IN THIS ISSUE

Australia

New Zealand

Fiji

United Kingdom

Canada

Costa Rica

United States

United Nations

 

 

Australia: Victoria to end contracts?

The newly elected minority Labour Government of Victoria is taking legal advice on how soon it can terminate  three prison management contracts initiated by the former  administration.

On 1 November 1999, Andre Haermeyer, the  Minister for Corrections and Police told The Age that “our commitment is to extract ourselves from those contracts at the earliest legal opportunity. However, that doesn’t mean we are going to fork out large amounts of money.”

He added: “We don’t care who owns the facilities. We do care who runs them and we basically want the profit motive taken out of running the prisons.”

Corrections Corporation of Australia, Australasian Correctional Management and Group 4 currently own and operate the three facilities. While their ownership appears not to be under threat, the companies are opposed to early termination of their management contracts.

The companies have 20 year contracts to provide accommodation services. Correctional services are provided on renewable five year contracts.

Victoria’s three private prisons hold more than half of the State’s prisoners.   

The contract for the first of Victoria’s three private prisons, CCA’s Metropolitan Women’s Prison, states that the Minister “may at any time” notify the contractor if any of the optional five further three year terms are to be put out to tender.

If bids are to be called for, then the existing operator “may submit a tender” but “the Minister may elect to accept or reject any tender received.”

The Government also has the right to terminate the contract if correctional services requirements are not met over a period of time.

One of the legal issues at stake is whether these criteria might apply in any of the three cases.

CCA’s management contract for the Women’s Prison expires in 2000. Group 4’s management contract for Port Phillip and ACM’s for Fulham Correctional Centre expire in 2002.

The director of Victoria’s Jesuit Social Services welcomed the minister’s announcement. Father Peter Norden said that the privatisation of Victoria’s prisons had been a “failed social experiment.”

It is also now unlikely that the former government’s proposals for another private adult facility, a new facility for young offenders and the expansion of the Fulham Correctional Centre will be implemented.

 Three of the ministers in the former government who failed to gain re-election were responsible for plans to develop a privatised youth detention facility. Two had chosen their respective constituencies as prospective locations for the facility.

 

Victoria’s contracts published

One of the last acts of the former Government of Victoria was to lose its three year legal battle to prevent the publication, under the Freedom of Information Act, of the financial details of its contracts with private prison firms  (see PPRI # 13, 23, 25 and 30).

In a written decision on 17 September 1999, the  Court of Appeal of Victoria’s Supreme Court upheld the Civil and Administrative Tribunal decision of 20 May and rejected the Government’s argument that publishing the financial details of the contracts would hinder competition.

It also held  that full disclosure of the contracts, rather than commercial confidentiality, was in the public interest.  Only certain specifications relating to prison  security are to remain confidential.

The Department of Justice was refused leave to appeal to the High Court of Australia.

The legal costs of the Government’s intransigence is borne by taxpayers: another hidden cost of privatisation.

The most controversial details disclosed are the annual performance fees which the companies can earn regardless of whether they meet performance targets (see table below).

But it is still impossible to determine whether the former Government’s original claims for cost efficiencies can be substantiated as proper comparators do not exist.

The details released relate to three contracts:

n Wackenhut Corrections Corporation’s Australian joint venture, Australasian Correctional Investment Ltd, which financed, designed and built the Fulham Correctional Centre in eastern Victoria. Wackenhut’s subsidiary Australasian Correctional Management (ACM) has a five year management contract for the facility;

n Excor Investments Pty Ltd,  Corrections Corporation of America’s joint venture company which financed, designed and built the Metropolitan Women’s Prison.  Corrections Corporation of Australia runs the facility;

n Australian Correctional Facilities Pty Ltd, Group 4's joint venture, which financed, designed and built Port Phillip Prison. Group 4 Corrections Services Pty Ltd runs Port Phillip.

 

	Fulham Corr. Centre	Port Phillip Prison	Metro. Womens Prison
Cost to build	A$54m	$A54m	A$16.5m
Start Up Fee	A$4.3m	A$2.7m	-
Annual Accommodation Fee	A$8m	$A8.4m	A$2.9m
Annual Correctional Services Fee	A$14.2m	A$15.9m	A5.2m
Annual Performance Fee (bonus)	A$1.6m	A$0.95m	A$0.69m
Payment for Law Change Risk	A$0.48m for first five years	-	-
Local Council Concessions	A$2.4m	-	-

 

Notes:

1. Fulham Correctional Centre and Port Phillip Prison both have a capacity of 600 beds. Metropolitan Women’s Prison’s capacity is 150 beds.

2. The fees for providing accommodation services also covers the company’s debts for the financing of  construction.

3. Figures for accommodation and correctional services are for the first year of the contract. Subsequent years have been adjusted for inflation and wage rates.

Although Group 4 managed to  negotiate slightly higher fees for providing accommodation and correctional services, Wackenhut negotiated the  most favourable terms, including: a payment of A$475,000 per year for the first five years for the risk of any change in the law which might affect the contract; concessions from the local council for utilities; and a higher start up fee than Group 4 received for a broadly similar contract.

