Friday, March 4, 2016

Lindsay Mitchell: The real cost of gangs


Earlier this week MSD released a report that found gang members had cost Work & Income and Child,Youth and Family $714 million in the 22 years between 1993 and 2014.

The annual cost of each gang member works out to $8,948 annually (3,627) - less than a superannuitant.






The remark is flippant. But I did mentally muse that raising the Super qualifying age to 67 (in line with other countries we like to compare ourselves to) would save far more than $714 million over 22 years.

On a serious note - and the problem of gangs and the abuse of their children is a very serious issue - the all-up cost to the tax payer is much higher than $32 million annually.

A few other major costs can be roughly (but totally unscientifically) calculated.

Not included in the MSD bill is the social security benefits of the mothers of gang member's children. Their welfare receipt will be greater than the father's. How much greater is unknown. But,

"7,075 dependent children were included in benefits with gang members for an average of 2.8 years."

Not very long because the children would generally be included in the benefits of their mothers.

I reckon doubling the cost would be conservative. There's another $64 million.

Then there's the cost to Corrections. According to SuperU (ex Families Commission):
"As of April 2013, gang members and affiliates comprised over 30 percent of inmates, with over 10 percent of the prison population belonging to the Mongrel Mob."
Thirty percent of prisoners  equates to around 2,400 @ $100,000 each which represents a yearly bill of $240 million.

Next is the cost to the Justice system. It costs $450 million to run the Ministry of Justice. May as well carve off 10% of that for gangs. A further $45 million.

And the police of course. Their annual budget is $1.4 billion. Let's be conservative again  and say 10% is spent on dealing with gangs so $140 million annually.

I guess ACC would have some involvement but wouldn't like to hazard a guess at a number.

So what have we got so far:

MSD  $96m
Corrections $240m
Justice $45m
Police $140m

Total: $521 million annually.

Or $143,645 for each gang member on average.

Credible? Maybe I've over-stated costs - maybe not. What I haven't done is include the Health system costs from violence and ill-health; nor Customs involvement nor Housing NZ.

While the MSD numbers were somewhat underwhelming, and expressed as a 22 year sum, not very helpful, this further exercise has rammed it home to me that breaking the cycle of inter-generational gang membership and activity would have enormous social and economic benefits for everybody.

5 comments:

Tim Wikiriwhi said...

It is interesting to watch the impact of Cannabis legalisation in the US kicking the Mexican cartels in the Balls.
Likewise *how much of the costs* you are attributing to gangs... really lies at the feet of the supporters and engines of the draconian war on drugs?
How much *violence*, court/police time, and Social welfare... results *Directly from the criminalisation of drugs* and the impact of social alienation from being labeled criminals?
I would say the Lions share.
The injustice of Drug prohibition *would be the Gangs Number 1 recruiting tool.*
They give a home and community to Society's cast aways.
Prohibition justifies the Gangs assertion that *Society is run by gangsters*.
Etc Etc.

Tim Wikiriwhi.

Lindsay Mitchell said...

You know that I don't disagree with you Tim. I had a long conversation with a Colombian refugee yesterday who sees drug legalisation in his homeland as the only way to free his country from violence and corruption.Uruguay legalised cannabis and Paraguay is pushing to do the same with the aim of taking the drug out of the hands of illegal traders. Anyway, there is nothing like hearing the reasoning from someone who has experienced the violence firsthand and bears the scars.

paul scott said...

Some pretty grab from the air figures there Lindsay. I would be very surprised if 10% of the Police Budget is on gangs. So maybe we could ask them. I am not defending the high costs associated with gangs, I just think we can do better than bus ticket punching numbers .

Peter Due said...

I wonder if the law was changed so that anyone riding a motor bike had to wear a orange hi vis jacket, would make a difference to the gangs, they would not look so threatening.

Dave said...

Tim, good point legalese all drugs, then we would have no gangs dealing in drugs, there is the small problem of lives and family's ruined because of drug addictions, not to mention the big cost in dealing with mental health issues and social costs but at least the gangs will not be trading eh!
While we are at it gangs also have organised groups who commit burglaries, yeah I was one of them, may as well make that legal to, yeah take it away from the gangs, if we get burgled, too bad. Car thefts, yep gangs also do that , lets also make that legal.... Tim and Lindsay get real, if we dealt really firmly with drug dealers like they do in Indonesia I wonder how many gang members would reconsider their chosen career.
Talk to the thousands of Kiwis who have had lives shattered by drugs about legalisation.