"Participants are issued with a basic model Vodafone 155 mobile phone loaded with pre-approved support service numbers to assist with their reintegration, including looking for a job.
"We plan to work with recidivist offenders to begin with, and a cellphone provides a useful tool to keep a line of communication open with them."
The scheme is funded by Vodafone and Serco, which holds the government contract to run the Auckland prison.
Vodafone provides the handset and pays the first month of a basic plan.
Serco funds two more months of the basic plan.
The offender was expected to pay for all additional phone call costs, Middleton said.
The Vodafone 155 model includes a calendar, FM radio, alarm clock, a calculator, a stopwatch and retails for about $50, without a call plan.
Only a handful of prisoners have been given the phones but if the project is successful, it is believed it will also be introduced at the new $300 million Serco-run prison at Wiri, South Auckland, when it opens next year.
The project has drawn criticism from hardliners, concerned it will be adopted throughout the country at state-run jails.
Nearly 9000 people are released from New Zealand prisons every year.
Sensible Sentencing Trust spokeswoman Ruth Money was outraged.
"This is like giving a reward to offenders for completing their sentences," she said. "If free mobile phones are being handed out to anyone, it should be to victims, not criminals."
Labour's corrections spokeswoman, Jacinda Ardern, believed Vodafone should provide offenders with jobs or training rather than cellphones.
But Serco New Zealand director of operations Scott McNairn defended the fledgling scheme.
"If it prevents just one person from becoming a victim, it will be worth it," he said.
Released prisoners who have been in jail for 31 days or more are eligible for a $350 "Steps to Freedom" grant from Work and Income.
The grant is used for buying groceries or clothing, or to contribute to housing expenses.
The Department of Corrections, which operates public prisons, said it supported the cellphones project but had no plans "at this stage" to introduce it at its facilities.
"Our aim is to reduce re-offending by 25 per cent by 2017 and programmes that help us achieve this goal are welcomed," the department's northern region commissioner, Jeanette Burns, said.