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Prior research

Australian Bureau of Statistics reports

Recorded crime—Victims, Australia 2011

The Australian Bureau of Statistics (ABS) compiles annual data provided by state and territory police jurisdictions to produce national counts of a select number of crimes that are reported to police. Data from ABS Recorded Crime—Victims, Australia 2011 (ABS 2012b, as revised in 2012—ABS 2013c) has been used in this report for the categories of homicide, sexual assault, robbery, break and enter, motor vehicle theft and other theft. The ABS does not compile complete national police figures on the other categories examined in this report (assault, thefts from vehicles, shop theft, criminal damage, arson, fraud and drug offences) and in most cases, data held by state and territory police services were used in conjunction with other victimisation survey information.

The reference period used by ABS (2012b) was offences that have been reported to police between 1 January and 31 December 2011. Of course, these offences may have taken place at some time prior to 2011. In 2010, certain changes occurred in police recording practices as part of the completion of the National Crime Recording Standard. Accordingly, comparisons may not be appropriate between data published prior to the Recorded Crime—Victims 2010 publication and subsequent publications (see ABS 2011b).

Crime victimisation, Australia 2011–12

The ABS’ Crime Victimisation, Australia 2011–12 (ABS 2013a) is compiled from data collected by the ABS 2011–12 CVS. The CVS data are collected on a financial year basis (eg July 2011 to June 2012), while the Recorded Crime—Victims data are collected on a calendar year basis (eg January 2011 to December 2011).

Questions within the CVS ask respondents to report their experiences for the 12 month period prior to participating in the survey. For example, for survey interviews conducted in September 2011, the respondent is asked to report any incidents of physical force or violence they have experienced since September 2010. This means that the potential span of data from the survey ranges from July 2010 (the earliest offence date for respondents who were interviewed in July 2011) to June 2011. The centre point to the survey recall period is June 2011. June 2011 is also the centre point of the Recorded Crime—Victims data. As such, the 2011–12 data from the survey and the 2011 Recorded Crime—Victims data are considered a suitable approximation for comparison (ABS 2011b).

Mayhew (2003b) and Rollings (2008) relied on data reported in the ABS Crime and Safety Survey (CSS), the precursor to the CVS. The ABS (2011b) warns that different crime statistics collections can yield different results and that caution should be taken when comparing data from different surveys and administrative by-product collections that relate to crime and justice issues. The specific methodological differences between the CVS for 2000–01 and 2004–05 and the CVS 2011–12 are discussed in ABS (2011b) and noted where relevant below.

The importance of crime victimisation survey information lies in its ability to reflect actual victim experiences of crime, unlike recorded crime statistics that only deal with matters reported to or detected by police. For most crime types, multipliers indicate the difference between crime victimisation data and police recorded crime data, although account also needs to be taken of crimes that are undetected by victims and hence not included in victimisation survey responses, and also crimes for which there is no individual victim.

Personal safety, Australia 2012

The ABS’ Personal Safety, Australia 2005 datasets (ABS 2013b, 2006b) are compiled from data collected in the ABS Personal Safety Surveys (PSS). The latest PSS was conducted from February to December 2012 and collected information from men and women aged 18 years and over about their experience of violence since the age of 15 years in the 12 months prior to the survey. This included their experience of physical assault, sexual assault, physical threat and sexual threat by male and female perpetrators, providing information on the prevalence of the different types of violence by different perpetrator types. Where a person had experienced any of these types of violence, more detailed information was then collected for their most recent incident of each of the types of violence—physical assault, sexual assault, physical threat and sexual threat by a male and by a female perpetrator. It also collected detailed information about men’s and women’s experience of current and previous partner violence, lifetime experience of stalking, physical and sexual abuse before the age of 15 years and general feelings of safety. The previous PSS was conducted in 2005. The findings were of use in the present study to determine the prevalence of sexual assault in a more precise way than had previously been available.

AIC fraud against the Commonwealth report 2010–11

The AIC conducts annual surveys of all Australian Government agencies’ experiences of fraud. These are in the nature of fraud victimisation censuses that seek to obtain data from the entire population of agencies and with a mandatory obligation to respond in accordance with the Commonwealth Fraud Control Guidelines (AGD 2011). Using a broad definition of fraud, agencies report their experience of fraud including not only incidents that would fall within the definition of ‘recorded crime’ by police agencies, but also suspected fraud, incidents under investigation and completed incidents, whether the fraud was proved or not, and whether the incident was dealt with by a criminal, civil or administrative remedy. Estimates are also provided of losses sustained and amounts recovered.

In 2011, an invitation to complete the questionnaire was sent to all 192 Commonwealth agencies. Of those invited, 154 agencies provided responses, which represented a response rate of 82 percent. Of those who responded, 40 percent (61 agencies) reported that they had experienced a fraud incident in 2010–11, totalling 91,091 incidents worth $118,878,181, although 20 percent of agencies that experienced fraud were unable to specify a loss. Losses were defined as the total amount, in whole dollars, thought to have been lost to the agency from fraud incidents, prior to the recovery of any funds, and excluding the costs of detection, investigation or prosecution (Jorna & Smith unpublished).

