Costs of organised crime
Source: data.gov.uk (2014-03-14)

Provides up-to-date estimates of the scale of a range of organised crime types and the social and economic costs associated with these types of organised crime.

Understanding organised crime:
estimating the scale and the social
and economic costs
Research Report 73
Hannah Mills, Sara Skodbo and Peter Blyth
October 2013

2

Understanding organised crime: Estimating the
scale and the social and economic costs
Research Report 73
October 2013
Hannah Mills, Sara Skodbo and Peter Blyth
Acknowledgement: We would like to thank everyone involved in the production of
this report, including the editors, data providers and those who provided comments
and quality assurance of the report content.
Implications
Understanding the costs of organised crime to the UK is an important priority, as
discussed in “Local to Global: Reducing the Risk from Organised Crime” (HM
Government, 2011). Estimates of the scale and social and economic costs of
organised crime help us set policy and law enforcement priorities and highlight the
relative potential benefits of different ways of tackling organised crime.
The current research improves estimation methods, discusses a wider range of data,
and ultimately provides a considerably broader and more detailed picture of the
scale and costs of organised crime to the UK than has previously been available.
 The social and economic costs of organised crime to the UK amount to
many billions of pounds. Drugs supply (£10.7 billion), organised fraud (£8.9
billion) and organised immigration crime types (£1.0 billion) have major
impacts on the UK, and other less visible crimes also cause substantial harm.
This report outlines evidence on organised acquisitive crime types; organised
child sexual exploitation; counterfeit currency; drugs supply; organised
environmental crime; firearms; organised fraud; organised immigration crime;
organised intellectual property crime; and organised wildlife crime, which all
cause damage to the UK.
 The scale of organised crime markets is considerable and the report
considers the scale of a range of crime types including drugs, organised fraud
and organised immigration crime which clearly generate substantial criminal
revenues. Other organised crime types such as organised acquisitive crime,
counterfeit currency, and organised intellectual property crime and others are
also assessed, as these also provide substantial criminal revenues.
 The report takes a cautious approach and applies high standards to the data;
data is only included where there is a strong degree of confidence in accuracy.

3

This means that the figures will often inevitably underestimate the full extent of
the scale and costs of organised crime in the UK.
 For policy makers and law enforcement partners it is therefore important to
consider this report alongside other sources of information; law enforcement
intelligence and in-depth professional subject knowledge provide important
context for understanding the implications of this report.

4

Contents
Implications

2
Summary

5
1 Introduction

13
2 Methodology and data

17
3 Findings

19
4 Conclusions

46
References

48
Annex 1 Technical annex

52
Annex 2 Re-estimating the scale of the illicit drugs market
103
Annex 3 Measuring the costs of drug-driven crime

121

Keywords
organised crime; scale; costs; social costs; economic costs; drugs; fraud; immigration
(crime); acquisitive (crime); revenues

The views expressed in this report are those of the authors, not necessarily those of
the Home Office (nor do they represent Government policy).

5

Summary
Context
Improving our understanding of the social and economic costs of organised crime is
a priority set out in “Local to Global: Reducing the Risk from Organised Crime” (HM
Government, 2011). This report aims to improve our understanding of organised
crime by providing up-to-date estimates of the scale of a range of organised crime
types and the social and economic costs associated with these types of organised
crime.

Scientifically robust estimates of the scale and the social and economic costs of
organised crime form an important part of the evidence base for policy and law
enforcement in this area. They contribute to priority-setting decisions, by showing the
relative costs of different types of organised crime. They can be considered
alongside the national intelligence picture on organised crime and improve
understanding of the relative potential benefits of different approaches to tackling
organised crime. The estimates of the scale of these markets can support law
enforcement partners in assessing the breadth and depth of their engagement with
different organised crime types.

Approach
There are substantial challenges to carrying out an exercise of this kind. In particular
there is an absence of sufficient data for some crime types. To ensure that the most
robust figures possible were produced, two strategies were therefore adopted.
Firstly, the research mainly focuses on producing estimates of the individual types of
organised crime (drugs supply, counterfeiting and so on). An estimate of the total
social and economic cost of organised crime is outlined in the findings section of this
report, but as the estimates are conservative in their approach this is likely to
underestimate the true costs of organised activity.
Secondly, the research is pragmatic in that it varies in the degree to which it fully
maps or estimates individual markets and their harms, depending on the data
available. In some cases estimates are therefore reasonably complete (for example
the scale of drugs supply) whilst in other areas (such as the full extent of the social
and economic costs of drugs supply) estimates are more partial. In some areas it
was possible only to produce estimates based on detected instances (as with people
smuggling) or ultimately not to produce estimates at all (as with trafficking for labour
exploitation).
Defining and categorising organised crime can also be challenging, and the research
takes a policy- and enforcement-based approach. The central definition is drawn

6

from “Local to Global: Reducing the Risk from Organised Crime”1 (HM Government
2011), while the types of organised crime covered in the research largely reflect
operational and strategic approaches to organised crime. The types of organised
crime in this report include: types of organised acquisitive crime; organised child
sexual exploitation; counterfeit currency; drugs supply; organised environmental
crime; firearms supply; organised fraud; types of organised immigration crime;
organised intellectual property crime; and organised wildlife crime.
The report does not attempt to cover all organised crime and there are important
exclusions. Identity fraud, corruption, extortion, blackmail, kidnap, and violence are
excluded. This is in part due to difficulty in disentangling data and events from the
other organised crime types that they sometimes enable. Similarly, organised cyber
crime has been excluded due to the high probability of extensive double counting as
well as the absence of sufficient data on the prevalence of cyber crime and the extent
to which it is organised2. Money laundering, an important enabler and a method of
legitimising the revenues of organised crime, has not been included due to the
substantial data challenges and the timescales for the current work. This, however,
means that any additional costs that arise from these activities are also excluded. All
of these excluded crime types are important and will continue to require further
research3.
The estimates of scale and social and economic costs are set out in Table S.1.
Estimates of scale (or market size) are a measure of known activity across different
types of organised crime and reflect the revenues, but not profit, earned by organised
criminals from activity in each market. Estimates of the social and economic costs
monetise, where possible, the full range of impacts of organised crime to victims and
society.
In many cases the scale estimates, where these equate to the value of property
stolen, also form part of the social and economic costs estimates. Therefore scale
and costs figures should not be added within organised crime types.4
Estimates were calculated using data for the financial year 2010/11 where possible;
otherwise the most recent available data prior to this have been used. Where

1 “Organised crime involves individuals, normally working with others, with the capacity and capability
to commit serious crime on a continuing basis, which includes elements of planning, control and
coordination, and benefits those involved. The motivation is often, but not always, financial gain. Some
types of organised crime, such as organised child sexual exploitation, have other motivations.”
2 Although Anderson et al. (2012) highlight a range of costs of cybercrime.
3 See the organised crime research strategy Future Directions for Organised Crime Research for a
discussion of research priorities for the organised crime field, available at:
http://www.homeoffice.gov.uk/publications/science-research-statistics/research-statistics/crime-
research/future-organised-crime-res-2011?view=Standard&pubID=960766
4 This is because market size estimates often represent the losses sustained by victims which form
part of the social and economic costs of each crime type.

7

necessary price data were uprated to account for inflation to 2010/11 values using
the HM Treasury deflator series.5 Estimates are for the UK unless otherwise stated.

5 The majority of the price data used in this report were already in 2010/11 prices.

8

Table S.1 Summary of estimates of the scale and the social and economic costs of organised crime, by crime type
Sector
Proportion
of total
crime type
that is
organised
Estimated
scale
Completeness
Social and
economic
costs
Completeness
Organised acquisitive
Crime
Various
£550m See below
£1,790m
See below
Cash and
valuables in transit
100%
£12m Only includes recorded offences. Likely
to underestimate scale.
£27m
Costs of recorded incidents only.
Distraction
burglary
100%
£35m Adjusted for underreporting of burglary
offences. Could overestimate scale.
£89m
Adjusted for underreporting of
burglary offences. Could
overestimate costs.
Organised metal
theft
20%
£24m Only includes scale for selected
companies and industries. Likely to
underestimate scale.
£44m
Costs for selected companies and
industries only. Likely to
underestimate costs.
Plant theft
100%
£100m Only includes reported thefts. Most
thefts are likely to be reported.
£650m
Industry estimate of costs of
reported thefts.
Road freight crime
100%
£52m Only includes reported offences. Most
offences likely to be reported.
£64m
Costs of reported offences only.
Limited estimate of victim costs.
Organised vehicle
crime
58%
£330m Adjusted for underreporting of vehicle
thefts. Conservative estimate of value
of stolen vehicle.
£920m
Good. Adjusted for underreporting of
theft of vehicle offences.
Organised child sexual
exploitation
-
- Only includes number of victims known
to police and child protection
authorities. No monetary estimate of
scale.
£1,100m
Costs resulting from known victims.
Likely to underestimate costs.
Counterfeit currency
100%
£7m Only includes detected UK sterling
notes counterfeited. No estimate of
coins. Will underestimate scale.
£7m
Estimate reflects losses only. Partial
estimate of costs.

