What is the economic impact of methamphetamine use on Australia?

October 2015

NDRI: Professor Steve Allsop, Professor Tanya Chikritzhs, Professor Simon Lenton, Professor Dennis Gray, Associate Professor Ted Wilkes, Dr Wenbin Liang, Dr Robert Tait

NDARC: Dr Marian Shanahan, Professor Michael Farrell, Professor Louisa Degenhardt, Professor Alison Ritter, Associate Professor Lucy Burns, Dr Sharlene Kaye

Other investigators: 

Steve Whetton, Deputy Director, South Australian Centre for Economic Studies, University of Adelaide and Flinders University
Associate Professor Rebecca McKetin, Centre for Research on Ageing, Australian National University
Associate Professor Anna Ferrante, Centre for Population Health Research, Curtin University

Project description: 

There has recently been significant concern about the impact of methamphetamine use, in particular ‘ice’, across Australia. Most of the concern has focused on the immediate impact on the health of people who use methamphetamine, their families and front line services, but there are also potentially major economic impacts. In 2008 the cost of illicit drug use in Australia was estimated at approximately $8b (Collins & Lapsley 2008), with amphetamine/methamphetamine contributing $3.7b (Moore 2007). The figure for the USA was US$23b in 2005 (Nicosia et al. 2009).

The major costs are associated with: the police and criminal justice systems, premature mortality, lost quality of life, drug treatment, other medical costs from methamphetamine use (e.g. accidents), the intangible costs of drug dependence, lost productivity including during periods of incarceration, child welfare issues, harms to others and environmental damage from clandestine laboratories.  A notable feature of the concerns expressed about Australian methamphetamine use has been its significant impact in some rural and remote regions. Methamphetamine is also used across economic strata (AIHW 2014).

The objective of this program is to provide an assessment of the societal costs of methamphetamine use and in the process develop a methodology that can be applied to other drugs. The approach will require a multidisciplinary / multiagency team involving drug specialists, epidemiology, criminology and economic modelling expertise – who will examine other approaches (e.g. Collins & Lapsley 2008; Nicosia et al 2009) and shape the current methodology. The project is a collaboration among several key organisations including NDRI and NDARC and the University of Adelaide / Flinders University, the Australian National University and Curtin University.