IN THIS ISSUE

U.S: North Carolina leads the way

The State of North Carolina has taken three decisive steps against prison privatisation.

In June, it passed legislation preventing any future speculative prison building by the private sector and banning companies from importing ‘out of state’ prisoners.

It also delayed for a year the construction of a new juvenile facility.

And it decided to take over the management of two  528 bed  private prisons that have been run by Corrections Corporation of America (CCA) since 1998.

The legislation was passed on 30 June. North Carolina  is one of just a few states to have taken this action.

The decision will hold unless the state is required to change it by the US constitution.

In 1997, the state declared a moratorium on speculative prisons. But this had to be overturned last year following a legal opinion by the Attorney General that  companies had the right to hold federal prisoners in North Carolina.

Although there is still some doubt as to the basis for this opinion, the scrapping of the moratorium led to Wackenhut Corrections Corporation being able to locate  its new Rivers Correctional Institution in Winton (see PPRI #32) and subsequently win a federal contract to house 1,200 prisoners from Washington DC. That facility is now under construction

CCA acquired the Pamlico Correctional Facility and Mountain View Correctional Facility as part of its acquisition of US Corrections Corporation in 1998.  The management contracts with the state were not due to expire until 2003. North Carolina will run the facilities but will continue to lease them from the company.

CCA fined $1m

North Carolina had been concerned for some time about deficiencies with CCA’s operations.

State monitors found understaffing and the inadequate provision of prison security and safety, education, medical and mental health care, substance abuse and work programmes.

 CCA has been penalised approximately $1m by the Department of Corrections.

The transfer from private to public operation is expected to be completed by September.

A Prison Realty Trust press release dated 23 June 2000 made no mention of the operational problems. It  said that CCA initiated contract termination discussions with North Carolina’s Department of Corrections in May.

“Given the economics of the management agreements, which we assumed as part of the acquisition [of USCC] we believe that it is in the best interests of Prison Realty and CCA to take this action ... the management contracts are not in keeping with CCA’s current business priorities...”

Campaigners have argued that instead of building a new prison, $2.5m should be spent on local crime prevention programmes for juveniles.

n The Carolina Justice Policy Center is a non‑profit organisation working to promote effective and humane solutions to criminal justice problems.  It publishes a monthly Legislative Update when the legislature is in session.  The updates include in‑depth information about community corrections programmes, prisons, major sentencing changes, and the death penalty.  Individual supporters receive the Legislative Update for $50 and agency subscriptions are $75. Contact: Carolina Justice Policy Center, PO Box 309, Durham,  NC 27702, USA. Tel: ++ 1 919 682 1149. Email: RubertL@aol.com

n The North Carolina based Public Safety and Justice Campaign (PSJC, see PPRI # 34) can be contacted at: 1515 Elizabeth Avenue, PO Box 36006, Charlotte, North Carolina 28236, USA. Phone: ++ 1 704 332 3090 Fax: ++ 1 704 332 0445. Email: skahn00000@aol.com

Contract audit review findings

An audit review of three contracts awarded to private prison contractors by the former Kennett government of Victoria has confirmed the misuse of commercial confidentiality, excessive secrecy, flawed concepts and poor performance.

The review noted that if the state makes a significant change in law or policy which impacts on a contractor’s profitability then the terms of payment have to be renogotiated. It was not possible to quantify these obligations in financial terms.

It also  found that:

n no evidence that the government conducted a prior evaluation of the contracting methodology (build, own, operate) chosen for the prison projects;

n the basis of calculation of public sector benchmarks, against which the private sector bids were evaluated, were flawed;

n there are gaps and inadequacies within service delivery outcomes - for example, they contain no measure of deaths in prison;

n the outcomes for private prisons were based on performance levels achieved in state prisons earmarked for closure.

n the measures appeared to be lacking if rehabilitation of offenders is considered to be a major priority for prison operators;

n performance data is not audited, which could lead to under reporting of incidents. The structure of the performance linked fee could provide operators with an incentive to under report incidents of poor performance;

n the performance linked fee can fail to reward good performance and can reward poor performance;

n competition between providers has a potentially major disadvantage in that it could result in fragmentation of service delivery.

The audit was “optimistic” about the future use of public/private partnerships and avoided dealing with what it termed “the threshold question”, ie, whether the state’s punishment and rehabilitation responsibilities should be contracted out at all. It concluded that this “is clearly a very difficult [question] which, ultimately, must be decided in the political arena.”

