It's official: Private prisons cost taxpayer more than state prisons

Money saving expert? Best to avoid privatisation
Money saving expert? Best to avoid privatisation
Ian Dunt By

As surely as night follows day, calls for departmental cost-cutting are met by promises to privatise more services. It seems intuitive - farm it all out to the private sector and cut your costs. And that's not even to mention the media-saturated propaganda about how much more efficient the private sector is, how the profit motive means it gets more things done better for less money than the public sector.

So with Michael Gove facing up to 40% cuts to his department, he'll likely be tempted to follow the same route. Before he does so he should look at the statistics his own department published earlier this month. At the request of the justice select committee, it was asked to separate out the data for private and public prisons.

It categorically disproves the claims of private sector efficiency.

Twenty-three per cent of the prison budget is spend on private prisons. But private firms don't run a quarter of the prisons. In fact they run just 13 of the 124 prisons and National Offender Management Service-run immigration removal centres – or 11%. At the end of June there were 15,393 prisoners in private prisons, just 18% of the total prison population.


So even though they account for just one in ten prisons and less than one in five prisoners, private prisons use nearly a quarter of taxpayer funding.

As Andrew Neilson, director of campaigns at the Howard League for Penal Reform, says:

"If the Ministry of Justice is looking at modelling cuts of a further 25% to 40% to the department's budget, then these figures suggest the solution does not lie in privatising more prisons. Despite the problems that benchmarking has brought, the public prisons have driven down costs thanks to their ability to make savings at scale."

The figures are even worse than they look at first glance. Private prisons are newer and have lower staff-to-prisoner ratios than their publicly-owned counterparts. It's the state prisons which labour under appalling levels of overcrowding. The ten most overcrowded prisons are all state owned, as the table below shows:

Prison Designed to hold Actually holds
Leeds 669 1,189
Swansea 242 429
Wandsworth 943 1,593
Kennet 175 290
Exeter 318 524
Preston 434 707
Lincoln 403 643
Durham 591 948
Leicester 214 340
Bedford 322 489

 

And yet even while struggling under this extraordinary burden, it turns out public sector prisons are more financially efficient than the private prisons so celebrated by generation after generation of ministers.

As Neilson says:

"Private prisons are bigger, newer, have more technology, lower staff ratios and less overcrowding. We were told this makes them more cost-efficient but these figures suggest otherwise.

"When it comes to the prisons budget, the only tenable way forward is to reduce demand on prison places. That will take bold and radical sentencing reform."

Whatever Gove is thinking of doing to implement those cuts, his own figures show privatisation isn'’t the answer. But since when has evidence ever stopped the free market obsessives from following their ideology?

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