Prison and Probation Services (England and Wales)

Wednesday 13th July 2011 Written Statements

[The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke)]

In the response to the Green Paper, “Breaking the Cycle: Effective Punishment, Rehabilitation and Sentencing of Offenders”, I set out a vision for a transformed justice system that will focus on public protection and cutting crime. An important part of delivering the changes I am committed to is ensuring that the services we provide are focused on delivering the best possible outcomes and the greatest value for money.

Competition between providers of our services can help us to meet these challenges as the previous Government recognised when they made contestability a feature of offender services when setting up the National Offender Management Service in 2004. The “Competition Strategy for Offender Services”, which I have published today, sets out how we will change the way we use competition to meet these aims. My approach is based on ensuring an effective balance between making services more efficient while reforming them so that they provide better outcomes for the public. In doing so, we will draw on a wide range of expertise from the private and voluntary sector, which will work in partnership with a strong public sector.

For offender services, I intend to employ the principle that competition will apply at some stage to all those services not currently bound to public sector delivery by statute. This will mean the benefits of competition can be felt much more widely, contrasting with the previous approach of only using competition when procuring new services or as a way of managing poor performance.

Underpinning this approach will be our commitment to apply more widely the principles of payment by results to services which reduce reoffending. By paying some or all of a contract value on the basis of the reduced reoffending levels achieved, we can focus service providers’ efforts on what works. This will ensure that money spent on rehabilitation is spent effectively. We intend to run a number of pilot exercises and competition will be a key mechanism in deciding which models we adopt.

In practice, this will mean taking a different approach for both custodial and non-custodial services. The use of competition in custodial services is now well established, as most recently demonstrated by the successful outcome of the competition for four prisons which I announced in March this year.

To ensure that we build on this strong record I am announcing today my intention to launch competitions for the management of a further nine prisons in the autumn. These are Lindholme, Moorland, Hatfield and The Wolds in Yorkshire, Acklington and Castington in Northumberland, Durham, Onley in Northamptonshire and Coldingley in Surrey. The Wolds is a prison run by G4S that has come to the end of its current contract; the other eight prisons are public sector establishments being competed for the first time. The public sector will have the opportunity to compete in all of these prison competitions.

These prisons have been selected by the National Offender Management Service to balance our need to increase efficiency and to make real the policy intent of the Green Paper.

Looking to the future, there is a need to consider the future shape of probation services in England and Wales to improve justice outcomes and to make the justice system more efficient and effective. I have asked my officials to explore the possible options for service improvements and different models of delivering offender services within the community. I will set out my preferred approach in the autumn. Alongside this, and supporting it, I will set out in detail my competition strategy for non-custodial services, which will also encompass the recently launched competition for community payback services, the competition for electronic monitoring contracts I am announcing today, and payment-by-results pilots in the community.

A further important element of our drive for greater efficiency is to ensure we have a modern, fit-for-purpose prison estate which can deliver high-quality, cost-effective and secure regimes. With the prison population not growing at the rate predicted by the last Government, we have an opportunity to close some of our more inefficient places.

I am therefore announcing the closure of HMPs Latchmere House and Brockhill. This will see a reduction of 377 prison spaces. This is part of an overall programme which includes a further 2,500 new prison places becoming available over the next 12 months. This will ensure that our operational capacity continues to handle the projected prison population in a way which meets the need both for greater efficiency and ability to support a strengthened focus on protection of the public and rehabilitation.

The closure of these places will provide estimated cost savings of £4.9 million this year and an on-going annual saving of £11.4 million. We also anticipate capital receipts from sale of the land at Latchmere House, which is in a prime location. We will transfer resettlement provision from that establishment to HMP Brixton to maintain our focus on reducing reoffending. We expect to be able to absorb staff displaced by this process elsewhere in the system and to avoid the use of compulsory redundancies.

The public have a right to expect continuing improvement in the quality and efficiency of public services, without compromising public safety. The competition strategy and adjustments to the prison estate I have outlined today will help ensure that this is the case.

Copies of the “Offender Services Competition Strategy” have been placed in the Libraries of both Houses. The document is also available online, at www.justice.gov.uk/publications/corporate-reports/moj/oscs.htm.