Contracting, Privatisation Probity and Disclosure in Victoria, 1992-1999: an independent report to Government, May 2000. Available on the Internet at www.dpc.vic.gov.au/auditreview

n The Faculty of Law at Victoria’s Monash University has set up a project on privatisation and public accountability to “work on a range of legal and interdisciplinary issues related to privatisation.”

Contact: Prof. Marcia Neave, Tel: ++61 3 9905 3381

Psych out

    Group 4, which operates Port Phillip Prison in Victoria, is donating an undisclosed sum of money to Melbourne University.

    In return, psychology students at the university will complete part of their training by working with prisoners with the aim of reducing reoffending rates.

Immigration security review

      A federal government task force is reviewing security at Australia’s immigration detention centres following a series of escapes from three centres in June.

Several hundred detainees escaped from centres at Woomera, Curtin and Port Hedland in protest over the length of time that the government is taking to process their asylum applications.

The centres are all run under contract by Australasian Correctional Management Ltd (ACM), Wackenhut Corrections Corporation’s Australian subsidiary.

ACM’s contract for the immigration detention centres is due for renewal in December 2000. The company faces financial penalties if escapes occur.

Borallon market tested

    The result of market testing for a new contract to run Borallon Correctional Centre in Queensland  is due to be announced.

    Borallon, run by Corrections Corporation of Australia (CCA), opened as a 240 bed facility in 1990. It has been  expanded twice, adding a further 248 beds.

As well as CCA, three other companies were invited to bid for the new contract: Group 4, Australasian Correctional Management - which both run prisons in Australia - and Management and Training Corporation, a US company seeking to break into the international prisons market.

If CCA is successful then a new contract will commence on 1 October.  If another company wins then the new contract will commence on 1 January 2001 to allow a transition period.

Western Australia monitors CCA

     The government of Western Australia is monitoring probity reports on Corrections Corporation of America (CCA) in the light of the company’s recent financial problems (see PPRI #35 and 34).

CCA owns 50 per cent of Corrections Corporation of Australia which has a contract to build and operate the Acacia prison (see PPRI #34, 32, 30, 28 and 26).

The company has told the government that it has no concerns about its financial status in Australia. The Justice Ministry’s director general has also said that Sodexho, which owns the other fifty per cent of Corrections Corporation of  Australia, has the capacity to buy the US  firm’s share and was maintaining a very close interest.

Cashing in on PFI prisons

       Shareholders in Group 4 and Carillion (formerly Tarmac), the consortium that won a contract to finance, design, build and run HM Prison Altcourse (see PPRI #35, 30, 29 and 18) have increased their expected profit on investment by 81 per cent since the contract was awarded.

         Two major factors led to this windfall: refinancing the debt arrangements on the project and being rewarded by the Prison Service for early completion of the prison’s construction.

The company has further benefited by having £500,000  in penalties for non-delivery of services waived.

The contract was one of the first to be awarded by the Prison Service under the Private Finance Initiative (PFI,  see PPRI #7 ).

Profit taking from debt refinancing begs further questions about the validity of the PFI compared to public sector borrowing.

 All new prisons in the UK are financed through the PFI and this method of privatising new public infrastructure is being promoted by the British government, banks and consultants to governments around the world.

A new report by the government’s National Audit Office reveals that:

n Fazakerley Prison Services Ltd (FPSL), the project company set up by Group 4/Tarmac after the Altcourse contract was  awarded in 1995, refinanced the project in November 1999;

n the arrangement included: extending the period over which FPSL’s bank loan would be repaid; a reduction in the lending margin for the loan; a fixed rate of interest covering the full period of the loan; and early repayment of subordinated debt invested by FPSL’s shareholders;

n the refinancing improved expected returns through early repayments of the original investment and by generating a more favourable flow of dividends;

n these expected returns increased by £10.7m (61 per cent) compared to the original projected level of £17.5m at the time the contract was awarded;

n the contract between the Prison Service and FPSL did not oblige the company to share any gains made through refinancing;

n the company was advised to seek permission from the Prison Service to refinance as, without it, the company might not be compensated in the event of  early termination of the contract;

n after previously rejecting offers of £100,000 and £300,000, the Prison Service negotiated a settlement of £1m from the company. But, offset against this, was £500,000 in penalties that the Prison Service agreed to waive;

n  the Prison Service regarded the company’s windfall as “a reward for FPSL taking risks in managing the first PFI prison project successfully.”

