The closure of three prisons and loss of 262 jobs – five issues for the National govt





The closure of three prisons and loss of 262 jobs

The closure of units in Waikeria, Tongariro-Rangipo, and Rimutaka Prisons, and the subsequent estimated loss of 262 jobs has been openly conceded as a re-distribution of inmates to the new, privately run prison at Wiri.  Corrections chief executive, Ray Smith, stated on 9 April;

I am also proposing to close units at three prisons – Rimutaka, Waikeria and Tongariro/Rangipo…

… With the opening of Auckland South Corrections Facility (at Wiri), and the subsequent reduction in pressure on prison capacity, we can now look at closing these end of life facilities.

The Wiri facility will be managed by multi-national corporation, Serco, as a profit-making venture, paid by the tax-payer.

Smith has blamed the closures and redundancies on the Waikeria, Tongariro-Rangipo, and Rimutaka Prisons being  “50 years old, surrounded by facilities that are 100 years old“. He claims “it would be uneconomic to bring them up to scratch“.

The closure of units at Waikeria, Tongariro-Rangipo, and Rimutaka is estimated to save the National government $165 million. This will be a godsend to Finance Minister Bill English, who admitted on 10 April that National’s much heralded promise of a budget surplus was looking more and more unlikely;

We’re (the Government) is continuing to manage the books carefully but lower inflation, while good for consumers, is making it less likely that the final accounts in October will show a surplus for the whole year.

With the  planned sale of state houses to the  Salvation Army, and other social services, having collapsed, English’s expectation of reaping big cash dividends from the housing sell-of has evaporated.

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As I wrote in October 2014;

Meanwhile, Bill English was outlining National’s true agenda, whilst Key was putting on his benign face to the New Zealand public.  As TV3’s Brook Sabin reported,

A big state-house sell-off is on the way, and up to $5 billion-worth of homes could be put on the block.

The shake-up of the Government’s housing stock will be a key focus for the next three years, with Finance Minister Bill English to lead it.

On the block is everything from a tiny 75 square metre two-bedroom state house in Auckland’s Remuera, on the market for $740,000, to a three-bedroom home in Taumarunui for just $38,000. Thousands more properties will soon hit the market.

The reason for putting up to  $5 billion-worth of homes  on the block?

Crashing dairy prices had left a gaping hole in the National Government’s books, and their much-vaunted Budget surplus next year was under threat. Remember that  Key was candid in the implications for the economy and the  government’s tax-take; when he stated – also on 6 October;

It can have some impact because if that’s the final payout, the impact would be as large as NZ$5 billion for the economy overall, and you would expect that to flow through to the tax revenue, both for the 14/15 year and the 15/16 year. My understanding is Treasury is working on those numbers for the incoming Minister of Finance, which fortunately is the same as the outgoing Minister of Finance as well.”

Faced with the imminent sinking of one of National’s cornerstone election promises – a return to surplus by 2014/15 – $165 million saved by the closure of prison units will be  a relief to an increasingly frustrated Bill English.

Key and English couldn’t flog of $5 billion of state housing to social services. So now they are looking at what is effectively privatisation-by-stealth with our prison services.

And bugger the inevitable consequences…


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Five issues for the National govt

The closure of units at Waikeria, Tongariro-Rangipo, and Rimutaka Prisons will not be without dire consequences that impact on nearly every aspect of New Zealand society, regions, and the economy.  Even the political landscape may be altered if this ill-considered plan goes ahead.

1. Sending “clients” to a private facility

There is something decidely immoral about up-rooting hundreds of prisoners whose freedom of movement and freedom of choice has been curtailed by State sanctions, and handed over into the hands of a private corporation – Serco – where the prime motivator is making a profit for shareholders. (Overseas shareholders, to be precise.)

In no way can this dystopian scenario be considered part of the “free market”, as all forms of choice have been removed from the prison “clients”.

Serco have been handed “clients” into their “care” whether wanted or not by the prisoners. Not since the slave trade from the 16th to 19th centuries have human being been treated as commodities by Western nations.

Make no mistake; private prisons turn human beings into “things”, to be used by business as investment commodities.

How long before prisoners are sold, bought, and traded by competing corporatised prisons? How long before their labour is sold to other businesses, for profit?

2. Regional economies and job losses

The loss of 262 jobs in Upper Hutt (Rimutaka),  Waikeria, and Tongariro-Rangipo will impact considerably on those regional economies already badly hit by loss of industries, closed businesses, population moving away, and continuing down-turn in the dairy industry.

