Safety and Cost Effectiveness of Private Prisons Private of Effectiveness Cost and Safety

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Safety and Cost Effectiveness of Private Prisons Private of Effectiveness Cost and Safety Safety and Cost Effectiveness of Private Prisons Victorian Auditor -General’s Office — Level 31 / 35 Collins Street Melbourne Vic 3000 T 03 8601 7000 [email protected] www.audit.vic.gov.au — Safety and Cost Effectiveness of March 2018 Private Prisons March 2018 2017–18: 15 Independent assurance report to Parliament 2017–18: 15 13353 VAGO_Safety and Cost Effectiveness of Private Prisons_Cover.pdf | Page 1 of 1 13353 VAGO_Safety and Cost Effectiveness of Private Prisons_Cover.pdf | Page 1 of 1 Safety and Cost Effectiveness of Private Prisons Independent assurance report to Parliament Ordered to be published VICTORIAN GOVERNMENT PRINTER March 2018 PP no 384, Session 2014–18 This report is printed on Monza Recycled paper. Monza Recycled is certified Carbon Neutral by The Carbon Reduction Institute (CRI) in accordance with the global Greenhouse Gas Protocol and ISO 14040 framework. The Lifecycle Analysis for Monza Recycled is cradle to grave including Scopes 1, 2 and 3. It has FSC Mix Certification combined with 55% recycled content. ISBN 978 1 925678 14 7 The Hon Bruce Atkinson MLC The Hon Colin Brooks MP President Speaker Legislative Council Legislative Assembly Parliament House Parliament House Melbourne Melbourne Dear Presiding Officers Under the provisions of section 16AB of the Audit Act 1994, I transmit my report Safety and Cost Effectiveness of Private Prisons. Yours faithfully Andrew Greaves Auditor-General 29 March 2018 Contents Audit overview ............................................................................................................. 7 Conclusion ......................................................................................................................................... 8 Findings .............................................................................................................................................. 8 Recommendations ........................................................................................................................... 12 Responses to recommendations ..................................................................................................... 13 1 Audit context ......................................................................................................... 15 Relevant legislation and regulation ........................................................................................ 25 Roles of agencies and associated entities .............................................................................. 26 Previous audits ....................................................................................................................... 29 Why this audit is important .................................................................................................... 29 What this audit examined and how ....................................................................................... 30 Report structure ..................................................................................................................... 30 2 Private prison contract management and performance ...................................... 31 Conclusion .............................................................................................................................. 31 CV’s scrutiny of operator performance .................................................................................. 32 Prison performance data ........................................................................................................ 36 Prison performance reporting ................................................................................................ 38 Performance results ............................................................................................................... 40 3 Safety and security of private prisons ................................................................... 45 Conclusion .............................................................................................................................. 45 Serious incidents ..................................................................................................................... 46 Security performance ............................................................................................................. 51 Safety performance ................................................................................................................ 53 Violence-reduction strategies................................................................................................. 7 7 The role of intelligence in safety and security ........................................................................ 80 4 Prison costs ............................................................................................................ 83 Conclusion .............................................................................................................................. 83 Total system costs .................................................................................................................. 83 Prison cost comparisons ......................................................................................................... 85 Why do private prisons cost the state less to operate? ......................................................... 87 Comparing prison cost elements ............................................................................................ 88 Actual costs under the new contracts .................................................................................... 88 State-funded capital works ..................................................................................................... 89 5 Negotiating new private prison contracts ............................................................. 91 Conclusion .............................................................................................................................. 92 Options analysis ...................................................................................................................... 92 Management of negotiations ................................................................................................. 95 Demonstrating value for money ........................................................................................... 102 Negotiation outcomes and new contracts ........................................................................... 105 Victorian Auditor-General’s Report Safety and Cost Effectiveness of Private Prisons 5 Appendix A. Audit Act 1994 section 16—submissions and comments ................... 109 Appendix B. Service delivery outcomes and key performance indicators .............. 119 Appendix C. SDO 23 Case Management .................................................................. 127 Appendix D. Improvements in new private prison contracts .................................. 129 Acronyms and abbreviations ACI Australasian Correctional Investment Ltd CMB Contract management branch CCTV Closed‐circuit television CV Corrections Victoria CVIU Corrections Victoria Intelligence Unit DJR Department of Justice and Regulation (and its predecessor, Department of Justice) DPC Department of Premier and Cabinet DTF Department of Treasury and Finance GEO The GEO Group Australia Pty Ltd G4S G4S Custodial Services Pty Ltd IMR Internal management review JARO Justice Assurance Review Office (formerly the Office of Correctional Services Review) KPI Key performance indicator MAP Melbourne Assessment Prison MRC Metropolitan Remand Centre OHS Occupational health and safety OCSR Office of Correctional Services Review OPCAT Optional Protocol to the Convention against Torture and other Cruel, Inhuman or Degrading Treatment or Punishment OV Occupational violence PIMS Prisoner Information Management System PIU Prison intelligence unit PPP Public–private partnership PSC Public Sector Comparator PPRF Private Prison Reporting Framework SDO Service delivery outcome SSU Security Standards Unit VAGO Victorian Auditor‐General’s Office 6 Safety and Cost Effectiveness of Private Prisons Victorian Auditor‐General’s Report Audit overview Victoria’s prison system faces significant challenges and risks: Male prisoner numbers increased by approximately 50 per cent over the last seven years, including significant growth in remand (unsentenced) prisoners. The prisoner population is increasingly complex, with mental health conditions, drug and alcohol issues, and chronic illnesses. Across the system, 43.6 per cent of prisoners returned to prison within two years in 2016–17. Young prisoners, prisoners with disabilities and prisoners of Aboriginal and Torres Strait Islander background are over-represented. Private prisons are part of the broader prison system in Victoria and, as such, are not immune to the challenges posed by a growing and increasingly complex prisoner population. Victoria’s privately operated prisons accommodated around one third of the state’s male prisoners in December 2017. The safe, secure and cost-efficient operation of these private prisons is essential, both for the effective functioning of Victoria’s corrections system and for community safety. Corrections Victoria (CV), a division of the Department of Justice and Regulation (DJR), is responsible for managing the contracts with the private prison operators to ensure the safe custody and welfare of prisoners. In this audit, we examined two of the three privately operated prisons
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