Victorian Auditor General’s report 
28 November 2012   
Prison Capacity Planning
Audit summary
Corrections Victoria (CV) is a service agency within the Department of Justice (DOJ) that is responsible for directing, managing and operating Victoria’s corrections system. As in other correctional jurisdictions, DOJ has set operating parameters for CV to manage the prisoner population to within 90 to 95 per cent utilisation of the prison system’s operational capacity. This is currently equivalent to 5 318 prison beds. These parameters are necessary to maximise the efficiency of the system while allowing CV flexibility to adequately manage the rehabilitation, human rights and welfare of prisoners.
CV is required to plan for and forecast the impact of any future growth, and take appropriate steps so that the system is capable of accommodating and providing services to future prisoner populations. In doing so, CV must factor in the long lead time required to construct new prisons and expand existing facilities. 
Planning for future prison capacity has been made more complex by the large growth in prisoner numbers, which increased by 38 per cent or 1 344 prisoners between 30 June 2002 and 30 June 2012. There were 5 024 prisoners in the prison system as at 30 September 2012. While long-term planning is important, this large growth in prisoner numbers and the periodic spikes in these numbers require the implementation of short-term measures—such as use of temporary beds—to quickly respond to capacity constraints. 
This audit focused on the prison infrastructure and support services—it has not examined the human resource implications arising from additional prisoner numbers.  
Conclusions
CV forecasts indicate that by 2016 the male and female prison systems will not have sufficient capacity to meet increases in prisoner numbers.
The male prisoner population is growing beyond the capacity of existing infrastructure. The average prison utilisation rates have remained close to or above the 
nationally-accepted limit of 95 per cent since May 2011. As a result, the capacity of the male prison system to cope with the increase in prisoners is becoming unsustainable. These existing capacity difficulties are compounded by the four- to six-year lead time to construct a major prison facility and also by changes, for example to sentencing policy, that are likely to increase the rate of imprisonment.  
In the male system there is a heavy reliance on temporary beds and double bunking, which has resulted in male prisons containing 22 per cent more beds than the infrastructure can currently support. In addition, up to 34 per cent of the total prisoner population may currently be housed in accommodation that does not comply with CV's standards, which recommend single cell accommodation. As a result, opportunities to continue to increase prison capacity through temporary beds and double bunking in the future are severely limited by prison infrastructure constraints.
Further, prisoner support programs and health services have not kept pace with the growth in prisoner numbers, primarily because funding for temporary beds prior to 2009–10 has not included allocations for these services. 
A substantial rise in the rate of serious prisoner incidents has occurred at the same time as prison capacity pressures have increased.
There is also evidence that prison capacity constraints are having adverse impacts outside the prison system. Difficulties in accommodating the increased number of male prisoners have contributed to the number of prisoners in police cells in 2012 reaching the highest levels since 2002. Police cells are not designed as a substitute for 
long-term accommodation and prisoners do not receive rehabilitative support. The high numbers of CV prisoners in police cells is well beyond what Victoria Police and CV deem to be satisfactory. It creates unacceptable health and safety risks for the prisoners, compromises rehabilitative outcomes and places an additional strain on police operations.
By comparison, there is currently spare capacity in the women’s system. This is despite experiencing a similar overcrowding crisis in 2009–10 when the utilisation rate reached 103.2 per cent. However, this spare capacity reflects an over-reliance on temporary beds. Prior to the recent opening of an 84 permanent bed unit, the ability to continue to add temporary beds to the primary women's prison—the Dame Phyllis Frost Centre—was nearing its limit.
Despite the current state of the prison system, CV, and by extension DOJ, has been active over the past 10 years in planning for growing prisoner populations. CV has developed long-term diversion strategies to reduce prison demand and meet future demand. CV’s long-term planning has included initiatives that would have alleviated the current overcrowding problems. However the funding of additional prison infrastructure has had to compete with other important areas requiring public funding. This has resulted in a shortfall between funding requested and funding received. 
