Australian Institute of Criminology

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Introduction

In 1992, the Australian Institute of Criminology (AIC) published a paper in its Trends & Issues in Crime and Criminal Justice series that presented the results of research that sought to estimate how much crime cost the Australian economy in 1990. It was estimated that the total costs of crime for that year were $27b or 7.2 percent of GDP (Walker 1992). Similar costing exercises were undertaken for the years 1996 (Walker 1997), 2001 (Mayhew 2003a, 2003b) and 2005 (Rollings 2008). The present report provides a further update on the cost of crime in Australia for the calendar year 2011—the most recent year for which baseline official statistics and survey data were available. The costs for 2011 are estimated to be approximately $47.6b (3.4% of national GDP). Over the preceding decade, therefore, the estimate costs of crime have increased by 49.8 percent. As a percentage of national GDP, the costs over the decade have declined by 0.4 percent of GDP.

The methodology underpinning these calculations includes both the costs of various specific criminal offences, as well as the costs of responding to crime through the criminal justice system and crime prevention measures. While estimating the costs of crime is a particularly difficult task—as many of the costs associated with different crimes cannot be conclusively determined or ascertained—it is, nonetheless, important to attempt to estimate what both individual crime types cost and what the community spends in preventing and responding to crime. Given the sizable financial investment made to fight crime, both in terms of direct investment from governments and investments made by individuals on preventative measures, seeking to understand which crimes cost more and whether there has been change over time would allow a better appreciation of where sizable resources might best be directed.

As in previous research, the categories of crime costed in this report are:

  • homicide;
  • assault;
  • sexual assault;
  • robbery;
  • burglary;
  • thefts of vehicles;
  • thefts from vehicles;
  • shop theft;
  • other theft;
  • criminal damage;
  • arson;
  • fraud;
  • drug abuse; and
  • other costs (which include costs of the police, prosecutions, courts and other government spending on crime, the prevention of crime and dealing with offenders).

The costing methodology used to calculate costs has been based on the methodology employed by the Home Office in the United Kingdom (Brand & Price 2000, Dubourg, Hamed & Thorns 2005; Home Office 2011) adapted to Australian conditions. The current costings are for the calendar year 2011. Although the most recent ABS Recorded Crime statistics were available for the year 2012, the most recent ABS Crime Victimisation Survey (CVS) data were only available for 2011–12. As explained below, in order to account for the survey reference period being 12 months prior to data collection, it would have been necessary to use the CVS survey for 2012–13 in conjunction with the 2012 recorded crime statistics. In addition, other government agency data were only available for the 2011 calendar year or the 2010–11 financial year.

For ease of use and comparability with previous reports, this report is presented in a similar fashion to the previous technical report (Mayhew 2003b), with the detailed methodology and costings associated with each major category of crime explained in detail in its own section. The headline results are set out in the Executive summary, which includes comparable findings for the years 2001 and 2005, by way of comparison.