A controversial new private prison opened in Auckland today.

Corrections Minister Judith Collins opened the Mt Eden Corrections Facility, the first since 2005 to be managed by a private sector contractor.

Opposition parties have consistently condemned the move and concerns have been raised about problems at overseas prisons run by the British company, Serco, which will operate the new jail. International reports linked Serco prisons with violence, overcrowding and poor health care.

The transition to Serco management will start tomorrow and be completed in August.

The new 554-bed Mt Eden prison building, gatehouse and support buildings will replace the existing Mt Eden Prison, which was opened in 1888. The facility would incorporate Auckland Central Remand Prison (ACRP) and be known as Mt Eden Corrections Facility. It will provide accommodation for up to 966, mainly remand, prisoners.

Ms Collins said the prison would be the country's most modern prison in terms of design and approach to management of prisoners and rehabilitation.

"It's crucial that prisons not only keep dangerous criminals securely locked away, but they have a strong focus on helping prisoners turn their lives around.

"It is our responsibility to ensure prisoners have the skills to find employment, or to help them beat the addictions that inevitably lead them back to a life of crime."

ACRP was under private management from 1999-2005 before the Labour Government prohibited private management of prisons.

In 2009 the Government passed the Corrections (Contract Management of Prisons) Amendment Act 2009, which allowed private sector organisations to tender for contracts to manage prisons on a case-by-case basis.

"The Department's contract with Serco is about encouraging new ideas and new approaches," Ms Collins said.

"Because when it comes to an issue as important as reducing crime and keeping New Zealanders safe, we don't want to be straitjacketed by ideology. We want to do what works."

Serco Asia Pacific managing director civil government Paul Mahoney said the company had committed to improving prisoner outcomes.

"Our team has been working closely with the Department of Corrections over the last few months to ensure a smooth transition to Serco in readiness for August 1, when we will also take full operational responsibility for the existing Auckland Central Remand Prison," Mr Mahoney said.

The multi-storey prison cost more than $200 million to build. The new prison, which overlooks the southern motorway approaches to Auckland, attracted controversy last year when critics said it would be built on a prime position and would give prisoners stunning views of the city and harbour.

The Department of Corrections said that would not be the case.

Former Auckland mayor John Banks also criticised it as an "architectural monstrosity".