Findings
Demand pressures on the prison system 
The capacity of the male prison system to accommodate growing prisoner numbers has been a longstanding problem. Current indications are that the system is reaching levels that are unsustainable. The male prison system has been operating at close to or above its operational capacity of 95 per cent since May 2011. As at 30 September 2012, the male prison system was operating at 95.8 per cent of its operational capacity (4 893 beds).
This pressure is likely to significantly increase with CV forecasting, in a 2012–13 funding submission, that the male prisoner population will grow by nearly 2 000 between June 2011 and June 2016. This forecast growth is due to projected general population growth and the implementation of proposed new sentencing and bail reforms. CV estimated this would result in a shortfall of over 1 400 prison beds by June 2016. Even with the additional 895 beds funded in the 2012–13 Budget and allowing for some inaccuracy in CV's forecasting, there will be a significant shortfall in beds within the foreseeable future.  
The female prison system is currently operating well within its target utilisation rate at 87.3 per cent. Given the small numbers of female prisoners, the women’s system is susceptible to large percentage variations in prisoner numbers. It is therefore prudent to maintain the utilisation rate at below 90–95 per cent. 
The demand pressures facing the prison system are summarised in Figure A.
Figure A
Prison capacity headline indicators
The prison system faces the following demand pressures:	
·	The prisoner population has grown by 38 per cent since 2002. 	
·	Male prisoner population is projected to grow by 44.7 per cent from June 2011 to June 2016. 	
·	There are more prisoners being held in police cells than at any point in the past 10 years.	
·	Prison expansions have increased capacity by 53 per cent more than the prison system was originally design for.	
·	Prisons currently hold 22 per cent more beds than their current supported capacity.	
·	Temporary prison beds make up 19 per cent of the total number of beds in the prison system.	
Source: Victorian Auditor-General’s Office.
Increase in police cell numbers 
The high male prison utilisation rate has contributed to considerable pressure on police cells in 2012. On 24 August 2012 the number of prisoners held in police cells was 251. This is the highest level in 10 years and exceeds the 225 upper limit that Victoria Police has stated it can hold before compromising operational capabilities. The current numbers substantially exceed DOJ's and CV's commitment since 2006 that police cell numbers will be kept below 100. This commitment has since been revised, with DOJ informing Victoria Police that from June 2012 the number of prisoners held in police cells would range between 150 to 200 per day based on forecast prisoner numbers.  
Limitations on expansion of existing facilities 
CV has had to rely on a combination of additional permanent beds to existing prisons, and using temporary beds and double bunks to service the increased prisoner demand. Temporary beds represent over 1 000 beds or 19 per cent of the total funded capacity.  
For the men’s system there are just over 1 600 more funded beds than the infrastructure was originally designed to support. The women’s system contains an additional 240 funded beds. 
CV has made modifications to nine of 14 prison facilities to increase the capacity that these facilities can support. As a result, there are around an additional 960 beds above the prison system's design capacity.  
These additional beds are all located at medium and maximum security prisons where the greatest demand pressures are. In addition, DOJ and CV do not consider that the physical condition of the main women's prison, the Dame Phyllis Frost Centre, is suitable to meet future forecast growth. As a result, in DOJ’s Women's Correctional Masterplan (2010), DOJ and CV have proposed to build a new multipurpose precinct to house 550 women offenders and to seek to either close, rebuild or refurbish the Dame Phyllis Frost Centre.
Increased prison incidents 
The increase in prisoner numbers and overcrowding within prisons and management cells has coincided with an increase in prisoner incidents over the past six years. The rate of serious incidents per prisoner, such as assaults, attempted suicides and self‑mutilation, has almost doubled over this time.
Impact on provision of prison services
The provision of services and rehabilitation programs has not kept pace with the increasing prison population, despite actions from CV to remedy the situation. CV did not receive additional funding for services when providing extra temporary beds to meet increased demand. However, for most of its programs, CV is unable to demonstrate the precise shortfall in service provision due to increasing prisoner numbers. 
