2.1 Definitions
The Plan of Action adopts the United Nations definition of violence against women and children as “… any act of gender-based violence that results in, or is likely to result in physical, sexual or psychological harm or suffering to women, including threats of such acts, coercion or arbitrary deprivation of liberty, whether occurring in public or in private life14.”
Further information on the type and nature of violence against women and their children encompassed by the Plan of Action are contained in the Plan and include both domestic (intimate partner) and family violence as well as sexual assault perpetrated by a stranger.
The Access Economics work considered domestic violence only. The cost estimates in this report attempt to capture the costs associated with the more encompassing definition of violence against women and their children envisaged by the Plan of Action. This requires making a distinction between intimate partner and non-intimate partner violence.
The impact of violence against women and their children where the violence is perpetrated by a non-intimate partner presents different costs than for domestic violence. For example, violence perpetrated by a stranger is less likely to occur in the victim/survivor’s home and so in these instances the cost of replacing broken and damaged household possessions is not generally incurred by the victim/survivor. Moreover, the children of the victim/survivor are less likely to witness the violence.
KPMG has sought to include the costs of non-domestic violence by assuming that the costs of non-domestic violence are the same as for domestic violence, with the exception that non-domestic violence is less likely to occur in the victim/survivor’s home or be witnessed by their children. Second generation costs and consumption costs are therefore excluded from the non-domestic violence estimate. The Access Economics estimate also includes violence perpetrated against men, which is excluded from the KPMG estimate.
2.2 Classification of costs
2.2.1 Direct, indirect (and opportunity) costs
Most studies of this nature seek to estimate direct (or tangible) costs and indirect (or intangible) costs associated with violence. The terms direct or tangible are commonly used interchangeably to refer to the costs associated with the provision of a range of facilities, resources and services to a woman and her children as a result of her being subject to violence15. Examples are the costs of crisis services,accommodation services, legal services, income support, and health and medical services.
The terms indirect and intangible are also used interchangeably, and refer to the pain, fear and suffering incurred by women and children who live with violence. These costs are sometimes termed the indirect social and psychological costs of violence16. Examples include replacing damaged or lost household items, replacing school uniforms and equipment when children change schools, and settlement of a partner’s bad debts.
A third cost category of opportunity costs has also been adopted. Opportunity costs can be defined as the cost of opportunities which the victim/survivor has lost as a result of being in or leaving a violent relationship. An opportunity cost is the cost foregone when the woman’s options are limited by the circumstances in which she finds herself. Examples include the loss of employment and promotion opportunities and quality of life. Opportunity costs are often included as part of indirect costs.
We note that Access Economics in their 2004 study concluded that the distinction between direct and indirect costs was not necessarily useful, given the problems of definition and comparison17. The cost categories adopted in the 2004 study (and those adopted for this estimate) therefore combine all three types of costs into seven cost categories as shown in Table 4.
Table 4: Categories of cost 18
| Cost category |
Types of costs included |
| Pain, suffering and premature mortality |
Costs of pain and suffering attributable to violence.
Costs of premature mortality measured by attributing a statistical value to years of life lost. |
| Health costs |
Includes private and public health costs associated with treating the effects of violence on the victim/survivor, perpetrator and children. |
| Production-related costs |
Includes costs associated with:
- lost production (wages plus profit) from:
- absenteeism;
- search and hiring costs;
- lost productivity of victim/survivor, perpetrator, management, co-worker, friends and family;
- lost unpaid work;
- retraining costs;
- permanent loss of labour capacity.
|
| Consumption-related costs |
Includes costs associated with:
- property replacement;
- settlement of bad debts.
|
| Second generation costs |
Includes private and public health costs associated with:
- childcare;
- changing schools;
- counselling;
- child protection services;
- remedial/special education;
- increased future use of government services;
- increased juvenile and adult crime.
|
| Administrative and other costs |
Includes private and public health costs associated with:
- legal/forensic services;
- temporary accommodation;
- paid care;
- counselling;
- perpetrator programs;
- interpreter services;
- funerals.
|
| Transfer costs |
Includes ‘deadweight loss’ to the economy associated with:
- government payments and services;
- victim/survivor compensation;
- lost taxes.
|
The Access Economics report contains further commentary on cost classifications relevant to the method of cost estimation – including economic and non-economic costs, prevention and case costs, short-run and long-run costs, and transfer costs. This may aid in understanding and interpreting the cost estimates in this report.
2.3 Costs of violence and impact of intervention
2.3.1 Australia
Recent studies of the economic costs to Australia have estimated total national costs of domestic violence and other associated fields of study, including child abuse, crime and drug abuse19. The methodology used will naturally vary, depending on the field of study and area of research focus. However, the range highlights the varied coverage of some studies and the variable consideration of the linkages between costs incurred by one entity affecting and driving costs in other areas.
