Ministry of Defence
The service level agreement (SLA) will see prisoners making sandbags, fence posts and other support products for Britains armed forces.
It is set to extend a 6-month trial that has already produced savings of nearly 500,000 and will see offenders learn valuable employment skills as the work is brought back to British shores.
Taxpayers are set to benefit from further savings after a 10-year SLA.
A number of the products were previously made overseas, while a number of items, such as hydraulic jacks, will now be able to be repaired rather than simply replaced.
As well as making significant savings, bringing back work to Britain and helping prisoners rehabilitation, the agreement will also be of great benefit to local businesses that supply materials to prisons such as HMP Coldingley.
Minister for Defence Equipment, Support & Technology Philip Dunne said:
I was pleased to visit HMP Coldingley prison today to see the workshops in action and speak to the prison workforce supporting our armed forces.
During times of austerity were always looking at ways to be more efficient and this is a fantastic initiative.
The pilot projects have been very successful, so signing the agreement here today is a great step in widening the benefits for both departments and society as it will offer prisoners more opportunities to develop skills and prepare for employment when released.
The 10-year SLA was signed at Coldingley prison, and comes into force on 1 February.
Offenders across a number of prisons will start making the wide range of products, with the agreement able to be expanded to allow prisoners to make more products and services.
The agreement is the result of a years work between the departments with a 6-month trial seeing the prisons produce 17,375 fence posts, 3,950 edge protectors, 128 refurbished hydraulic jacks, 250 burner boxes and 20,000 sandbags.