New Zealand slaps huge fine on Serco for mismanaging Mt Eden prison: takes control after reports of violence
New Zealand has slapped a hefty fine of half a million NZ dollars (AUD 455,901 million) on security company Serco, which has been manning the Auckland's Mt Eden prison, for allegedly mismanaging the prison including reports of violence. The penalty was slapped by NZ Corrections chief Ray Smith. The discovery of "fight club" videos and serious allegations of violence in the jail had disturbed the government.
Following adverse reports that the private agency has bungled the prison affairs, the Government took over its management in the third week of July, after retaining Serco’s staff on site, with Corrections prison director and his team overseeing the facility. Serco was awarded a NZ$300 million (AUD 273.5 million), 10-year contract to run Mt Eden. The contract is now under review, upon completing six-years. The penalties on Serco will cover its activities in the last financial year that ended in June and it may face more fines later, Smith said.
PM’s Reaction
Making his comments on the prison issue, Prime Minister John Key said incidents at Mt Eden prison are broadly in line with publicly run prisons across the country and Mt Eden issue will not spell the end of privately run prisons. “Those people who hate private sector provision of services and the like will say this is the moment that we told you so and it's all wrong," the PM told TVNZ. At the same time, Mr Key warned that Serco may lose its contract if its management of the facility was found wanting. There will be an independent review by Corrections chief inspector in August. That time, the option of terminating the contract with Serco may be considered. There is also a likelihood of allowing Serco staff at the prison while Corrections being in charge.
Minister’s Assurance
Labour Party’s Corrections spokesman Kelvin Davis said he received a "tsunami" of information regarding the goings on in Serco-run jail. "So there's three rape allegations, there's an extortion allegation and there's others that I just can't go into ... I just have to give them over to the police and leave them to deal with it and investigate.”
Police confirmed that it received the allegations from Davis and said they are looking into it. Assuring prompt action, Corrections Minister Sam Lotu-Iiga said: "We've taken steps, serious steps to fix the problems within Corrections. There will be further steps going forward, there's a lot of work to do within our prisons and I'm here to fix it, I've been given that task and that's what I'm going to do."
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