It is this sort of regional neglect that resulted in Northland voters abandoning the National Party and electing NZ First leader, Winston Peters, as their electorate MP.

Waipa District mayor, Jim Mylchreest, was frustrated and angry at National’s further under-mining of what remained of regional economies;

Here they are with a major change and not even bothering to let us know plans are afoot.

I assume that they’ve done their sums and it’s more efficient for them but they’re not looking at New Zealand in terms of what are the benefits to try and keep employment in the regions.”

Mayor Mylchreest has every right to be angry – closure of a high-security wing at Waikeria Prison will  result in the loss of 148 jobs – creating considerable impact on nearby Te Awamutu (pop: 10,305), only sixteen kilometers away.

Is this how the National Party “supports” the regions?!

It seems that National has not learned a single thing from the Northland by-election.

Rimutaka may well be a safe Labour seat. But it also delivered 15,352 Party Votes for National – now at risk as Upper Hutt will be hard hit by job losses at Rimutaka Prison.

National may have mis-calculated the political fall-out from this move.

3. NZ First/Country Party

A loss of 262 jobs. Millions lost from regional economies. Small towns losing more people. Businesses closing, through lack of turn-over. Which, in a vicious circle leads to more job losses…

A recipe to increase NZ First’s re-positioning on the politicalk spectrum as a de facto “Country-Regional Party”?

It certainly sounds like it.

National may have handed Peters an early Christmas gift to campaign on. Disaffected voters seeing hundreds of jobs lost in their communities – with  subsequent closures of down-stream businesses in their town Main Streets – may wonder why on Earth they should keep voting for National? What’s in it for them?

Not much it would seem.

“Vote National – Lose Your Job” would appear to be the new slogan for National for the 2017 elections.

I have no doubt that even as I write this, and you the reader are reading my words, that Winston Peters and his NZ First strategists are already working on how to maximise these events for their own political gain.

I have no doubt whatsoever; the “Northland Experience” will be repeated throughout the country – much to Winston Peters’ delight.

4. Prisoner’s families

National’s Corrections Minister Peseta Sam Lotu-Iiga has stated;

I understand that this proposal may be unsettling for affected staff but Corrections will have extensive support and assistance in place should the proposal go ahead. I also believe that the proposal reflects our commitment to providing safe and secure working conditions for staff and a safe and productive environment for prisoners.

Prisoners have a much better chance of successful rehabilitation in modern facilities where they have access to education, training and employment opportunities.

Being close to their families is an important factor in rehabilitation for some prisoners.”

However, transferring several hundred prisoners from as far afield as Rimutaka, to Auckland – a distance of some 650kms – is hardly “being close to their families”  and one can only imagine how increasing isolation from family and community will give  “prisoners […] a much better chance of successful rehabilitation”.

The distances involved are considerable, as this Corrections Department map illustrates;


[6] Waikeria Prison [8] Tongariro/Rangipo Prison [13] Rimutaka Prison
[6] Waikeria Prison
[8] Tongariro/Rangipo Prison
[13] Rimutaka Prison

Minister Lotu-Iiga needs to explain why he thinks that isolating prisoners in this manner, can possibly assist in their rehabilitation and reintergration back into their communities?

It seems that transferring prisoners out of their communities flies in the face of the Minister’s assertions.

It may also prove more expensive, as prisoner’s families make increased calls upon the Child Travel Fund;

The Child Travel Fund provides financial support to eligible children traveling to visit a parent in prison. The fund also supports parents traveling to visit a child who is under 18 years of age and in prison.

Does National even care?

They should. Increasing prisoner’s alienation from family and communities undermines every effort made by the judicial/corrections system to rehabilitate prisoners.

It should definitely be cause for concern for  the corporate managers of Wiri, for whom rehabilitation and reduced re-offending is part of their contract, according to Corrections chief executive, Ray Smith;

They can earn up to $1.5 million in incentive payments if they can reduce the rate of reoffending by up to 10 percent more than the department can do.”

According to Derek Cheng at the Herald, writing three years ago;

For Wiri, Serco will face stiff financial penalties if it does not meet rehabilitation targets – which will be set at 10 per cent lower than public prisons.

The Corrections Department has a target to reduce re-offending by 10 per cent. If that is achieved, Wiri would have to achieve a rate 20 below the current rates or face fines, which have yet to be set.

