Social cost of illicit drug use: $1.31 billion

Thursday 1 May 2008, 9:00PM
By Hon Jim Anderton

New research shows that use of illicit drugs like cannabis and P had social costs to New Zealand in 2006 of $1,310 million.

The chair of the ministerial committee on drug policy and Progressive Party leader, Jim Anderton, released the research at an alcohol and drug forum at Otago University tonight. He says New Zealand should have the strength to care enough about the social costs of drug use to do more to minimise the harm.

The research was carried out by BERL and peer reviewed by experts from three universities.

The study concluded, “the harm from drugs consumed in 2006 is substantial and that illicit drug seizures may have prevented approximately another third again of harm.”

At $1,310 million, the social costs of illicit drug use amounted to nearly one per cent of New Zealand’s GDP. Illicit drug production cost the country $519 million. Related crime cost us $414 million. Lost output due to illicit drug use cost $106 million. Another $53 million resulted from drug-attributable health care and road smashes.

Over two fifths of social costs - 42 percent, or $551 million - is caused by illicit stimulants, such as P. The report says stimulants stand out as the “the second largest source of tangible costs for the user” at $2640 per user in 2006. They caused $551 million of social costs in 2006.

The social costs of cannabis use were estimated at $444 million.

Jim Anderton said cannabis is not as intrinsicially damaging as other illicit drugs such as opioids or LSD, with a lower ‘social cost per kilogram’ and lower ‘social cost per user’, but the total social cost of cannabis use is very high because use of the drug is so widespread.

“The more widespread the use of cannabis gets, the higher that cost will be.

We all pay the social costs of harm caused by drug use in paying taxes for our hospitals and police and social agencies to pick up the pieces. The victims of crime pay the social costs. The families of users pay the social costs. And the users pay the cost too. In the case of cannabis they pay around $1,750 each, per year, in social costs.”

The research is being used to create a drug harm index, which can be used to quantify drug-related costs, where avoidable costs lie and what could be done to minimize them. It will help answer questions about the cost-benefit of current drug strategies and policies.