Update on lockout law debate

Rod Bogaards’ recent guest post on the proposed lockout law was quoted by Paul Syvret in the Courier-Mail yesterday in his opinion piece Lockout laws’ knock-on effects need to be weighed. Regarding the proposed law, Syvret noted:

The problem is there has been no qualitative evaluation of the socio-economic impact of such heavy-handed, nanny-state regulation.

As economist and former Productivity Commission director Rod Bogaards argues in an analysis of the NSW experiment, when you are deploying a very blunt regulatory club, there is a big difference between effectiveness and efficiency…

…the laws have taken a shotgun approach to dealing with a rat problem, with scant regard to the collateral socio-economic damage…

…If you are going to design effective and equitable regulation, then, as Bogaards says, “you actually have to do the work first to assess unintended consequences, and that hasn’t been considered in this instance”.

Well done to Rod for injecting himself into this important debate. Rod is certainly right regarding the need for closer analysis of the proposed law, comparing the expected benefits and costs of the proposal. Such analysis would include consideration of other options to reduce alcohol-related violence, which is undeniably a major problem. Other options to consider in a cost-benefit analysis could include greater police numbers in known trouble spots or an increase in the “sin tax” on alcohol (with compensating reductions in other taxes). Of course, any taxation changes would need to be enacted by the Commonwealth, but they should still be considered in a comprehensive analysis of options to reduce alcohol-related violence.

In 2012, John Marsden, a founding director of my previous employer Marsden Jacob Associates, led some very interesting work on the costs and benefits of increasing alcohol excise that is still relevant to the current policy debate. The study argued that an increase in alcohol excise (and fixing up the current anomalous taxation treatment of wine) would yield net benefits to the community through reducing binge drinking and harms to others. The report, which was commissioned by the Foundation for Alcohol Research and Education (FARE), can be downloaded via the following link:

Marsden Jacob report on alcohol taxation

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