15 Sep 2015

Serco let off $270k in fines - Minister

8:00 pm on 15 September 2015

It has been revealed in Parliament that private prison operator Serco has been let off hundreds of thousands of dollars in fines for serious contract breaches.

Mt Eden Prison is currently under the management of the Department of Corrections, while an official investigation is carried out into allegations of mismanagement by Serco.

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Corrections Minister Sam Lotu-liga. Photo: RNZ / Alexander Robertson

Under questioning from Green Party corrections spokesperson David Clendon this afternoon, Corrections Minister Sam Lotu-liga spelt out the sum of Serco's cancelled fines.

"Mr Speaker, since Serco took over management of Mt Eden Prison in 2011, I'm advised that Corrections has issued a total of 55 performance notices to Serco - seven have been withdrawn," Mr Lotu-liga said.

"And the total amount of the withdrawals is $275,000."

But it seems there are more fines that Serco has had cancelled and Mr Clendon asked the minister about one of them.

"Does the minister approve of Corrections' decision to excuse the $100,000 fine that was imposed when Serco failed to take back razors that had been issued to prisoners, to inmates, if so why?" Mr Clendon asked.

Mr Lotu-liga responded that that was not one of the seven withdrawn fines he was referring too.

Mr Clendon then asked if, after the razor blades incident, and other problems at Mt Eden Prison, the Minister had lost faith in Serco.

"My confidence in Serco, as I've already said in this House, is dependent on the review which is currently taking place by the Chief Inspectorate into the incidents at Mt Eden Prison," Mr Lotu-liga replied.

Later, Mr Clendon told reporters that it was inexcusable that Serco kept getting let off the hook and that the Minister was not aware of the razor incident.

"It's extraordinary that he does not know that, we would like to know on what basis was that very serious breach of contract excused and no financial penalty imposed.

"Especially in the context of a prison, there will be people in that prison who have been convicted of non-payment of fines," Mr Clendon said.

In July, the Corrections Minister said Serco had been fined $300,000 for failures in its management of Mount Eden Prison in the 2014/2015 financial year.


Photo: RNZ