Reforming New Zealand’s “punitive” drug laws – including the decriminalisation of all drugs and introduction of a legal market for cannabis – would benefit the country by at least $450 million a year, according to a cost-benefit analysis commissioned by the Drug Foundation.

The report, produced by economist Shamubeel Eaqub from consultancy Sense Partners, says there would be a net social benefit of at least $225 million from investing an extra $150m in addiction treatment, drug education, and harm reduction interventions.

It estimates there would be a net social benefit of $34m to $83m from replacing the Misuse of Drugs Act, passed in 1975, with a new law based on a health-based approach to the issue.

Creating a legal, regulated market for the purchase of cannabis would bring $185m to $240m in new tax revenue while also saving the justice sector $6m to $13m, the report says.

The release of the report comes as the Government carries out inquiries into New Zealand’s mental health and addiction services, while also preparing for a referendum on legalising the personal use of cannabis by the next election – a commitment in the Greens’ confidence and supply agreement with Labour.

‘Fiscal weight’ on case for reform

NZ Drug Foundation executive director Ross Bell said the report’s findings added “a little bit of fiscal weight” on top of the moral argument for treating drugs as a health issue, rather than a criminal justice problem.

Eighty percent of the money spent by the Government on addressing New Zealand’s drug problems went towards a “punitive” response, Bell said, with only 20 percent going towards health-based interventions.

Politicians had traditionally fought to be the toughest on drugs, with MPs recently “squabbling” over who would have the toughest sentences in dealing with synthetic cannabis.

However, he said there had been signs of change, with Prime Minister Jacinda Ardern opting against signing New Zealand onto a hardline drug policy charter spearheaded by US President Donald Trump at the United Nations.

“Even the police have been seeing we can’t arrest or we can’t enforce our way out of this problem…the momentum now to treat this as a health issue has been shifting.”

With the Government preparing its first ever “Wellbeing Budget” in 2019, Bell said he was keen for it to commit to doubling its existing funding for health-driven drug initiatives.

Eaqub said overseas evidence showed most health-based initiatives had a benefit of one-and-a-half to seven times the initial investment.

While creating a legal market for cannabis was a more difficult policy to enact, the revenue it would generate was necessary to help cover the cost of the health initiatives, he said.

“We have to do all these things together, we can’t pick one.”

“The war on drugs is not only a failed model – it’s a war on those people who use drugs,” Leafe said.

NZ Needle Exchange Programme executive director Kathryn Leafe said harm reduction needed to be a part of any treatment model, something which a crime-based approach did not do.

“The war on drugs is not only a failed model – it’s a war on those people who use drugs,” Leafe said.

Bell acknowledged there would be issues to resolve around the minimum age of purchase if cannabis was regulated, but said those problems would be preferable to the status quo.

“The beauty of trying to put a regulated market in place is you’re actually taking it out of the hands of the criminal black market where there is no control.”

MPs welcome report

Green Party MP Chlöe Swarbrick backed the report’s findings, saying New Zealand needed sensible drug regulation that was based on evidence.

“Politicians can end this unnecessary, deeply irrational suffering. All evidence shows if we want to reduce drug harm – if we genuinely want to stop the deaths so frequently invoked – we must decriminalise drug users and resource their support.”

Health Minister David Clark was also supportive, describing the report as “a really important contribution to the debate in New Zealand”.

Clark said there was international evidence suggesting potential benefits to decriminalisation or legalisation of drugs, but the Government would “not rush into anything” given the risks.

“We want to take carefully each step as we look at those issues because for example we know we don’t want kids accessing drugs; the way in which you restrict anything that’s harmful is something you want to pick through carefully.”

Sam Sachdeva is Newsroom's national affairs editor, covering foreign affairs and trade, housing, and other issues of national significance.

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