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Private prisons: profitability, bodies and justice. What are the issues and challenges?

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Private prisons: facts, data and future prospects


    One of Colorado’s private prisons. One of Colorado’s private prisons. Here: Crowley County Correctional Facility, run by the market leader, Corrections Corporation of America (CCA). Photo © Philippe Brault

    Logos de CCA, Geo Group et Cornell

    Logos de Bouygues, Eiffage, Gepsa, Siges, Idex Groupe, Vinci et Spie Batignolles

    An increasing number of prisons have been privatised, either fully or partially, since the mid-eighties. It started in the United States, but has spread to other continents.

    Prison privatisation has taken two main forms:

    1. Full privatisation: a private company takes 100% control of a prison including supervising the inmates. This has so far only been experimented in the United States, the United Kingdom and Australia.
    2. Private-public partnership: part of the organisation is delegated to private operators by the state. Certain services (catering, laundry, cleaning, shop) such as maintenance of the equipment and buildings and even providing vocational training for inmates and managing the workshops may also be handed over to private companies. In recent times, these partnerships have expanded to include prison construction. In 2009, 38 out of a total of 194 penitentiaries in France were in so-called public-private partnerships.

    Privatisation may take different forms in different places, but the same forces are at work behind its rampant growth: an explosion in the prison population, outdated existing infrastructure, cuts in the state budget…

    United States

    The US was the first country to take the plunge. The first fully private prison (including the guards) opened as early as 1984. The industry boomed, despite serious reservations from the US Congress among others, which warned of the possible conflict of interest between profitability and imprisonment. By 2006, the private sector had control over between 7 and 10% of all prisoners in the United States (source : Quick facts about prison privatization [PDF]). Its business model is based on the number of prisoners. Currently, the average daily cost of a prisoner is about $55. This amount is stipulated by contract and paid to private prison companies by the various American states.

    There were a number of legal cases concerning these private prisons in the 1990s. One major one was a case in which judges were found to have taken bribes in return for transferring prisoners to certain private prisons, as Frank Smith tells us in the film Prison Valley.

    Various people have expressed their concern from a moral point of view, as this is a particularly sensitive area in the US. Some opponents of private prisons think this privatisation harks back to the time of slavery and to the practice of ‘convict leasing’ (the state would hire out prisoners to local businesses).

    Others see the private sector as an alternative solution at a time when America is having to reduce state expenditure.

    Private prisons do not generally accommodate the most dangerous prisoners. They are less full than state prisons and the average number of guards is roughly the same, although this last claim is challenged by many of the union officials and activists we met in Denver and Cañon City, Colorado.

    Two giant companies account for two-thirds of the market:

    • Corrections Corporation of America (CCA): the group of companies was founded in 1983 in Nashville (Tennessee). It manages 63 penitentiaries and owns 44 in 19 states, giving a total of 85,000 beds. CCA likes to present itself as the “fourth-largest company in the American prison system after the federal government and two states”. For the year ending 31st December 2009, CCA declared a net profit of $155 million and turnover of $1.584 billion. CCA has been listed on the New York Stock Exchange since 1994. They refused to meet us in spite of our repeated requests.
    • Geo Group (ex-Wackenhut): it claims to have 61 prisons, 60,000 beds and 13,000 staff, and proclaims itself a world leader in the provision of correction services. Geo Group is active in Australia (since 1991), the United Kingdom (since 1994) and South Africa (since 1999) as well as Cuba and Canada. The second-largest operator of private prisons, Geo Group announced net profits of $58.9 million for 2008.
    • A third group, Cornell made a net profit of $26 million in 2008. The company was established in Delaware in 1996 and its prison department employs over 4,000 people in around 70 facilities.


    Only some prisons have been privatised in France, but the number has been rising ever since the Chalandon law was passed on 22nd June 1987, which allowed the private sector to become involved in running prisons. This progression received a boost in 2002 when a law on the orientation and scheduling of judicial affairs was passed with plans to modernise prison infrastructure (13,200 beds) at a cost of 1.4 billion euros.

    This law foresees that public-private partnerships may delegate to the private sector any operations that do not fall under the sovereign duties of the state, meaning overall management of the prisons, guarding the inmates and the Clerk’s responsibilities. Everything else is open to privatisation. Including the design and construction of certain prisons, with the state committing itself to pay long-term rent according to the cost of building the facilities.

