Prison Privatization - A Challenge for Abolitionists
by Stephen Nathan, for ICOPA, December 2000
The world’s criminal justice systems are a multi-billion dollar ‘market’ being targeted by
a handful of multinational prison and security corporations.
Their growing influence and the re-emergence of privatization as a major tenet of
criminal justice policy since the late 1980s have created a significant challenge to the
prospect for prison abolition.
Contracts for privately financed, designed, built and operated prisons are usually for 25
years for ownership of facilities and between three and ten years renewable for the
provision of correctional services. The companies also demand guarantees that
substantial compensation will be paid in the event that governments decide to change
policy that will affect profits.
Ultimately, that makes it more difficult both politically and financially for governments
to extract themselves from such contracts.
So it was both fitting and ironic that the ICOPA conference took place in Toronto,
Ontario, at a time when the communities of Penetanguishene and other northern Ontario
towns had joined with public prison employees in battle against the provincial
government over its prison privatization plans.
Ontario's facilities and projects for young offenders are already privatized and the
management of a new 1,200 bed facility for adult offenders under construction in
Penetanguishene is due to be contracted out.
The Ontario Public Service Employees Union (OPSEU), which represents the province’s
6,000 corrections staff, fear that more contracts could follow and that the proprivatization government will ‘get out of the business’ of corrections altogether.
What helped fuel such strong opposition was the government's refusal to engage in public
debate about the moral and ethical issues surrounding prison privatization. For many, the
crux is whether such a core government function should be handed over to corporations
whose shareholders' interests come before the general public's; and whether corporations
should be allowed to develop a long-term vested interest in shaping criminal justice
policy.
There are also concerns about the loss of accountability, the threat to public safety,
inadequate programs to rehabilitate prisoners, and the social and economic effects of
inferior staffing levels, wages and conditions associated with private prisons.
Fundamental questions have also been raised about how the North American Free Trade
Agreement (NAFTA) and the World Trade Organization (WTO) might force Ontario's
criminal justice system to be opened up to further competition.
But, as in other small towns and cities that have become reliant upon public sector prison
jobs and services, the lack of a meaningful alternative economic strategy has led to
arguments largely about public versus private prisons rather than on whether the
construction of another facility is desirable.
The Ontario government helped set that agenda by intimidating town councils with the
threat that if they do not accept privatization then investment in new corrections
infrastructure will go elsewhere. As a result, at least one council, Thunder Bay, reversed
its initial opposition to private prisons.
Although in Ontario the current restructuring of the correctional system is not just an
issue for people in rural areas, it is hardly surprising that the prospect of economic ruin
and the defence of relatively well paid jobs with pensions and other benefits has taken
precedence over key criminal justice issues such as alternatives to incarceration or the
current trend towards harsher sentencing.
Ontario’s U-turn
The strength of feeling in Ontario also came about because of a U-turn in government
policy after the right wing Harris government was re-elected for a second term and Mr
Rob Sampson, the Minister for Privatization in the first administration, became Minister
for Corrections.
In October 1998, Ontario's then Solicitor-General, Robert Runciman, announced that new
prisons planned to replace some of the province's ageing smaller facilities would not be
privately run.
"There are a whole range of issues around privatization that have not been properly
addressed, and public safety is number one. There were some issues raised in the United
States recently regarding private operations that raised a number of concerns," said
Runciman.
Those concerns were largely caused by problems at the Northeast Ohio Correctional
Centre in Youngstown, Ohio, run by Corrections Corporation of America (CCA), the
largest private prison operator in the U.S. In the first two years of that facility's operation,
two prisoners were murdered, at least 14 others were stabbed, and six prisoners, including
five convicted murderers, escaped.
CCA and Washington D.C., whose prisoners were sent to the facility, settled a
subsequent class action lawsuit filed by prisoners for US$1.65 million in damages.
But while Ohio's problems had been resolved sufficiently for Mr Sampson to reverse the
previous decision, at least one Ohio State Senator was still reeling from the experience.
In a letter dated 29 February 2000 to Ontario Premier Mike Harris, Senator Robert F.
