Australia has seen rapid, unsustainable growth in its incarceration rate. Over the past ten years, the proportion of Australian residents who are incarcerated has risen by 30 percent, from 167 per 100,000 adults to 217 per 100,000 adults. This rise has led to taxpayers carrying a heavier burden for incarceration. Across the country, state and territory governments now spend more than $4.4 billion annually on prison operations, out of more than $17 billion total justice costs. Over the past five years, the average annual growth of prison spending has been 6.6 percent, with a 29 percent total increase over that period.
The purpose of this paper is to show what this increase means in real terms. Every extra dollar committed to incarceration is a dollar that might have been spent elsewhere in the criminal justice system, on some other government service, or returned to taxpayers. To illustrate this point, this paper compares operational prison spending with spending on police services. This comparison is valid for two main reasons: the first is that policing and incarceration share the common purpose of reducing crime through incapacitating and deterring criminals, and so it is legitimate to consider whether governments’ criminal justice spending is efficiently ordered towards that end; and secondly, studies have shown that policing is more effective in deterring crime than increasing the severity of punishment, and so maximising value for money in criminal justice may involve redirecting spending from prisons to policing. Given Australia’s already high level of policing, this comparison might also suggest that a reduction in incarceration will not diminish the overall deterrent effect of Australia’s criminal justice system.
The IPA supports a sensible and safe reduction in Australia’s level of incarceration through the reform of punishment for nonviolent offenders, including the expansion of community service, home detention, and fines and restitution orders. These punishments can capture the severity of many types of offending, while at the same time being cheaper to administer than prison and more strongly correlated with preventing reoffending and lowering crime. In this paper, references to reducing incarceration mean this kind of reform.