Though Finance Minister Bill English – quoted in Scoop at around the same time – was more cautious;

It will also face financial penalties if it fails to meet short-term rehabilitation and reintegration measures including prisoner health and employment targets, and safe, secure and humane custodial standards.”

However, speaking to Paul Henry on Radio Live, Corrections chief executive, Ray Smith, was more circumspect when asked directly what penalties were involved in prisoners re-offended after release;

(@ 7:35)

Henry: “If rehabitation rates, if recidivism rates deteriorate, is there a penalty?”

Smith: “Well they just can’t earn the incentive payment if they can’t [meet the targets(muffled)].”

Henry: “So there isn’t actually a penalty?”

Smith: “[Stuttered words]...the penalties are associated with failure on security. The incentives are geared towards having to actually achieve better outcomes than the Department.”

So unlike penalties associated with prisoner escapes, where Serco actually has to pay the government, the only “penalty” associated with not meeting rehabilitation targets is foregoing $1.5 million in incentive payments?

Under Serco’s contract to manage Mt Eden Remand Prison, it is fined $150,000 each and every time a prisoner escapes, as happened in 2011 and 2012.

Under the contract to manage Wiri, it appears that the “penalty” is foregoing incentive payments.

The two “penalties” are not exactly the same and Minister English was being less than clear when he referred to Serco facing “financial penalties“.

Repeating the question – does National care? Not in the least, one may rightly guess. After all, chances are that National will no longer be in government when the ‘chickens come home to roost’ on this little social time bomb, and John Key will be writing his memoirs somewhere on an idyllic Hawaiian beach.

5. Relocating staff?

There seems to be confusion as to what will happen to the 262 staff who will lose their jobs from  Waikeria, Tongariro-Rangipo, and Rimutaka Prisons.

In his interview with Paul Henry on Radio Live on 10 April, Corrections CEO Ray Smith offered to do his best to find replacement jobs at other facilities for 262 redundant staff.

Suggestions that staff would be relocated to Auckland, with a “$20,000 relocation assistance-payment” appears to be farcical for two reason;

1. $20,000 payment to a Corrections staffmember living in a small town, where properties are worth considerably less than the over-heated Auckland housing market, is unhelpful. There is a worsening housing shortage in Auckland, and it seems to be verging on incompetence for this government to be adding to the housing problem by encouraging more workers and their families to move to the the city, thereby adding to congestion.

2. According to various media reports, the new Wiri facility is already fully staffed;

And unfortunately for staff who will be laid off, the opening of a large new prison in South Auckland next month is no consolation as all jobs are already filled. – TV1 News

A new prison in south Auckland will pick up the relocated inmates, but it is already fully staffed.TV3 News

So where are the jobs? Certainly not at Wiri.

Which makes this statement from Corrections Minister Lotu-Iiga unconvincing;

It should also be noted that the number of prisoner places is not reducing and will in fact increase with the opening of [Wiri]. We will have a net increase of 433 beds.”

The closure of three facilities; 262 redundancies; and contracting out to a private provider all reeks of National’s mania for cost-cutting.

As with many other cost-cutting exercises, it is New Zealanders; their families; and economically-fragile regions and small towns, that are having to pay the price. Treating prisoners as commercial commodities adds a particularly nasty aspect to this exercise.

Meanwhile, foreign-owned Serco stands to gain $30 million of tax-payer’s money, per year, from managing the new Wiri prison.

Someone is benefitting, and it is not us.


Justice not for sale logo


Prison facts and statistics – December 2014


Number of prisoners in each prison - nz prisons



Justice not for sale logo


Fairfax media: Up to 262 prison jobs may be cut in major Corrections restructure

TV3 News: Union – Prison staff can’t afford to move to Auckland

TV1 News: Budget surplus looking increasingly unlikely this year, Bill English admits

TV3 News: State housing sell-off worth $5B

Hive News: Treasury re-crunching Budget numbers for low Fonterra payout

National Party: Remaining on track to Budget surplus in 2014/15

Wikipedia: Serco

TV1 News: Town’s fury at being left in dark over prison closure

Wikipedia: Te Awamutu

Election Results 2014: Official Count Results — Rimutaka

Department of Corrections:  Sustainable Development Framework

Department of Corrections:  Travel assistance for visits

TV3 News: Union – Prison staff can’t afford to move to Auckland

NZ Herald: New private prison at Wiri given green light

Auckland Scoop media: Amazing promises for new Wiri prison: less offending, better safety, superior service

