Labour says private prison company Serco must be booted out after an alleged rape in a jail.
Police, The Department of Corrections and Corrections Minister Peseta Sam Lotu-Iiga were all investigating after the prisoner, previously segregated, was moved into the "mainstream" jail population, then allegedly beaten up and sexually assaulted.
Labour's acting Corrections spokeswoman Jacinda Ardern said the incident was "clear evidence" Serco was not fit to run New Zealand's prisons.
"After the chaos and violence we saw at Mt Eden Prison, we are now seeing Serco isn't fit to run Wiri prison either.
"It's there in black and white in Serco's contract that they have to run proper segregation policies at Wiri to keep at-risk prisoners safe. They clearly aren't living up to that."
Ms Ardern said the Government was "being soft" on Serco.
"They've had second chance after second chance so the Minister won't have to face up to reality," Ms Ardern added.