9

Sector
Proportion
of total
crime type
that is
organised
Estimated
scale
Completeness
Social and
economic
costs
Completeness
Drugs supply
100%
£3,700m Data for 8 types of illicit drugs. Could
underestimate scale if surveys fail to
capture full drug using population. No
account of differences in drug use
across the UK.
£10,700m
Conservative estimate of costs of
drug-related crime. Limited health
data available. No account of
differences in opiate and crack drug
use across UK. Likely to
underestimate costs.
Organised
environmental crime
-
- Data not available to allow estimation
of scale.
-
Data not available to allow
estimation of costs.
Firearms supply
100%
- Data not available to allow estimation
of scale.
£160m
Only includes costs of supply-related
firearms offences. Likely to
underestimate of total costs. No data
for Northern Ireland.
Organised fraud
15%
£8,900m Adjusted for undetected fraud. Could
overestimate scale. Majority made up
of robust measures of detected fraud.
£8,900m
Costs only include losses and CJS
costs. Does not capture full costs.
Organised immigration
crime
Various
£240m See below
£1,040m
See below
Organised abuse
of legitimate entry
75%
£26m Only includes detected activity. Will
underestimate scale.
£11m
Only includes direct costs of
organised crime involvement. No
impacts of migration included. Costs
of enforcement response only.

10

Sector
Proportion
of total
crime type
that is
organised
Estimated
scale
Completeness
Social and
economic
costs
Completeness
Human trafficking
for sexual
exploitation
100%
£130m Only covers foreign women (excludes
domestic trafficking and men and
children) – will underestimate scale.
Estimate of total victims (foreign
women) not just those identified.
£890m
Only costs for foreign female victims
(excludes domestic trafficking and
men and children). Doesn‟t include
impacts of migration. Includes victim
costs, but could underestimate
them.
Human trafficking
– other
exploitation
-
- Data not available to allow estimation
of scale.
-
Data not available to allow
estimation of costs.
Organised people
smuggling
75%
£88m Only includes detected activity. Will
underestimate scale.
£140m
Only includes direct costs of
organised crime involvement. No
impacts of migration included. Costs
of enforcement response only.
Organised intellectual
property crime and
counterfeiting
80%
£90m Only includes seizures of physical
goods. No estimate of cyber crime
involvement. Will underestimate scale.
£400m
Only costs of seizures of physical
goods. Likely to underestimate
costs.
Organised wildlife
crime
-
- Data not available to allow estimation
of scale.
-
Data not available to allow
estimation of costs.
Notes: Estimates are for the UK (with the certain exceptions) in 2010/11 prices, rounded to two significant figures (with the exception of drugs which is rounded to three significant figures). These
figures are not additive either between rows or columns. Estimates of scale often form part of costs estimates so these two figures cannot be added for each crime type.
- Dashes highlight areas where insufficient data are available to allow estimates to be calculated.

11

Conclusions and implications
The research demonstrates that the impact of organised crime on the UK, expressed
as estimates of the social and economic costs caused, is significant. As would be
expected from previous work in this area, drugs supply, organised fraud and
organised immigration crime types all have major impacts on the UK; the other, less
familiar organised crime types also have substantial impact on the UK.
 Drugs supply (£10.7 billion social and economic costs) is associated with
substantial amounts of drug-related acquisitive offending as well as health
costs and drug-related deaths, impacting on individuals, families, and
communities.
 Organised fraud costs to the UK are estimated to be substantial (£8.9 billion),
and these, along with the costs of counterfeit currency (£7 million) and
organised intellectual property crime (£0.4 billion), damage the prospects and
reputation of UK businesses and financial services as well as reducing tax
revenue.
 The suffering caused by human trafficking for sexual exploitation (£890
million) is extensive, despite our ability to capture only a small proportion of
those harms in this report and the further work needed to map the costs of
people smuggling (£140 million) and abuse of legitimate entry (£11 million).
 The damage caused by organised child sexual exploitation is well evidenced.
Quantitative data are limited but the harms are still extensive (£1.1 billion).
 The six types of organised acquisitive crime (from £27 to £920 million) cause
damage to individuals, communities and businesses, whether through the
physical and emotional harms caused to victims, the financial losses incurred
through disruption of business or the direct losses incurred.
 The costs of organised violence and homicide have not been included in the
current work, nor have we been able to capture the violent offending
associated with the supply of illicit drugs. However an estimate of the social
and economic costs of firearms supply (£160 million) illustrates a small part of
the damage by violence caused by organised crime.
 Organised environmental crime and organised wildlife crime cause pollution
and damage communities and businesses in the UK. There are insufficient
data to currently estimate costs, but there is clear evidence on the types of
damage caused.
 We estimate that the total social and economic costs of organised crime are at
least £24 billion per year.

12

Alongside the cost estimates, scale figures have also been produced; these develop
our understanding of the scale of criminal activity and the revenues earned by
offenders in each market6. Unsurprisingly, here too drugs supply and organised fraud
are dominant. The less familiar types of organised crime such as organised
acquisitive crime, organised child sexual exploitation, counterfeit currency, and
organised intellectual property crime are also estimated to be substantial. The scale
of some markets remains unknown, and further work could be done to address this
gap.

Law enforcement partners, as part of their work to disrupt and dismantle organised
crime groups, often seek to seize criminal assets and deny offenders the benefit of
their illegal activities. Estimates of the scale of these markets will support law
enforcement partners in assessing the breadth and depth of their engagement with
different organised crime types.
Ideally, this report would fully map the scale and the social and economic costs of
organised crime, providing estimates of the true extent of criminal activities and the
harms to the UK. In the absence of perfect data, estimates have been provided for
those areas that can be robustly estimated. The report takes a cautious approach
and applies high standards to the data, only including data where there is a strong
degree of confidence in accuracy. This means that the figures will inevitably, and to
differing degrees for each crime type, underestimate both the scale and the impact of
organised crime on the UK. Variation in confidence about the degree to which the
data and estimates fully capture costs is indicated in Table S.1.
For the policy maker and law enforcement audience it is therefore essential to
consider this report alongside other sources of information; law enforcement
intelligence assessments and in-depth professional subject knowledge provide
important context for understanding and operationalising the implications of this
report.

6 Note that it does not set out the costs to offenders, and further work would be needed to assess the
profit to offenders.

13

Understanding Organised Crime:
Estimating the scale and the social and
economic costs
1. Introduction
Background
Improving our understanding of the social and economic costs of organised crime is
a priority for the Government, as set out in “Local to Global: Reducing the Risk from
Organised Crime” (HM Government, 2011). This report sets out findings from work
undertaken by the Home Office in discussion with partners across government
departments and agencies to construct a better, shared understanding of the scale
and costs of a range of key types of organised crime.
Scientifically robust estimates of the scale and the social and economic costs of
organised crime form an important part of the evidence base for policy and law
enforcement in this area. They contribute to priority-setting decisions, by showing the
relative costs of different types of organised crime. They can be considered
alongside the national intelligence picture on organised crime and improve
understanding of the relative potential benefits of different approaches to tackling
organised crime. The estimates of the scale of these markets can support law
enforcement partners in assessing the breadth and depth of their engagement with
different organised crime types.
Aim
The overarching aim of this research is to improve our understanding of organised
crime in the UK, by providing up-to-date estimates of the scale of a range of
organised crime sectors, and of the social and economic costs associated with these
types of organised crime.
The work brings together a wide range of data on the scale and costs of organised
crime in the UK. Data on the scale and impact of these kinds of hidden, illegal
markets7 is understandably often scarce. The absence of sufficient data in some
areas means the work has two important aspects to it in order to ensure as robust
figures as possible are produced.