RadioLive: Around 260 staff face redundancy at Waikeria, Rangipo and Rimutaka prisons (audio)

Auckland Scoop media: Private operator of Mt Eden fined $150,000 for prison escape; security improvements made

Radio NZ: Serco fined after another prisoner escape

TV3 News: Govt criticised over prison job cuts

Radio NZ: Serco expects $30m revenue from Wiri prison

Department of Corrections:  Prison facts and statistics – December 2014

Previous related blogposts

The lunatics are running the Asylum

Housing; broken promises, families in cars, and ideological idiocy (Part Rua)




140105 Housing in prisons





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  1. Do you really think there will not be further jobs created as a result of this change? If you don’t the question I have for you is if they can house the same number of prisoners with much less staff why are you happy with the current arrangements?

  2. You seem to be in denial that private sector involvement in the supply of public services is a long established and highly successful model in NZ. Healthcare, eldercare, postal services, roading, education, printing services, the list is very, very long. Why are Prisons any different? I know you don’t like this, Frank, but the private sector is embedded as a public service provider, and long may it continue.

    • I see that the Far Right’s two cheerleaders are here. You must’ve hit a nerve, Frankie boy.

      As usual, they don’t address the actual points you’ve raised and just indulge in their parroted RW rhetoric. Clever? Not.

          • Yes I have. It is full of your usual misrepresentation and misunderstandings of economics. Taking a similar logic, given NZ Post is owned by the State, government should not use emails as it is costing posties their jobs. It is as if you want the a world to stop changing because of the disruption it causes.

            • Your blanket statement doesn’t begin to address the points I raised or the information I presented.

              What “usual misrepresentation and misunderstandings of economics ” are you referring to?

              Give specifics.

              Your one point, “given NZ Post is owned by the State, government should not use emails as it is costing posties their jobs” – equates email with privatisation of the prison service?

              So you equate email with introducing corporatisation and the profit motive into the corrections service?

              Do you know, Gosman, that you could justify practically anything by simply parroting that gross, generalised neo-liberal cliche?

              Try addressing the actual points I raised without framing it within your dogma.

              Try addressing the five points I raised above.

              Try reflecting on the cost of shifting hundreds of prisoners from lower/mid North Island, to Auckland and how that will impact on their rehabilitation.

              Try addressing the point that Bill English has mis-represented the issue of “financial penalties” to the public?

              See – you’ve addressed none of the matters I’ve raised. Equating email with privatising the prisons doesn’t begin to address what I’ve written.

              It’s as if you can’t deal with the specifics, and all you can do is throw generalisations/cliches around, as if that’s an adult response.

              Try again.

              • Have you heard the statement “I don’t care whether the cat is black or white so long as it catches the mice” ? You could learn a lot from that sentiment. If private sector can provide services more effectively than the public in an area why should you object?

              • Frank can you actually explain, in specifics, your objection to private provision of services to the state. What is it, other than a deep philosophical intransigence?

                  • Frank/Rumplestiltskin…I did. You haven’t made a single, meaningful objection stick. You’re on an ideological hobby horse, and we’re still waiting to hear you declare you will never drive on a road built by private enterprise, agree to an operation contracted to a private surgeon, attend a doctor in private practice, travel on ‘public’ transport contracted to a private company, ex etc

                    • National/ACT Supporter Nehemia/Intrinsicvalue –

                      you haven’t made a single, meaningful objection stick.

                      Which ones? Present the flaws and your counter-factuals. To date you’ve been singularly unable to do this.

                      and we’re still waiting to hear you declare you will never drive on a road built by private enterprise

                      Except for private driveways, farm roads, access roads on private land, every public road in this country was built using taxpayers’ money. Before Rogernomics, those roads were built and maintained by the Ministry of Works or local councils.

                      With privatisation, the work has been contracted out to private companies. You’re attempting to justify new privatisation by pointing to previous privatisation. Hardly a rational argument.

                      agree to an operation contracted to a private surgeon

                      … if you can afford it. People have that choice.