Corrections Corporation of Australia’s financial penalty for any escape is A$20,000 compared with the A$75,000 which can be imposed on Group 4 and ACM.

The case was brought by the Coburg Brunswick Community Legal and Financial Counselling Centre, PO Box 353, Coburg, Victoria 3058, Australia. Tel:++ 613 9 350 4555. Fax:++ 613 9 354 2433.

 

Tear gas used at ACM prison

Tear gas was used to quell an incident at Australasian Correctional Management (ACM, Wackenhut) run Fulham Correctional Centre on 18 August 1999.

The prisoners set fires and refused to return to their cells in protest over planned overcrowding at the prison. Damage estimated at A$100,000 was caused.

ACM had agreed to take an extra 60 prisoners despite the prison having reached its capacity of 600.

 

More tear gas at CCA’s prison

Three staff  were injured during a nine hour disturbance by prisoners at Corrections Corporation of Australia’s Metropolitan Women’s Prison, Melbourne, on 23 August 1999.

The Police Special Operations Group was called in to help regain control. According to Victoria’s  correctional services commissioner, tear gas was used “as a last resort”.

n Tear gas was also used on 17 October 1999 after prisoners at the facility protested about overcrowding. Some 35 women were housed in a unit designed for 24.

Amanda George of the Federation of Community Legal Centres alleged that using chemical weapons twice in three months indicated that “the prison was in crisis”.

Liberty Victoria has called for an inquiry into the use of tear gas.

n A coroner’s inquest into the self inflicted death of prisoner Paula Richardson has heard that she called prison staff on an intercom many times during the hours before her death on 11 September 1998.

Ms Richardson was eventually found dead in her cell with a shower curtain around her neck.

Other evidence included: Ms Richardson had been forcibly strip searched by male officers two months prior to her death. Company policy was that only officers of the same gender should conduct strip searches; Ms Richardson’s foster mother had warned prison authorities of the risk of suicide; CCA’s operations co-ordinator, Ms Gaylene Coram, claimed that she was unaware of Ms Richardson’s history of self harm and suicide attempts.

 

Two for Tasmania

     Two new prisons should be put out to tender but “at least one should remain under public management” concluded a Legislative Council Select Committee of the Parliament of Tasmania.

The Committee’s report, published in September 1999, recommended that two existing prisons should be replaced.

But the Attorney General, Peter Patmore, is opposed to the concept of private prisons. “I believe the Government has a responsibility to run the prisons itself,” he said.

 

Health services short list

     Western Australia’s Justice Ministry has short listed Pacific Shores Health Care (Wackenhut) and St. Vincent Hospital, Melbourne in a competition for a contract to provide prison health services (see PPRI # 30).

 

Wackenhut wins another

       Australasian Correctional Management Ltd (ACM) has won a contract from the Australian Department of Immigration and Multicultural Affairs to run a new immigration reception and processing centre at Curtin, Western Australia.

The facility has a capacity for up to 270 detainees and is expected to generate annual revenues of around US$6m.

ACM now manages five detention facilities with a capacity of 1,390 beds in Australia.

 

NEW ZEALAND

 

Northland design bid

       The New Zealand Department of Corrections has called for registrations of interest from firms seeking to design a 350 bed campus style prison in the Northland region (see PPRI #23, 25, 26 and 30).

n Australasian Correctional Management (Wackenhut) has been awarded a five year management contract for Auckland Central Remand Prison.  The facility is expected to open in May 2000.

n New Zealand’s Labour Party has pledged that it will halt the privatisation of prisons if elected to govern in 2000.

 

Chubb wins tagging contract

        The Ministry  of Corrections has awarded Chubb NZ Ltd a five year contract worth NZ$6.5m to provide home detention services  (see PPRI #30).

Low security offenders sentenced to less than two years in custody will be eligible to apply for this option.

 

FIJI

 

Offer of new complex considered

       Australasian Correctional Services, Wackenhut’s Australian subsidiary, has recommended that Nabaro Prison on Suva be replaced with a new prison complex.

The company was commissioned by the  Fijian Justice Department to report on the future of its existing facilities.

The Government has also received a proposal to privately finance, design and build a new complex. It could, however, be publicly run.

A Government spokesperson told PPRI that “nothing had been confirmed.”

 

UNITED KINGDOM

 

 

 Documents reveal tender facts

        Independent assessors commissioned by the Home Office rated an in house bid from the Prison Service for a contract to run HM Prison Doncaster  as “operationally” superior to Premier Prison Services but the contract is still to be awarded to the company (see PPRI # 31).

Extracts of documents relating to the recent tendering process seen by the Observer show that Premier’s bid did not allow sufficient time out of cells, particularly for young offenders, and offered poor educational provision.

The assessors said that there “appears to be the lack of an overall strategy to the regime” proposed by Premier that leads to a “failure to address satisfactorily numeracy, literacy and key and basic skills'.

In contrast, the Prison Service proposed a “constructive regime” which was described as “excellent” and “comprehensive”.

