Illicit drug use presents significant financial, psychological and social costs on individuals and families. This chapter assesses the direct and indirect financial costs of illicit drug use on families. As with the other aspects of illicit drug use, the financial costs extend beyond the immediate impact on the user to bear on their wider family and ultimately the community.

This chapter examines the extent of the actual or direct costs associated with drug use, including activities which may be involved in maintaining a habit (including criminal activity and its ramifications) and the costs associated with treatment. Further, the committee acknowledges the indirect costs which may be borne by the family of a drug user, including loss of income (particularly for carers) and additional housing costs.

The committee pays particular attention to the situation faced by the increasing number of grandparent carers in Australia today. The committee has received extensive evidence from representative organisations and grandparents themselves concerning the level of emotional and financial support provided as a direct result of their children’s inability or incapacity to adequately care for their own offspring. This has significant implications for the prevention of child abuse and neglect in our society, as acknowledged in chapter three. While the committee pays particular attention to the plight of grandparent carers, it also acknowledges the difficulties faced by other relatives (particularly aunts and uncles) who may have to care for children whose parent(s) use illicit drugs.

Although much of the evidence from families contains common elements and experiences, each family situation is individual. Families Australia told the committee that:

There are, for example, particular burdens on sole parents compared with dual parent households in coping with the pressures of a family member who is using drugs. Former prison inmates and their families were cited as another group with unique needs as they face the challenge of re-establishing life within the community and family.¹

Importantly, there is usually no single financial cost to families of drug use and resources can be drained for a variety of reasons. The Western Australian Network of Alcohol and Other Drug Agencies outlined this complexity:

There are a multitude of overlapping issues … including child protection, domestic violence, justice issues, physical and mental health, housing and employment etc. As a result it is difficult to ascertain the specific financial, social and personal costs to families impacted by drug use on its own, other than to note that together with co-occurring complexities including illicit drug use the cost to families is obviously significant.²

Immediate costs of drug use

Costs to the individual

The immediate cost of drug use for the user is the purchase of the drugs. The greater the use the greater the costs. Money spent on drug purchases cannot be used on other expenses such as rent or mortgage repayments. The Australian Association of Social Workers noted the interrelated nature of the problems surrounding addiction and the type of payments families may feel they need to make on the addicts’ behalf:

Alcohol and illicit drug abuse may also lead to other legal concerns such as crimes committed in order to raise sufficient money to support ongoing substance use, and violent assaults. The cost of maintaining ongoing substance use may mean that there is not enough money left to pay for a range of goods and services. Irregular employment or unreliability at work frequently accompanies heavy substance misuse. This will impact on regular bills such as rent or mortgage, food and clothing, and other purchases that are the staples for survival.³

Drug users may also embark on high-risk behaviour to finance their addiction, typically including drug dealing, burglary and prostitution.⁴

The costs of theft, loans and outstanding debts

It is unfortunately a common experience that families’ money and possessions are stolen by the addicted family member in order to fund their habit. One mother described that:

From personal experience in my home, we have had to deal with thousands of dollars, literally, being taken from my wallet—to the point that I have had to lock all my personal possessions in my bedroom when I am at home. We have had things taken from our home to be pawned so that they can get enough money to get their next hit.⁵

A stepmother explained:

My stepdaughter started injecting speed. This was devastating to all of us in the house. Belongings from her older and younger sister as well as myself and her father were stolen and taken to pawn shops. The pain of watching your child seeing things, losing weight, stealing, lying and becoming withdrawn is more than a mother can bear.⁶

Another parent recounted that:

A couple whom I have met have a son who graduated from marijuana to heroin. He fed his habit by stealing from his parents. His mother had been an internationally acclaimed dancer on ice and had been awarded many trophies and much jewellery in her European career. The father was a builder and had acquired many expensive tools. Both suffered the theft of all of their possessions at the hands of their son.⁷

Other experiences reported to the committee included:

• theft of a father’s identity and the sale of property belonging to him;
• fraudulent use of a parent’s credit card through appropriation of the card number and signature on receipt slips; and
• families returning home to find all the household furniture, cash and jewellery gone.⁸

It is not uncommon for a family to extend financial loans, pay fines or settle outstanding debts incurred by an addicted family member in order to stave off legal proceedings.⁹

More frightening is when families face violence associated with criminals seeking to recover drug debts from users. Families may see no option but to settle debts with drug dealers on behalf of family members.¹⁰ Toughlove NSW told the committee that many families became involved with dealers and gangs who blackmailed them into becoming further involved in criminal activity.¹¹

When to cease support

Families agonise over whether to continue to provide financial support or not. Paying bills and providing loans to a drug addict may be the only way to keep a child from becoming homeless or criminally active. On the other hand, such financial support may only subsidise and prolong a drug habit.¹² Resolving this dilemma can cause great tension within families:

I did not want my son to go hungry and get beaten up so I would take him money and food even at midnight … I was so stressed my husband and I would argue constantly. My younger son and wife told me … not to give Peter any money or food as I was helping Peter with his addiction. Well I did not like to hear that as I thought I was doing the right thing as a mother and I argued with them…¹³

Another mother explained the pressure on her family:

He stole from us, his family. His father endeavoured at this stage to talk to him but all to no avail. The next few years caused a lot of grief … I continued to travel down the path of handing out money to keep my son out of serious trouble. By this time his father wanted no part of his son’s life... At this stage I was going down hill fast as was my marriage.¹⁴

Financial pressure on families can play a role in the breakdown of the family structure, and separation and divorce can further exacerbate the financial impacts.¹⁵ The obvious personal and social costs of such family breakdowns were discussed in chapter seven.

The downward spiral associated with providing on-demand financial support to an addicted family member often ends only after difficult decisions are made as to what is reasonable or sustainable.¹⁶ As a mother told the committee about the financial support she provided to her drug addicted son:

I started paying for his food, his Metro-10 and his telephone. I got his dental work done—his back molars taken out. I paid for his health society to keep him on. I paid for his clothes and his cigarettes. As it kept going on and on, I kept cutting down, and right at the end I was just paying for his food.¹⁷

Indirect costs of drug use

Cost of treatment

While many families baulk at, or cannot afford to support an addict, most are more willing to pay for detoxification and rehabilitation treatments in order to get a loved one drug free.¹⁸ In fact, in many cases an addict may only be able to maintain therapy with the financial support of his or her family.¹⁹

The Australian Injecting and Illicit Drug Users League noted that a fee for service approach by treatment agencies often meant that families paid for treatment:

Currently Australia’s drug treatment programs are based on a ‘user-pays’ principle. If the person who has been using drugs cannot afford to pay for the treatment then the service will often automatically look to the family to provide financial support...²⁰

The costs for pharmacotherapy programs such as opiate replacement medication (methadone and buprenorphine) can be a financial drain on families, particularly given that prescription can continue for a number of years.²¹ An indicative cost of methadone treatment is $30-$35 per week or $1,600 a year in Victoria, meaning that ‘often, the cost of pharmacotherapy prevents families from buying good quality food’.²² As an alternative, a three to six month naltrexone implant can cost up to $3,000 from a private clinic.²³

Residentially based detoxification and rehabilitation services can also vary widely in cost and be beyond the financial reach of many families.²⁴ One addict was more lucky:

His father knew of a private rehabilitation clinic in Victoria. After a period of a few days he agreed (reluctantly) to go... The cost was in excess of $20,000. My son was told he would need to be there for between four to six months. He stayed for six months, leaving in January of this year. He was very fortunate that his father was in a position to pay for his treatment.²⁵

The burden on families increases further when treatment is unsuccessful, and given that addiction is a condition prone to relapse this is not unusual. One man explained to the committee that he had resumed taking drugs the day after his return from a ten week residential rehabilitation program that had cost his parents $2,500.²⁶ The committee further heard of an unsuccessful treatment at another private clinic at a cost of $20,000 per week.²⁷

