Victoria’s independent financial auditor has estimated the illicit cannabis market was worth at least A$1 billion last year in an assessment that could strengthen calls for personal use to be legalised in the state.

The Parliamentary Budget Office (PBO) revealed Victorians spent between $1.02bn and $1.27bn propping up the illicit market in 2022, a figure that law reformers believe illustrates the folly of prohibition

Rachel Payne (photo: Kate Meakin)

The estimates, based on data from the Australian Institute of Health and Welfare, the National Drug and Alcohol Research Centre, and the most recent National Drug Strategy Household Survey, are expected to be raised by Legalise Cannabis Party MPs Rachel Payne and David Ettershank during an upper house debate later this month on their plans to legalise personal use.

The PBO analysed the current cannabis street price as well as the total quantity of cannabis consumed in the state, with estimates based on the consumption of 84,700kg of cannabis.

Legalise Cannabis Victoria, which commissioned the PBO to explore the value of the illegal market, argued the figures “clearly demonstrate that prohibition is a failed policy and justifies the need to regulate cannabis”.

The estimates should also be viewed alongside the National Drug survey which found almost 80% of Victorians believe reform is needed, party officials said.

“What the PBO report shows us, and these are conservative figures, is that the illicit cannabis industry is alive and well in Victoria,” Payne said.

“We already have a cannabis market [but] it just happens to be an illicit one. People often say cannabis is a gateway drug, but the drug dealer is really the gateway to much more harmful, unknown products. Let’s get on with reducing harm by allowing the consumer to grow their own.

“Regulating cannabis is a global movement. Let’s get profits out of the hands of criminals by allowing ordinary Victorians the ability to possess, grow and share personal-use cannabis.”

David Ettershank

Fellow Legalise Cannabis MP David Ettershank added: “In a cost-of-living crisis, rather than entering the illicit market, Victorians will be better off with a regulated environment, not just financially but our community will be far safer too. 

“Why should someone risk arrest, criminalisation and their livelihood buying illicit cannabis when they could grow it legally and safely at home? 

“This is a billion-dollar illicit market that only exists because of the failure of successive state governments to demonstrate a little political courage and reform the laws.”

Under the party’s Regulation of Adult (Personal Use) of Cannabis Bill 2023, adults will be permitted to grow up to six plants per household and possess up to 50 grams of cannabis. This bill will also allow gifting of up to 50 grams of cannabis between adults.

The debate is scheduled for November 29.

Steve has reported for a number of consumer and B2B titles over a journalism career spanning more than three decades. He is a regulator contributor to health journal, The Medical Republic, writing on...

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