Tel’s Tales: Calculating the cost of doing nothing

Terry Sarten

The recent cyclone-related devastation has clearly demonstrated the shape of the fiscal shadow cast by the cost of doing nothing. Whenever a major initiative is mooted, there is debate about how much it will cost but no mention of the other side of the ledger — what it will cost to do nothing.

This is evident as flood-prone areas are engaged in discussion about the potential for retreat and rebuilding away from low-lying areas that have been repeatedly overwhelmed by flooding. There is general agreement this would cost millions, but the staggering amount of money already being predicted still pales against the actual future cost of doing nothing. There is now clear evidence that recent flooding events will happen again and again, requiring greater levels of financial rescue. Investing in remediation strategies such as retreat and not building on flood-prone land does not come cheap, but there is also a huge cost to not doing these things.

One of the difficulties with doing the cost-benefit analysis and assessing the socioeconomic fallout of policy decisions is that the fiscal implications are spread across a range of economic indicators. Rarely is the impact across the whole range of government departments entered into the equation.

A classic example of this cost-benefit equation is evident in suicide deaths.

The emotional and social burden of suicide is immense and is carried by a range of government agencies and the community. Applying the NZ Ministry of Transport’s calculation of the economic cost for each fatal crash as a relative measure, the cost of a suicide death costs the nation’s economy $4.32 million. For a mere $12 million, every health region in the country could provide a well-resourced, community-based Youth One Stop Shop health services, offering free access to a first point of care, assessment and support for those at risk. Prevent three people from initiating suicide and the state is on the credit side of the ledger and getting 100 per cent return.

There are other aspects of risk for young people that school and community-based youth services are involved in such as sexual health, contraception advice, counselling, advocacy and assessment for referral to secondary services. There is a cost to not doing these things.

For example, having a baby at a young age, without good support, can create life-altering disadvantage that impacts on both mother and child. Quantifying the dollar value of preventing unplanned pregnancies for teenagers is difficult. Reproductive health researchers in the US say that for every dollar spent on family planning, there is a reflected saving of $4 in maternity and infant care. These are US figures, nevertheless, the argument for doing the sums and calculating the cost of not doing something against the benefits of intervention are just as valid here in NZ.

The well-researched value of Youth One Stop Shop-style health services provides savings to a range of sectors: health, justice, education and welfare, but there is no collective approach that draws these together to investigate the potential for jointly funding Youth One Stop Shops around the country.

Disclaimer: I have worked in both One Stop Shop youth health services and for the Child and Youth Mortality Review Committee, and the potential benefits of investing in suicide prevention/ intervention are well documented.

– Terry Sarten aka Tel is a social worker, musician and writer

Feedback:tgs@inspire.net.nz or https://www.terrysarten.co.nz