Monash University Accident Research
Centre study (1997)

Some time ago, the Monash University Accident Research Centre (MURAC) undertook a comprehensive study that examined the nature, extent and cost of injury to the state of Victoria for the period of 1993–94. The study drew on a number of sources including, but not limited to, the Victorian Coroners Facilitations System, the Victorian Inpatient Minimum Dataset, the Victorian Emergency Minimum Dataset and the Extended Latrobe Valley Injury Surveillance. Importantly, MURAC were able to calculate the short and long-term costs of injury sustained during interpersonal violence, including where an individual was hospitalised, received non-hospitalised medical treatment or where fatalities occurred. Values calculated included direct costs relating to actual expenditure and certain types of indirect costs (being the value of lost output due to reduced productivity). The costs associated with interpersonal violence were based on a sample of 20,877 victims; less than one percent of whom involved a fatality and 14 percent of whom were hospitalised.

Although focusing on Victoria, the MURAC study is the only one of its kind available in Australia. In the absence of national research, the values associated with interpersonal violence were used in this report to estimate the medical and injury costs around offences such as assault, sexual assault and robbery.

Bureau of Infrastructure, Transport & Regional Economics: Cost of road crashes in Australia (2010)

In 2010, the Bureau of Infrastructure, Transport & Regional Economics (BITRE; formerly the Bureau of Transport and Economics) released an updated report regarding the cost of road crashes in Australia for 2006. As with Mayhew’s methodology (2003b), actual cost data produced in the Bureau of Transport and Economics’ report were not used, but rather the ratio of lost output to intangible losses was applied to data from the MURAC study (Watson & Ozanne-Smith 1997). In the absence of more recent research, the BITRE findings were used.

Benefits of theft reform (MM Starrs)

Produced in 2005, the MM Starrs (2005) report is the second review of the National Motor Vehicle Theft Reduction Council (NMVTRC) and provided an independent assessment of the costs and benefits of vehicle theft reform and the NMVTRC’s performance in overseeing the reform process. Section 4 of the report deals with the unit costs of stolen vehicles and provided detailed estimates for 2004–05. Specifically, the MM Starrs cost estimates for property losses for stolen vehicles for which an insurance claim has not been made have been included in this report. Additional data in connection with motor vehicle theft were obtained from the NMVTRC.

The costs of tobacco, alcohol and illicit drug abuse in Australian society in 2004–05 (Collins & Lapsley)

Collins and Lapsley (2008) produced their fourth report, which estimated the total value of the costs of tobacco, alcohol and illicit drug abuse to Australian society for 2004–05. They defined costs as

the value of the net resources which in a given year are unavailable to the community for consumption or investment purposes as a result of the effects of past and present drug abuse, plus the intangible costs imposed by this abuse (Collins & Lapsley 2008: 2).

Some data from their publication has been used in the drug abuse section of this report and a more comprehensive description of their findings is also available in that section. Collins and Lapsley’s (2008) methodology has been criticised by Crampton, Burgess and Taylor (2011) who reviewed the methods and assessed the policy influence of a series of publicly funded cost of illness studies. Their analysis showed that headline cost estimates, including Collins and Lapsley’s (2008) work, depended on an incorrect procedure for incorporating real world imperfections in consumer information and rationality, producing what was argued to be a substantial overestimate of costs. Other errors were identified that further inflated these estimates, resulting in headline costs that they found to be unrelated to either total economic welfare or GDP and therefore of no policy relevance. It was argued that counting only external, policy-relevant costs not only deflated overall figures substantially but also resulted in rank-order changes among cost categories. These views have been taken into consideration in the current costing exercise.

UK Home Office reports

The economic and social costs of crime against individuals and households 2003–04

The study by Dubourg, Hamed and Thorns (2005) was an update of the original Brand and Price (2000) work completed by the Home Office in 2000. The original study looked at the detailed costs of crime in England and Wales in 1999. Mayhew’s (2003a, 2003b) work relied heavily on the methodology (with some small differences) employed by Brand and Price (2000) and the updated estimates in the current report are used mainly for comparison purposes, but the overall methodologies are still similar.

In 2011, the UK Home Office released updated unit costs and multipliers to reflect those used in the Integrated Offender Management Value for Money Toolkit (Home Office 2011). Where appropriate, these updated figures were used as the base for some of the Australian estimates presented in this report.

Crime against businesses: Detailed findings from the 2012 Commercial Victimisation Survey (2013)

In 2012, the British Home Office conducted its CVS in which representatives of 4,000 businesses and premises were interviewed from four major commercial sectors—manufacturing, wholesale and retail, transportation and storage, and accommodation and food. The interviews were conducted by telephone and participants were asked questions regarding experiences of crime that occurred at their premises during the preceding 12 months (Home Office 2011). Questions covered a range of topics including the nature of the crime, crime prevention and the costs incurred as a direct response to victimisation as well as in prevention.

Currently, there is no comparable report available in Australia. Victimisation surveys such as the ABS’ CVS do not include business as victims meaning that this population if often overlooked. While the AIC’s Small Business Crime survey did examine the nature of crimes against business in Australia, it was conducted in 1999 and therefore was not used in this report.

