Despite a tough new law, prison inmates sued the Corrections Department for $1 million in new claims last year, figures released under the Official Information Act show.

Last June, the Government introduced the Prisoners and Victims Claims Act after public uproar over payouts to inmates for breaches of their human rights.

Nearly $400,000 of taxpayers' money was spent in the five months to November 30 defending claims from inmates and staff, The Press newspaper reported today.

Critics say it is an insult to crime victims that inmates persist in taking legal action.

Under the act, compensation is restricted to "exceptional cases" and victims will have first call on any compensation that is paid.

Public Prisons Service (PPS) general manager Phil McCarthy told The Press it had spent $394,077 on "external agencies" defending legal claims.

"The total amount (of claims) includes a number of inactive claims that the department is still required to record a contingent liability for," he said.

"There is, of course, no necessary relationship between such claims and the size of any settlements that may be reached."

Mr McCarthy said in the five months to November, PPS had paid out $35,855 to settle claims from inmates and staff.

The Prisoners and Victims Claims Act was pushed through Parliament after five inmates were awarded $130,000 in 2004 for harsh treatment in an illegal behaviour-management regime (BMR) in Auckland Prison.

Corrections Association president Beven Hanlon said society had to decide what it expected in terms of prisoner rights.

New Zealand's treatment of inmates was excellent compared to other countries.

Sensible Trust spokesman Garth McVicar said while inmates should be treated humanely they should not be allowed to sue for money.

In the first case to test the act last August, a former Christchurch prison inmate, Julian Heath Edgecombe, had his $40,000 claim for an assault by a guard dismissed by the High Court.

Wellington lawyer Tony Ellis, who took the BMR case, has lodged claims for 42 more former BMR inmates and plans a class action for about 160 more.

Justice Minister Mark Burton said the Government's first and preferred option, of denying inmates the right to sue, was contrary to its "international obligations".

The reason that Parliament passed the Prisoners' and Victims' Claims Act was precisely to recognise that victims have the right to make a claim against any such compensation and to simplify the procedure for doing so, Mr Burton said.