Often initial treatment requires follow up which can be a further financial drain on families with no guarantee of success or efficacy.²⁸ Unfortunately, as a representative of UnitingCare Burnside explained:

Some families think that a one-week detox, so that heroin is no longer in the blood, is all that is needed and then that person can stay drug-free for the rest of their life. Unfortunately, it does not work that way.²⁹

Some families with overseas backgrounds may see the best treatment as being to send a drug addict back to their homeland, away from harmful influences:

Some parents from Vietnamese and Khmer backgrounds send their drug-using child to live in their home country, in the hope that a different environment will improve the management of their child’s addictive behaviours. This places financial stress on the parents, as they are required to stop work and take extra holidays in order to spend time with their child. This situation also places financial stress on the extended family members, often grandparents, who are required to support the drug-using child while he/she is overseas.³⁰

Other costs can be associated with the treatment of conditions brought about by drug use. Dental problems are extremely common in methamphetamine and opiate addicts, and that treatment of these conditions (e.g. removal of teeth, reconstructive dental work) can impact on a family’s financial resources.³¹ One addict’s use of heroin and methadone necessitated a $14,000 full mouth reconstruction, only made possible by the fact that her father had continued to pay her private health insurance cover.³²

Loss of income

Addicts themselves not only have to pay to support their drug habit but often suffer from an inability to retain employment. As the Australian Drug Treatment and Rehabilitation Programme noted for one individual:

The direct cost of drugs … purchased over the ten year period would have run into many thousands of dollars. However, compounding this is money forgone from not being physically and mentally fit enough to work and earn sufficient income to live without government and parental support … this latter cost is even greater than that of the drugs used.³³

It is not only drug users, however, who may be affected by a loss of income or decreased ability to work. Family members may decide not to work in order to focus on caring for a drug using family member.³⁴ A client of the Alcohol and Drug Foundation ACT, for example, said, ‘I gave up an important job, but I couldn’t stand the thought that he might die while I was at work’.³⁵

Others find that the stress of coping means that they cannot keep a job.³⁶ One family member believed that:

… my father missed out on several career opportunities and [was] made suspiciously redundant at one company because he was unable to give the mental energy required because he was too worried where his son was sleeping that night.³⁷

Another admitted to the committee:

As a registered nurse, I have not been able to return to the workforce due to my inability to function at my normal level.³⁸

The financial impact on families owing to the loss of income earned by the carer is heightened by the lack of government assistance, as a parent observed:

There is no Carer’s Allowance for families dedicated to saving their loved one’s life — no tax deductions for a child who is now costing much more money than they ever did as a young child… I’m not talking in the hundreds of dollars but the thousands of dollars spent on debts, clothing, food, healthcare, doctors, nutritionists, psychologists and the list goes on including the costs of the family’s health needs as this suffers also.³⁹

Housing and homelessness

Having a family member using illicit drugs and living under the same roof as the rest of the family can become untenable for many. Parents may feel that they have no choice but to expel an illicit drug user from home to reduce the disruption to the rest of the family. Where the parent is the drug user, the family may struggle to meet mortgage or rental payments and face eviction. The ever present risk is homelessness or crisis accommodation for the drug user and possibly for his or her family.

In some cases families try to meet housing costs for family members using illicit drugs:

To assist the young struggling family, my wife and I, and the parents of our daughter’s partner, purchased in 1999 the house they were renting at the time. The property was purchased with the agreement that the tenants - our adult children - would pay rental which would assist with repayments of the loan acquired to purchase the property. The rental was heavily subsidised. Over the period the property was occupied, payments made consistently fell well short of the already subsidised rental. Thus the real subsidy over the six year period equated to between $23,000 - $26,000. Following the breakdown of the relationship between the partners the property was sold.⁴⁰

The additional risk in cases such as this is that the parents trying to support a drug user may have to sell their own houses because of the financial strain of supporting the addicted person.⁴¹

Inappropriate housing can have considerable socially destructive flow-on effects:

Housing problems can cause drug users and their children to be separated, and foster care systems to become over-burdened. Often, when drug users and their families are rehoused by social services, they are placed in accommodation in close proximity to other people struggling with drug misuse problems. This can slow down or prevent drug users from recovering, placing additional strain on their families.⁴²

The loss of stable housing and additional strain on families adds to the financial deprivation and longer term financial burdens on families.

