5  Results

Costs have been broken down according to which of the following sectors bears the cost: the public sector (fiscal costs) or the private sector (social costs).

As indicated earlier, we have included costs associated with crimes committed against local authorities in the private sector category. A more detailed sectoral analysis could separately identify local authority costs.

5.1  Costs borne by the public sector

Costs borne by public sector agencies are based on actual 2003/04 expenditure, taken from relevant agencies’ annual reports.

5.1.1  Core justice sector

The following core justice sector agencies incurred crime-related costs in 2003/04: the Police; the Ministry of Justice (Courts and Justice outputs); the Department of Corrections; the Department of Child, Youth and Family Services (mainly Youth Justice outputs); the Crown Law Office; the Serious Fraud Office; and a handful of Crown entities, namely the Law Commission, the Legal Services Agency (mainly legal aid) and the Police Complaints Authority.

Costs for the core justice sector total an estimated $1.6 billion net (i.e. after including offsetting revenue from Courts’ fines).[3] Summary fine revenue collected by the Police (speeding cameras and tickets) is excluded from this analysis. Table 3 breaks down core justice sector costs by crime category.[4]

Total net core justice agency spending is fairly evenly split over offences against the person, offences against private property and offences with no direct or intended victim.

Table 4 breaks down core justice sector costs by intervention stage. The largest cost share for the core justice sector is in detection and investigation (mainly by the Police). Redress and sanctions (mainly Courts) would be the next largest, except for the large offset of Courts’ fines. The next largest is resolution and adjudication (incurred by Courts, Corrections and Crown entities, chiefly in legal aid).

5.1.2  Health sector costs

Violent and sexual offences and robbery often involve injuries to the victim requiring medical treatment. The costs of providing these services have opportunity costs that need to be included in any calculation of the costs of crime. While the actual health consequences are suffered by the victims, the treatment costs are largely paid for by the public sector.

We have estimated New Zealand’s health service costs for victims of violence, sexual offences and robbery using the UK Home Office methodology for measuring the health costs of violent crime (Dubourg, Hamed and Thorns, 2005). That methodology estimates health service costs based on assumptions about the activities likely to be involved in treating each health state (e.g. ambulance, nurse, physiotherapy, and counselling). These are then weighted by health state prevalence and duration indexes for each crime type and multiplied by unit costs of health care activities to derive unit health service costs by type of offence.

The UK monetary estimates have been converted to New Zealand dollars using the OECD’s index of purchasing power parities for GDP for 2004.[5] It is assumed that the types of activities used to treat victims of violence, sexual offences, robbery and the (adjusted) unit health service costs are similar between the UK and New Zealand. This ignores differences in the respective health systems – New Zealand has ACC, for example. Ideally, New Zealand treatment type and cost data should be used; however, these are not readily available.

We have assumed there to be no health sector costs associated with crimes other than violence, sexual offences, robbery and serious traffic offences. Costs for serious traffic offences have been proxied using unit health service costs for victims of violence.