In light of this report, the Treasury is to issue new guidelines to government departments but is “expected to recognise the private sector’s rights to receive refinancing benefits as a reward for the successful management of risks where these are appropriately priced.”

The Refinancing of the Fazakerley PFI Prison Contract,  Report by the Comptroller and Auditor General, National Audit Office, HC 584 Session 1999-2000, 29 June 2000. See also www.nao.gov.uk

n see also Public Services or Corporate Welfare: Rethinking the Nation State in the Global Economy, by Dexter Whitfield. The book  demonstrates how the state facilitates globalisation by promoting private finance and shows how international bodies such as the World Trade Organisation and the World Bank are committed to the privatisation of public services and welfare states. Whitfield presents a radical analysis of partnerships and private finance. Pluto Press,  September 2000, ISBN 0745308562.

Two new women’s prisons

       The Prison Service of England and Wales has invited five companies to bid for contracts to finance, design, build and run two new prisons.

A 460 bed facility for remand, unsentenced and sentenced women at Ashford in South East England and the other, at Peterborough in Eastern England, will have 840 beds, with 360 for women and 480 for men.

The five bidders are: Group 4; UK Detention Services (CCA and Sodexho); Premier Prison Services (Wackenhut Corrections Corporation and Serco); Securicor; and Caledonian Correctional Services Corporation (CCSC).

Four of the bidders already run prisons in the UK. CCSC is a joint venture of Caledonian Building Systems and John Mowlem, both British building companies, and Correctional Services Corporation of the US, which runs  35 facilities for juveniles and 18 for adults. The company is still trying to break into the overseas market.

Mowlem was a former partner with Corrections Corporation of America in UK Detention Services Ltd.

The Prison Service expects to announce the preferred bidders for the contracts by April 2000. Ashford is due to open in 2002 and Peterborough in 2003.

n The Prison Service has submitted a planning application to build a new 600 bed prison for young offenders adjacent to  an existing publicly run prison in South East London.

Prison to be market tested

      HM Prison Brixton, in South London, is to be the first publicly run prison in the UK to be market tested (see PPRI # 31 and 5).

In November 1999, the prison was declared as ‘failing’ and given one year to improve its performance.

But following recent allegations that some staff  operated an unauthorised punishment regime for young black prisoners, the Prisons Minister announced on 10 July that the private sector would be invited to bid to run the prison. An in-house bid will also be considered.

It was also announced that Stephen Twinn, a former Prison Service governor who went to work for Group 4 in 1991, is to take over as governor of HM Prison Brixton. He will lead the in-house bid.

The Prison Officers Association (POA), which represents the majority of staff, is devising a strategy to deal with the government’s decision and to try and prevent further market testing of existing public sector prisons.

Lowdham Grange inspection

“Other aspects of the low staffing levels were that the Officer could not leave the wing to follow up prisoners’ applications or to use the toilet and if there was an incident, there were very few staff available to deal with it. The other side of this staffing position was that Officers and prisoners got to know each other well and there was clearly good, mutually respectful relationships between them. However, no matter how good these relationships were, there was no justification for leaving one Officer on his/her own with up to 67 prisoners. Full consideration should be given to finding ways to ensure that officers are not left on their own on a wing at any time” - HM Chief Inspector of Prisons.

HM Prison Lowdham Grange is a 500 bed category B training prison for adult males. It opened in February 1998. It is financed, designed, built and run by Premier Prison Services Ltd (Wackenhut and Serco, see PPRI # 29).

HM Chief Inspector of Prisons carried out an announced inspection between 22 and 26 November 1999. The report is dated January 2000 but it was not published until April.

The Chief inspector noted that “... this is a very good report, all the more remarkable because of what has been achieved in such a very short space of time.”