The 2004 Access Economics report classified the costs of domestic violence by seven cost categories, calculating the estimated cost in 2002-03 (see Table 5).
Table 5: Summary of annual costs by category20
| Category |
Annual cost, 2002-03 |
| $ million |
% of total |
| Pain, suffering and premature mortality |
3,521 |
44 |
| Consumption-related |
2,575 |
32 |
| Production-related |
484 |
6 |
| Administrative and other |
480 |
6 |
| Transfers |
410 |
5 |
| Health |
388 |
5 |
| Second generation |
220 |
2 |
| Total |
8,078 |
100 |
‘Pain, suffering and premature mortality’ was by far the most costly category at $3.5 billion, contributing 44 per cent of the total cost of domestic violence. Health costs were $388 million.
The study estimated that the largest cost burden was borne by victims of domestic violence at $4.0 billion, followed by the rest of the community and society at $1.2 billion and the federal government at $848 million. Subsequent groups were children (9.5 per cent of total cost), perpetrators (6.9 per cent), state/territory and local governments (6 per cent), employers (2.2 per cent) and friends and family (0.1 per cent)21.
A breakdown of comparable expenditure of government by jurisdictions is unavailable. Using an updated Access Economics cost estimate to state/territory and local government of $554 million in 2007-08 and population data, in the absence of other data, an estimate of the spend in jurisdictions on domestic violence may be derived as shown in Table 622.
Table 6: Estimated government expenditure by jurisdiction 2007-0823
| Jurisdiction |
Estimated
expenditure
($ million) |
Proportion of
total
(%) |
| New South Wales |
180 |
33 |
| Victoria |
137 |
25 |
| Queensland |
111 |
20 |
| Western Australia |
56 |
10 |
| South Australia |
41 |
8 |
| Australian Capital Territory |
13 |
2 |
| Northern Territory |
9 |
2 |
| Total |
547 |
100 |
This methodology has obvious limitations and should be treated with caution. For example, the NSW Government spent an estimated $351 million in agency costs in 2007-08 as a result of domestic and family violence24, significantly higher than the NSW state expenditure estimate above25.
The total costs of domestic violence in NSW were estimated at $1.5 billion in 199026. The study in NSW found that women bear the greatest share of the economic costs of domestic violence. The federal government was found to bear the largest proportion of government costs, through expenditure on income support, housing and medical costs. State government costs were primarily incurred through the provision of court and legal services, child welfare and family support programs.
Using a ‘retrospective case study’ approach to women’s experience of domestic violence in Tasmanian and Northern Territory studies, the direct costs of domestic violence in Tasmania in 1994 were estimated at $17.6 million and $8.9 million in the Northern Territory in 1996. Indirect costs were also significant but were not extrapolated to gain a state/territory-wide estimate. The provision of income support comprised the greatest proportion of direct costs, followed by accommodation costs. The government/community sector bore the greatest share of direct costs, while women bore the greatest proportion of indirect costs27.
Other research focused on the qualitative and quantitative costs incurred by business and the corporate sector and attempted to estimate the annual cost of domestic violence to Australian employers28. This research highlighted the need for consideration of linkages. For example, the direct costs to employers are not only end-costs in themselves but also affect other aspects of an organisation, such as distribution and production, which can result in late deliveries, bringing about customer dissatisfaction and lost business. Similarly, costs to women, such as the inability to work caused by domestic violence, have a ‘domino-effect’ on other sectors of society: income forgone by victims/survivors results in diminished profits for business and decreased tax revenue to government.
2.3.2 International research
Research has also been undertaken internationally on the costs of domestic violence. In the United Kingdom, for example, Professor Walby of the University of Leeds estimated in 2004 the total cost of domestic violence for the state, employers and victims/survivors at around £23 billion a year29. As in Australia, the human and emotional cost borne by victims/survivors through pain and suffering makes up the largest component at over £17 billion. The other costs are broken down as follows:
- Lost economic output due to time off work – around £2.7 billion a year. It was estimated that around half of the cost is borne by employers and half by individuals in lost wages.
- Criminal justice system – around £1 billion a year (nearly one-quarter of the criminal justice system budget for violent crime). Includes police, prosecution, courts, probation, prison and legal aid.
- Health care – around £1.2 billion a year. Includes physical injuries and mental health care.
- Civil legal services – over £0.3 billion a year. Includes legal actions such as injunctions and divorce
- Social services – nearly £0.25 billion a year, overwhelmingly related to children
- Housing and refuges – £0.16 billion a year.
Professor Walby found the costs of domestic violence are partly borne by the state and the wider society, partly by the individual victims/survivors, and partly by employers. She allocated the burden at £2.9 billion a year for the state, around £19 billion a year for victims/survivors, and £1.3 billion a year for employers.