                      Prisoners do not.

                      attend a doctor in private practice,

                      Not sure what that has to do with privatised prisons, which, to date, has been a State activity. Private medical practices are not state activities.

                      travel on ‘public’ transport contracted to a private company

                      So you’re using privatisation of one industry to justify more privatisation? That hardly stacks up does it, Nehemia/Intrinsicvalue. That’s like saying that because National has subsidised Charter Schools, Rio Tinto, and the Film Industry, that government should be subsidising all industries in New Zealand?

                      Is that your logic?

                      If not, it’s hard to know what your point is because your ideology is inconsistence and lacks coherency.

                      On top of which, you still haven’t addressed a single point I’ve raised above.

    • Nehemia/Intrinsicvalue – you’ve made the same flawed argument for state subsidies for Charter Schools, under your “Intrinsicvalue” persona, when commenting on Dianne Khan’s blogposts. Eg;

      The fact that state services have been privatised and subsequently contracted out to private companies under successive neo-liberal governments is not a rationale to do more of the same.

      Your “logic” is circular, and therefore flawed. As I’ve pointed out to you numerous times before, NW/IV.

      • Actually a number of different posters here have made the same point. Why don’t you address it? You see the key is not just the extent to which this happens, it is the success of the times it does. The education sector is one of the systems greatest successes, with private involvement in ECE, primary and post primary education a huge success. Care to explain why most private education providers have full rolls when public ones don’t Frank?

        • Actually, Nehemia/Intrinsicvalue, the only “number of different posters here” are you and Gosman – both cheerleaders for National/ACT.

          Neither of you have addressed a single point I have raised in my story above.

          Indeed, you’re now deflecting on to private schools – whilst the topic of this blogpost was the privatisation of state prisons.

          That’s the biggest “red herring” I’ve seen in a while.

          It’s clear that you (Nehemia/Intrinsicvalue) are engaging in a bit of mischievous trolling whilst Gosman is up to his old tricks of simply ignoring what has been put before him, and wandering off-tangeant into his own little world.

          Neither of you are willing to address the points I’ve made and the issues I’ve raised (and which I repeated for Gosman’s benefit).

          It seems clear that neither of you have anything remotely sensible or to-the-point on this issue. Typical of right-wingers who are faced with the dilemma of criticisms they can’t answer?

    • So let’s see if I understand you, NW. Just because mass privatisation has taken place is your rationalisation for MORE privatisation to take place??? That’s kinda like saying that because we have thousands of burglaries every year, we should have more burglaries?? Sorry mate, that’s not a justification, that’s your vision of insanity, as applied by neo-cons.

  3. I see Peter Dunn is doing his bit for CIRCO (TM) – and keeping marijuana illegal. And of course he will carry on supporting the Beer Barons. How did such a amoral creature get elected?

    They need clients in these prisons, and we seem to following the model of locking up the poor and dissatisfied.

    So much for the much vaunted discussion when the GFC hit, to look at prison reform.

  4. These private prisons should be filled with white collar criminals who funnily enough always support National…….

    And I agree with Adam that if we had proper regulation of the drug Alcohol combined with sensible regulation of safer drugs like Cannabis then we would be slashing our prisoner numbers……

    • 31% of all crime in New Zealand can be attributable to alcohol (2007-08).[12]

    • At least one third of recorded violence offences committed in 2007-2008 occurred where the offender had consumed alcohol prior to committing the offence.[13]

    • Alcohol-related crime is estimated to cost New Zealand NZ$716.5m a year with NZ$200.1m alone spend on policing.[14]

    • On average, 33% of all recorded offences are committed on Friday and Saturday nights and Sunday mornings. However, when the number of offences where it is not known if an offender was affected by alcohol is accounted for, the overall most probable percentage is expected to be 46% of all offences.[15]

    • Approximately half (49.5%) of all homicides recorded between 1999-2008 involved either a suspect or victim being under the influence of alcohol at the time of the incident. 207 (42.3%) involved at least one suspect and 175 (36%) involved at least one victim under the influence of alcohol at the time of incident.[16]

    The Nats are maintaining an environment which produces high rates of Alcohol offending …………. That’s a fact.

    • and the new bar alcohol laws are driving bars away from providing a dancefloor environment.

      There fore this is driving more and more people to setting up there own bar in garages, houses and the likes, with the consequent problems of alcohol mayhem on the streets, when people have parties at home and get out of hand, because of the polifferation of bottle stores providing cheap alcohol.

      All because of the poorly thought out updated laws.

  5. Cool article Frank. Sad state of affairs when privatisation of prisons means making money from having people in prison. Cheers for the article.

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