Jean Pasqualini's book Prisonnier de Mao
I haven't found the point about learning from one's mistakes but this is the closest Mao quote I've found:

中国监狱制度的改革与发展


  “我们的监狱不是过去的监狱，我们的监狱其实是学校，也是工厂，或是农场。”


Which roughly equates to something like: Our prisons are not prisons of the past, our prisons are actually schools, they are factories, or farms.

Jean Pasqualini might have taken some liberties or licenses since this has to do with 劳改 (re-education through labor) with his translation, but I can't be sure yet.



Update: So, the wiki quote is listed as:


  Behr, 1987 p.283


Which is a reference from Edward Behr's 1987 book "The Last Emperor" - page 283, here is the excerpt in question:

 


  The difference lay in the overall approach of those in authority to all those accused of any kind of 'crime'. As Jean Pasqualini, author of Prisoner of Mao, a uniquely insightful analysis of the Chinese penitentiary system based on his own prison and labour camp experiences, put it: 'Prison is not prison, but a school for learning about one's mistakes.' Chinese prisons were places 'where the prisoners reform the prisoners'.


A translation of "The Last Emperor" (中国末代皇帝) was done by 黄群飞 (Huang Qunfei) and published in 1989, here is his translation of the above paragraph found on page 219 of the book:




  不同之点在于那些掌权者对那些被控犯有各种“罪行”的人的总的处理方法不同。《毛泽东的囚犯》一书的作者琼·帕斯加里尼，根据他自己蹲监狱和劳动集中营的经历，对中国的悔改制度作了与众不同的、独到的分析。他说：“监狱不是监狱，而是一所悔罪的学校”。中国的监狱是“囚犯改造囚犯的地方。”


Jean Pasqualini's quote is quite the resemblance of Mao's by saying:


  “监狱不是监狱，而是一所悔罪的学校”