By Pam Graham of NZPA

Wellington, Feb 3 NZPA - The Department of Corrections is making it clear that only companies with significant prison management experience need apply to manage one of its prisons and that they will have to meet the needs of Maori prisoners and other ethnic groups.

The Government passed law to enable contract management of prisons in December. It is expected to pick a prison by May and in the meantime the department has issued a request for information (RFI) to interested parties with a goal of signing a contract by early 2011.

The RFI seeks both experience and local knowledge and notes no one has both. It suggests parties with one or the other may get together.

It says that New Zealand-based companies are unlikely to meet the required attribute of having significant prior experience in running prisons.

The RFI also states that the ability to meet the needs of Maori prisoners and other ethnic groups is an essential requirement of any organisation holding a prison management contract in New Zealand.

"As contract management of prisons is effectively new to New Zealand, no organisations with significant prison management experience and significant financial resources are expected to be able to provide current evidence of meeting the needs of Maori and other ethnic groups," the RFI said.

Organisations without the key attributes are invited to submit an expression of interest.

The department will pass on all expressions of interest to all experienced prison management companies that are short-listed at the end of the RFI process. Responses to the RFI are due on March 1.

The RFI also notes that government reforms of procurement policies are seeking to enhance participation by New Zealand businesses.

It says the most likely way in which a Maori and-or New Zealand business could participate in managing prisons was as a sub contractor, as an adviser, or as a business partner with an experienced prison management company in a new legal entity that would bid for a prison management contract.

"These three opportunities are not mutually exclusive," the RFI said.

The department manages 20 prisons with capacity for about 9100 prisoners, which is expected to increase to more than 10,000.

The prison contract is being closely watched by business groups both here and overseas interested in private public partnerships (PPPs) to build new public facilities. Wellington-based investment bank Morrison & Co has set up a fund to invest in so-called social infrastructure PPPs, which include prisons, hospitals, schools, social housing and student accommodation.

Radio New Zealand reported this week that the department is currently consulting with prison officers, unions, Maori and other groups on a proposal to contract manage the Auckland central remand prison at Mt Eden.

Corrections Minister Judith Collins also had a preference for a proposed new prison in south Auckland to be managed by a contractor.

The RFI says that new prisons may be established through PPPs that may involve design, construction, financing and contract management of prisons.

The key attributes for a manager of an existing prison included a history of strong financial performance, a sound legal history, and a substantial capital base.

The RFI is designed to identify a short list of managers and identify Maori organisations and New Zealand businesses that may want to offer intellectual human or financial resources to the short listed prison management companies.

A second stage will occur after a prison is selected and will involve a request for proposal.

The Government believes that contract management of prisons will bring innovation to prison management, yield efficiencies and cost savings and bring an exchange of ideas.

The contracts are seen as a template for effective working relationships between public and private sector prison managers.

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