> download the April 2012 edition of the Public Sphere newsletter (PDF, 801KB)
Last week the Government announced a 25 year contract had been awarded to the private provider of a prison in Wiri.
Such a secure contract is unusual in government dealings, but gives solid certainty to the private provider of the prison and their investors. Given the substantial capital input the Wiri prison requires, it could be argued that such a length of contract is justifiable; presumably the contractor will have penalties for poor performance of the buildings and services.
However, it does seem a shame that the Government is prepared to offer financial security to an organisation locking people up, but it seems, not the same financial security to community organisations providing training and treatment facilities that keep people out of prison or contribute to a reduction in the re-offending rate of those leaving prison.
For many years not-for-profit community organisations in their 12 month contracts with government, have been expected to provide all the buildings and infrastructure in which to provide addiction treatment programmes, postprison
rehabilitation services and employment training.
Occasionally, the government has been prepared to offer a three year contract for the provision of these services. It is something of a miracle that organisations have been able to keep going in such a context of uncertainty— which private providers in this new age of public private partnerships (PPPs) are not so willing to bear. They are not willing, because short run contracts for services provide no sustainable level of income for the contractors or predictable profits for investors. The Salvation Army feels that the Government should also provide a more secure contractual environment for its community partners.
New Zealand’s imprisonment and recidivism rate is among the highest group in the OECD. Alcohol and drugs continue to be a major contributor to criminal offending. In addition, the absence of work skills and employability are a major aspect that drives re-offending.
Does it make sense then that community providers, offering help with addiction and employment, operate on a hand-to-mouth contractual arrangement with Government? And in some cases, on frozen contract prices that can last for years?
It makes good sense to provide some financial and contract security to providers who are investing in lowering New Zealand’s rate of offending and recidivism, by well-targeted addiction treatment and employment training services.
The argument has often been that no government could contract outside of the fiscal year, or its term of office. The current Minister of Finance has been able to somehow overcome this longstanding view when it comes to building an expensive new prison at Wiri, by providing a contract of 25 years in the private sector.
It is a good thing that the Government is prepared to take a long term view, and provide one of its private sector partners with guaranteed funding, while expecting a guaranteed level of service.
But why should this only apply to private organisations building and running prisons? If New Zealand is to make social-economic progress, we need a consortium of connectedness between the Government, communities, NGOs and private organisations.
If that consortium is to be real, then these community providers need to be treated with contractual respect and provisioned to enable them to keep investing in the public good of New Zealand.
Major Campbell Roberts (Director Social Policy & Parliamentary Unit)