Hagan wrote:
"Ohio's experience with private prisons has been to date...wholly regrettable...Given my
district's history with private prisons and reports of similar events at other private prisons
in the United States, I would respectfully urge you to reconsider your position on the
construction of a private prison in the Province of Ontario."
Mr Sampson’s apparent love affair with prison privatization in the US also clouded his
ability to take into account the publication of a Congress-commissioned study of all
previous research into private prisons in the U.S.
The study concluded:
"Some proponents [of privatization] argue that evidence exists of substantial savings as a
result of privatization. Indeed, one asserts that a typical American jurisdiction can obtain
economies in the range of 10-20%. Our analysis of the existing data does not support
such an optimistic view.
"Few studies have been conducted to compare the relative performance of privately and
publicly operated prisons. Most are affected by a variety of methodological
problems...Given these shortcomings and the paucity of systematic comparisons, one
cannot conclude whether the performance of privately managed prisons is different from
or similar to public operated ones.
"With respect to public safety and inmate programming, the available data do not
support definite conclusions. The available surveys of either privately or publicly
operated facilities do not provide the information needed to compare the quality of such
programs or the extent of prisoners' engagement with them."
Ontario’s Minister for Corrections also failed to notice that, in the U.S., private prisons
had suffered the worst catastrophes in the industry's recent history. A guard and pr
isoners were murdered; there had been serious escapes and riots; guards were indicted for
sexual and physical abuse of prisoners; contract performance failures led to financial
penalties and terminations; and companies faced a string of prisoners' lawsuits.
These same companies had been lobbying for business in Canada and would be bidding
for any contracts Ontario had to offer.
After campaigners bombarded the Ontario government with information about the
industry’s shortcomings in the US, Mr Sampson changed tack and issued media
statements espousing the UK model of prison privatization instead, saying that he was
keen to cut costs and reduce recidivism, as had been successfully achieved in the UK.
But the emissary who was sent to the U.K. to see how well it was being done, still left Mr
Sampson on shaky ground.
Although some eight per cent of the prison population in England and Wales is held in
private facilities there is no evidence that privatization reduces recidivism rates and in
March 2000, the Prisons Minister admitted that the research could not be done.
Also, companies running adult and juvenile facilities in England and Wales have been
penalized over £2 million for contract failures; for three successive years, the privatelyrun Doncaster prison recorded the highest number of incidents of prisoner self-harm; and
a recent study found that a privately operated secure training centre for 12-14 year olds
had been unable to prevent reoffending.
There is also doubt about the claimed comparative overall cost savings between public
and privately operated adult facilities, since no exact ‘like with like’ comparisons have
been made.
Meanwhile, Scotland’s only private prison has been dubbed Scotland’s most violent and
the chief inspector of prisons was threatened with legal action in July 2000 if he
published the company’s staffing levels in his inspection report. A version which
included this ‘commercially confidential’ information had to be pulped by the printers
and an amended report published.
Don’t look to Australia and New Zealand
The Ontario government has yet to change tack again and argue that Australia’s prison
privatization experience is the way forward.
If it did, it would be embarrassed to find that in Victoria, which until recently had almost
half of its prisoner population held in three privately financed, designed built and
operated facilities, a report by the state’s Auditor-General raised fundamental questions
about the oversight and operation of the prisons, noting that "there is still some
uncertainty whether the cost savings expected to flow... will be realized."
All three operators have been penalized for contract failures and Group 4's Port Phillip
Prison has racked up the highest prisoner suicide rate in the state.
Even more significantly, in October 2000, the Metropolitan Women’s Correctional
Centre - Victoria’s first privately financed, designed, built and operated prison - was
taken into public ownership and operation. The government paid A$20.2m to Sodexho
SA of France, the new owners of Corrections Corporation of Australia which had run the
prison since it opened in August 1996. The company had failed to resolve persistent
operational problems.