Understanding organised crime: Estimating the scale and the social and economic costs (2013)

In 2013, the British Home Office published a research report that sought to estimate the social and economic costs of organised crime to the United Kingdom for the year 2010–11 (Mills, Skodbo & Blyth 2013). The study examined certain specific types of organised crime including organised acquisitive crime, organised child sexual exploitation, counterfeit currency, drugs supply, organised environmental crime, firearms supply, organised fraud, types of organised immigration crime, organised intellectual property crime and organised wildlife crime. Other types of organised crime such as identity fraud and cybercrime were excluded owing to risks of double counting and the paucity of available data. The research also identified a range of limitations in the estimations that make the total an underestimate of the actual costs involved. The study reached the following conclusions that have relevance to the costing methodology used in the present Australian study:

  • Drugs supply (£10.7b social and economic costs) is associated with substantial amounts of drug-related acquisitive offending as well as health costs and drug-related deaths, impacting on individuals, families and communities.
  • Organised fraud costs to the United Kingdom are estimated to be substantial (£8.9b) and these, along with the costs of counterfeit currency (£7m) and organised intellectual property crime (£0.4b), damage the prospects and reputation of UK businesses and financial services, as well as reducing tax revenue.
  • The suffering caused by human trafficking for sexual exploitation (£890m) is extensive, despite our ability to capture only a small proportion of those harms in this report and the further work needed to map the costs of people smuggling (£140m) and abuse of legitimate entry (£11m).
  • The damage caused by organised child sexual exploitation is well evidenced. Quantitative data are limited but the harms are still extensive (£1.1b).
  • The six types of organised acquisitive crime (from £27m to £920m) cause damage to individuals, communities and businesses, whether through the physical and emotional harms caused to victims, the financial losses incurred through disruption of business or the direct losses incurred.
  • The costs of organised violence and homicide have not been included in the current work, nor have we been able to capture the violent offending associated with the supply of illicit drugs. However, an estimate of the social and economic costs of firearms supply (£160m) illustrates a small part of the damage by violence caused by organised crime.
  • Organised environmental crime and organised wildlife crime cause pollution and damage communities and businesses in the United Kingdom. There are insufficient data to currently estimate costs, but there is clear evidence on the types of damage caused.
  • ‘We estimate that the total social and economic costs of organised crime are at least £24b per year’ (Mills, Skodbo & Blyth 2013: 11).

The authors of the report noted the limitations on the available data and included information only where there was a strong degree of confidence in its accuracy. Should further research be undertaken in Australia to estimate the cost of organised crime, the Home Office methodology and findings will be an invaluable source of guidance.

European Parliament report

The economic, financial and social impacts of organised crime in the European Union (2013)

In 2013, the European Parliament published the results of a study into the economic, financial and social impacts of organised crime in the European Union (Levi et al. 2013). The study sought to generate a best estimate for the economic, financial and social costs of organised crime in and against the European Union and to inform an evidence-based understanding of the associated issues. An aggregate figure for the costs of organised crime and responses to it in the European Union as a whole was not able to be calculated, but instead estimates were given for selected offences, including some of those dealt with in the present Australian study such as homicide, drug abuse, fraud and motor vehicle crime. The European study also examined other organised crime types including human trafficking, intellectual property theft, environmental crime and cybercrime that provide useful information for future Australian estimates of the cost of these crime types. As was the case with the recent Home Office Report (Mills, Skodbo & Blyth 2013), the limitations of the study were clearly apparent:

Unfortunately, there are so many gaps in the data available that this short scoping study was unable to fulfill our (and the European Parliament’s) loftier ambitions and produce actual estimates for most offenses. However, the data and analysis presented makes a notable step forward and identifies some important gaps that must be filled if organised crime control policies are to take account of good evidence (Levi et al. 2013: 9).

Nonetheless, the report was able to indicate the minimum identifiable direct economic costs of selected organised crime types as follows (Levi et al. 2013: 10–11):

  • Human trafficking—€30b
  • Fraud against EU (cigarette smuggling)—€11.3b
  • Fraud against EU (VAT/MTIC fraud)—€20b
  • Fraud against EU (agricultural and structural funds)—€3b
  • Fraud against EU individuals—€97b
  • Unrecovered motor vehicle theft—€4.25b
  • Payment card fraud—€1.16b
  • Insurance fraud—€1.0b (in UK alone).

Added to these costs are the costs of responding to organised crime in the European Union that are in excess of €210m.

In concluding, the authors of the report stressed the need to help to differentiate between three different costs of crime categories that future research needs to address:

  • private costs: which impact upon individuals directly connected to the victim;
  • parochial costs: that are born through community ties, for example extortion threats or Ponzi fraud against a particular business community or ethnic group; and
  • public costs: are where the impacts are shared between citizens who are not directly connected to each other (Levi et al. 2013: 12).

Both the Home Office and the European Parliament reports provide useful conceptual and methodological insights into how costs of crime could be measured in Australia in the future, particularly with respect to some of the more problematic crime types that involved organised criminal activity.