But the report also included such findings as:

n outcomes for prisoners were inevitably reduced in quality if not in quantity;

n the deployment of staff ... did not ensure a safe environment for prisoners and staff at all times;

n there was a need to provide more activity places and programmes for prisoners to address their offending behaviour. Too many were remaining on living units all day with little to do;

n we were concerned to find single officers supervising large numbers of prisoners and quite unable to see everything that was going on;

n staff working on their own were isolated and vulnerable and did not feel confident enough to challenge the behaviour of prisoners when the need arose;

n personal officer and sentence planning schemes were in need of attention;

n there was not enough purposeful activity for prisoners;

The staff told the inspection team that:

n there was a lack of staff. There were often two staff for unlock but then one officer would be left on a wing with 50-60 prisoners;

n a lot of time off in lieu (TOIL), over 5,000 hours, had accrued;

n those who worked on the houseblocks did not get a proper lunch break;

n there was a lack of training for middle management. Staff were promoted but then received no training;

n staff morale had never been worse. Staff worked long hours, there was a lack of communication, a lack of staff and no team spirit. One group was often pitted against another;

n the wage structure was appalling. Basic pay for a Prisoner Custody Officer was £13,000. Many staff felt tempted to go into the state prison system;

The company does not recognise trade unions. Staff are represented by a Works Council. Some members of the Works Council told the Chief Inspector that:

n staff had voted to work a shift pattern of four days on/four days off with long shifts and no meal breaks;

n staffing levels on residential units were too low.

The Board of Visitors said that:

n the original senior management team had lacked competence, confidence and experience. A period under a caretaker director had followed and consolidation had taken place but the prison needed to be taken forward.

The Chief Inspector’s other findings included:

n most of the time there was a single operative in the control room and delays getting through the doors and gates were inevitable at busy times of the day. This was not helped by the fact that the system controlling the doors failed countless times each day, leaving people stranded at different doors and gates around the wing. Routinely this was not much more than an inconvenience but, in an emergency situation, the consequences could be very serious indeed.

n the food was well cooked and plentiful. However, what happened to the food once it left the kitchen could only be described as chaotic;

n only a third of prisoners attended any education course;

n there was only the equivalent of 50 full time education places in a prison with 524 prisoners.

n the education wing was poorly designed both in relation to security and in regard to teaching matters;

n in the main, work offered was routine and repetitive in nature, such as making hair nets or folding paper hats;

n no assessment had been undertaken in respect of the employment needs of prisoners;

n prisoners were required to sign compacts agreeing to maintain acceptable standards of behaviour ... the staff did not put the effort into making themselves or their prisoners stick to them, rendering the compacts meaningless documents;

n the prison had a comprehensive anti-bullying strategy ... all staff with whom we spoke said that they had not undertaken any formal training on anti-bullying;

n probation staffing arrangements were insufficient to provide a credible service;

n the single beds in 24 cells had been replaced by double bunks with very obvious and substantial ligature points;

The Chief Inspector made 106 recommendations for improvement. He also noted 28 examples of good practice.

HM Prison Lowdham Grange, Report of a Full Inspection 22-26 November 1999, Home Office, 50 Queen Anne’s Gate, London, SW1H  9AT, England. Also available at: www.penlex.org.uk

Scotland’s first is most violent

       HM Prison Kilmarnock, run by Premier Prison Services,  has made “a promising start” even though, in terms of assaults on staff,  it is “Scotland’s most violent prison” according to the Chief Inspector of Prisons for Scotland.

The prison opened in March 1999 and it is Scotland’s only privately financed, designed, built and run facility. It reached its capacity of 500 screened prisoners in June 2000 and is now overcrowded by 24.

In a carefully worded report of an inspection carried out between 20 and 30 March 2000, the Chief Inspector said that the staff were willing and helpful, there were excellent processes and systems for gathering information, and time out of cell for prisoners exceeded what is available in other Scottish prisons.

But, even though the Chief Inspector’s brief did not include carrying out a financial audit, the report made no mention of the penalties incurred by the company for contract failures.

Nor did it include the prison’s staffing levels, a detail deemed a “confidential matter” in the contract between the SPS and Kilmarnock Prison Services Ltd, the consortium that was awarded the 25 year contract.

Other details kept from the public by the Scottish Prison Service (SPS) include the actual cost of running the prison and the cost of the privatisation process itself, including the cost of the SPS  helping the prison through its early stages.

Ninety-one per cent of staff had no previous experience of working in a prison and, notably, the Chief Inspector “cautioned against the possible conditioning of staff by the more manipulative and experienced prisoners”.

The Chief Inspector also commented that:

n there is a need to do more about tackling offending behaviour;

n some prisoners ... were still leading a relatively unstructured life and were not always being challenged to confront their offending behaviour;

n there was a very real danger of stagnation because long term prisoners would not wish to progress to other establishments;

n it was proving difficult on occasion to confirm the roll of the prison at meal times and lock-ups;

n meal times were frequently delayed due to problems reconciling the prisoner number checks.