The assessors give each bid marks in different areas. According to the documents, the Prison Service outscored Premier on running a secure prison and treating people fairly. They scored the same for managing resources effectively. The Prison Service earned 874 marks for its operational plans ‑ 14 more than Premier.

When the Doncaster decision was announced on 22 October 1999, Prisons and Probation Minister Paul Boateng said the decision was “not just simply a question of pounds, shillings and pence” (see PPRI #31).

But the Home Office documents reveal that there is little cost difference between the bids. Premier estimates that under its plans the annual cost per prisoner would be £16,955, just £189 a year less than the Prison Service.

The Liberal Democrat home affairs spokesperson is to table questions in Parliament demanding answers from the Home Secretary about the bidding process.

A spokesperson for the Prison Officers’ Association said that the bidding process was “a complete and utter sham” and that “if the Home Secretary has chosen Premier with such stinging criticism from his own advisers, how can we have any confidence in the future of Britain’s prisons?”

n HM Prison Brixton, in South London, is the first publicly run prison to be threatened with market testing if it does not improve its performance within the next  year (see PPRI # 31).

Immigration centre contract news

        Wackenhut (UK) Ltd has won  a contract to transport immigration  detainees,  provide security at holding areas in ports and airports and manage the Manchester Detention Centre for the Immigration Service.

n Group 4 has lost a bid to renew its contract to run the immigration detention centre at Harmondsworth, near Heathrow Airport.

The contract has been won by Burns International Security, a subsidiary of the American firm Borg Warner.

 

CANADA

 

Ontario still exploring possibilities

      The Province of Ontario’s Lieutenant Governor has promised that the new Government will continue to be run “more like a business” (see PPRI #15-23, 25 and 30).

In a speech at the opening of the new Parliament on 21 October 1999, the Hon. Hilary Weston said that while remaining “open to outsourcing and privatisation” the Government “will continue to replace aging jails with more secure facilities. It will expand strict discipline rehabilitation programming for young and adult offenders. And it will ensure that criminals are accountable for their own actions by exploring all reasonable ways to make them contribute to the costs they have imposed on taxpayers.”

 

COSTA RICA

 

 

Privatisation plans afoot

    A Costa Rican architectural firm has called for consultants with experience of “operating private jails” to assist in the drawing up of proposals to privatise “most of the large jails” in the country.

In 1998, the previous Government tried to privatise the construction of new prisons but this plan failed.

 

 

UNITED STATES

More cost doubts cast

      Private prisons in the US are “no more cost effective than public prisons” a study of 33 cost effectiveness evaluations of public  versus private facilities has revealed.    Other institutional characteristics such as the economy of scale, the security level and age of the facility were the strongest predictors of a prison’s per diem cost.

Are private prisons More Cost Effective Than Public Prisons? A Meta Analysis of Evaluation Research Studies by Travis C.Pratt and Jeff Maahs, University of Cincinnati, in Crime and delinquency, Vol 45 No.3, July 1999, Sage Publications, 2455 Teller Road, Thousand Oaks, CA 91320, USA.

Investigation in New Mexico

       Four deaths at Wackenhut prisons in New Mexico since December 1998 have prompted an investigation into the State’s prison system.

Ralph Garcia, a Wackenhut Corrections Corporation correctional officer, was killed on 31 August 1999 during a four hour riot by prisoners at the company’s Guadalupe County Correctional Facility.

Three prisoners have also been killed at this and the Lea County facility in Hobbs (see PPRI # 29 and 30).

During the 31 August incident, prisoners caused damage to one third of the facility.

The company claims that it complied with its contractual obligations in the handling of the riot and that both of its facilities were safe.

Prior to this incident staff at Guadalupe, fearing for their security,  had made written requests for the company to increase staffing levels and issue radios with panic buttons. Some had campaigned for union representation.

Wackenhut has since admitted that emergency notification procedures “can and should be improved”.

It has also proposed to spend $2.5m to improve the Guadalupe facility if the State increases its payments to the company. It also wants to change the use of the Hobbs facility in order to take federal prisoners.

An independent board of inquiry is now investigating the  riot and the State’s entire prison system. It is expected to report by mid January 2000. The cost of the inquiry is expected to be between $150,000 and $200,000.

The inquiry will also investigate several eruptions of violence at Corrections Corporation of America’s prison in Torrance County and the deaths of two prisoners in a State run prison.

Wackenhut receives  around $25m a year to house 1,500 state prisoners at its Lea County and Guadalupe County facilities.

New Mexico currently houses one third of its prisoners in private prisons.

n Initial efforts to investigate the recent events at Wackenhut’s prisons were complicated by the fact that Mr Manny Aragon, the president of the State senate, had been a paid lobbyist for Wackenhut Corrections Corporation since 1998.

Mr Aragon chaired a private legislative briefing on the  31 August incident. But following calls for an investigation to determine whether Mr Aragon’s business relationship with Wackenhut was in conflict with his duties as a senator, he resigned his Wackenhut consultancy on 21 September 1999.

Mr Aragon claimed that, despite his Wackenhut role,  he opposed prison privatisation and he had no conflict of interest since his lobbying work for the company was carried on outside of New Mexico.

 

 

UNITED NATIONS