The new Supermax 2.0 facility has officially opened at the Goulburn Correctional Complex, but there are no inmates in it yet.
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The new centre will house 46 inmates and is part of a $47 million funding package.
Inmates will start moving into it from May 27.
Minister for Corrections and Counter Terrorism Anthony Roberts officially opened the new high-security unit to house extremist and terrorism-related offenders on May 14.
In opening the facility to much pomp and ceremony, Mr Roberts said the 46-bed High Risk Management Correctional Centre 2 is part of the NSW Government's investment in countering terrorism and the radicalisation of inmates in the prison system.
"Our biggest priority is keeping the community safe and this new unit ensures extremist, terrorism-related and high-risk offenders will be held in one of the most secure facilities in Australia," Mr Roberts said.
He said the NSW Government has also identified a number of counter-terrorism initiatives to enhance community safety.
"The $47 million funding also provides for a dedicated counter-terrorism Intelligence Unit based at Silverwater and an increase in the number of beds in the original Supermax from 56 to 75," he said.
"Complimenting the resources here at Goulburn are specialist programs that combat extremism and the spread of radicalisation," he said.
He said the new Supermax 2.0 would work in conjunction with the current Supermax, but would house inmates who had demonstrated a willingness to "disengage from radical behaviour."
"The new unit will act as a 'step-down unit' from Supermax to house the offenders who have demonstrated a commitment to disengage from radical behaviour, allowing us to combat extremist narratives and challenge ideology," Mr Roberts said.
Inmates and staff in the Corrective Services Industries unit at the jail had assisted with the construction of the new unit.
"Up to 21,000 inmate hours were used in the project, providing opportunities for them to enhance their skills that are a vital part of rehabilitation and release preparation," Mr Robert said.
Across the state, Corrective Services NSW (CSNSW) is currently managing 41 inmates charged or convicted of terrorism-related offences.
CSNSW Commissioner Peter Severin said the new unit included enhanced security features, including high-definition digital CCTV cameras, thermal-imaging cameras and a high-voltage electric fence.
"These security measures will ensure inmates remain securely inside the facility, but will also stop contraband from getting into the prison," Mr Severin said.
"We've also installed a purpose-built control room so our front line officers can securely and safely manage the facility using advanced access-control systems and up-to-date cell communication channels."
He said the NSW Government has also identified a number of counter-terrorism initiatives to enhance community safety.
"Complimenting the resources here at Goulburn are specialist programs that combat extremism and the spread of radicalisation," he said.
Across the state, Corrective Services NSW (CSNSW) is currently managing 41 inmates charged or convicted of terrorism-related offences.
Member for Goulburn Wendy Tuckerman welcomed the new facility.
"Goulburn community has been significant providers in some of the construction and that has been fantastic for our economy and our local suppliers and builders," Mrs Tuckerman said.
"Ongoing, local businesses do supply the jail so that is fantastic for business as well."
More than 20 new jobs would be added as a result of the addition and broader initiatives to reduce re-offending.
Other official guests at the opening included Member for Hume Angus Taylor, Goulburn Mulwaree Mayor and Deputy Mayor Bob Kirk and Peter Walker and Goulburn Jail governor Larry Bulger.