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Human Services Privatisation Creep and TiSA

Australia has the highest rate of private incarceration per capita of any country in the world. We imprison more people now than in any time in history. Private prisons operate in five of Australia’s states: Queensland (QLD), New South Wales (NSW), South Australia (SA), Victoria and West Australia (WA). There are eighty-two state prisons between these five states with around 20% of Australia’s prison population residing in nine private prisons. Victoria has the highest number of inmates held in private prisons than in any of the other four states. It is comprised of thirteen state run prisons and two privately owned prisons. As of 2014 the two private prisons accounted for 31.8% of the total inmate population or 1,845 out of 5,800 inmates.

A report called: Prison Privatisation in Australia – The State of the Nation June 2016 was the first to collate publicly available information on private prisons in Australia. The key areas that were explored were Accountability, Costs, and Performance and Efficiency. The first private prison to open was the Borallon Correctional Centre (CC) in QLD, near Ipswich. It was operated by Serco until it closed in 2012. Serco is one of three private prison contractors favoured by state governments, the other two are G4S and the GEO Group (GEO), formerly known as Australasian Correctional Management (ACM). The privatisation stemmed from a 1988 report called the Kennedy report. It was chaired by businessman and accountant, Jim Kennedy and its intention was to reform corrective services in QLD. A program for privatisation was set out within his report: ‘(t)he opportunities for introducing private sector involvement are substantial and should lead to an increase in cost-effectiveness’. The reasoning behind this was that in some areas private providers ‘can do it cheaper and better’ and that introducing competition to the public sector would allow for the measurement of public sector performance. It was budgetary concerns with staff sickness and over-time that led to these measures not overcrowding as was the case for the other states except SA. Borallon CC was back in state hands in April 2016 as an education centre called ‘earn or learn’ for eighteen-thirty-year old offenders.

NSW followed QLD’s lead with an ‘Investigation into Private Sector involvement in the NSW Corrective System’ in 1989. The report cited a claim that Borallon CC had made cost savings of 7.5-10%. One parliamentarian cast doubt over the fact that no information had been provided as to how these numbers were established or calculated. Despite this questioning, Junee CC near Wagga Wagga was approved as NSW’s first private prison. It was originally managed by ACM in 1993, the ACM was restructured and became the GEO Group in 2004. GEO won the bid again in 2009 and still manages the facility today.

Independent inspection of private prisons in NSW has been sporadic, an Inspector of Custodial Services (ICS) was appointed in 1997 with a review off office scheduled for 2003. The ICS was to address issues not already covered by the Ombudsman. The review was carried out by former Police commissioner John Dalton and former chairman of the Corrective Services Commission, Vernon Dalton. They recommended it to be discontinued citing that many duties overlapped with that of the Ombudsman and the government accepted their recommendations. Another ICS wasn’t appointed until another nine years later in 2012 and within this time frame in 2009, the NSW government privatised Parklea CC in the North West of Sydney. The contract was awarded to GEO and it revised its plans to sell Cessnock CC in the Hunter due to an economic downturn in the region.

With a record 12,000 inmates in NSW, the NSW government announced “Better Prisons” in March 2016, with plans to “market test” the operation of the John Morony CC near Windsor, Sydney. For contrast, as of June 2015, there were 36, 134 people incarcerated across all eight states in Australia. Private companies were invited to compete against state owned, Corrective Services NSW (CSNSW) for the tender with a winner to be announced in early 2017. A $3.8 billion expansion of the prison system was also proposed and includes a “Commissioning and Contestability Unit” costing $2.9 million. The unit is based on the work of former Serco worker, Gary Sturgess who was also an adviser to former Liberal premier Nick Greiner. The NSW shadow treasurer Ryan Park said “Contestability shouldn’t be an evil word – but under this government, all it means is privatisation by stealth. This government has shown time and time again that contestability isn’t about service delivery – it’s about saving money.” Mr Sturgess argues that it’s not about actually privatising but rather the threat of it to get public services and unions to improve their efficiency. “Gladys Berejiklian understands contestability – she used that approach as transport minister when she took on the private bus monopolies in western Sydney, and then initiated a reform agenda within the State Transit Authority … using the threat of competition if they did not reform,” he said.

The “Better Prisons” reforms also include cutting the number of teachers from CSNSW from over one hundred full-time positions to twenty. Corrective Services Minister David Elliott is to create sixty more roles but they don’t require a teaching degree. Prison teachers went on strike and up to two-hundred people rallied outside the NSW Parliament in September last year. “No-one can do the job that you do, you are highly skilled” Labor’s Guy Zangari told the crowd. “It’s more than just reading and writing, it’s more than just gaining skills to get a job.”

