Operator of Port Phillip Prison could sue Allan government

The operator of Victoria’s biggest maximum security jail — Port Phillip Prison — is considering taking multimillion-dollar legal action against the Allan government after the jail was shut and its contract torn up.

The operators of the state’s biggest maximum security jail are weighing multimillion-dollar legal action against the state government after its contract was torn up.

The Herald Sun has been told international corrections giant G4S is examining its options after the shock termination of its Port Phillip Prison contract in June.

That decision came seven years into a 20-year arrangement under which it was to run PPP until 2037.

A parliamentary corrections inquiry was told in 2021 that the contract was worth $1.8bn.

Publicly available contract information shows G4S may be entitled to a termination payment for the early abandonment of the contract.

But there are provisions for it to be ended prematurely without compensation.

G4S has declined to comment but corrections insiders say the company is seriously considering fighting for compensation.

The potential legal action was a fair and “reasonable” step for G4S to take, a prison source said.

Port Phillip Prison has a capacity of around 1100 inmates. Picture: David Caird

“It’s totally reasonable, in any workplace you’d get some sort of compensation if your contract was terminated early and you did nothing wrong,” the source said.

The publicly-listed firm operates in America, Asia, Europe Africa and the Middle East.

G4S communications published online in June say PPP is shown by Corrections Victoria’s own data to be “consistently outperforming” other maximum-security jails and having fewer “incidents” than them for 23 straight quarters.

“This performance is achieved while maintaining a 20 per cent lower per prisoner cost compared to public prisons, according to the Victorian Auditor General,” the bulletin says.

Staff at PPP are expected to be offered jobs in other prisons.

The privately-run jail has a capacity of nearly 1100 inmates and opened its cells in September of 1997.

G4S has operated the maximum-security prison since that time.

There were 719 prisoners held in the cells at the end of May.

PPP will close by December 31 next year, with prisoners to be transferred to other maximum security prisons including the new Western Plains prison in Bacchus Marsh.

Some Port Phillip Prison inmates and staff are set to be moved to Victoria’s newest jail Western Plains Correctional Centre. Picture: Mitch Clarke

It is also understood many of the staff at PPP will be offered gigs at the new prison.

The $1.1bn centre, which has been sitting empty for the best part of two years, will begin taking in inmates from mid-2025.

The state government has forked out about $35m each year to maintain and patrol the empty prison.

Coroner David Ryan in July revealed the death of 32-year-old Indigenous man Joshua Kerr in custody, while on remand at PPP, was avoidable.

Mr Kerr was found dead hours after being taken to hospital for burns sustained while lighting a fire in his cell in 2022.

Eight prison officers were in June suspended while an independent investigation was launched after an inmate injured themselves slipping on their own waste.

It is understood the inmate, who has highly complex needs, suffered a broken femur and fractured hip on April 30 last year.

Originally published as Operator of Port Phillip Prison could sue Allan government