By Peter Wilson and Sarah Robson
The Government could be looking for ways to end Serco's Mt Eden Prison contract.
After revealing another violent incident at the remand prison, Corrections Department chief executive Ray Smith is taking legal advice and says he's looking at all his options.
"I feel I must consider taking firmer steps to ensure the safety of prisoners and staff," he said.
"The bottom line is that prisoners must be safe when serving their sentences."
Another prisoner transported from Mt Eden arrived at the destination prison with injuries, and has made serious allegations about his treatment at Mt Eden, he said.
Mr Smith is going to meet Corrections Minister Sam Lotu-Iiga to discuss what can be done under the contract the Government has with Serco.
Earlier on Thursday Mr Lotu-Iiga called in company bosses and told them they were on notice.
He said there was no guarantee the contract would be renewed.
Opposition MPs want it ended immediately after Mr Lotu-Iiga revealed Serco had already been fined $300,000 for performance failures during the 2014/15 financial year.
The minister said the failings included inadequate staffing, mixing accused prisoners with guilty prisoners and incident notification.
He was being hounded by Opposition MPs over allegations by Labour's Kelvin Davis that there have been numerous serious incidents at the prison including inmates being thrown off balconies by gang members.
Mr Davis says throwing prisoners off balconies is known as "dropping" and he's alleged that one, identified as prisoner Evans, was fatally injured.
"There are so many issues going on the contract must be canned," Mr Davis told reporters after Mr Lotu-Iiga had spoken in Parliament.
"They got off lightly - only $300,000, I would think they'd be laughing."
The Green Party's corrections spokesman, David Clendon, says putting Serco on notice isn't good enough.
"There have been riots, assaults, fight clubs and the manufacturing of contraband," he said.
"Does the prison have to burn down before the minister acts?"
WHAT SERCO CAN BE FINED FOR UNDER ITS $300 MILLION 10-YEAR CONTRACT:
* Escaped prisoner $150,000
* Death in custody from unnatural causes $150,000
* Loss of control $100,000
* Breach of a performance notice $50,000
* Wrongful release $25,000
* Wrongful detention $25,000.