A New Zealand study indicated that the annual cost of family violence in that country was at least NZ$1.2 billion30. In 1993-94 this was more than the NZ$1 billion earned from wool exports; nearly as much as the NZ$1.4 billion spent on unemployment benefits; and around half the NZ$2.5 billion earned from forestry exports.
Both these international studies emphasise that the costs of domestic violence are just as significant abroad, in terms of both the economic costs borne by the state and society, and the costs borne by individual victims/survivors, relatives and businesses.
2.3.3 The impact of intervention
While a number of studies have sought to calculate the cost of domestic violence, there is little information which identifies and analyses the impacts of government intervention on the costs of domestic violence. Information that is available is primarily international.
During 2002, the European Union defined seven indicators which identify the extent and nature of partner violence within the member states. The indicators are being used as a surveillance and evaluation tool for implementation of measures and methods to reduce violence against women. Denmark is one of the first countries to publish such analysis.
Denmark has observed significant falls in some indicators of violence over a relatively short period: from 2000 to 2005, a 30 per cent decline in domestic violence was observed following the implementation of actions plans in 2002-2004 and 2005-2008 to stop violence against women31. However, this has been countered by an increase in overall violence statistics which still appear to be climbing, with little indication of when they will plateau; between 2000 and 2005, an approximate increase of 8 per cent was observed. This is not an altogether unexpected outcome, given that government intervention increases awareness and can have the effect of increasing reported violence.
In Norway, a government action plan on domestic violence was implemented in 2004. While the number of formal reports of domestic violence increased from 3,890 cases in 2003 to 4,348 cases in 2005, this was not attributed to an increase in violence but was seen rather as an indication that more women were contacting the police as a result of greater openness about the problem and less stigma associated with being a victim of violence in couples32.
In the United Kingdom, the Home Office (in partnership with the Prime Minister’s Delivery Unit) developed a National Domestic Violence Delivery Plan for 2005-06. A number of ‘proxy’ indicators against which the government intends to measure the medium- to long-term success of the strategy were identified and are yet to be fully measured against intervention, but provide an indication for trends in domestic violence at this point:
- Homicides as a result of domestic violence: On average in the UK, two women a week are killed by a partner or ex-partner33. Since 1997, trends in domestic violence homicides have been broadly level and although an upward trend can be detected in recent years, the numbers are too small to be statistically significant. In the medium to long term, a downward trend would be desired as agencies begin to focus more on early intervention and protection.
- Headline prevalence of domestic violence: Measured by the British Crime Survey Inter-Personal Violence module, which estimates the extent of domestic violence, sexual assault and stalking in England and Wales. The general trend remains the same, with between 18 and 25 per cent of violent crime being domestic violence-related.
- Numbers of a) young people and b) all people who think that violence is acceptable in some circumstances: Research from 1998 showed that one in five young men and one in 10 young women thought that violence towards a partner was acceptable in some situations34. While there is no information on trends, these figures will be used as the baseline to measure this indicator annually using the Office of National Statistics Survey. It is hoped levels of acceptance will reduce as levels of awareness increase.
- Percentage of domestic violence incidents with a power of arrest where an arrest was made related to the incident and, of this, the percentage of partner-on-partner violence: Since April 2004, this has been a Statutory Indicator in the Policing Performance Assessment Framework. The objective is that the underlying trend will be upwards, with increased training and guidance for frontline police officers.
- The number of domestic violence offenders brought to justice: This will measure outcomes in the criminal justice system. The number of offenders successfully prosecuted would hopefully increase, and the ratio of successful prosecutions to arrests would increase too, as evidence-gathering and support for victims improve.
- The number of civil orders made: In 2003, around 30,000 non-molestation and occupation orders were issued and about 4,500 undertakings were given.
- Actions against domestic violence: The average number of refuge places per 10,000 population was 0.5 in both 2001-02 and 2002-03 and 0.96 in 2003-0435.
- Victim satisfaction with the support they have received from key agencies: Data will be gathered from a sample of those who said they were victims in the British Crime Survey Inter-Personal Violence module and a pool of victims from refuges. It will be produced on the government’s behalf by Women’s Aid, as responses will need to be sensitive to the needs of victims.
All identified international models of costing interventions are as yet relatively undeveloped in their formulation and implementation, and more time is required to draw concrete conclusions as to what this would likely mean for costing impacts and timings of Australian measures. One clear theme is that most nations have a relatively ‘fluid’ approach to measuring outcomes for national strategies on reducing domestic violence.
An important component of the Plan of Action will be the establishment of key performance indicators linked to desired outcomes, so that progress in addressing this problem can effectively be monitored, measured and evaluated against anticipated outcomes identified in the business case for investment.