"This includes at least four prisoners employed in the concrete factory making concrete panels for the exercise yard."
The Release-to-Work programme allows minimum security prisoners who meet strict eligibility criteria to engage in paid employment in the community, giving them work experience and employment skills.
Upgrades to the prison total $22million - part of an $87million upgrade to five prisons around New Zealand.
"Whanganui Prison is already making a significant contribution to the Government's reducing reoffending goal by involving suitably skilled prisoners in the upgrades," said Ms Tolley.
The Government aimed to reduce reoffending by 25 per cent by 2017, she said. "You guys are already halfway there. That's an outstanding achievement in just two years. Imagine what we can do in another three years."
If the 25 per cent target is reached, New Zealand will have 18,500 fewer victims of crime every year.
Ms Tolley said about 7500 prisoners were released every year, and it was important to support them to reduce chances of reoffending
Upgrades to the east and west wings of the prison would cost $19.3million and include internal refurbishment and security upgrades, construction of secure staff bases, earthquake strengthening, cell hardening, and additional exercise yards with increased security.
Of Whanganui Prison's 529 prisoners, 55 have been moved to other facilities around the country, but prison manager Reti Pearse said they would ask for Wanganui and Taranaki prisoners to be returned once the work was completed.
Before the official opening the building was blessed by Graham Puru and John Maihi.
Lower North Regional Commissioner Paul Tomlinson and Mayor Annette Main also attended yesterday's opening.