Because businesses are often seen as being more economically efficient than the government, governments often introduce the private sector into traditionally state run services. The capacity to grow shareholder profits whilst saving taxpayer money is presented as attractive especially in a time of fiscal tightening. Competition does indeed motivate people and organizations to perform well, because they lose out on revenue if they don’t.
However this ideological shift to convert public funds into private profits can be damaging and often wasteful itself. This can especially be seen in the case of prison privatization in various western countries, such as the US, UK & Canada. One example is that in the UK, two of the companies involved in prisons are being investigated for overcharging the government by tens of millions of pounds.
Also prison privatization often delivers poor results and dangerous services. Driven by profits and not social justice, corporations will often pay low wages and hire inexperienced staff. They will have a higher turnover of staff, meaning a lack of consistency and poor continuity of care for prisoners.
A 2003 report in the UK found that despite some evidence of good performance by privatized prisons, they performed less well in safety and security with high levels of assaults. Prisoners also expressed concerns about personal safety due to the experience of staff.
In 2012, it was reported that Canada’s only privatized prison, in Ontario had poorer security, health care and recidivism rates than public prisons of the same size.
The prisons may well be run more efficiently under privatization but after they can’t get more efficient, the corporation will still be seeking higher profits, such is their obligation to their shareholders. Because the best interests of the business to keep prisoners in the system for as long as possible- the employee’s jobs depend on keeping them there, and the subsequent lobbying for longer prison sentences, will eventually cost more money. Corrections Corporation of America, the nation’s largest owner of private prisons, made a pitch to 48 governors state run prisons, which included an ‘occupancy agreement’- a clause demanding the state keep those newly privatized prisons at least 90% full at all times. Occupancy agreements are common practice within the private prisons sector.
They will also lobby against progressive policies like decriminalizing marijuana, would cut back into the corporations’ profits, as would measures aimed at reducing the system’s racism, given incarceration rates for black people is 7 times that of white people.
Furthermore, powers like having a right to detain, to remove an individual’s liberty and to restrain, should only be exercised by public servants- employed by the state, whose line of reporting runs straight to the minister in charge of prisons.