Judith Collins is lauding the supposed economic benefits of the private prison at Wiri in South Auckland (soon to be filled with people sentenced under all these new laws the Nats, the party of freedom, are passing with no impact on the crime rate). Apparently, the prison will generate $1.2 billion worth of economic activity over 30 years.
Wahhooo! To get rich all we need to do is build more prisons! Let’s do it, then we can all buy dune-buggies!
But wait, Collins says is the government is planning to spend $101 million on construction and $40m per year for 30 years on wages. That’s $1.3 billion over 30 years. And that only results in $1.2 billion of economic activity in New Zealand.
How’s that? Oh, yeah, the private foreign owner who will be taking hundreds of millions offshore.
And of course an expenditure of money, public or private, results in economic activity and the wages are re-spent through the economy (the multipler effect). So what? It doesn’t mean it’s a good or optimal use of that money.
We could pay $101 million for the construction of the Great Wiri Sand Pit and pay $40 million a year for workers to empty and re-fill it. That would be the same expenditure as the Nats are planning on their new prison and it would result in the same ‘economic benefits’ – illusionary ones. But at least we wouldn’t be spending the money on another 960-bed criminal training unit and sending hundreds of millions of dollars offshore for the pleasure.
The real questions are:
Pity no-one asks them.