7 All types of organised crime in this report have been characterised as “markets” that can be
described, in economic terms, as any structures that enable transactions to take place. The activities
of organised criminals described in this report can be thought of as the buying and selling of certain
“products”. It is this activity that is captured by estimates of market size or “scale”.

14

Firstly, the research mainly focuses on producing estimates of the individual types of
organised crime (drugs supply, counterfeiting and so on). An estimate of the total
social and economic cost of organised crime is outlined in the findings section of this
report, but as the estimates are conservative in their approach this is likely to
underestimate the true costs of organised activity.
Secondly, the research is both cautious and pragmatic in that it varies in the degree
to which it fully maps or estimates individual markets and their harms, depending on
the data available. In some cases estimates are therefore reasonably complete (for
example, the scale of drugs supply) whilst in other areas (such as the full extent of
the social and economic costs of drugs supply) estimates are more partial. In some
areas it was possible only to produce estimates based on detected cases (as with
people smuggling) or ultimately not to produce estimates at all (as with trafficking for
labour exploitation).
This approach means that on the one hand the estimates are conservative and will
tend to underestimate the full extent of the social and economic costs to the UK,
while on the other hand, the estimates are scientifically robust and provide a useful
contribution to the evidence base, improving our ability to measure such costs both
now and in the future.
Note that this report does not aim to provide estimates that are directly comparable
with earlier work in this area, as both data and methodologies have developed
considerably over time.8
Definition and typology
Defining and categorising organised crime can be challenging. Organised crime
encompasses a huge variety of criminal activities, and definitions in the literature
vary. The current work takes a policy- and enforcement-based approach to this
question.
The starting point is the definition set out in “Local to Global, Reducing the Risk from
Organised Crime”, which states:
“Organised crime involves individuals, normally working with others, with the
capacity and capability to commit serious crime on a continuing basis, which
includes elements of planning, control and coordination, and benefits those
involved. The motivation is often, but not always, financial gain. Some types of

8 Previous estimates have been published in Extending Our Reach: A Comprehensive Approach to
Tackling Organised Crime available at http://www.official-
documents.gov.uk/document/cm76/7665/7665.pdf . Some elements of these were based on previous
unpublished Home Office research which has since been released under Freedom of Information,
available at http://www.homeoffice.gov.uk/about-us/freedom-of-information/released-information1/foi-
archive-crime/9886.pdf?view=Binary

15

organised crime, such as organised child sexual exploitation, have other
motivations.” (HM Government, 2011)
In order to identify which types of crime to include and where to draw conceptual
boundaries, discussions were held with law enforcement colleagues as well as
partners across government departments and agencies. Discussions centred on the
organised crime strategy definition set out above, alongside those approaches set
out in law enforcement threat assessments9 and other law enforcement intelligence
documents. The types of crime included therefore reflect operational and strategic
approaches to organised crime. 10 These crime types are set out in Table 1.1.
The report does not attempt to cover all of organised crime and there are important
exclusions. Some types of crime were excluded due to the difficulty in disentangling
data and events from other types of organised crime that they sometimes enable.
This, however, means that any additional costs that arise from these activities are
also excluded. These excluded crime types include identity fraud, corruption,
extortion, blackmail, kidnap, and violence.
In addition, organised cyber crime has been excluded from the current work due to
the high probability of extensive double counting as well as the absence of sufficient
data on the prevalence of cyber crime and the extent to which this is organised11.
Money laundering, an important enabler and a method of legitimising the revenues of
organised crime, has not been included due to the substantial data challenges and
the timescales for the current work. All of these excluded crime types are important
organised crime issues in their own right and will continue to require further
research12.

9 See for instance http://www.soca.gov.uk/threats
10 For many crime types in this report, a proportion of activity within the crime type is assumed to be
organised and not the entire crime type.
11 Although, Anderson et al. (2012) highlight a range of costs of cybercrime.
12 See the organised crime research strategy Future Directions for Organised Crime Research (Home
Office, 2011a) for a discussion of research priorities for the organised crime field, available at:
http://www.homeoffice.gov.uk/publications/science-research-statistics/research-statistics/crime-
research/future-organised-crime-res-2011?view=Standard&pubID=960766

16

Table 1.1: Scope of this report, crime types
Organised crime types discussed in this
report
Organised
crime
types
excluded from this report
 Organised acquisitive crime
o Cash and valuables in transit (CViT)
o Distraction burglary
o Organised metal theft
o Plant theft
o Road freight crime
o Organised vehicle crime
 Organised child sexual exploitation
 Counterfeit currency
 Drugs supply
 Organised environmental crime
 Firearms supply
 Organised fraud
 Organised immigration crime
o Organised abuse of legitimate entry
o Human trafficking (sexual exploitation)
o Human trafficking (other exploitation)
o Organised people smuggling
 Organised intellectual property crime
 Organised wildlife crime
 Money laundering
 Cyber crime
 Kidnapping
 Corruption
 Identity fraud
 Violence
 Extortion

17

2. Methodology and data
For each crime type identified, estimates of scale and social and economic costs
have been produced. Estimates have been calculated using data for the financial
year 2010/11 where possible; otherwise the most recent available data prior to this
have been used. Where necessary, price data were uprated to account for inflation to
2010/11 values using the HM Treasury deflator series.13 Estimates are for the UK
unless otherwise stated.
A limited range of potential data sources were available. Where a choice of sources
was available, judgements were made on what data were the most appropriate
based on criteria such as quality, robustness, and reputation of source. Where only
one data source was available, it was assessed against the same criteria and only
included if of sufficient quality. Weaknesses in any of the data used have been
highlighted in the relevant sections.
The methodologies used to estimate the scale and social and economic costs are
independent of each other.
 Estimates of scale, or market size, are produced to provide a sense of the
scale of known activity across organised crime types and reflect the revenues
earned by organised criminals from activity in each market14. In general, this
estimation is based on the average value of the item associated with the
particular offence multiplied by the annual volume of those offences. For
example, in the case of vehicle crime the number of vehicles stolen by
organised crime groups is multiplied by the average value of the vehicles
stolen. Estimates of the market size are referred to as „scale‟ estimates
throughout this report.
 The social and economic cost estimates15 monetise, where possible, the
full range of harms to victims and society resulting from the estimated extent
of each crime type. Estimates follow existing Home Office methodology for
estimating the costs of crime16. This includes the costs in anticipation of crime
(such as security expenditure), costs as a consequence of crime (such as

13 The majority of the price data used in this report were already in 2010/11 prices.
14 These estimates however should not be used as a measure of profit of organised criminals as any
costs organised criminals will incur need to be subtracted. This is not within the scope of this report.
15 The term “social and economic costs” are used in this report as in Brand and Price (2000) to include
costs imposed on individuals, households, businesses or institutions by crimes they suffer directly
(private costs) and wider impacts on society as a whole through, for example, responses to the
perceived risk of crime (external costs). The term “social costs” is used in its economic sense to
include both financial costs reflected in expenditure, and notional costs reflecting best assessments of
the less tangible impacts of crime, such as the emotional and physical impact on victims.
16 See, for example, Brand and Price (2000), and Dubourg et al. (2005). Unit costs used are revised
unit costs published with the Integrated Offender Management Value for Money toolkit (Home Office,
2011c).

18

property stolen17 and emotional and physical impacts), and costs in response
to crime (costs to the criminal justice system).
The scope of costs considered within this report captures any harms occurring within
the UK, regardless of the nationality or residency status of victims. When assessing
the social and economic costs this report does not examine any „benefits‟18 of
organised crime, for example benefits to offenders. Nor do the estimates of social
and economic costs of organised crime types include the harms to organised
criminals or costs to organised crime groups. This is consistent with previous Home
Office research where any effects on a person carrying out an illegal action are not
considered to affect the total welfare of society19.
Estimates have been produced for individual crime types using varying
methodologies and data sources. The estimates are robust, conservative and, in
most cases (because of the largely hidden nature of organised crime), partial
estimates of total organised crime activity.
In many cases20 the scale estimates, where these equate to the value of property
stolen, also form part of the social and economic costs estimates. Therefore scale
and costs figures should not be added within organised crime types.21
In some cases assumptions have been made to enable the production of meaningful
estimates. For example, assumptions have been made concerning the proportion of
a particular criminal activity that is accounted for by organised criminals, and the
prices paid for particular criminal services. Such assumptions are based on
intelligence, and are developed in consultation with law enforcement partners and
other professionals working in the relevant crime area. Assumptions are discussed in
the text as they arise and are also covered in more detail in the technical annexes.
Were these assumptions to be altered, the size of the estimates produced would
change. In addition, the assumptions in this report only apply to the known aspects of
organised criminal activity. As such, they cannot necessarily be applied to any
emerging evidence relating to the organised crime types considered.