Opportunity costs

Opportunity costs refer to what is foregone as a result of an activity, in this case because of illicit drug use. The opportunity costs for an addict can be acute:

Severe dependence problems that go unchecked can lead to terrible loss of educational, employment and social opportunities for the young people involved. For example, a young man of 28 can appear to have an emotional age of only 15 or 16 due to the loss of normal social and educational development as a result of the need to pour personal energies and survival instincts into supporting a drug habit…The chance for leading a normal, healthy life and contributing one’s full potential to society is reduced. This is over and above the obvious longer term general and mental health consequences of ongoing drug abuse and addiction.⁴³

Families too can suffer opportunity costs, which can be as basic as having to go without food and necessities because all or most of the family’s income is being spent on maintaining a drug habit.⁴⁴ In a household where the parents are drug users, children’s material needs for food, shelter, clothing, hygiene and medical care may be neglected as a result of money being diverted into drugs.⁴⁵

Non drug-using family members in all types of families suffer as the burden of drug use is spread between family members:

Some financial costs to families are more obvious … others are less obvious – such as … having to channel money to the drug problem that may have been earmarked for other family members.⁴⁶

There are also broader social costs arising from the wasted potential of drug users. As Toughlove warned:

Drugs are being openly sold on the streets, outside schools and most railway stations. This is doing irreparable damage to our young people. They are the future of our country and without them we are at risk of losing a whole generation. Imagine the total loss of continuity to our society.⁴⁷

Costs to the whole community

The report has already mentioned the Australian Federal Police’s Drug Harm Index, which calculates the financial benefit to the community of drug interdiction. Participants in the inquiry also noted the costs to the community as a whole of illicit drug use:

The reality is that whether or not you are directly affected by someone’s drug use you pay a price. The cost to the tax payer of law enforcement, of an ailing psychiatric health system, having your home broken into by a person seeking the means to buy drugs … ⁴⁸

The Australian Family Association was also aware that:

The escalation, in drug-related vandalism, crime and violence in society also drains the public purse - it places pressure on hospital beds, ambulance and medical services, insurance costs, prisons, police and parole services, charitable organisations, local council amenities and so on.⁴⁹

Grandparent carers

According to the Australian Bureau of Statistics, in 2003 there were 22,500 grandparent families with 31,000 children aged 0-17 years in Australia, representing around one per cent of all families with children aged 0-17 years.⁵⁰ It is thought that the number of grandparent-headed households is growing.⁵¹ One reason is that child protection agencies are giving increasing emphasis to kinship care — where children at risk are cared for by family members other than parents, in preference to placing children in foster care.

The result is that in 2005-06, there were 10,316 children in out-of-home care being cared for by relatives, accounting for 40.5 per cent of children in out-of-home care.⁵² In 2001-02, there were 7,439 children in out-of-home care being cared for by relatives, accounting for 39 per cent of children in out-of-home care.⁵³

Evidence suggests that, in many cases, grandparents are taking on the primary care role for their grandchildren because of their own children’s drug problems.⁵⁴ Suddenly being asked to care and provide for grandchildren can place considerable stress on grandparents.⁵⁵ Many have already endured years of anguish with their drug-using young people and are exhausted. They may obliged to undertake care of the grandchildren, however, as there is no one else who can outside of the foster care system.⁵⁶

Financial impact on grandparent carers

Many grandparent carers have reduced their working hours or retired and may be unprepared for the additional financial costs they face in caring for young children. Grandparent carers may be faced with a myriad of unexpected costs:

Grandparent support required has included payment of fines, buying and replacing essential items, rehabilitation and mental health services, etc, and providing recreational and educational supports for children.⁵⁷

Marymead Child and Family Centre, who operate a ‘grandparents raising grandchildren support network’, report that many grandparents are on a fixed income, and some are dependent on charities for food and clothing. Physical care issues for children, such as orthodontic treatment, can be left untreated due to the high costs. Marymead said also that the cost of activities such as sports, music lessons and school excursions was outside the budgets of most grandparents raising grandchildren.⁵⁸

In order to meet the costs of living, grandparents may be forced to expend their retirement savings:

The other common story is them having to mortgage their homes, which they have paid for, when they were about to tour the country in their four-wheel drive and caravan, or maybe they were just planning retirement. They are having to sell off property or take out a mortgage on the home that they have paid off after many years of working in order to take out legal proceedings to gain custody of their grandchildren.⁵⁹

Of course, there are not just financial costs facing grandparent carers in these situations.⁶⁰ Grandparent carers can become socially isolated as their friends of similar age may be unused to or uninterested in having young children around. The shift in lifestyle can also lead grandparents to worry about their own health and what will happen to their grandchildren when they can no longer care for them.

Access to financial assistance

Kinship or relative care is an attractive alternative to providing foster care for children at risk because some of the costs of the child protection system can be shifted to grandparents. It also gives children a greater sense of continuity and family identity. However, grandparent and other kinship carers may be doubly disadvantaged, because not only do they face the direct costs of child rearing, but they have limited access to the financial and other support offered to foster carers.⁶¹ As Families Australia described:

Grandparents and other relative carers are increasingly called upon by state and territory child protection agencies to take in children as the numbers of foster carers continues to diminish, yet grandparents are not always recognised as foster carers and so do not receive the same level of financial and other support. In addition to the issue of financial support, training and casework support provided to foster carers is often not extended to relative carers and may depend upon whether or not a child has been legally ordered into the care of a grandparent. If there are no court orders in place, it is less likely that the grandparent/s will receive assistance.⁶²

One person speculated that:

Another possible reason for the increased use of family and kinship carers could be related to the shortage of foster carers. It is widely reported that limited resources given to child protection jurisdictions makes the use of family and kinship carers a more attractive option since it is a cheaper option as kinship carers tend to receive lower levels of support then foster carers.⁶³

One difficulty is that grandparents or other family carers are often looking after their grandchildren through informal arrangements, even if they have been brokered by child protection agencies.⁶⁴ This means that the child is not eligible for assistance from some state-based programs and that the carers will find it difficult to access important information such as birth certificates and immunisation records. Such documents are required for school enrolments and for placing grandchildren on their grandparent’s Medicare or Health Care cards.⁶⁵

Grandparent carers can be caught in an invidious position, caught between wanting to formalise their caring role in order to receive benefits, and pressure from their children who do not want to lose their benefits:

Grandparents in particular, may be emotionally blackmailed by their child into NOT claiming or pursuing entitlement to a Centrelink payment so they are able to support grandchildren. Usually it is not until an extreme event occurs that grandparents or relatives eventually claim a payment. They are very aware that when they claim a payment, the parent’s payment will cease or be dramatically reduced and there will be work obligations for the parent of the child. The grandparents are very reluctant to take this step. They are ‘torn’ between ‘dobbing in’ their child and the extreme financial hardship they find themselves under.⁶⁶

Australian Government support for grandparent carers

In the absence of state government support the Australian Government has introduced a range of measurers to assist grandparent carers, including:

• waiving the Child Care Benefit work/study/training test for grandparent carers;
• providing a special rate of Child Care Benefit called Grandparent Child Care Benefit for grandparents on income support, covering the full cost of approved child care for those children;
• providing all children in grandparent/relative care with access to a Health Care Card;
• expanding the eligibility criteria for the Transition to Independent Living Allowance to include young people in grandparent care;
• providing $400,000 per annum until 2009-10 to enable legal aid commissions to provide or expand dispute resolution processes, such as family conferencing, that involve grandparents and/or extended family members; and
• from 1 July 2007, strengthening Social Security legislation to make it easier for Centrelink to ensure that income support payments for principal carers, including grandparents, are provided to the person who is actually providing the majority of day-to-day care for the dependent child.⁶⁷