Drug use amongst prisoners was high and the company’s drug strategy lacked the necessary co-ordination and integration. The development of a robust strategic approach towards reducing drug use was still at an early stage.

The Chief Inspector was “disappointed to note” that, on average, only one drugs suspicion test per month had been carried out. He added that “considering the drug culture within the establishment this ... does not provide any real challenge ...”

There was only one substance abuse counsellor for 500 prisoners.

Other findings included:

n  ... “it was something of a disappointment” that there was no evidence of custody plans for remand prisoners despite expectations that inroads were being made into this aspect of prisoner management;

n much still needed to be done to provide short term and remand prisoners with the short, high impact programmes that were required;

n it was also recommended that there should be a review of the entire work of the social work unit, including staffing resources, in order to ensure effective social work output;

n prisoners could become very bored because although they were out of their cells for very lengthy periods, the recreation facilities were rather limited;

n not all prisoners in the work parties were fully employed and a surprisingly high number of prisoners were being retained in the residential areas pending interview or other regime activity;

n staff deployed to the work sheds were not instructors nor were they necessarily qualified tradesmen. There was also “slippage” in health and safety and other standards;

n education had some strengths but it also had significant weaknesses. The curriculum and the ways in which it was delivered did not fully meet the needs of the students;

n catering was good but delays at meal times meant that food had lost its quality by the time prisoners received it. The Chief Inspector also recommended that every food handler be given health and hygiene training;

n the layout and design of the health centre mitigated against good observation and sight lines.

Staffing

n the retention of nursing staff was an issue to be addressed. The Chief Inspector noted that “pay had been a major consideration” and that it will be necessary to address the high turnover of nurses;

n he also noted that Prisoner Custody Officers often worked alone within the residential wings;

n the four Sentence Planning Officers were supposed to provide cover for staff on the wings to allow them to undertake their personal officer duties. But due to the existing workload, this had  yet to happen;

n there was a lack of permanent supervision in the closed visits and agents’ facilities and the Chief Inspector suggested that the staffing arrangements should be reviewed;

n between March 1999 and January 2000, 87 staff from “almost every area of the prison” had resigned. Some 45 had been on probation;

n there was no opportunity for new staff selected to work at Kilmarnock to have experience of the prison setting.

Staff interviewed by the Chief Inspector said that:

n the company did not recognise trade unions and staff were represented by a Works Council which was not as powerful as a recognised trade union;

n morale was low;

n the disparity of pay between staff at the company’s different prisons was an issue of concern;.

n there were heavier than expected prisoner escort commitments;

n staff facilities were described as inadequate;

n staff had elected not to take unpaid meal breaks during their shift as the time taken would have been added on to the shift time, leading to a longer working day;

n they were constantly being put under pressure to meet deadlines and targets in order to satisfy the terms of the contract. They also complained that management kept changing  rules;

n staffing levels on all the wings was too low, particularly as there were occasions when they were left alone and this led to fears about personal safety;

n the shift pattern was about to be changed for the fourth time since the prison opened;

n there was also  concern about the length of the shifts without any breaks and only a few minutes to eat lunch;

n accrued levels of Time Off In Lieu (TOIL) were high and it was difficult to get time off. Supervisors claimed that TOIL was not a problem;

n they also complained that training was too short and did not cover issues in sufficient depth : they had to find their feet by being ‘on the job’.

Regarding training, the Chief Inspector noted that:

n there were no systems in place that would measure to what extent the training delivered was transferred into the operational setting, nor was there any evidence that supervisors were competent to carry out the necessary assessment;

n supervisors had not received any training specific to their role;

n “developing training in the prison will be a significant challenge over the coming year ...”

What the prisoners said:

n standards were higher compared to other Scottish prisons.

n Relationships with staff were excellent. But there was a feeling that many of the staff lacked the professionalism and expertise of the staff  in other SPS prisons

n staff were not always able to cope with what they were asked to do;

n the prison was relatively safe;

n there was criticism of the facilities available for those who wanted to come off drugs;

n detoxification facilities were described as poor;

n sentence planning was the subject of much criticism;

n the wages were comparatively very high.

Report on HM Prison Kilmarnock, HM Inspectorate of Prisons for Scotland, Scottish Executive, St Andrews House, Regent Road, Edinburgh, EH 1 3DG. Published 20 July 2000.

n The new Chief Executive of the Scottish Prison Service is in favour of a mixed economy and further privatised facilities could possibly be developed including two prisons, the training college and the prisoner escort service.