17 Property recovered is subtracted from this so that the value of property stolen net of the value of
property recovered is used. In 2010/11 Serious Organised Crime Agency (SOCA) recovered assets
worth £20.3 million.
18 Although the value of any property recovered is offset against the costs of stolen property. Other
benefits could include jobs in the security industry that are necessary to protect individuals and
businesses from organised crime.
19 See Brand and Price (2000) for further details.
20 Generally, where scale estimates do not capture the value of stolen goods, they do not form part of
the social and economic costs estimates.
21 This is because market size estimates often represent the losses sustained by victims which form
part of the social and economic costs of each crime type.

19

3. Findings
Estimates of market size (scale) and the social and economic costs for a range of
organised crime types were produced; these are set out in Table 3.1. The scale and
cost estimates should not be added within organised crime types, as in many cases
the scale estimates form part of the social and economic costs estimates (see
methodology and data section).
Where possible, the estimates include enforcement costs. However, some
enforcement budgets that are associated with organised crime in general, could not
be broken down to identify costs related to specific crime types. These are not
captured in the estimates in Table 3.1. For instance, the 2010/11 budget for the
Serious Organised Crime Agency (SOCA) was approximately £430 million. This is a
cost resulting from organised crime that does not apply to any specific organised
crime type and cannot be further broken down.22 As such, all cost estimates
presented do not include SOCA costs of preventing and responding to organised
crime.
There are several crime types within the scope of this report where there are not
sufficiently robust or extensive enough data available for an exercise of this kind. For
these crime types, it has not been possible to estimate either the scale of organised
activity or the social and economic costs of such activity. These crime types are:
 organised environmental crime;
 human trafficking for the purposes of labour exploitation;
 human trafficking of men and children; and
 organised wildlife crime.
There are a number of other crime types where estimates have been calculated but
assumptions have been relied on, including in particular organised immigration crime.
These assumptions are set out as they arise and are also explored in the technical
annexes 1-3.
Total social and economic costs of organised crime
Adding up the costs of individual crime types, we find that the social and economic
costs of organised crime are estimated to be at least £24 billion a year. It is highly
likely that some double counting exists between the estimates for individual crime
types (such as between drugs supply or firearms supply and elements of organised
acquisitive crime) although this is not anticipated to be extensive. But, as the
estimates are conservative in their approach (including only those where there are
robust scientific data) they tend to underestimate the true scale or costs of organised

22 Similarly, assets recovered by SOCA should be taken into account as property recovered from
organised criminals. In 2010/11 over £9.9 million worth of assets were recovered by SOCA. As with
SOCA enforcement costs, it has not been possible to break this down by crime type.

20

activity to varying degrees and the degree of underestimation is highly likely to
outweigh the double-counting effects.
Comparing the social and economic costs of organised crime with other
costs of crime
This report estimates that the social and economic costs of organised crime are at
least £24 billion per year. It is important to note that this figure may not be
comparable on a one-to-one basis with other costs of crime estimates. There are two
primary reasons for this.
Firstly there may be an overlap between the crimes of interest. For instance the
estimated costs of crime against individuals and households of £36.2 billion in
2003/04 (Dubourg et al., 2005) includes some of the organised acquisitive crimes
included in this report.
Secondly there may be differences in the definition of what costs should be counted.
For instance the estimated cost of domestic violence of £15.7 billion in 2008 (Walby,
2009) reflects the direct costs resulting from crime committed by individuals against
victims. Conversely some of the costs included in this report are indirect, such as the
costs of drug-related acquisitive crime. These costs are not caused directly by
organised criminals, but are costs which would not occur in the absence of organised
crime – in this case, drug supply. We believe that a broader definition of costs that
should be counted is appropriate in the case of organised crime because it is, in
certain cases and amongst other things, an enabling crime. Tackling organised crime
could reduce not only the direct costs caused by the organised criminals themselves,
but also the indirect costs that result from organised criminal activity.
It should also be noted that a significant proportion of the estimated social and
economic costs of organised crime arises from deaths and ill health outcomes of
drug users. Although these are clearly social costs that should be counted, there is
arguably a distinction between costs which have been willingly incurred23 and those
that have been forced upon a more conventional victim of crime. The issue of
addiction and the extent to which drug users are capable of making rational
consumption decisions clouds this distinction.
All of these issues mean that care needs to be taken when comparing the social and
economic costs of organised crime estimate with other estimates of crime costs.

23 In the sense that they are taken into account in a market-based decision: a drug user may decide
that the risk of adverse health impacts is outweighed by the pleasure gained through the drug
purchase.

21

Table 3.1 Summary of estimates the scale and the social and economic costs of organised crime, by crime type
Sector
Proportion
of total
crime type
that is
organised
Estimated
scale
Completeness
Social and
economic
costs
Completeness
Organised acquisitive
crime
Various
£550m See below
£1,790m
See below
Cash and
valuables in transit
100%
£12m Only includes recorded offences. Likely
to underestimate scale.
£27m
Costs of recorded incidents only.
Distraction
burglary
100%
£35m Adjusted for underreporting of burglary
offences. Could overestimate scale.
£89m
Adjusted for underreporting of
burglary offences. Could
overestimate costs.
Organised metal
theft
20%
£24m Only includes scale for selected
companies and industries. Likely to
underestimate scale.
£44m
Costs for selected companies and
industries only. Likely to
underestimate costs.
Plant theft
100%
£100m Only includes reported thefts. Most
thefts are likely to be reported.
£650m
Industry estimate of costs of
reported thefts.
Road freight crime
100%
£52m Only includes reported offences. Most
offences likely to be reported.
£64m
Costs of reported offences only.
Limited estimate of victim costs.
Organised vehicle
crime
58%
£330m Adjusted for underreporting of vehicle
thefts. Conservative estimate of value
of stolen vehicle.
£920m
Good. Adjusted for underreporting of
theft of vehicle offences.
Organised child sexual
exploitation
-
- Only includes number of victims known
to police and child protection
authorities. No monetary estimate of
scale.
£1,100m
Costs resulting from known victims.
Likely to underestimate costs.
Counterfeit currency
100%
£7m Only includes detected UK sterling
notes counterfeited. No estimate of
coins. Will underestimate scale.
£7m
Estimate reflects losses only. Partial
estimate of costs.

22

Sector
Proportion
of total
crime type
that is
organised
Estimated
scale
Completeness
Social and
economic
costs
Completeness
Drugs supply
100%
£3,700m Data for 8 types of illicit drugs. Could
underestimate scale if surveys fail to
capture full drug using population. No
account of differences in drug use
across the UK.
£10,700m
Conservative estimate of costs of
drug-related crime. Limited health
data available. No account of
differences in opiate and crack drug
use across UK. Likely to
underestimate costs.
Organised
environmental crime
-
- Data not available to allow estimation
of scale.
-
Data not available to allow
estimation of costs.
Firearms supply
100%
- Data not available to allow estimation
of scale.
£160m
Only includes costs of supply-related
firearms offences. Likely to
underestimate of total costs. No data
for Northern Ireland.
Organised fraud
15%
£8,900m Adjusted for undetected fraud. Could
overestimate scale. Majority made up
of robust measures of detected fraud.
£8,900m
Costs only include losses and CJS
costs. Does not capture full costs.
Organised immigration
crime
Various
£240m See below
£1,040m
See below
Organised abuse
of legitimate entry
75%
£26m Only includes detected activity. Will
underestimate scale.
£11m
Only includes direct costs of
organised crime involvement. No
impacts of migration included. Costs
of enforcement response only.

