Prisoner aid group loses contract

The group has operated for 133 years. Photo / Brett Phibbs

A national body that helps ex-prisoners fit back into society has lost its Government contract in the wake of an internal split and a falling-out with Corrections Minister Judith Collins.

The Corrections Department's $2.5 million-a-year deal with the Federation of NZ Prisoners Aid and Rehabilitation Societies (NZ PARS) will end at the end of this month after 51 years.

The department said it would negotiate interim agreements to keep funding the federation's 17 separate societies for six months and would then put reintegrative services for prisoners out for tender.

The Salvation Army and other agencies such as the Waipareira Trust are expected to compete for the work.

The decision means the closure of the federation's Wellington office and redundancy for its three staff, including national director Lyanne Kerr, a former probation officer and Whangarei district councillor.

Ms Kerr fell out with Ms Collins last year after writing to Community and Voluntary Services Minister Tariana Turia, complaining about being "bullied" by Corrections officials.

Federation president Graeme Dunstall said officials told him that both they and Ms Collins were "displeased" and that they had lost confidence in Ms Kerr.

"They said to me, 'Are we bullies?"' he said. "I said, 'I understand why Lyanne would have said what she said'. I mentioned the gap between what they said to us and their letters. Their letters were very heavy letters."

Corrections Department rehabilitation and reintegration manager Alison Thom said the contract with the federation was terminated because the organisation had been "unable to demonstrate to us the financial stability that is required".

The federation spent $309,000 more than it received in the three years to last June. Mr Dunstall said Corrections asked for reports on the organisation's finances last year, first from Deloittes and then from former Mobil manager Richard Martin. Both came up with "horrendous" projected deficits by June this year.

"At the most extreme he [Mr Martin] had a deficit of $700,000," Mr Dunstall said.

But he said neither consultant understood non-profit organisations, which depended on uncertain grants from philanthropic agencies. He said grants had now come through, and regional societies had contributed to the national body, so the federation believed it would be "cashflow-positive" through to this June.

The Auckland PARS sought a High Court injunction in December to stop the federation absorbing the 17 regional societies' staff and "operational assets" into a single entity.

Mr Dunstall said NZ PARS felt obliged to take over the regional societies after former Corrections reintegration manager Phil McCarthy told it that the federation could not continue in its existing form and had to have the power to pass on directions from Corrections to the regions.

Thirteen of the 17 societies voted for the takeover. But Auckland, Waikato, Rotorua and West Coast, representing 45 per cent of the national workload, voted against. Auckland alone had net assets of almost $1.4 million.

NZ PARS abandoned the attempt to absorb the regional societies and agreed to pay part of Auckland's legal costs in a settlement last month.

Ms Collins said she did not ask Corrections officials to stop working with Ms Kerr and Ms Kerr's letter to Mrs Turia was not a factor in cancelling the federation's contract.

YEARS OF SUPPORT

* Began in Dunedin in 1877.
* Part-funded by Corrections Department via national contract since 1959.
* 17 regional societies and national body also get philanthropic funding.
* Provides practical support to prisoners and their families during and after jail, including helping to find housing and jobs and reintegration with families.