UNITED STATES

Another lawsuit for CCA

        The mother of Steven Moore, a former juvenile prisoner at CCA’s Shelby Training Center in Tennessee, has filed a lawsuit in federal court alleging that staff beat her son and drove him to a suicide attempt in August 1999 that has left him permanently disabled. Damages of $20m are being claimed.

It is alleged that staff abused Moore physically and emotionally throughout his stay and ignored Steven Moore’s threats to kill himself despite a previous attempt to hang himself.

Moore was found hanging by his bed sheets from an

air‑conditioning ventilator. He suffered brain injury caused by oxygen deprivation as a result of the suicide attempt and needs 24‑hour care and attention, according to the lawsuit.

The lawsuit claims that CCA records show Moore had bruises and scratches on his body that coincided with each of his complaints of abuse by CCA employees.

The Shelby Training Center, opened in May 1986.

Steven Moore’s case and a profile of CCA’s recent problems in Tennessee, appears in  the Memphis Flyer, 1-7 June 2000.

www.memphisflyer.com/backissues/issue589/cvr589.asp

For an article about CCA’s operation in Youngstown, Ohio, see: Prisons, Inc. How one corporation is turning a rusting steel town into the private prison capital of the world, by Barry Yeoman, in Mother Jones, May/June 2000.

www.motherjones.com/mother_jones/MJ00/toc.html

n According to Prison Realty, as at 23 June 2000, the companies doing business as Corrections Corporation of America had 69,000 beds in 77 facilities under contract or under development in the US, Puerto Rico, Australia and the UK.

More Wackenhut guards indicted

    Two guards formerly employed by Wackenhut Corrections Corporation at the Travis County Community Justice Center, Texas, were indicted on 28 June 2000 on charges of sexual misconduct against a former prisoner.

A total of 14 former staff have now been indicted for similar offences against female prisoners.

The company lost its contract to run the facility in November 1999 (see PPRI # 32).

The State’s investigations are continuing and more charges could be brought.

Wackenhut’s haul

    According to Wackenhut Corrections Corporation (WCC), as at 3 July 2000, the company had contracts/awards to manage 56 correctional/detention facilities in North America, Europe, Australia and Africa with a total of 40,733 beds. 

It also provides mental health services, including 436 beds at two mental health facilities; correctional health care services; prisoner transportation; and electronic monitoring for home detainees. 

The company claims to be the industry leader in the international market, with awards or contracts for over 55 per cent of the privatised prison beds in countries outside of the US.

n Wackenhut Corrections Corporation is now known as WCC.

According to the company, it is “ just a different type of corporate identity,” and not related to the problems at a number of the company’s facilities which have  attracted media and government scrutiny.

YSI under scrutiny again

        Youth Services International’s (YSI) security policy and procedures at the Victor Cullen Academy for juveniles in Maryland is under scrutiny by the State after two youths escaped on 11 June 2000.

Staff did not know that the boys were missing until they were returned to the detention centre by police.

YSI is owned by Correctional Services Corporation (see PPRI # 30, 26, 24, 21, 14 and 3).

According to the Frederick News-Post, other  incidents at the Victor Cullen Academy (VCA) include:

n December 1997 -  two boys, not incarcerated at the time, aided in the escape of a VCA inmate by firing a handgun to cause a distraction;

n January 1999 - an 18 year old inmate escaped from an escort;

n March 1999 - a 19 year old escaped;

n June 1999  - three boys escaped during the night by cutting security screens in a dormitory. The escape went unnoticed for about four hours. Two employees were suspended. An investigation was ordered by the Department of Juvenile Justice.

n April 2000 - a former VCA inmate was charged with assaulting a staff member;

n June 2000 - two juveniles escaped by opening a third floor window and used a makeshift rope to climb down the outside of the building. Their escape went unnoticed by staff members for more than four hours.

 Meanwhile, a youth who raped a member of staff at YSI’s Charles H.Hickey Junior School in Baltimore, Maryland, in June 1999 has been found guilty and will be sentenced on 28 August 2000 (see PPRI # 30).

Nevada’s juvenile experiment

     Youth Services International (YSI), has opened the State of Nevada’s first prison for male juveniles aged between 13 and 18. SI is owned by Correctional Services Corporation (see above ).