23

Sector
Proportion
of total
crime type
that is
organised
Estimated
scale
Completeness
Social and
economic
costs
Completeness
Human trafficking
for sexual
exploitation
100%
£130m Only covers foreign women (excludes
domestic trafficking and men and
children) – will underestimate scale.
Estimate of total victims (foreign
women) not just those identified.
£890m
Only costs for foreign female victims
(excludes domestic trafficking and
men and children). Doesn‟t include
impacts of migration. Includes victim
costs, but could underestimate
them.
Human trafficking
– other
exploitation
-
- Data not available to allow estimation
of scale.
-
Data not available to allow
estimation of costs.
Organised people
smuggling
75%
£88m Only includes detected activity. Will
underestimate scale.
£140m
Only includes direct costs of
organised crime involvement. No
impacts of migration included. Costs
of enforcement response only.
Organised intellectual
property crime and
counterfeiting
80%
£90m Only includes seizures of physical
goods. No estimate of cyber crime
involvement. Will underestimate scale.
£400m
Only costs of seizures of physical
goods. Likely to underestimate
costs.
Organised wildlife
crime
-
- Data not available to allow estimation
of scale.
-
Data not available to allow
estimation of costs.
Notes: Estimates are for the UK (with the certain exceptions) in 2010/11 prices, rounded to two significant figures (with the exception of drugs which is rounded to three significant figures). These
figures are not additive either between rows or columns. Estimates of scale often form part of costs estimates so these two figures cannot be added for each crime type.
- Dashes highlight areas where insufficient data are available to allow estimates to be calculated.

24

The following sections set out the findings for each organised crime type in more
detail. The scope of the organised crime type is considered and presented together
with the estimates of scale and social and economic costs. Further details are
discussed in the technical annexes.
Organised acquisitive crime
In this section, six types of organised acquisitive crime are considered:
 cash and valuables in transit;
 distraction burglary;
 organised metal theft;
 plant theft;
 road freight crime; and
 organised vehicle crime.
Armed robbery has not been included as an organised acquisitive crime type.
Elements of several types of organised acquisitive crime considered in this section
are enabled by the use of firearms, including cash and valuables in transit (CViT) and
road freight crime. Additionally, many armed robbery offences are captured in the
firearms section. These are thought to be the most organised elements of armed
robbery with other armed robbery offences largely considered to be “unsophisticated
and/or opportunistic” (SOCA website, accessed May 2012). For many of the
acquisitive crime types considered, assumptions have been made about the
proportion of organised involvement. These assumptions are outlined as they arise
and are discussed in greater detail in Annex 1.
a. Cash and valuables in transit
Scope
Cash and valuables in transit (CViT) robbery “relates to the illegal appropriation of
these high value goods – usually cash – while they are being transported from one
location to another” (Wainer and Summers, 2011). These offences, classified as
commercial robbery, can occur at various locations on the route between cash
centres and bank branches. Such robberies typically require planning and
preparation and often more than one offender,24 which as a result mean that all these
offences can be attributed to organised crime.
Scale
SaferCash25 recorded total losses resulting from cash and valuables in transit
offences of approximately £12 million in the UK in 201026. Given the nature of these

24 Evidence from Wainer and Summers (2011) suggests that the majority (53%) of CViT offences
detected in the Metropolitan Police Service in 2009 involved two or more offenders.
25 SaferCash is a national centre for intelligence sharing on CViT robbery holding a database of all
CViT robberies occurring in the UK. It is operated by the British Security Industry Association (BSIA).

25

robberies, this is all attributed to organised crime. The average loss per offence is
approximately £15,00027.
Costs
The social and economic costs of cash and valuables in transit robberies include the
value of property stolen from banks and businesses, the physical and emotional
harms sustained by victims, lost output for businesses, and any criminal justice
system (CJS) costs from resulting prosecutions. The losses identified in the scale
section form part of the social and economic costs. Additional harms have been
quantified using Home Office costs of crime estimates for „robbery – commercial‟,
excluding the value of property taken28. Approximately 30 per cent of these robberies
result in injuries for victims (Wainer and Summer, 2011), the costs of which have
been approximated using Home Office costs of crime estimates. The social and
economic costs of recorded organised cash and valuables in transit robberies are
estimated to be approximately £27 million.
b. Distraction burglary
Scope
Distraction burglary occurs where “a falsehood, trick or distraction is used on an
occupant of a dwelling to gain, or try to gain, access to the premises to commit
burglary” (Home Office, 2012c). Distraction burglars usually target residential
addresses, often of vulnerable people such as the elderly. Most distraction burglary is
thought to be related to organised crime as offenders are “extremely professional
criminals who…may travel hundreds of miles in a day, committing 20 or 30 offences
across… [police] force areas in order to avoid detection.” (Home Office, 2003)
Therefore, it is assumed that all distraction burglary can be attributed to organised
crime. This may overestimate the organised crime involvement as a small number of
offences are thought to be committed by individuals.29
Scale
There were a total of 5,480 completed distraction burglaries30 recorded by police in
England and Wales in 2010/11 (Chaplin et al., 2011). Allowing for the fact that many
burglaries go unreported31, and then extrapolating from England and Wales data to

BSIA members are responsible for over 70 per cent of UK security products and services (by
turnover).
26 Data from SaferCash – these have not been grossed up to account for non-BSIA members.
27 Number of offences taken from SaferCash data.
28 The value of property taken is excluded as this would double count the scale of organised CViT
robbery as estimated in the previous section.
29 According to intelligence provided by Operation Liberal, an initiative to tackle distraction burglary
offences.
30 These are separately recorded in police recorded crime in England and Wales. This figure does not
include those distraction burglaries that were attempted but unsuccessful.
31 Using a multiplier published by the Home Office in 2011. This follows methodology set out in Brand
and Price (2000) and Dubourg et al. (2005). For further details please consult Annex 1.

26

the UK population gives an estimate of 17,294 distraction burglaries in the UK. The
scale of organised distraction burglary is estimated to be approximately £35 million32.
Costs
The social and economic costs of distraction burglaries include the losses and the
physical and emotional harms sustained by victims, as well as any CJS costs from
resulting prosecutions. The losses identified in the scale section form part of the
social and economic costs but additional harms have been quantified using Home
Office costs of crime estimates for „burglary – domestic‟33. The costs of the estimated
1,523 distraction burglaries that were attempted but unsuccessful in the UK have
also been included.34 The total social and economic costs of organised distraction
burglary are estimated to be £91 million. It is possible that the costs of distraction
burglaries are not the same as those of domestic burglaries but this is the best
available proxy.
c. Metal theft
Scope
Metal theft refers to thefts of items for the value of their constituent metals, often
copper, lead and aluminium (Ministry of Justice, 2012). Common targets for metal
theft include copper wire and cable from transport and utility networks. Other targets
include lead from churches and other historic buildings, catalytic converters (for their
precious metal content), and street furniture, such as aluminium road signs and lead
drain covers (ibid.).
Police intelligence suggests that metal theft is committed by both individuals
committing low-level, opportunistic offences, and organised groups committing thefts
that are often higher value, and which require greater levels of planning or expertise.
It is this latter category of offences that are considered within the scope of this report.
Scale
Offences involving the theft of metal have grown rapidly in recent years. (ACPO,
2012) There is no separate recorded crime category for metal theft. However, it has
been estimated that there were between 80,000 and 100,000 other theft offences
recorded by police where metal was stolen in 2010/11 (Ministry of Justice, 2012)35.

32 Using the average value of property stolen of £2,040. This is taken from R Chaplin et al. (2011) and
is the average (mean) value of property stolen during a domestic burglary.
33 Unit cost of a domestic burglary is £3,925.
34 Using police recorded crime and the same multiplier as for successful distraction burglaries. The
same unit cost as for successful distraction burglary is used excluding the value of property taken as it
is assumed in unsuccessful distraction burglaries no property is stolen.
35 Metal theft offences are likely to be underreported with some offences not recorded accurately as
metal theft related.

27

Intelligence from the British Transport Police suggests that approximately 20 per cent
of metal theft offences are organised.36
The scale of organised metal theft is best37 measured by calculating the scrap value
of stolen items. As accurate data on the average value of metal stolen in organised
offences are not available, the scale of organised metal theft has been estimated by
considering the expenditure on replacing the stolen metal by victims of metal theft38.
The Home Office recently estimated the expenditure on replacing stolen metal by
victims of metal theft at £128 million per year. (Ministry of Justice, 2012) As this
estimate is based on figures from a selection of companies and industries that were
able to identify this expenditure, it is likely to understate the total expenditure on
replacing stolen metal39. Assuming 20 per cent of metal thefts are organised, the
scale of organised metal theft is approximately £26 million. This figure does not take
account of the fact that expenditure on replacement metal will be higher than the
scrap value of metal stolen (since replacement expenditure covers new materials –
the costs of which have been rising in recent years - and labour costs), nor the fact
that organised metal theft offences are likely to have a higher average value than
non-organised offences (Sidebottom, 2012) as organised criminals are likely to target
higher value and larger metal items.
Costs
There are a range of costs associated with metal theft, including the cost of replacing
stolen metal, the cost of repairing damage resulting from the theft, service disruption
(for example, when offences occur on the rail infrastructure or affect public utilities)
and loss of revenue (Ministry of Justice, 2012). Significant costs also fall to police
forces40 to tackle organised metal theft. The CJS costs of investigating and
prosecuting organised metal theft offences are also relevant.

