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Every prisoner would love to work (and at a decent minimum wage) and would be happy to pay tax - how the Government allocates tax is up to them but don't go saying "it will go to victims compensation" - there are too many false victims in our victim culture.
In principle it sounds a good idea. The money should go to a CHARITY of the Prisoner's choice. That would only be fair. Such as OXFAM - TEAR FUND - CANCER RESEARCH or even local charities. Each prisoner would then be contributing around 30% of the £12,000 say £4,000 a year towards the cost of their keep - which although very short of the £52,000 it costs will actually work out well for the Chancellor.
Letting them keep £20 a week is fairish - though if they are expected to work 40 hours it does not seem much more than the £10 that they get already for just a few afternoons - that needs to be looked at. The pay should b graded starting at £20 per week to make it fair. The cost of buying stuff in a Prison is far higher than in the real world for many things so they are already taxed in that way.
But a good idea and a positive move which should be seriously considered.