Mr Blair said: 'We know that millions have already been wasted in this exercise, but we are not being given the full picture. The Home Office hides behind this 'commercial confidentiality' screen to avoid telling us how much it is paying private contractors to run prison services. We know already that there will be a massive extra cost to taxpayers following the Home Office's belated discovery of employment laws protecting existing prison jobs.
'It's a sorry tale of incompetence and the waste of millions of taxpayers' money. It makes nonsense of government claims that prison privatisation is about efficiency and saving money.'
Harry Fletcher, assistant general secretary of the National Association of Probation Officers, and spokesman for the prison service unions' anti-privatisation campaign, claimed that the Home Office had wasted millions in prison privatisation and that there were more losses on the way.
'The Government embarked on this programme with two clear aims - to break the prison officers, and to give the department's civil servants a jolt to make them more efficient. But the move has backfired disastrously and has meant that taxpayers will now have to pay more for prisons,' he said.
Mr Fletcher said that it was incredible that the Home Office, which presided over the country's criminal justice system, should overlook basic employment laws protecting employees. After it had turned over the prisons' supply and transport department to a private contractor and offered redundancy deals of up to pounds 30,000 to 153 existing employees, it found that it would be in contravention of European employment laws signed in 1981. 'Now they have to rip up the contract and will have to pay several millions to the contractor. They will also have to re- employ the original staff. But they cannot rescind the redundancy offers, and some people may choose to take the money.'
Mr Fletcher drew attention to the plan to privatise Strangeways prison, which he said was in tatters. Private companies making bids believing that they could run it with fewer, alternative staff, had been told that they must take on existing officers, and maintain their wage levels and conditions of employment.
'In terms of efficiency and saving money, the exercise has cost millions so far in civil servants' wasted time, unnecessary redundancies and compensation,' he said.
The Home Office said last night: 'We are aware that this 1981 employment law applies to various privatisation plans, but cannot say what the costs are.'