Non-financial assistance for grandparent carers

In addition to the financial impacts on grandparents in caring for their grandchildren, grandparents may need additional support in undertaking a parenting role. Tonie Miller highlighted how the change in role affects grandparents and the children they care for:

In undertaking primary care of their grandchildren, grandparents are denied the role of grandparent. They suffer from social isolation from their peers, anger, fear, fatigue and increasing demands in negotiating the inadequate assistance systems available in their jurisdictions, while they experience declining health and often the continual high stress levels induce mental health issues. There is great variation of assistance from different jurisdictions, states and territories, regarding state assistance being offered to these families. Most do not come near the real costs involved financially, let alone emotional, health and social costs.

Respite care is rare for these families, and tensions may result in further fracture of the family, and breakdown of lengthy and important marriages/relationships. The relationships between the natural parents and the grandparents undertaking primary care and responsibility are often hostile and complex, with the children caught in the middle. The grandparents care passionately for their grandchildren and some become hypervigilant due to threats from the natural parents to harm or take the children if the grandparents do not comply with their demands.

Grandparents are not a homogenous group, and some find difficulties accessing the limited assistance offered to them and accessing relevant and helpful information. Most are permanently exhausted with diminished quality of life in their senior years. Children who have begun their lives as described above, come with behavioural and emotional ‘baggage’, often well beyond the capacity of the grandparent to deal with. They may also present with physical as well and emotional disabilities.⁶⁸

Non-financial effects on grandparents caring for their grandchildren nominated by inquiry participants are generally similar to those experienced by families generally (see chapter seven). However, grandparents may be more susceptible to the negative impacts because of their health or social activities and networks. Some of the concerns expressed by grandparents include:

• high levels of stress and greater susceptibility to loneliness and depression;⁶⁹
• isolation from friends and social networks and a feeling that they don’t ‘fit in’ with younger social activities such as play groups;⁷⁰ and
• stigma associated with a perception that they have ‘failed’ at raising a child the first time around.⁷¹

Some of the particular difficulties experienced by grandparents highlighted by inquiry participants included:

• they are less likely to know their rights and have access to formal channels of support;⁷²
• a lack of recognition from employers in supporting kinship carers to allow for additional leave similar to leave available to maternity leave;⁷³
• the need for information on child management and behavioural issues.⁷⁴

Other possibilities for support

The committee sympathises with grandparents who are torn between support for their children and their concerns for the safety and welfare of their grandchildren. Suggestions by inquiry participants to increase support to grandparent carers included:

• a national 24-hour telephone support line;
• further consideration by state and territory governments of the payment of the foster carer allowance to grandparents who are providing primary care;
• further consideration by state and territory government of the adequacy of financial support for grandparents to meet the needs of grandchildren in their care who are not under formal care and protection orders;
• small grants provided to communities through local, state/territory and Commonwealth governments for support groups, respite services and local information;⁷⁵ and
• flexible financial aid be provided to family carers (grandparents, siblings, etc) of drug users’ children, preferably through the expansion of welfare packages. For example, family allowance payments could be paid to the children’s care-giver, with this being arranged by professionals.⁷⁶

The committee welcomes the initiatives of the Commonwealth in assisting grandparents access a range of financial benefits. The committee expects that a review currently underway by Centrelink and the Department of Human Services on service delivery implications for grandparents will lead to further measures to streamline access to support and make it easier for grandparents to get information about what is available.⁷⁷

The committee understands that some grandparents do not want their carer status formalised, even if this makes them ineligible for state and Commonwealth benefits. However, in cases where child protection agencies have facilitated the carer arrangements, those state and territory agencies should provide grandparents with the full array of financial and support services available to foster carers.