UPDATED 3.01PM: Regional leaders say it defies logic to close parts of three North Island prisons, and move resources to Auckland.

Around 260 jobs are on the line with units at Waikeria, Tongariro-Rangipo and Rimutaka prisons set to close.

A new facility is opening in south Auckland.

Waipa District Mayor Jim Mylchreest says there is constant talk of the congestion and cost of housing in the Super City.

"To close down a reigonal and effectively force those those people or those jobs into an already overcrowded situation just defies logic."

Mylchreest says the loss of around 150 jobs at Waikeria Prison is major for those living in and around Otorohanga, and affected staff are being offered a $20,000 relocation allowance, but trying to relocate from Te Awamutu and find a similar home somewhere like Auckland would be an absolute joke.

Mylchreest is also unhappy with the lack of consultation with the region - he first heard of the closures from the media.

"Nobody has bothered to contact the local council, and when you consider central government makes legislation to make us consult with the public, you'd have thought they would have done a bit better than that."

Taupo District Mayor David Trewavas says the community will work hard to find jobs for the 67 local prison workers set to lose theirs.

"Certainly the town won't close up. It will work really hard to keep going. But it's sad when they take a good employer out of the market and shift it to Auckland."

Trewavas claims people who own homes in Turangi would not be able to afford to sell up and buy in the metropolitan centres.

Labour's corrections spokesperson Kelvin Davis says the units being shut are only outdated, because the government let them get that way.

"The prison at Rangipo hasn't had a cent spent on it in a number of years, and again this is just a justification to run down other units to justify opening a private prison at Wiri."

"There are concerns around a lot of issues in Corrections, cost cutting, privatisations and there's been a number of assaults in prisons in the past few weeks."

The Corrections Association Chief executive Ray Smith says the units earmarked for closure are old and tired and its Wiri Prison will provide the facilities instead.

Meanwhile Corrections Association president Beven Hanlon believes it shows the partly privatised prison, opening next month, is already costing jobs.

"The other part of the consultation process that they're doing introduces a heap of new managers. We need more managers like we need a hole in the head."

"They may have children, likelihood they do. They may have all of their family support structure in the city they live in."