    Critics have pointed to design faults in various semi-privatised prisons, such as a flawed locking system at Roanne and a flawed electrical system at Mont-de-Marsan prison, which short-circuited the lighting, heating, cameras, telephones and door-opening systems in December 2008. Many people consider private companies’ need to make a profit to be incompatible with quality requirements.

    Recently the plans and secret codes for a new prison went missing. They were stored on four laptops belonging to a respected construction company.

    The main companies to benefit from the prison sector being opened to the private sector come from the construction and energy sectors. The main companies in this oligopoly are the following:

    • Bouygues: its subsidiaries DV Construction, GTB Construction and GFC Construction have built half-a-dozen prisons in France, including La Farlède (Var), Chauconin-Neufmontiers (Seine et Marne) and Liancourt (Oise). In 2005, Bouygues, the world’s leading construction company, signed a contract worth 140 million euros to build further penitentiaries (press release [PDF]) in Mont-de-Marsan (Landes), Bourg-en-Bresse (Rhône-Alpes) and Rennes (Ille-et-Vilaine). In 2008, Bouygues won a construction contract for prisons in Nantes (Loire-Atlantique), Annoeullin (Nord) and Réau (Seine-et-Marne) (press release [PDF]), in return for the state paying it 27 years’ rent worth a total of 40 million euros exclusive of all tax.
    • Eiffage: France’s third-largest construction company was awarded its first contract to build four prisons (Roanne, Nancy, Lyon-Corbas and Béziers) in 2008. The first of these opened in 2008. The cost of a facility such as the one in Nancy-Maxéville is estimated at 69 million euros. In the latter’s case, the state will pay an annual rent of 9 million euros to the private operator over a period of almost three decades. Eiffage's private-public partnerships and concessions list
    • Gepsa: A subsidiary of Cofely, which is itself a subsidiary of GDF-Suez. Gepsa was established in 1990 and is one of the French prison department’s principal partners in fifteen public-private partnership facilities, the company announces, stating that it is also a Facilities Management specialist. (source).
    • Siges: A subsidiary of the Sodexo Group, currently involved in running seven facilities in northern France. Its website states: We refuse to carry out our operations in countries where some inmates are sentenced to capital punishment. That is why Sodexo has never had any operations in the United States, for example.
    • Idex: The leading independent French energy and environmental services group also offers its competence in facility management. Idex is involved in running new prisons in Poitiers, Le Mans, and soon Le Havre. (source).

    Other leading names in the French construction industry such as Spie Batignolles and Dumez (Vinci Construction), have followed those mentioned above onto the booming prison construction market.

    Another point of discord is the work and vocational training provided to inmates in these facilities. The minimum wage is 3.27 euros per hour in prison and 3.54 euros per hour in a remand centre compared with 7.61 euros in the world outside. In 2006, the Economic and Social Council highlighted some shortcomings of these private prisons. This is what led Gonzague Rambaud and Nathalie Rohmer in their book Le Travail en prison [Éditions Autrement, January 2010] to conclude the following: By handing the keys of the prisons to be built over the coming decades to private companies, the Ministry of Justice has presented the multinationals with juicy pickings (…). As far as the inmates are concerned, it is difficult to determine what the added value will be in terms of work and vocational training, aside from a potential promotional operation presenting the exceptional trajectory of a handpicked cohort of prisoners. After twenty years of privatised prisons, we have to admit that the private sector has done no better than the [public] prisons administration: the lack of qualified work and a range of high-quality vocational training is every bit as great in private prisons.

    Further information — USA

    Further information — France

    Posted by David Dufresne Prison Valley Team
    Apr 7th 2010 (edited May 28th 2010)
    To report corrections and clarifications, contact Prison Valley Team
    This web documentary is very interesting.

    1) Could you please provide the sources for this information:

    "There were a number of legal cases concerning these private prisons in the 1990s. One major one was a case in which judges were found to have taken bribes in return for transferring prisoners to certain private prisons, as Frank Smith tells us in the film "Prison Valley"."

    What cases? Who were the judges involved? Where are the links to these cases (perhaps they have been published on the different jurisdictions web sites)?

    2) Correction to the text: "They received to meet us in spite of our repeated requests." should be "They refused to meet us..."
    • David Dufresne Prison Valley Team
    • May 28th 2010 (edited May 28th 2010)
    @miscstuff : we did the correction to the text and ask to Frank Smith more details. Thank you for all.
    Please, miscstuff, find the Frank Smith answer to your question:

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