The Home Office recently estimated the cost of metal theft to the UK at £220 million
per year41 (Ministry of Justice, 2012). This is likely to be a conservative estimate. Not

36 This is based on the metal theft offenders apprehended by the British Transport Police. This
assumption has been applied to all metal theft and so may prove inaccurate. However, this was the
best available estimate of the proportion of metal theft offences that are organised.
37 This is most consistent with the definition of scale used in this report which is designed to capture
the market size of each organised crime type by considering the potential revenue available to
organised criminals.
38 This will include both the cost of materials and the cost of labour.
39 Including government departments and private sector companies. These costs have not been
extrapolated to the whole of the UK.
40 Including the British Transport Police which has at least 100 officers dedicated to tackling metal theft
from the railways, both organised and non-organised.
41 This estimate used a bottom-up approach using estimates from other Government departments and
the private sector which provide some data on the social and economic costs of metal theft at the
individual company and market sector level. This is not a comprehensive estimate as figures were
only identified by a selection of companies and sectors affected by metal theft. There this is likely to
represent a conservative estimate of the costs of metal theft to the UK. Figures have not been
extrapolated to account for those companies or sectors affected but which do not provide figures.

28

all affected sectors are covered and not all the potential costs of metal theft could be
quantified, including the CJS costs of organised metal theft and the defensive and
preventative costs to police forces, which could not be separated from the costs of
tackling other (non-organised) metal theft offences.

Assuming that 20 per cent of these costs are attributable to organised crime means
that organised metal theft costs approximately £44 million each year. As with the
scale estimate, this is likely to underestimate the costs of organised metal theft
offences. However, this is the best available estimate of the costs of organised metal
theft.
d. Plant theft
Scope
Theft of construction and agricultural equipment is commonly known as plant theft.
The Plant and Agricultural National Intelligence Unit (PANIU)42 suggests that such
equipment is often not well secured making theft easy, while demand from abroad
means that equipment often moves quickly out of the UK. Theft of small (usually
handheld) items is largely not considered attributable to organised crime and can be
the result of opportunist thieves (Edwards, 2007). However, the theft of larger items
of plant, which are often stolen to order, is usually attributable to organised criminals,
who often use networks abroad to send items out of the UK.
Scale
There were over 6,000 plant items recorded as stolen by the Plant and Agricultural
National Intelligence Unit in the UK in 2011 with an estimated value of £100 million.
These figures cover larger plant items only so are considered wholly attributable to
organised crime.43
Costs
Existing estimates of the social and economic costs of plant theft have been
developed by Combined Industry Theft Solutions (CITS). These costs are estimated
to be approximately £650 million each year to the UK. This includes plant
replacement costs, hire of replacement equipment, loss of business, and insurance
claim processing (CITS, 2012). This represents the best currently available estimate
and is broadly consistent with previous estimates calculated by the Home Office
which place the costs of plant theft between £600 million and £1 billion (Smith and
Walmsley, 1997).

42 PANIU is a specialist police unit. Its primary aim is to reduce plant and agricultural theft across the
UK.
43 Intelligence from PANIU suggests that theft of large plant items requires organised networks to plan
and carry out offences, and to sell on the stolen items.

29

e. Road freight crime
Scope
Road freight crime (the theft of haulage vehicles and their loads) is “a largely
organised and increasingly violent crime” (TruckPol, 2011). Organised criminals often
target valuable loads when they are vulnerable44 through techniques such as theft,
hijacking and deception. TruckPol, the national road freight crime intelligence unit,
suggested that all road freight crime is attributable to organised crime because „to
steal and realise the value of stolen goods requires a network of individuals to whom
the goods can be passed‟ (ibid.).
Scale
There were 2,567 incidents of road freight crime recorded in the UK in 2010
(TruckPol, 2011). This includes 1,370 incidents of thefts of vehicle, almost 850
incidents of thefts from vehicles, as well as 12 incidents of hijacking and 10 incidents
of deception. TruckPol estimated the value of stolen vehicles and loads in 2010 to be
over £52 million, all of which can be attributed to organised crime.
Costs
The social and economic costs of organised road freight crime include the scale
estimate of the value of goods stolen, the physical and emotional costs to victims of
violent robbery or hijacking, the costs of replacing stolen goods, and any
enforcement and CJS costs resulting from prosecuting organised criminals. These
costs have been estimated using Home Office costs of crime estimates for „theft of a
commercial vehicle‟. The 27 violent incidents recorded by TruckPol in 2009
(TruckPol, 2010) have also been included in the costs estimates. The social and
economic costs of road freight crime are estimated to be approximately £64 million.
f.
Vehicle crime
Scope
Organised vehicle crime includes theft of high-value vehicles to order, theft of
vehicles for export to the developing world, and theft of older vehicles to be broken
down for parts. Vehicles are also stolen for use in fraud offences.
Scale
The scale of organised vehicle crime has been estimated using recorded crime
figures for the „theft of vehicle offence‟, attributing approximately 60 per cent to
organised crime45. In addition, the Crime Survey for England and Wales identifies six

44 Either in lay-bys or when they arrive early to warehouses (source: TruckPol Intelligence).
45 Based on intelligence from specialist vehicle crime police units that unrecovered stolen vehicles are
a good indication of the involvement of organised crime. This is because the methods used by
organised criminals are more sophisticated, often because vehicles are exported to other countries or
dismantled for their constituent parts. As such, the chances of those vehicles being recovered is low.

30

per cent of burglaries as burglaries where car keys are stolen. All of these „car-key
burglaries‟ are attributed to organised crime46 and in all cases the vehicle is assumed
to be stolen but not recorded as a theft of vehicle offence.47
It is estimated that approximately 130,000 vehicles were stolen by organised
criminals in the UK, including those resulting from car key burglary. The average
value of a stolen vehicle is estimated to be £2,50048. This yields an estimated market
size of organised vehicle crime of £325 million. This estimate captures both what is
detected and undetected in the market49 but is still likely to be an underestimate as
organised criminals are likely to target higher than average value vehicles.
Costs
The costs of organised vehicle crime have been calculated using the Home Office
costs of crime estimate for „theft of a vehicle‟. This unit cost, including the value of
property damaged or stolen, physical and emotional costs to victims, and CJS costs,
is £5,29850. Applying this unit cost to the number of stolen vehicles attributed to
organised crime results in costs of approximately £690 million. In addition, the cost of
approximately 47,000 “car-key burglaries”51 is also included. This gives a total cost
estimate of organised vehicle crime of approximately £920 million.
Organised child sexual exploitation
Scope
“Child sexual exploitation is a form of child abuse” involving exploitative situations
where young people receive something as a result of performing, or others
performing on them, sexual activities. (Department for Education, 2011) There are
three broad categories of child sexual exploitation:
 inappropriate relations;
 „boyfriend‟ model of exploitation including peer exploitation; and
 organised/networked sexual exploitation or trafficking.
These categories are often linked and all three categories can contain elements that
are organised. However, this section focuses on the third category because it is

The Crime Survey for England and Wales in 2011 reported that approximately 40 per cent of stolen
vehicles are recovered.
46 This is assumed because of the planning and coordination that is required in order to commit the
offence.
47 Instead the burglary would be recorded as the primary offence according to Home Office Counting
Rules.
48 The average value of a stolen vehicle as reported in the Crime Survey for England and Wales
2010/11. This is the average value of both recovered and unrecovered vehicles.
49 Through the use of total crime multipliers to account for crime not reported to or recorded by the
police.
50 Home Office costs of crime estimate for theft of a vehicle. This has been uprated to account for
inflation using HM Treasury gross domestic product (GDP) deflators. Costs are for 2010.
51 Based on the assumption from the Crime Survey of England and Wales that six per cent of
burglaries involve car keys being stolen and that this is necessary for the theft of the vehicle.

