Corrections Minister Judith Collins has slammed the "extravagance" of the previous Government's prison building programme and is looking at using pre-fabricated modular units to slash construction costs by more than half.
She said new jails - which will be required to accommodate the boost in inmate numbers flowing from National's tougher stance on sentencing and parole - would be "functional, humane and safe" but not "luxurious".
As an example of Labour's extravagant spending, she cited the $380 million Spring Hill Corrections Facility in the Waikato which worked out at around $660,000 per cell to build once all costs were taken into account.
"You can buy two houses for that. You've got to do better than that.
"There has been a lack of accountability because there has been too much money. We don't have the luxury of taxes rolling in."
Ms Collins said she had asked her officials to present her with ideas on prison construction which had been rejected by the previous Government. They had presented her with a modular design used in Australia which, including infrastructure and other construction costs, worked out at around $300,000 a cell.
Apart from savings in design costs and a review of the size of the profit margins firms were enjoying through winning building contracts with the Corrections Department, she was also looking to build new jails on land Corrections already owned and which was zoned accordingly, rather than developing "green-field sites in the middle of nowhere".
The cost-cutting would not extend to furnishing or fittings, although she had yet to be convinced about the expense involved in requiring jails be kept heated to certain temperatures.
Further cost savings would come from National advancing its policy of private management of prisons, with preparation of the necessary amending legislation now under way.
The tight constraints on Government spending are highlighted in a briefing paper released yesterday by Finance Minister Bill English which reveals the Treasury querying the effectiveness of National's justice policies.
It warned the justice sector had the potential to consume "large proportions" of the operating and capital funding available to the Government.
Labour leader Phil Goff - who was Corrections minister in the 12 months leading up to last year's election - was critical of National's cost-cutting plan.
"If you are short-sighted enough to build something cheap and nasty you will be rebuilding before very long." When you are building a public institution, you build it to make it last," he said.
Citing the leaky-building syndrome as an example of the effect of cutting corners, Mr Goff said the minister had to choose between building prisons on the cheap or doing the job properly.