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Prisoner numbers reached their highest level nationwide yesterday, although there was still some spare room at the Otago Corrections Facility at Milburn.
Corrections Minister Judith Collins said yesterday's "unlock" figures showed 8509 people were locked up, either in prisons or police stations - 16 higher than the previous peak of 8493 prisoners on September 7.
In 1996-97, the average prison population was about 5000.
There were 292 prisoners at the Milburn facility yesterday - meaning there were at least 43 free beds there.
The nationwide figures mean there have never been more prisoners behind bars in New Zealand's history.
"This underlines the urgent need to ensure there are enough beds to accommodate forecast numbers of prisoners," Ms Collins said.
Ms Collins said the introduction of shipping container accommodation and double bunking was necessary to manage the "serious capacity crisis".
The double-bunking contract at Milburn began earlier this month, with Dunedin-based construction firm Naylor Love in charge of installing extra infrastructure and an extra 150 beds to lift its capacity from 335 to 485 by February next year.
The average national prisoner population was about 5000 in 1996-97.
Mrs Collins said the forecast jump in prisoner numbers could not be allowed to threaten public safety by leaving prisoners in prison vans, court and police station cells or being released back into the community.
She has asked the department to speed up ways to meet the extra demand.
Last month, it announced plans to build a 60-bed container block at Rimutaka Prison.
"However, that alone will not be enough, and double bunking will also be necessary to manage this serious capacity crisis.
"Double bunking is the fastest way to add extra capacity."