    The 96 bed $14.7m Summit View Youth Correctional Center is supposed to ease overcrowding at other juvenile centres. But the state is also sending what it describes as “serious and chronic offenders” to a private facility because its own  Child and Family Services Division does not have the necessary expertise.

YSI has an initial three year operating contract. According to a brochure, Summit View plans to offer a “comprehensive array of educational and vocational services and programmes, including educational assessment and work skills programmes.”

Juvenile Justice Survey

Authorities that contract out services for juveniles had the most difficulties with for-profit providers, a recently published survey has found. The American Correctional Association (ACA) conducted a survey in 1999 and received 57 replies from 41 jurisdictions including Puerto Rico and the Federal Bureau of Prisons.

    Between 1991 and 1999 the use of for-profit contractors increased from 60 per cent to 80 per cent.

    The main reason given for contracting out was that the private sector could provide services and expertise lacking in the public sector. The advantages quoted ranged from contractors being responsive to needs to being more flexible.

Shortcomings of contracting out included:

n monitoring/control problems;

n a lack of knowledge of department of corrections procedures;

n high costs;

n high staff turnover;

n contracting process too cumbersome;

n resistance to assessment/evaluation;

n unrealistic view of the population;

n resistance to taking difficult juveniles;

n staff inexperience.

Private Sector Involvement in Juvenile Justice, by Robert B. Levinson and Raymond Chase, reported in Corrections Today, April 2000. ACA, 4380 Forbes Boulevard, Lanham, Maryland MD 20706-4322, USA.

www.corrections.com/aca/cortoday/april00/travis.html

More contracts on the way

        Puerto Rico is making a second attempt to  privatise two existing minimum security camps for adults after companies failed to bid for  contracts the first time around.

Prisoner transportation between 25 facilities is also being privatised, except for medical cases which is tun by the Department of Health, .

Prison maintenance and food services are also expected to be contracted out.

n The Puerto Rico Department of Corrections is hosting the First Corrections Summit of the Americas from 10-14 September 2000. The event is being partly sponsored by the private corrections industry.

CHILE

Ten new prisons

        The government of Chile needs ten new prisons to cope with overcrowding running at 40 per cent. The government is looking abroad, particularly to the US, UK, France and Spain for proposals on financing, construction and service delivery.

But it has notified potential interested companies that only state employees can perform custodial functions.

URUGUAY

US construction firms line up

       Four new prisons are to built in Uruguay between 2001 and 2005.

Companies lining up to bid for constsruction contracts include: Carndon International, Marx Solutions Inc, Rosser, Rilarey SA, Southern Steel, Spills Candela and Lemartec.

According to the government, only food services could be privatised.

SOUTH AFRICA

Banking on new prisons

       The financing arrangements for South Africa’s first privately financed, designed, built and run prison are so advantageous to the banks, advisers and companies involved that they hope it will become the model for other new infrastructure projects.

The 3,000 bed Mangaung maximum security prison in Bloemfontein will cost R513m. It is being financed using 10 per cent equity investment and 90 per cent debt (see PPRI #34, 30, 23, 20, 18, 16, 15 and 13).

Investec Bank has taken up more than half of the R456m debt, with Absa Corporate Bank taking up the rest. Investec also acted as joint financial adviser and arranger with FBC Fidelity and as joint underwriter with Absa.

The debt is for 15 years at a fixed interest rate and the deal has been structured so that Investec and Absa can, if they wish,  sell the debt on to other lenders.

The 10 per cent equity investment is held by Bloemfontein Correctional Contracts (BCC), a company formed by the Ikwhezi consortium to build and run the prison. BCC is 60 per cent owned by empowerment groups Ten Alliance Holdings, Fikele Projects and a community trust.

Funding for the empowerment shareholders has been structured to allow them to settle their debt early.

The other 40 per cent is owned by Group 4, which will run and maintain the facility, and Murray & Roberts, the designers and builders.

The debt used to finance the prison is secured by the cash flow that will be generated by the fees received from the government which will pay a daily rate per prisoner place regardless of whether the place is filled.

But a number of South African construction and engineering companies have criticsed the government for cutting back on its prison building programme.

Originally, the industry  hoped that seven new prisons would be built. The government first reduced the number to four and then cut it down to two.

Firms such as Concor, Basil Read and Murray & Roberts, which were involved with consortia  interested in bidding for more prison contracts, are among those which claim that their profits have been hit by engaging in tendering processes that did not come to fruition.