And, within weeks of the takeover, an independent inquiry commissioned as a result of
the deaths at Port Phillip was published
Although the investigating panel had “a strongly held view that the quality of the overall
service to prisoners and the community matters more than who manages the prison” they
also found that: “The future focus should be on collaboration rather than competition, and
on promoting the notion of a correctional service system rather than a correctional
industry ... in a fragmented system it is prisoners who suffer most.”
There would not be much point in Ontario looking to New Zealand either.
In New Zealand, the Labour Alliance government agreed not to terminate one prison
contract negotiated by the former administration, but it has halted the rest of the prison
privatization program.
Minister for Corrections, Matt Robson, said in January 2000 that "there has been an
experiment overseas - driven by ideology - to introduce private prisons, and it hasn't
worked. The ideology-driven belief that...private is better is not suited to our prisons, and
this government won't let New Zealanders become guinea pigs for an experiment here."
Ideological in Ontario too
So far, the government has been able to ignore the public’s wishes and the operational
evidence from elsewhere. Even Ontario’s own auditor has found that there is no sound
business case for privatizing the management of the new prison at Penetanguishene.
The government has also pandered to the needs of potential bidders for the contract by
relaxing some of the terms included in the original Request for Proposals, a key stage in
the tendering process.
Critics of the Ontario government have concluded, therefore, that the true motive must
be ideological.
In a bizarre twist of fate the Minister for Corrections had to resign in December 2000
over the antics of one of his parliamentary colleagues.
But this didn’t stop the Legislature passing Bill 144, the legislation to enable
privatization, euphemistically referred to as “An Act to establish accountability in
correctional services...”
And if Mr Sampson’s successor continues with the privatization plan, Ontario will be the
first Canadian province to privatize adult correctional facilities.
Under scrutiny in the U.S.
Most of the private prisons currently in operation are in the United States. While the
private corrections industry’s prospects have doubtless been boosted by the election of
George W. Bush, some of the leading companies have been recently forced on to the
defensive.
In September 2000, in San Antonio, Texas, the World Research Group and the Reason
Foundation’s Public Policy Institute held their Fifth Privatizing Correctional Facilities
conference, an annual event for the operators, investors, potential investors, industry
analysts and potential client authorities.
The hook for 1999's event was “Grow Profits and Maximize Investment Opportunities In
This Explosive Industry.”
In 2000, the aim of the comparatively stripped down affair was to rebuild confidence in
the industry.
This was necessary because the industry’s recent spate of problems had caused it to fall
foul of Wall Street. This led stock prices in Prison Realty Trust (now Corrections
Corporation of America) and Wackenhut Corrections Corporation to plummet which, in
turn, limited the availability of finance capital required for expansion.
As one analyst at San Antonio put it, the industry “had gone from being the market
darling to something lower than dirt.”
Fortunately, there were also bankers on hand to offer advice. Adverse media reporting
about the prison industry’s problems had impacted negatively on the banking community
which, according to one banker, “underscores the need to for a global privatization voice
out there.”
So part of the plan to emerge included the leading private corrections companies in the
US forming a single industry voice with the aim of combatting critical media coverage.
They also intend to fund ‘independent’ research to prove that prison privatization is
successful.
Although new contracts continue to be awarded - particularly by the Federal Bureau of
Prisons - anti-prison privatization sentiment in the US has been at an all-time high, with
courts, legislators, citizens groups, organized labour, faith groups, student organizations,
academia and the media all scrutinizing the industry as never before.
In June 2000, the State of North Carolina passed legislation preventing any private
businesses from building “speculative” prisons with the hope of winning contracts to fill
them later and banned companies from bringing in out-of-state prisoners. It also delayed
for a year the construction of a new juvenile facility. And it decided to take over the
management of two 528-bed private prisons that have been run by Corrections
Corporation of America (CCA) since 1998.
And CCA’s profile will not have been helped by a December 2000 federal grand jury
finding that the company had a corporate policy of using excessive force to control
teenagers at a juvenile detention facility that it had run in Columbia, South Carolina.
On 15 December 2000, a former inmate William Pacetti, now 18, was awarded more than
$3 million in punitive damages and $125,000 in actual damages for his pain and suffering
after CCA guards hog-tied, maced and threw him against a wall.
