Adam is a political reporter for the New Zealand Herald.

Wiri prison contract may be reviewed by future Labour govt

Photo / NZ Herald
Photo / NZ Herald

The consortium behind the $300 million prison to built at Wiri South Auckland has been warned a future Labour Government may review its contract in favour of the taxpayer.

Corrections Minister Anne Tolley yesterday released the 1547 page contract for the construction and operation of the 960 bed prison, which was signed last month and will remain in effect until 2040.

British company Serco, which leads the consortium, will operate the prison when it is completed in 2015. It recently told the London Stock Exchange it anticipated revenue of $29.4 million a year from the prison.

Labour justice spokesman Charles Chauvel yesterday criticised the contract, saying much of the revenue paid to Serco would be taken as profit and would go offshore.

Mr Chauvel said the contract's lengthy provisions dealing with disputes indicated the considerable potential for the deal to go wrong for taxpayers.

He said Serco had an "unsatisfactory" record as a private operator of public entities, in New Zealand and elsewhere. "As operator of the Mt Eden Remand Centre it has a track record of escapes, bungling and missed performance targets."

- NZ Herald

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