Up to $100 million of New Zealand Superannuation Fund money may be invested in the new Wiri prison if the Government decides to go ahead with the public-private partnership model for its design, construction and operation.
Wellington investment banker Lloyd Morrison's Public Infrastructure Partnership (PIP) Fund yesterday welcomed news the
Government will investigate the merits of a PPP model for the new prison.
Managing director of the fund Peter Coman said the announcement was a strong endorsement of Morrison & Co's decision to set up the investment vehicle, which has already received a commitment of $100 million from the NZ Super Fund.
With locally owned Craigs Investment Partners, Morrison & Co is seeking to raise a further $50 million for the fund from the public and from private investors.
The fund "will be able to invest in the Wiri Prison PPP if its involvement is limited to the design, construction, financing and life cycle maintenance of the prison", Mr Coman said. However, it would not invest in the custodial or operational side of the facility.
"You could have a situation where they have two contracts - one for the construction and life cycle and the other for the custodial side, in that case we could invest," he said.
But it was too early to say if the eventual deal would allow that division.
If not, the only potential bidder with experience in operating prisons in this country is Australasian Correctional Management (ACM) Services which managed the Auckland Central Remand Prison for five years until 2005.
But Finance Minister Bill English yesterday indicated one scenario could involve "a local firm that can build a prison working alongside an experienced operator".