The incidents occurred when Pacetti, then a 14 year old, was in the facility between July
1996 and January 1997.
Although CCA might yet appeal the decision, the verdict could lead to similar verdicts
for 21 other former inmates who have filed lawsuits alleging assault and improper
punishment.
"It's a case where a corporation had a policy of using abuse, not a case involving the
actions of individual officers," said Gaston Fairey, the Columbia lawyer who represents
William Pacetti and several other former inmates.
In 1996, the South Carolina Department of Juvenile Justice signed a three year contract
with CCA to run the prison and other programs for young offenders.
But after one year, after a series of escapes and other operational problems, the state
decided not to renew the contract.
Meanwhile, across the US, students at college campuses have been campaigning against
food services provider Sodexho Marriott because its parent company - Sodexho SA of
France - is heavily involved in the private prison industry.
Corrections USA (CUSA), an organization of public sector corrections officers, has been
active in several states and Canada.
And for the last year, the Public Safety and Justice Campaign a broad based coalition of
labour, criminal justice, religious, community, student and advocacy organisations has
been actively campaigning, particularly in the southern states.
International markets and the World Trade Organization
Heightened scrutiny and operational problems in the US, UK and Australia along with
the New Zealand government’s stance on privatization mean that continued international
expansion is crucial to the industry’s future.
Significantly, the WRG/Reason Foundation conference in September 2000 did not
(publicly, at least) discuss how the World Trade Organization (WTO) might assist with
the industry’s rebuilding process.
But then, did it need to?
Consider this: since 1988, the United Nations Sub-Commission on the Promotion and
Protection of Human Rights has tried to initiate a study of prison privatization. But the
Sub-Commission has failed to win approval from its parent body and the proposal has
been consistently blocked, most recently by the US; in April 2000, the Organization of
American States was called upon by Mexico to look into the possible advantages of
privatizing prison services; in September 2000, in San Juan, the Government of Puerto
Rico - with sponsorship from the private sector - organized the ‘First Corrections Summit
of the Americas’ to promote prison privatization throughout Central and South America
and the Caribbean.
Meanwhile, on the other side of the globe, Krygyzstan recently passed a new executive
code enabling private prisons to be developed; the government of the Netherlands is now
said to be impressed with privatization and is carrying out a feasibility study; and, in
September 2001 one of the leading European based prison companies, Group 4, will be
making a presentation at a major corrections conference in Namibia.
These developments exemplify how industry lobbying works and new markets are being
opened up.
So far, the private prison corporations have not needed to resort to the Word Trade
Organization (WTO) or the General Agreement on Trade in Services (GATS) regulations
to fuel their international aspirations.
Since the early 1980s, prison operators have been able to cash in on the privatization tidal
wave generated by the IMF, World Bank, USAID, the international consulting firms and
free market - oriented think tanks.
These have all supported corporations’ need for new markets by promoting economic
restructuring through public spending cuts, governments getting out of the ‘business’ of
running essential services and turning them over to the private sector.
The UK and Australia were the first easy pickings for private prison companies.
Now, in the Third World and the emerging economies of Eastern Europe - where,
arguably, some of worst prison conditions and human rights abuses exist - financial aid
for new infrastructure is tied to privatization of state assets and services.
So the prison firms have been strategically positioning themselves.
Florida based Wackenhut Corrections Corporation - now known as WCC - describes
itself as “an industry leader and pioneer in the privatization of correctional facilities
throughout the world.” So far, outside of the US, it has established international alliances
with strategic local partners and won contracts in Australia, the UK, South Africa,
Canada, New Zealand and the Netherlands Antilles.
WCC is owned by the Wackenhut Corporation, a security firm with operations in 56
countries on six continents. It offers “global integrated service solutions” and describes
its international trading base as Central and South America, although recently it has
established itself in Eastern Europe, Asia and Africa.
Until recently, WCC’s main domestic rival, Corrections Corporation of America, had
prison contracts in the UK and Australia. But in September 2000, Sodexho SA of France,
CCA’s joint venture partner and a major shareholder, acquired CCA’s UK and Australian
operations.
