By Bernard Hickey
Finance Minister Bill English has warned an announcement today of plans for an extra 1,800 prison beds will reduce the room for the Government to consider tax cuts before next year's election.
English told reporters in Parliament the extra beds would cost NZ$1 billion to build and an extra NZ$1.5 billion to run over the next five or six years.
"It will have an impact because it is a very large spend and, two or three years years ago, we probably thought this could be avoidable," English said when asked if the extra spending would make it harder for the Government to unveil tax cuts and other spending before the next election.
"It's all part of this rachetting up of tougher sentences, tighter remand conditions, less bail and taking less risk with people who commit serious offenses," he added.
Asked if that meant there would be less room for tax cuts, he said: "I wouldn't want to judge that because it is a bit early, but certainly spending this kind of money on prison capacity is going to reduce other options."
Earlier Police and Corrections Minister Judith Collins announced the Government would increase prison capacity by 1,800 beds at a construction cost of NZ$1 billion.
Prisoner numbers were growing faster than expected because the proportion of offenders charged with serious crimes has risen, meaning more people are being remanded in custody and serving more of their sentences in prison, she said.
“We have to respond through new investment or we will create unacceptable safety risks for staff, prisoners and the public, and be less effective at rehabilitating prisoners," she said.
The Government had approved an increase in double bunking in the Northland Region Corrections Facility at Ngawha by 80 beds and had approved a new accommodation block to be built at Mt Eden Corrections Facility with an extra 245 beds.
Collins said the Government would consider a business case for a new 1,500 bed facility at the existing Waikeria Prison in the Waikato, which would include the delivery of rehabilitation programmes including Drug Treatment Units, reintegration programmes, education and training programmes and Special Treatment Units to help address violent and sexual offending.
English later told Parliament the Government had no choice but to build the extra beds.
"The courts are sentencing them every week and we've got to have somewhere to lock them up," he said. He was asked in Parliament about comments he made in 2011 about the Wiri prison being the last the new prison the Government would build. He admitted he had got that wrong.
"I do recall saying that and the statement about not building any more prisons turned out to be not correct," he said (in the video above).
English, Key say increased migration good for economy
Meanwhile, when asked about the effects of high net migration on demand for health, education, transport, housing and prison services, English and Key said they saw high migration as a sign of success and good for the economy.
English said he had a positive view about migration. Over the weekend the Green Party launched a migration policy aimed at keeping population growth at 1% per annum, which would imply a halving of net migration from current levels. See more here in our article yesterday.
"We think New Zealand benefits from having people bring both their financial capital and their skills to New Zealand, and we have gaps that need to be filled by migration," English said.
"We haven't got an explicit population policy, but we have a positive view about New Zealand that's open to migration and, as we know, over the decades that fluctuates," he said.
"Sometimes we have quite high levels, as we do at the moment, but the long run average is about a third, long run inflow of people is about a third of what it is at the moment. You would expect over time that is what it would go back to."
Key told his post-cabinet news conference on Monday that migrants were a useful addition to the economy, and needed by employers.
"You have a huge number of employers in areas, particularly tourism related, where there are huge peaks in demand around the summer season, where they’re screaming for workers. And you saw that with horticulture when they couldn't get workers, there were points when fruit was rotting on the vines because no one was there to pick it," Key said.
“So I think they are a useful additive to New Zealand," he said.
Challenged about Reserve Bank comments about high migration moderating wage growth, Key said: "We have had the third or fourth highest real wage growth in the past eight years of any OECD country, so wages are rising in real terms, and rising faster compared with other countries."
'Bigger jails a sign of failure'
Labour Leader Andrew Little described the announcement of extra prisons as a sign of failure, and that a Labour Government would prefer to spend on education and health than on tax cuts.
"I hope our economic development is not now going to be built around imprisoning more people," Little told reporters.
"In the end, prisons are a mark of failure of law enforcement. One of the reasons that sits behind our call for 1000 extra police is that, when you take police off the beat, as this govenrment has done, and you close down community police stations, you remove the deterrant factor that the police have by their presence in the community," he said.
"It's not a success for any country to claim, 'gee, we've got more prisoners, we need more prisons". That's actually a failure. A country managing its economy right, putting in place the right social support and social structures, including a properly and well-resourced police force, doesn't mean you have more prisoners, you have fewer of them - because people see the police presence, communities are safer and more secure," he said.
"If you look at a whole range of areas where there has been underfunding, we know that school operational funding has been frozen, police numbers have been frozen, we've got the health system now $1.7 billion down, failing to keep up with population needs, there are a whole heap of areas where, if you had the means and resources, you'd be filling those gaps before you do tax cuts. My preference is, let's do those things that are about supporting people, creating those foundations for strong communities, good families and job opportunities, before we do tax cuts."