In contrast, CV sought and received additional funding to address unmet demand in the sex offender and education programs.
Prison system planning
Long-term strategy
Since 2001, DOJ and CV have responded to emerging demand pressures in male prisons and the forecast increases in male prisoner numbers by developing two 
long-term strategies. They are in the process of developing a third. These strategies have incorporated a multi-faceted approach that has combined infrastructure investment to address forecast prisoner increases, and demand management initiatives that aim to reduce the growth in prisoner numbers.
The Corrections Long Term Management Strategy was developed in 2001 and led to the introduction of two new prisons by 2006. As a result, in 2006 the average weekly number of prisoners held in police cells fell consistently below 100 for the first time since 2002. The utilisation rate decreased from 95.1 per cent at 30 June 2005 to a more manageable 92.3 per cent at 30 June 2006. 
The effectiveness of the Prison Facilities Master Plan (2007) was compromised by delays in the construction of the Hopkins Correctional Centre and the new prison not being funded until 2012–13. These delays have resulted in additional capacity pressures.
Contingency planning
CV acted promptly to introduce short-term strategies to respond to demand pressures, such as deploying temporary beds and implementing management efficiencies. However, these can only be seen as interim measures, and their effectiveness has been limited due to the already high levels of occupancy and the lead time to build additional infrastructure.
Forecasting prisoner numbers
While acknowledging that forecasting prisoner numbers is complex, CV could improve and strengthen its forecasting approach. CV uses two models to forecast future prisoner numbers—a primary model and a secondary model. The accuracy and robustness of forecasting models are critical, as results from this process underpin DOJ's business cases for seeking additional infrastructure funding. 
While CV's models are able to forecast demand for the men's prison system reasonably accurately for up to three years, they are less accurate for the women's prison system. Accuracy diminishes the further ahead forecasts are made. Forecasting 4–5 years in advance is less accurate and tends to understate the actual growth in prisoner numbers.
Given that the forecasting error rates are higher for the female prison system due largely to the smaller prisoner population, the female system is particularly vulnerable to stress when sudden unforeseen spikes in prisoner population occur. Adopting the recommendations in this report will provide greater confidence that the forecasts of prisoner numbers and capacity are robust and reliable. Greater transparency of prisoner forecasts will also provide increased public confidence that capacity is being appropriately managed.
CV has comprehensively briefed government and DOJ’s senior management on trends in prison capacity, the implications of increased prisoner numbers and system-wide risks. CV has advised government that if the forecast trends continue, further substantial investment in prison infrastructure will be required to meet future demand. 
Recommendations
Number	Recommendation	Page	
	Corrections Victoria should:		
1.	determine whether its targeted offending behaviour programs have sufficient places to meet demand and, if necessary, incorporate this assessment in future funding submissions	20	
2.	update and improve the primary model in areas such as the use of demographic data, and the way in which stakeholder-provided information is quantified 	37	
3.	conduct regular external reviews of the primary forecasting model 	37	
4.	use the secondary model in a limited capacity only, due to shortcomings in the model	37	
5.	develop a new forecasting model based on contemporary practice, and then establish a consolidated multi-forecast system that incorporates the outputs from all the models	38	
6.	publish its forecasts pending the completion of Recommendation 2.	38	

Submissions and comments received
In addition to progressive engagement during the course of the audit, in accordance with section 16(3) of the Audit Act 1994 a copy of this report, or relevant extracts from the report, was provided to the Department of Justice, Victoria Police, the Department of Education and Early Childhood Development, the Department of Premier and Cabinet and the Department of Treasury and Finance with a request for submissions or comments.
Agency views have been considered in reaching our audit conclusions and are represented to the extent relevant and warranted in preparing this report. Their full section 16(3) submissions and comments are included in Appendix B.