Something has been bugging me all day about the Economic Impact Statement lauded by Judith Collins as a money spinner for Wiri and region. Crampton sums it up nicely, saying the story confuses costs and benefits. He also helpfully links to other reactions around the blogosphere. Yep, they're all valid, but that wasn't it.
No, it took me a bit of a think but I finally put my finger on it. Indulge me with a bit of crude maths. It costs around $100,000 to keep a prisoner locked up for a year, excluding capital costs (building the thing and keeping it in good repair). Collins is crowing about the $1.2 billion return on investment over 30 years, which No Right Turn works out at around $40 million a year.
The new prison in Wiri will have 960 beds. 960 times a hundred grand works out to $96 million, all of which the taxpayers pick up. Only $40 million will enter the regional economy. Where does the other half go? Is there a better way for the government to spend half, burn half of $96 million a year in Wiri?
3 comments:
And there's the lifespan of only 30 years. Mt Eden has functioned fine for over 130 years - and I know from the inside that it still does - is this new Wiri prison designed to be replaced in only 30 years? Keep those cushy contracts rolling over, eh. The whole concept of planning to take more people prisoner is monstrous and the details of how to do it are similarly ghastly.
Here in Wellington, Mt Crawford had to be reopened back in 2009. Mind you, that's a relatively young prison. Built in 1927, so it's only 83 years into its 30 year to life.
I've not seen the study, but I'd expect that they're discounting future economic impacts. Throw an 8% discount rate on your calculations and see what happens.
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