An economic analysis for Aboriginal and Torres Strait Islander offenders: prison vs residential treatment


Research studies have identified a disproportionate number of Indigenous Australians in the correctional system, and argued the importance of diverting young men and women away from a life of substance use and crime. It has been recommended that funding be redirected from the construction and operation of any further correctional system centres to establish a Ôbreak the cycleÕ network of Indigenous-specific residential rehabilitation services for courts to utilise as a viable alternative to incarceration. This study aims to: examine the patterns and prevalence of Indigenous people in the prison system; outline the impact and implications of incarceration of Indigenous people; and analyse the costs and benefits of addressing Indigenous problematic alcohol and drug use with treatment, particularly residential rehabilitation, as compared to prison. The research included a scan of relevant literature and data repositories, and consultations with key stakeholders, such as experts in the field of residential drug treatment, including in a custodial environment, staff of residential substance use treatment facilities delivering services to Indigenous and non-Indigenous people, offenders and non-offenders, and magistrates from drug courts. Analysis of the study findings show that the total financial savings associated with diversion to community residential rehabilitation compared with prison are $111 458 per offender. It is concluded that: the costs of treatment in community residential rehabilitation services are substantially cheaper than prison; diversion would lead to substantial savings per offender of $96 446 (based on a cost of community residential rehabilitation treatment of $18 385 per offender); even if using the highest estimate of the cost per offender for residential rehabilitation treatment ($33 822), the saving would still be substantial, at around $81 000. In addition, he study finds that community residential treatment is also associated with better outcomes compared with prison: lower recidivism rates and better health outcomes, and thus savings in health system costs. The savings associated with these additional benefits of community residential treatment are approximately $15 012 per offender. Treatment of Indigenous offenders in the community rather than in prison is also associated with lower mortality and better health-related quality of life. In monetary terms, these non-financial benefits have been estimated at $92 759 per offender. As the residential treatment scenario involves lower cost and is associated with better outcomes than incarceration, it is clearly the more advantageous investment (Introduction and Conclusion, edited).

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