Section E: Other Issues

18. Targeting Particular Types of Industry

While Inmate Employment Training contributes to the rehabilitation of offenders, opposition to prison industries is often advanced on the basis of allegedly unfair competition, and subsidised costs in commercial markets. To minimise allegations of unfairness, prison industries will target markets where there is little opposition to entry, such as:

  • achieving internal self-sufficiency
  • community service
  • import substitution or produce for export
  • commodity industries
  • operating in cooperation with the private sector
  • becoming involved in areas where there are no competitors.

A key consideration in evaluating new inmate employment initiatives is that they are not in business areas that could lead to direct displacement of private sector jobs. The Department will also seek to remain a small player in most markets. There are approximately 1.6 million people employed in New Zealand and the total prison population is less than 0.2 percent of this.

Further offsetting concerns about the impact of Inmate Employment is the considerable social benefit derived from community service activities. As well as providing inmates with an opportunity to develop general work habits and some particular skills, community service activities contribute positively to the enhancement of community assets.

19. Competitive Neutrality

For government agencies, competitive neutrality includes the concept that where governments are competing in the provision of goods and services they should not compete unfairly due to perceived advantages compared with private sector participants. These advantages could, for example, include immunity from certain regulatory requirements and income tax.

The approach taken in this policy is that prison industries must be able to compete in a market environment while meeting their full attributable costs. The make-up of costs in prison industries may differ from those in private sector industry, but prison industries will operate in a competitively neutral manner by using industry benchmark costings for the particular industry. Labour costs per inmate hour may be less in prison industries than in private industries but there are many additional costs faced by prison industries that are not faced by private industries, these include:

  • low productivity
  • high labour turnover rates
  • high training costs
  • high ratio of supervision
  • high reject rates
  • occasional sabotage
  • interruptions to the working day.

While the make-up of costs is different for prison industries, any product from prison industries which is sold in the private sector will be priced on the basis of a competitive market-related price.

In a number of overseas jurisdictions, prison industries pay inmates the minimum wage and then deduct amounts for accommodation, food and administration. This gives an impression of "competitive neutrality" in the costing of prison industries relative to the private sector. The prime focus of the New Zealand industry programme is rehabilitation and skill acquisition and the payment of an "incentive allowance" is consistent with this approach.

There are two considerations in determining "incentive payments" to inmates for undertaking employment training. The first is that inmates are receiving a fair remuneration (based on the additional costs and risks of undertaking employment training) and are not exposed to unjust working conditions.

The second concerns preserving social equity for the community by reducing costs to the taxpayer and attempting to ensure that Inmate Employment Training does not directly affect existing jobs.

The Department will seek involvement of the private sector in providing employment training for inmates. However, all such initiatives must have a contract which ensures that working inmates are not exploited and are provided suitable training experience. These inmates remain under the direct supervision and control of prison authorities. All inmates involved with work for private employers must volunteer for employment.

20. International Conventions and Rules

The International Labour Organisation (ILO) Convention 29 on Forced Labour was adopted by the General Conference of the ILO on 28 June 1930 and was ratified by New Zealand in 1938. This is the main international convention dealing with prison inmates working. Under Article 1 of the Convention all Parties undertook to suppress the use of forced or compulsory labour in all its forms.

According to the ILO Convention "forced or compulsory labour" means:

All work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily.(1)

Article 2(2)(c) of the ILO Convention provides that the term "forced or compulsory labour" shall not include:

Any work or service exacted from any person as a consequence, of a conviction in a court of law, provided that the said work or service is carried out under the supervision and control of a public authority and that the said person is not hired to or placed at the disposal of private individuals, companies or associations.(2)

The United Nations Standard Minimum Rules (the Rules), were adopted by the First United Nations Congress on the Prevention of Crime and the Treatment of Offenders held at Geneva in 1955, and were approved by the Economic and Social Council by resolutions in 1957 and 1977. The Rules recognise the need for flexibility due to individual countries different circumstances and advocate that it is the broad purpose of the principles and practices enunciated in the Rules that should be adhered to, rather than the strict wording itself.

Rule 72(2) of the Rules states that:

The interests of the prisoners and of their vocational training, however, must not be subordinated to the purpose of making a financial profit from an industry in the institution.

Rule 73(1) states that:

Preferably institutional industries and farms should be operated directly by the administration and not by private contractors.

The prime focus of the Inmate Employment Policy is on rehabilitation and skill acquisition. The interests of the prisoners in obtaining vital work experience and therefore increasing their chances for legitimate post-release employment is a key aim of the Inmate Employment Policy. The objective of establishing commercially viable prison industries is a means to obtaining legitimate work skills.

21. Reintegrative Services

A key objective for providing work experience and skills is to increase the likelihood of inmates obtaining legitimate post-release employment. It is important, therefore, to develop reintegrative services to assist inmates in finding employment once released.

The Department is currently developing a Reintegrative Services programme as part of Integrated Offender Management. A number of specific initiatives are underway. The Department purchases services from the New Zealand Prisoners' Aid and Rehabilitation Society (NZPARS) to assist offenders with reintegration. Fresh Start, a charitable organisation, is also working with employers and offenders to provide employment opportunities for people with criminal convictions. Corrections has a Memorandum of Understanding with Work and Income New Zealand and has been advised by them that offenders are a target group for their employment products and services. The Department will also establish networks with private sector employers to facilitate the Release to Work scheme and to provide employment opportunities to inmates when they have completed their sentence.

22. Follow-up on Outcomes

Through its reporting to Parliament, the Department will inform on its inmate employment goals and accomplishment. Part of this reporting will in future cover overall effectiveness in reducing re-offending and the extent employment training has assisted inmates secure jobs on release from prison.

1 Article 2, paragraph 1 of the ILO Convention

2 Article 2, paragraph 2 (c) of the ILO Convention