Sodexho has operations in 60 countries and offers “a whole world of services across five
continents.” The company, which has a 16.9 per cent stockholding in Corrections
Corporation of America (CCA), now owns Corrections Corporation of Australia and
CCA’s former UK joint venture, UK Detention Services Ltd.
France has a number of semi-private prisons in which the corrections officers are public
employees but Sodexho and another multinational, Lyonnaise des Eaux, are the facility
builders and providers of all non-custodial services. This model is being promoted in
Europe and elsewhere.
The European security firm Group 4, which runs prisons and associated services in the
UK and Australia will soon open a 3,024 bed maximum security facility in South Africa.
In May 2000, the company announced a merger with Danish security and public services
firm Falck, creating a combined operation base of 50 countries.
Other firms such as Britain’s Securicor (operating in 30 countries), and, from the US,
General Security Services Corporation, Management & Training Corporation (MTC),
Correctional Services Corporation and BI Inc - which is big in electronic home arrest
products and has its corporate HQ located at the aptly named Lookout Road in Boulder,
Colorado - all have international aspirations. MTC has just won its first non-US prison
management contract, in Australia and a Securicor subsidiary operates juvenile detention
centres in Florida.
With such global operations already in place, will these firms need the persuasive
powers of the WTO to get a foothold in countries that may be reluctant to privatize
prisons and/or other criminal justice services?
Only time - and whether enough governments capitulate to the prison corporations’ hard
sell - will tell.
A WTO official said recently that there are GATS regulations in place that seemingly
protect a country’s correctional services from what he termed “liberalization requests”,
whereby the private sector can demand that a government opens up its services to
competition.
But if the industry’s expansion gets blocked by a country on ideological, ethical or legal
grounds then according to Ellen Gould, a Vancouver-based independent analyst, there are
a number of ways that private prison firms could “pry open” these new markets.
And as Scott Sinclair, a Canadian trade policy specialist notes, GATS covers most public
services. However, services provided in the exercise of governmental authority are
excluded from the agreement but “these are defined so narrowly that the exclusion has
very limited practical value. All governmental services provided on a commercial basis
are subject to GATS provisions,” he says.Ultimately, any dispute over the interpretation
of GATS regulations rests with WTO dispute panels which, the private prison operators
will conveniently find, exist to serve only one set of interests.
Conclusion
Prison abolitionists are long schooled in the argument that a debate about privatization is
a diversion from the broader debate about whether prison works.
But unless the privatization of prisons and other aspects of criminal justice systems is
tackled on an international basis and linked with the broader campaigns currently being
waged against the WTO, prison abolition will be pushed beyond reach for many more
years to come.
Endnotes
Private Prisons in the United States: An Assessment of Current Practice, Abt Associates
Inc, 1998.
Hansard, 9 March 2000 quoted in Prison Privatisation Report International # 34,
March/April 2000.
Victoria’s Prison System, Community Protection and Prisoner Welfare, AuditorGeneral of Victoria, Special Report No.60, May 1999 in Prison Privatisation Report
International #30, July/Aug 1999.
Report of the Independent Investigation into the Management and Operations of
Victoria’s Private Prisons, October 2000, published 28 November 2000.
Sequel to Seattle: GATS. How the World Trade Organization’s new ‘services’
negotiations threaten democracy, by Scott Sinclair, Canadian Centre for Policy
Alternatives, 2000.
Stephen Nathan (stephennathan@ compuserve.com) is a freelance journalist and
researcher and editor of Prison Privatisation Report International (PPRI), published in
London by the Prison Reform Trust.
PPRI can be found on the Internet at:www.penlex.org.uk/pages/prtprep.html
Citizens Against Private Prisons (CAPP, Ontario) wredditt@csolve.net
Public Safety & Justice Campaign (PSJC) skahn00000 @aol.com
Justice Action (New South Wales) ja@justiceaction.org.au
Coburg Brunswick Legal Services (Victoria)coburg_brunswick_vic@fcl.fl.asn.au