Key Points:

  • Previous study on cannabis legalisation estimated net social benefit of $225m/year
  • New journal article says social and health risks were understated in that report
  • US evidence indicates possibility for higher use and harm, journal authors say
  • Researchers say Kiwis need full picture of risks before they vote on legalisation

The risks of legalising cannabis in New Zealand have been understated, say a group of drug researchers.

In particular, the assumption that a legal cannabis market will not result in an increase in harm was misguided given evidence from the United States, the researchers from Massey University said.

New Zealanders will vote in a binding referendum on personal use of cannabis at next year's general election.

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Writing in the New Zealand Medical Journal today, researchers from the university's SHORE and Whakiri Research Centre said they were broadly in support of cannabis law reform that was based on harm reduction.

But the group - led by respected drug researcher Professor Chris Wilkins - were concerned about a report released late last year which they said did not give an adequate picture of the potential risks of a commercial cannabis market in New Zealand.

That report, by economic consultancy Sense Partners, looked at the potential impact of several law reform options, including a legal, regulated market for cannabis. It concluded that such a market in New Zealand could generate $240 million in tax revenue and could have a net social benefit of $225m a year if health and education services were invested in.

Massey University drug researcher Chris Wilkins and his colleagues say it is important that Kiwis are given rigorous and balanced information on cannabis legalisation before they vote in a referendum next year. Photograph by
Massey University drug researcher Chris Wilkins and his colleagues say it is important that Kiwis are given rigorous and balanced information on cannabis legalisation before they vote in a referendum next year. Photograph by

One of the Massey academics' concerns about the Sense Partners study was its belief that the price of cannabis could be raised in a legal market to avoid encouraging more people to use it.

In the United States, the legalisation of cannabis in two states had resulted in big falls in the price of cannabis in those places - even with high taxes on the product. That was because companies were able to produce at scale and with modern agricultural methods.

"This suggests it will take a very high tax rate and/or minimum price on cannabis, and continual revision of these tax rates, to maintain the legal price of cannabis and counter the efficiency gains of legal cannabis production," the article said.

Another issue was the assumption in the Sense Partners' report that a commercial cannabis market would not result in any increase in drug-related harm.

There were only a handful of published studies on use and harm in places where cannabis had been legalised, in particular in relation to adolescents where the health and social risks were greatest.

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One US study showed increased hospitalisations, emergency department visits and calls to the poisons centre after medical cannabis, then recreational cannabis, were legalised in Colorado. Another paper found higher rates of cannabis use and dependence in US states with medicinal cannabis - and not necessarily recreational cannabis - regimes.

"These findings … suggest that any balanced evaluation of the impact of a regulated commercial cannabis market should include the possibility of increasing adult cannabis use and related health costs," the Massey researchers wrote.

They added: "Those who disproportionately bear the harm of alcohol and tobacco use are also likely to disproportionately bear the harm of commercially available cannabis, including Maori, high-risk youth, those suffering mental illness and lower socio-economic groups."