The Prison Privatisation in Australia – The State of the Nation June 2016 report covers publicly available data as of December 2015, and concluded that many problems in QLD private prisons were mirrored in NSW. NSW governments have favoured confidentiality and commercial-in-confidence protections for private, over providing the public with any transparency about their operations and costs. When it comes to Performance Level Fees (PLF), Key Performance Indicators (KPI) or bonuses for reaching “performance targets”, it gets even more opaque. One example from 2006 involved GEO still being awarded its PLF despite not meeting its performance targets for Junee CC. The justification given By Commissioner Ron Woodham was that ‘performance linked fees were designed to encourage performance rather than be punitive’. The Department of Corrective Services (DCS) makes an annual report about some of the prison’s performance but not the costs, they’re aggregated. In fact, the researchers of the above report could find no publicly available information regarding the breakdown of private prison costs on a year-by-year basis. NSW has an Ombudsman that handles prisoner complaints and reports their data prison-by-prison. According to the data there are more complaints in private prisons than in public ones. There’re contract “monitors” that make reports about both private prisons in NSW but these reports are also not publicly available. The monitors reports don’t marry up with the Ombudsman’s either especially regarding complaints made. In 2011 when inmates died at Parklea and three men escaped from the prison, there was no mention of these incidents at all in the monitors reports.

It is of interest that the NSW government at the end of March 2016, made both the Junee CC and the Parklea CC contracts available through the CSNSW website. The contracts are heavily censored, for example in schedule six of the Junee contract ‘Operational Service Level Fee and Opioid Pharmacotherapy Program Fee’, all of the financial information has been redacted. In section eight, the ‘Key Performance Indicators and Performance Linked Fee’ has had the targets for each KPI censored, meaning that we don’t know the level of service that is expected of GEO. The Parklea contract states that the operational fee in schedule six is $29, 124, 488 but any information relating to the breakdown of these costs has also been redacted. It also lists financial penalties for major incidents such as deaths in custody but it doesn’t include the KPI’s against which the PLF is calculated. Once again, we have no idea what level of performance is expected of the contractor by the NSW government.

Image by artist Banksy

Treasurer Scott Morrison asked the Productivity Commission to investigate privatising human services. The preliminary findings of the inquiry suggested that social housing, public hospitals, dental services, aged care, services for remote Indigenous communities and social housing services could all be reformed. The commission will work on recommendations for each sector and report back to Mr Morrison in October this year.

There has been much said about the Trans-Pacific Partnership (TPP) by Prime Minister Turnbull, President Donald Trump and the media. Mr Trump has made it clear that he believes that it’s not in America’s best interests to sign the agreement but Mr Turnbull doesn’t want to let it go. What has been missing is any talk about the Trade in Services Act (TiSA) agreement in the media or by Mr Turnbull or Mr Trump. There is a media release from October 21st last year by Trade, Tourism and Investment Minister, Steve Ciobo. He chaired a ministerial meeting on TiSA in Oslo, Norway that weekend and the release talks of ‘increasing Australian services exports, a key part of the Turnbull Government’s national economic plan to create jobs and drive economic growth.’

Australia’s services sector is a major part of our economy and accounts for 70% of economic activity. It employs four out of five Australians and accounts for 20.9% of all of Australia’s exports. Services account for around 75% of the European Union (EU) economy and 80% of the US economy. TiSA was also meant to be signed off with the TPP at the end of last year but it stalled due to disagreements about the free movement of personal data across borders. Mr Trump has already promised and already met with thirteen US tech giants last year and promised to make it “a lot easier” for their companies “to trade across borders.”

TiSA according to Wikileaks and other whistle-blowing sites is a deal that will “lock in” the privatisation of services, even in cases where private service delivery has failed. Government’s would never be able to return water, energy, health, education or other services to public hands. Perhaps this’s why there is such secrecy and a five-year clause preventing public access to the TiSA agreement after it has been signed.

We have seen the Australian federal government’s attitude towards human services with Centrelink and Medicare, and the absolute lack of transparency when it comes to the treatment of private prison operators in Australia. Should our tax payer dollars be used to pay private, overseas companies bonuses for fulfilling their contract’s? If companies need incentives to do a good job it sounds like human services belongs in the hands of public. When will state government’s using private, prison operators admit that a lack of staffing appears to be much of that sectors problems? And lastly, I implore you to please help create awareness about this, if they come for our services it will be the end of Australia or the world as we know it.

This article was originally published on Political Omniscience.



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  1. Kate Ahearne

    Thanks, Mel. Conservative governments talk a lot about the need for smaller government, by which they seem to really mean bigger business. The secrecy is scary, but perhaps the most alarming point you have raised here is the spectre of privatisations being set up in such a way that they are irreversible.

