of Lehman Brothers.

“Investment banks like Lehman and others in Wall Street have been facilitating the flow of private capital into prisons for decades now- and nobody holds them accountable.”

 

Punishment & Society, The International Journal of Penology, Vol 4, No.3, July 2002, Sage.

This is a special issue on privatisation that includes five articles and two book reviews. “ ...the flow of essays and polemics has slowed and the early passions aroused on either side of that [public/private] debate appear to have cooled.” assert the editors.

“The current climate seems to favour continued efforts directed at the development of rehabilitative regimes through the proliferation of offender treatment programmes, and possibly the designation of further therapeutic community units within the prison estate. It is likely that the private sector will play an increasingly important role in the provision of such regimes. If this really is the case the current system of accountability must be radically reassessed and the question of legitimacy must be addressed.”  

That is the conclusion reached by Elaine Genders, reader in criminology, University College London, in her discussion of the development of Dovegate prison run by Premier Custodial Group Ltd in the UK and “what residual problems remain for the private contracting of a therapeutic community prison like Dovegate in particular, and for the private management of a rehabilitative system more generally.”

 

ENDS

 

Prison Privatisation Report International

Public Services International Research Unit (PSIRU)

School of Computing and Mathematical Sciences

University of Greenwich

30 Park Row, London SE10 9LS, England

Internet:www.psiru.org/justice

Email: Stephen Nathan,  stephennathan@compuserve.com