Labour says involving Maori in rehabilitation programmes at the new private prison is a cynical way to buy off opposition.
Corrections Minister Judith Collins says she expects Maori to be part of any bid to build and manage a new men's prison in south Auckland.
But Labour MP Kelvin Davis says he's disgusted some iwi and urban Maori leaders are going along with the plan.
He told Waatea News that private prisons profit from locking up Maori, not rehabilitating them, and Maori should not do it.
He also said there was no evidence rehabilitation improved the last time there was a privately-run prison in New Zealand.
The Auckland central remand prison operated under private management between 1999 - 2004.