  2. babyjewels10

    Well said Kate. It really is scary and moreso, that people don’t seem to realise what’s happening.

  3. billshaw2013

    Mel, looks like you have put in some hard work to produce this. Well done. If the conservatives keep pushing privitisation it will be only a matter of time before it bites them. As Kate says locking in privitisation so that is irreversible is scary. It is also another incentive for a major upheaval in our political system.

  4. king1394

    Private companies want to run prisons because they can make a profit from doing so. They have an interest in seeing the inmates fail to be rehabilitated and they also have an interest in encouraging a viewpoint within society that prison is the only answer for lawbreakers. It is in their interest to see a ‘lock ’em up and throw away the key’ mentality which includes the attitude that anything that is done to prisoners is OK, there is no need to provide an environment where human dignity is valued or opportunities for self-improvement available. It is in their interests for any programs to help improve the lives of prisoners to fail.

    It is not in the community’s interests to have people sent to prison ultimately return to society more angry and less competent than they were when they went in, but it is certainly in the interests of private prison providers. Privatised prisons should be returned to public hands and public scrutiny

  5. auntyuta

    Right, I think too, that people do not realise what’s happening. When people are being kept in the dark, this is a big problem for democracy!
    What is happening to humanity?

  6. Kate Ahearne

    Wow, King! Powerfully said.

  7. Cartwheel printing solutions

    Cheers, yes Kate this scares the absolute you know what out of me. Especially if we take into account the climate change deniers & the potential damage that they can do.

  8. Carol Taylor

    How could one privatise public hospitals? Would they, when sold become private hospitals meaning the end of the public hospital system in Australia? I should imagine that this something that the Libs would applaud.

  9. Cartwheel printing solutions

    Yes Baby Jewels, this frustrates me no end, in a time where we have never been so connected, nobody knows what’s really going on behind the scenes. How to inform without boring folks & how to counteract Murdoch esp rurally?

  10. Cartwheel printing solutions

    Hi Bill Shaw, Ty I er didn’t shower for 2 days 😉 Online is getting worse & worse in regards to getting to the truth. Agree it’s an opp for us to shake the system upside down, it doesn’t fit in this era. Neither does the financial accounting system, it’s too simplistic. If everything was properly accounted for, half of these Corps wouldn’t be as rich. Heard of the $99 Big Mac? Eye opening..

  11. Cartwheel printing solutions

    Hi King, spot on, the same goes for job service providers, do enough to be seen to be doing something but keeping them unemployed makes them more money. Hideous to profiteer in this way.

  12. kerri

    How on earth can anyone NOT recognise that any public service function cannot be run cheaply when it is run to make a profit? Privatisation is all about profit and benefits to shareholders!
    Of course privatisation means public assets can never be returned to the government.
    Take any school as an example? How many houses are built and sold off on old school sites. How much would it cost to repurchase every one of those houses?
    What makes me even more angry is the conservative idiots sell off these assets for a song to support their idealogy. They are our assets!

  13. kerri

    Regarding the worth of prisons to rehabilitate and the benefits of long term incarceration.
    My daughter recently did a study tour where she got to freely (in an open environment) chat to San Quentin inmates. All SQ inmates are in for murder but they got to speak to the ones who had only committed one murder.
    One inmate stands out. They call him “Wall Street”. His is a story of youthful ignorance and a life in jail turned around by self education and remorseful motivation, yet he remains in jail. Now with knowledge and skills largely self taught he is no longer a danger to society but is he a benefit to a system run for profit?
    I urge you to read his story and question why such people remain in jail when the only benefit is to the shareholders?

  14. longwhitekid

    Recommended correction to following sentence: “This government has shown time and time again that contestability isn’t about service delivery – it’s about saving money…” should be appended with “….to spend on themselves” for accuracy. Because what are they saving it for? They’re not.

  15. David Bruce

    Excellent article Mel. When you realize that these prison operators also manage Air Traffic Control systems and Control Towers (Kiev for example), health care services (Obamacare), defence training centres and many other government services, it should be no surprise for Governments to insist on secrecy for these business transactions. These business service companies can give governments plausible deniability for many of the staged events designed to scare the masses, and accept the draconian legislation we see emerging world wide. The missing MH370, and the MH17 shoot-down are two examples where these private enterprise operators have been identified.

  16. totaram

    king1394 has articulated what should be evident to anyone with half a brain. The CEO of a business that runs “private prisons” will only want his/her business to grow, whereas what society would like is less and less incarceration and more rehabilitation. How these people have been allowed to get away with “privatising” our prisons is shameful and the most damning critique of the neo-liberal macro-economic mythology.

