Don’t be a dope

A newspaper editorial sings the economic praises of marijuana reform

The advocates of decriminalising cannabis now have an economic case to press. A Treasury official, in a document prepared for a brainstorming session, suggested the Government could save more than $500 million a year legalising the popular drug.

The report, intended for internal use but seemingly based on robust calculations, suggested tax from a legal cannabis industry could be worth $150m, with annual savings of $400m from lower policing costs.

These are not trivial numbers, though both Treasury Secretary Gabriel Makhlouf and Finance Minister Bill English were quick to dispel any idea that drug policy reform was under way.

Makhlouf said that although the figures in the report were drawn from high-level estimates, they were not official Treasury assessments. English said the report did not cross his desk and was not intended to be widely distributed.

Nor does the enthusiasm of the Treasury analyst reflect the Government’s position, which treats drug use as a health issue.

Its drug strategy through to 2020 does not propose decriminalisation, though the policy did anticipate the medical use of marijuana going mainstream as a pain relief therapy. That alternative seems likely to occur, and sooner rather than later.

The numbers covered by Treasury just look at cost savings and totally underestimates the revenue from excise tax.? This can and will be the government’s next cash cow.?

The Treasury paper makes the point that drug reform “isn’t a particularly radical idea these days”. It observed that Denmark, Germany, Portugal, parts of Australia and the United States have decriminalised possession of cannabis to varying degree and have had “positive” experiences “and don’t seem to have an increase in drug use”.

Despite these trends, there would seem to be limited political appetite for New Zealand to open the kind of recreational dope shop found in Colorado, Washington and Oregon.

There is good evidence to support this cautious approach.

The New Zealand Drug Harm Index, compiled by the Ministry of Health, estimates the social cost of drug-related harms and intervention costs in 2014/15 as $1.8b. Cannabis contributes to this cost, given that the most recent survey found 11 per cent of adults over 15 reported using the drug in 2012/13. Users report harmful impacts on work and study. A minority have noted learning problems, and some consumers acknowledge the drug has a harmful effect on their mental health.

Those people should not use it then.? Just like some people should not drink.


– NZ Herald