Perth, Feb 4: If you ever wondered why Australians mete out the most linear sentences in the world, it is because the prison system now costs taxpayers more than $7.3 billion a year, while delivering worsening outcomes for public safety and communities.
Australia’s continued reliance on incarceration is proving increasingly expensive and ineffective, with new data showing a deeply entrenched “revolving door” back into prison as governments persist with the American-style approach of building more prisons instead of investing in what actually reduces crime.
The Productivity Commission’s latest Report on Government Services, released late Tuesday, shows total net operating and capital costs for Australian prisons have surged beyond $7.3 billion, marking a five per cent increase since 2021–22. At the same time, the proportion of people returning to prison within two years has climbed to a six-year high of 44.5 per cent, despite Australian Bureau of Statistics data showing that rates for most major crime categories have fallen over the past decade.
Justice Reform Initiative chair Robert Tickner AO said the figures expose the scale of failure in the current approach to criminal justice.
“If any other area of government had such a high failure rate there would be a public outcry about the waste of public money,” he said. “The evidence is very clear: the experience of prison increases the likelihood of future offending. If we want to get serious about community safety, we need to invest in the underlying drivers of incarceration rather than simply building and filling more prison cells.”
“These figures underscore the strong economic case for reform. We are spending billions each year on ineffectual prisons when that money could be better spent on schools, hospitals, mental health services and addressing the factors behind disadvantage.
“All the research shows us that jailing is failing. It doesn’t work to deter crime, it doesn’t work to address the drivers of crime or improve community safety, it costs an exorbitant amount, and it increases the likelihood of people returning to the justice system.”
“Stopping the relentless flow of people into Australian prisons deserves cross-party collaboration and support from Australians from all walks of life. Overreliance on prisons without addressing the underlying issues is letting all of us down.
“The fact that Aboriginal and Torres Strait Islander people represent 36.4% of the prison population 35 years after the Royal Commission into Aboriginal Deaths in Custody is beyond belief and I call on the Australian Government to step up to work with the states and territories to address the underlying issues identified by the commission.”
The 2026 Report on Government Services data shows real net operating expenditure on prisons reached $5.43 billion in 2024–25, up 4.3 per cent in a single year and nearly 50 per cent over the past decade. Over the past five years alone, operating expenditure has risen 18 per cent nationally, with Tasmania, Queensland and the Northern Territory recording the steepest increases.
The national average daily prison population has reached an eight-year high of 45,526 people, up from 43,009 in 2019–20. The Northern Territory recorded the sharpest rise in the past year, followed by Western Australia, with both jurisdictions also seeing the fastest growth in the incarceration of First Nations people. Victoria is the only jurisdiction to record a decline in its total prison population.
Aboriginal and Torres Strait Islander people now account for more than a third of the daily prison population nationwide, with the number of First Nations people incarcerated rising by almost 12 per cent in the past year alone. The data also shows 26 deaths from unnatural causes in prisons, the highest number in five years, with 10 of those deaths involving Aboriginal and Torres Strait Islander people. A further 22 deaths occurred in police custody, six involving Aboriginal and Torres Strait Islander people.
Despite long-term declines in most crime categories, the rising rate of people returning to prison highlights a justice system that is perpetuating cycles of disadvantage and repeat offending.
“If we are serious about community safety, we must invest in what works — not continue pouring billions into a system that is failing on every measure,” Tickner said.
“None of this is about being soft on crime; it is about being clear-eyed about what actually works to reduce crime and make communities safer.”
“We cannot keep doing the same thing and expecting a different result. Time is up – governments have all the evidence in front of them from countless inquiries and royal commissions. It is time for action.”
The Justice Reform Initiative is calling for urgent investment in evidence-based alternatives to incarceration, including diversion programs, community-based supports and First Nations place-based strategies proven to reduce offending and improve community safety.
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