  17. Shogan

    The more they sell means less for them to look after & politicians wages should be adjusted accordingly!!

  18. nexusxyz

    Australia is increasingly becoming a little America with its own little ‘industrial complexes’, corrupt politicians, excessive rent seeking, financialisation, the oppression of the poor and disabled, slow death of the health service as the US system is such a good model (sarc), hollowing out of the productive economy and small business, moronic fixation with the casino chip housing market, etc. When the economy is subject to an external shock the implosion will be epic.

  19. Alan Baird

    It’s a sad fact that for many years the Conservatives have got away with Privatisation Creep (they’re all Privatisation Creeps) because the ALP was quite complicit in this. I can remember the Carr (Labor?) Government being infuriated when some of their privatisation plans were thwarted. Several Labor Treasurers in a row were gimlet-eyed-zealots on the issue, in lock step with the Liberals, if not more so. I would be VERY surprised if other states had similar “across the aisle” agreement and pursued similar policies, all with VERY little information supplied to Joe Average. Nevertheless, people ARE becoming quite tired and irritated by every mention of yet another privatisation. Once upon a time these deals were accompanied by assurances by pollies that services would improve and their prices would drop if privatised. With the advantage of experience, we know this is tosh.

  20. Max Gross

    Secrecy, deceit and outright lies are hallmarks of the LNP. Call it their KPIs!

  21. Kyran

    Just in the off chance you missed this, Mel Mac, we are having a bit of a problem down here in Victoria. According to that guy guy, and most of the MSM, we have a law and order issue. Apparently, juvenile offenders are meaner, tougher and more rebellious, than ever. We need more jails. With suitable guards, suitably equipped.
    I am unsure if Parkville or Malmsbury are privately run. Both facilities have been described, for decades, as unfit for purpose.
    Let that sink in.
    Unfit for purpose. For decades.
    Evidentiary based programs have shown that the daily $ rate of incarceration, around $300 per day, is a waste of everything, without support programs. Those support programs have a fraction of the cost, yet deliver a reduction of 80% recidivism. Serco and G4S ran those other facilities, Manus and Nauru, for a while. How did that go? Private Prisons can only equate to commercial warehousing of human beings. The venue is clearly unimportant.
    The naptime government, down here, defunded most of the support programs. How did that go?
    This bloke, Bernie Geary, previously ‘Child Safety Commissioner’, has been a tad vocal, as have been many ‘youth advocate lawyer’s’.
    Evidence V law and order. Surely we can hope?
    Thank you, Mel Mac, and commenters. Take care

  22. Chris Powell

    How about Illegal Abduction of CHildren by Browns Plains DOCS/FACS? WHY WAS CHASE— CHASED BY LADY CILENTO ———-WAS CHASE— CHASED BECAUSE OF A TRIAL! ——————- AND A SICK AGENDA! Paula- Dee- Angela and myself have looked behind the scenes. We have been Digging the rabbit hole of Professor ROSLYN BOYD-Scientific Director of the Queensland Cerebral Palsy and Rehabilitation Research Centre. Roslyn Boyd IS LADY CILENTO! She was handed a hefty sum – the Australasian Cerebral Palsy Clinical Trials Network would get $2.49 million over five years. With this money, she will be advancing Ceberal Palsy in Queensland along with Identifying Red Flags for feeding difficulties and nutritional status in children and young people with cerebral palsy.(CHASE!) NUTRICIA is FUNDING this Research.let’s join the dots…..Nutricia makes Nutini. Roslyn Boyd will be trialing a supercharged Nutini Plus formula – Pre and Pro Biotics added and see whether that will help children on the poisonous crap called Nutini!
    We know that Cini and Marc WOULD NOT agree to Chase being part of this TRIAL. We have seen how POWERFUL REAL FOOD IS.,,,,,, ROSLYN BOYD SURE DOES NOT WANT CHASE OFF NUTINI and on a path to healing!… ROSLYN DOES NOT WANT other parents of children at Lady Cilento to opt for a real food diet either. There would not be numbers in her trial. I bet my bottom dollar that many parents are thinking of choosing an organic diet. after seeing Chase REMARKABLE PROGRESS.When armed with knowledge parents do what is in their child’s best interest and that is not in the interest of Dr. Roslyn Boyd! We see the trees in the forest Chase. WE WILL FIGHT FOR YOU BUDDY <3 ]research.centre.uq.edu.au/article/2016/11/83m-awarded-faculty-research http://researchers.uq.edu.au/researcher/1895 http://researchers.uq.edu.au/research-project/30616

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