31

entirely organised in nature, according to the definition used in this report. This
category involves the grooming and abuse of children and young people by
organised networks and groups. For example, children and young people may be
passed through networks where they may be forced or coerced into sexual activity
with multiple men. (Barnardos, 2011a) This exploitation can take place over many
months or years (Barnardos, 2011b) and “violence, coercion, and intimidation are
common” (Department for Education, 2011).
As organised child sexual exploitation does not always involve a financial motive for
the organised crime groups involved, it is not meaningful to estimate the potential
revenue for organised criminals. Any such estimates would provide only a partial
view of the revenues available from this type of organised crime. Instead the scale
estimate reflects the number of victims of organised child sexual exploitation.
Scale
Several studies (including Barnardos (2012); CEOP (2011); and Barnardos (2011a))
have attempted to estimate the overall scale of child sexual exploitation, only a
proportion of which would be classified as organised crime. The Office of the
Children‟s Commissioner is undertaking work to gather evidence on child sexual
exploitation by gangs or groups, including the number of known victims, using a
definition which closely matches the definition of organised crime used in this report.
Results from Phase 152 suggest there are at least 2,409 victims53 of child sexual
exploitation by gangs and groups. (Berelowitz et al., 2012) This only captures victims
known to agencies responding to a request for evidence, and is therefore likely to
underestimate the scale of organised child sexual exploitation (for example, agencies
in some police force areas did not submit any information on cases of child sexual
exploitation). As public and practitioner awareness of the problem increases, more
victims are likely to be identified.
Costs
The social and economic costs of organised child sexual exploitation are wide-
ranging and include the physical and emotional costs of coercion, the costs of sexual
exploitation, and a number of costs resulting from the abuse. Organised child sexual
exploitation is estimated to cost approximately £1.1 billion per year. This estimate
includes violence suffered at the hands of the exploiters, the physical and emotional
costs of rape and sexual assault, self-harm and attempted suicide following or during
the exploitation, sexual health issues, and disengagement from education.
The estimated costs do not include costs to families as a result of a child being
sexually exploited including the impacts on parents and other family members, such

52 Phase 1 ran from October 2011 until September 2012 and focussed on gathering evidence on the
nature and reported prevalence of sexual exploitation of children by groups and gangs.
53 This figure is based on records from August 2010 until October 2011. This 14 month period is likely
to overestimate the number of victims in a year. However, this is still likely to underestimate the true
scale of organised child sexual exploitation as many cases are thought to go unreported.

32

as strained relationships and family breakdown, financial expenditure, and lost output
as a result of having to take time off work. This is because quantified data on the
extent and cost of these harms are not available.
Costs incurred by agencies involved in preventing children becoming victims of
sexual exploitation have not been included as they could not be identified separately.
Criminal Justice System costs are also excluded as data on organised child sexual
exploitation offences are not collected separately from other child sex offences.
Counterfeit currency
Scope
Organised criminals produce a variety of banknotes and coins but the main focus of
criminals in the UK is on UK banknotes and coins. This includes Bank of England
notes as well as Scottish and Northern Irish sterling banknotes. Limited data are
available for both the scale and costs of organised counterfeit currency so these
estimates should be considered as a minimum.
Scale
Approximately 350,000 counterfeit notes were taken out of circulation in 2010 with a
face value of £6.7 million.54 The procedures and technology necessary to produce
counterfeit coins and notes are such that all counterfeit currency is assumed to be
the result of organised crime. However, this is only a partial estimate of the scale of
organised counterfeit currency, as not all counterfeit currency is identified and taken
out of circulation. In addition, the total market size would include counterfeiting of
sterling coins and non-sterling currencies produced in the UK.
Costs
It has not been possible to quantify the social and economic costs of counterfeit
currency beyond the losses incurred by individuals and businesses handing in
counterfeit currency and therefore losing the equivalent value in sales revenue. The
social and economic costs of currency counterfeiting will be a minimum of £6.7
million. Additional costs that could not be quantified include the costs to retailers of
training staff to detect counterfeits or installing detection devices, the costs of
designing currency in response to specific threats, and the costs to the CJS of any
prosecutions relating to counterfeit currency.

54 Data taken from the Bank of England and the Association of Commercial Banknote Issuers (ACBI)
for 2010. This can vary considerably depending on the outcome of police or SOCA operations to
target counterfeit currency.

33

Drugs supply
Scope
Organised crime groups and networks produce, supply, and distribute illicit drugs
within the UK. There will be some exceptions, for example, where cannabis is grown
and used by the same person, but this is unlikely to considerably affect either scale
or cost estimates.
The scale of organised drugs supply captures the amount of money spent by drug
users on buying illicit drugs55. The costs of organised drug supply include the harms
resulting from the use of illicit drugs. This includes the costs of acquisitive crimes
committed to fund addiction, costs of drug offences under the Misuse of Drugs Act
1971, costs of health harms resulting from drug use, the costs of drug treatment, and
public spend directly aimed at tackling illegal drugs supply and demand in the UK.
Data limitations mean that it is not possible to include all illicit drug types that are
facilitated by organised crime.56
Scale
The scale of the illicit drugs supply is best estimated by considering the demand for
illicit drugs. This is defined as the money spent by drug users on certain illicit drugs.
This definition of scale is consistent with previous Home Office estimates including
Pudney et al. (2006). Data from the Offending, Crime and Justice Survey and the
Arrestee Survey have been used to calculate expenditure on eight drug types:
amphetamines; cannabis; crack cocaine; ecstasy; heroin; LSD; magic mushrooms;
and powder cocaine. Estimates for England and Wales have been scaled up to the
UK using population and arrest statistics. The size of the illicit drugs market in the
UK57 in 2010 is estimated to be £3.7 billion. Further details of changes to the
methodology and data used compared with previous Home Office estimates are
described in Annex 2.58
Costs
This report builds on previous work to estimate the proportion of each acquisitive
crime type that is committed to fund addiction and to then apply these proportions to
an estimate of the total cost for each type of acquisitive crime, based on the costs of
crime methodology. Further details can be found in Annex 3. Drug-law offences59 and
enforcement costs were calculated using a separate methodology. Drug-related

55 Due to data availability this report considers the supply of amphetamines; cannabis; crack cocaine;
ecstasy; heroin; LSD; magic mushrooms; and powder cocaine.
56 New psychoactive substances are within the scope of this report, however, data availability on their
scale and social and economic costs are not sufficient to be estimated here.
57 Estimates for England and Wales have been extrapolated to the UK including Scotland and
Northern Ireland. Further information can be found in Annex 1.
58 Due to the methodological changes from previous Home Office estimates of the scale of the illicit
drug market, Annex 2 details the methodology and data used.
59 These include possession, supply, unlawful importation or exportation, and other drug offences.

34

health costs include hospital admissions, neonatal care, and the costs of treating
drug-related HIV. The social and economic costs of illicit drugs in the UK60 are
estimated to be £10.7 billion, of which almost £6 billion is the result of drug-related
crime.
Organised environmental crime
Scope
Several types of environmental crime occur in the UK. Organised crime groups are
involved in elements of environmental crime, including „waste crime‟, which includes
the illegal dumping of waste products, such as „end of life‟ vehicles and metal
(Environment Agency, 2011). Illegal dumping of construction and demolition waste
can also include hazardous waste such as asbestos (ibid.).
Intelligence suggests that some criminal groups trafficking electronic-waste (e-
waste)61 are also involved in crimes such as theft, human trafficking, fraud, drugs
supply, firearms supply and money laundering.62 There is also a link between
organised crime and illegal export of e-waste to countries in Africa and Asia.63 The e-
waste can be stripped down and valuable parts taken such as gold, copper, steel and
other metals that can be reclaimed from the electrical waste.
Not all environmental crime is organised and there are limited data available,
particularly concerning the proportion of activity that is organised, so estimating the
scale and social and economic costs of organised environmental crime has not been
possible. Instead, available data are set out to give an indication of possible scale,
and social and economic costs.
Scale
The Environment Agency reports that there were 661 active illegal waste sites in
April 2011, 540 of which were active sites within 200 metres of a sensitive receptor.64
In 2010 the Environment Agency prevented 4,500 tonnes of waste from being
illegally exported and carried out 280 successful prosecutions, resulting in fines at a
total value of £943,000 for illegal waste activity.
The Environmental Investigation Agency estimates that up to 50% of all computers
discarded in the UK enter illegal trade streams as e-waste (Environmental

60 Estimates for England and Wales have been extrapolated to the UK including Scotland and
Northern Ireland on the basis of population. Further information can be found in Annex 1.
61 E-waste contains certain valuable components that are desirable to recover. It is easy to source,
relatively cheap to ship, and the risk of being caught is low.
62 Speech by Lord Smith, Head of the Environment Agency, 7th International Interpol Conference on
Environmental Crime, September 15, 2010.
63 Particularly electrical and electronic consumer goods.
64 Sensitive receptors include: dwellings; schools; businesses; water courses; groundwater; Source
Protection Zones; public foot paths; bridleways; public access areas; Sites of Special Scientific
Interest; Areas of Outstanding Natural Beauty; Special Protection Areas; Special Areas of
Conservation; and Ramsar sites.

