§ Mr. Gordon PrenticeTo ask the Secretary of State for the Home Department what representations he has received during the last 12 months on the impact of the price of goods manufactured by prisoners on similar products made by commercial businesses outside; and if he will make a statement. [10144]
§ Beverley HughesThe Prison Service policy on pricing is that goods and services should be offered at a fair market price, which covers direct manufacturing cost plus a contribution to the recovery of overheads. Prison overheads are higher than outside because of high fixed costs, such as high ratios of costly supervision, a short working week and low productivity rates. Once a prison has recovered all variable costs and a contribution to the direct costs, its rates are in most cases no lower than those of comparable commercial ventures.
The Prison Service has dealt with three cases during the last 12 months in which concerns were expressed about under-cutting by prisons. All three cases were fully investigated and it was found in each case that Prison Service policy had been adhered to.