Corrections snatches Mt Eden Prison back from Serco

Corrections is taking over the management of Mt Eden Prison from private operator Serco.

The government will officially take control of the troubled facility on Monday.

Serco wardens will remain but a Corrections management team of what cabinet minister Nick Smith called "20 crack staff" will be moved in.

The announcement came shortly after Serco managing director Paul Mahoney met Corrections Minister Sam Lotu-liga to discuss a string of recent controveries over prison violence and organised boxing fights.

Appearing at a 3.30pm press conference in the Beehive with Mr Lotu-liga, Corrections chief executive Ray Smith said he took legal advice last night and had to "act in the interests of staff and prisoners" and activate a "step-in clause" in Serco's contract.

"There are also other options potentially available to me under the contract. These include a final warning and early termination of the contract," Mr Smith said.

"In the meantime financial charges may be imposed over the events that have surfaced in respect of the issues that have surfaced over the last week. These are likely to be substantial," he said.

The Corrections boss described the situation as "salvageable."

Labour hits back
Labour's corrections spokesman Kelvin Davis was quick to attack Mr Lotu-liga, saying the decision to step in and take over the management of Mt Eden prison is an admission that privatising the prison was a mistake.

"The government has gone all in on Serco and it's been a fiasco. After spending millions of taxpayers' dollars on getting a private company to run Mt Eden, the government is now having to spend even more cleaning up the mess," he says.

"Serco has totally failed to deliver the high quality prison it promised. Instead we've had chaos and violence."

He says this is a big black eye for the government, and a humiliating back down. "Just last month, the minister was crowing that Serco's performance was at the highest level. Now he is having to take the prison from it."

"The question now is, if the government's prison privatisation has been such a failure, why on earth would we let them privatise anything else?" Mr Davis says.

Corrections Minister Sam Lotu-liga says he is pleased Mr Smith has made the decision that Corrections will take over the running the prison.

He says the decision was not taken lightly but Serco has taken "too long to fix the problem."

He emphasised the importance of the safety and security of staff and prisoners.

"We don't want to make kneejerk reactions as some in Parliament would promote."

UK-based Serco lost $2.6 million on its New Zealand operation last year. It has been fined more than $300,000 so far for incidents at Mt Eden prison.

Serco also has a 25-year contract to run the $840 million prison recently opened at Wiri in south Auckland.

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