The Government says a new multimillion-dollar prison for South Auckland may not be needed because the number of prisoners is expected to fall dramatically.
A Ministry of Justice forecast says the prison population is expected to drop 6.2 per cent by 2021.
Over the past decade, it grew 45.6 per cent.
The predicted drop is being attributed to several factors, including a fall in recorded crime, and greater use of police diversion for low-level offences.
Prime Minister John Key said it was possible that the 1060-prisoner facility planned for Wiri, in South Auckland, may not be needed.