Illicit drugs in Australian society are associated with health, social, and economic burdens. Governments respond to the wide-ranging implications of illicit drug use and supply by mobilising the substantial social and economic resources represented across different portfolios – including policing and law enforcement, education, health, and community and welfare services.

Transparency and accountability are crucial in relation to public funds and drug policy. Understanding spending by governments provides a baseline for policymakers, stakeholder organisations, and the public. Governments are only able to spend a finite amount of money. Where governments spend money illustrates what they consider important in responding to drugs. The first government expenditure estimate (known as the ‘drug budget’) across Australia was completed for the financial year 2002/2003 (Moore, 2005); the second was for the financial year 2009/2010 (Ritter et al. 2013). This report is the third so-called ‘drug budget’, estimating proactive spending on illicit drugs by governments across Australia.

This report provides an estimate of Australian governments’ proactive expenditure on illicit drugs for the financial year 2021/22. Four drug policy domains were included: prevention, treatment, harm reduction, and law enforcement. A top-down approach was employed to derive estimates, which was possible for prevention, treatment, and law enforcement. A bottom-up approach was employed to derive estimates for the domain of harm reduction.

Australian governments spent approximately $5.45 billion in 2021/22 in proactive responses to illicit drugs. This estimate includes expenditure on prevention programs designed to prevent or delay drug use by young people—such as in-school education; treatment programs that aim to decrease drug use through medical and psychological services—such as specialist alcohol and other drug treatment; harm reduction programs that aim to reduce harms associated with drug use without necessarily reducing use—such as needle syringe programs; and law enforcement programs that aim to disrupt supply and inhibit demand for illicit drugs—such as policing and prosecution of drug crimes and interdiction of illicit drugs at Australian borders. The $5.45 billion amounts to 0.63% of government expenditure. In 2021/22, this represented a per person spend of $209.61.