35

Investigation Agency, 2011). When new European Union rules came into force in the
UK in 2007, many companies entered the market as recyclers, expecting up to 1.5
million tonnes of electrical and electronic waste needing to be recycled every year
(ibid.). By 2009 the volume of e-waste recorded was only one-third of what was
projected, with the bulk of the remainder siphoned off onto the black market.65
Costs
The social and economic costs of organised environmental crime are likely to include
the costs of enforcement to prevent the illegal export and dumping of waste, the
costs of removing illegally dumped waste, and the human cost due to the damage to
health from hazardous waste. E-waste can be highly hazardous to both the
environment and human health due to the substances it contains. For example, older
computers and televisions can contain large amounts of lead. It has also been
suggested that young children abroad have been involved in the stripping of
materials from exported waste (ibid.) As well as the physical and environmental
costs, there will be the costs of enforcement, including the regulation of waste sites
and shipments, and any prosecutions resulting from organised illegal activity.
Firearms supply
Scope
The majority of criminally linked shooting incidents in the UK can be described as
organised in intent but disorganised in nature (Home Office, 2012a), suggesting that
the supply of illicit firearms is highly organised. While the number of illicit firearms in
use by organised criminals is thought to be small, the harm caused by these firearms
is substantial. Sufficient open source data do not exist to quantify the scale of illicit
firearms. However, data are available to assess the social and economic costs of
illicit firearms, and these are set out below.
Scale
The scale of organised illicit firearms includes the international trafficking of illicit
weapons as well as the domestic supply of illicit firearms to organised crime groups
throughout the UK. It is assumed that all those involved in the international trafficking
of firearms would fall within the remit of organised crime as defined in this report. The
supply chain involves „importers‟, „middle men‟, and those who store guns to be
readily accessible for criminal use (ibid.). Intelligence from the National Ballistics
Intelligence Service (NABIS) (Home Affairs Select Committee, 2010) suggests that,
often, the same firearms are passed between different criminal groups and used in
different violent incidents. This suggests that the market for illicit firearms within the
UK is best characterised by that of suppliers loaning firearms to a number of
organised crime groups.

65 The Guardian, „Dirty Deals‟, July 9 2009.

36

Costs
The social and economic costs of firearms supply capture the harms resulting from
the use of firearms supplied by organised crime groups. This has been calculated
using the estimated number of incidents where certain firearms66 were fired or used
as weapons. This totals over 4,000 offences67. While these offences themselves are
not necessarily organised, it is assumed that the firearms used to commit them were
supplied by organised crime networks. Therefore, the offences are direct
consequences of organised crime.
Using Home Office costs of crime estimates, these offences are attributed a value.
The estimated social and economic costs of illicit firearms are £160 million. While this
is likely to be an overestimate of the costs of these offences68, this is likely to
significantly underestimate the harms resulting from the organised supply of illicit
firearms.
Data were not available for Northern Ireland so this estimate only covers England,
Wales, and Scotland and should be considered partial.69
Organised fraud
Scope
Fraud is a substantial element of the threat from organised crime groups (National
Fraud Authority, 2012). Organised fraud is thought to involve a wide range of
activities including personal and business tax fraud, benefit fraud, payment card
crime, and elements of excise duty fraud. There are likely to be organised elements
of charity fraud but no data on this were available. A number of enablers can be used
to commit fraud including identity theft and cyber crime.
Scale
The scale of organised fraud is based on estimates from the National Fraud Authority
(NFA) in its Annual Fraud Indicator (AFI). The majority of this is made up of
organised criminal attacks on HM Revenue and Customs (HMRC). Attacks on the tax
system totalled approximately £5 billion in 2010/11. (HMRC, 2012) This includes
Missing Trader Intra-Community (MTIC) fraud, smuggling of alcohol and tobacco and

66 In England and Wales those weapons excluded are air weapons, imitation firearms and other
firearms or weapons for which no license is required. For Scotland air weapons, imitation firearms,
and unidentified firearms are excluded.
67 Provided by Home Office Statistics, breakdown of firearms offences reported (Home Office, 2012b).
68 As some of the firearms involved will have been legally held or misappropriated and not supplied by
organised crime. There is also the possibility that some offences are likely to still have been committed
if the firearm was not available.
69 Given the differences in the use of firearms in Northern Ireland, assuming the same rate of use per
population across all countries of the UK was not appropriate. As such, estimates have not been
extrapolated to the UK. No data were available for Northern Ireland so the estimate presented is for
Great Britain only.

37

VAT repayment fraud. These are „co-ordinated and systemic attacks‟ (HMRC, 2012)
and can be wholly attributed to organised crime.
Estimated organised proportions are applied to a range of other fraud types including
mass-marketing fraud and benefit fraud to estimate the scale of organised fraud.
Estimates have been adjusted by the NFA to account for undetected fraud.
The total scale of organised fraud in the UK is estimated at £8.9 billion70.
Costs
The social and economic costs of organised fraud include the losses sustained by
individuals, businesses, and government departments as well as the costs of dealing
with the fraud71, and the CJS costs resulting from fraud offences. The losses
sustained as a result of organised fraud are outlined in the scale section and form the
majority of the social and economic costs estimated. The CJS costs of organised
fraud offences have been estimated as approximately £19 million.72 This gives an
estimate of the social and economic costs of organised fraud of approximately £8.9
billion73. This will not capture the full costs of organised fraud as it is not possible to
quantify many of the other costs of fraud. These include the time spent by victims of
fraud rectifying the damage done by organised fraudsters, the costs of operating
fraud prevention bodies including Action Fraud and the Credit Industry Fraud
Avoidance System (CIFAS), and the precautionary costs incurred by individuals and
businesses trying to avoid becoming victims of fraud.74 Government expenditure on
tackling fraud should also be included but this could not be separately identified.75
Organised immigration crime
Some aspects of immigration crime are known to have substantial organised
elements. Not all immigration crime is organised however, so this report applies
assumptions of organised involvement to data on detected immigration crime. These
assumptions are largely based on what is known to date about immigration crime.
The assumptions used in these sections may not be valid if applied to future
evidence on immigration crime.
The following types of organised immigration crime are examined in this report:
 organised abuse of legitimate entry;
 human trafficking (sexual exploitation);

70 This is based on the NFA estimate of £9.9 billion for organised fraud but accounting for more recent
data from HMRC on the scale of criminal attacks on the tax system.
71 This can include rectifying any changes made to accounts by organised criminals, stopping credit
cards and so on. It can also include emotional costs resulting from being a victim of fraud.
72 Full details of how this was calculated can be found in Annex 1.
73 Rounded to two significant figures.
74 This will include expenditures on shredders but also precautionary behaviour such as avoiding
certain methods or places of payment (Levi & Burrows, 2008).
75 For example, this will include HMRC costs of preventing Missing Trader Intra-Company (MTIC)
fraud, as well as the costs of the Fighting Fraud Together and the Fraud, Error, and Debt Taskforce.

38

 human trafficking (other exploitation); and
 organised people smuggling.
Definitions for each subsection are set out together with estimates of scale and the
social and economic costs. Data sources in this section are mainly management
information from the UK Border Agency.76 Costs include those harms occurring within
the UK. In some cases this will overestimate the costs of organised crime to the UK
and UK public services77. The social and economic impacts of migration generally
are not considered within the scope of this report78.
a. Abuse of legitimate entry
Scope
This section is intended to capture organised criminals targeting legitimate processes
to facilitate illegal migration, including sham marriages79 and abuse of temporary and
permanent migration routes. Organised crime activities such as the organised abuse
of Tier 4 of the Points Based System (the study route) and visa overstaying are within
the scope of this section, but data were not available to allow them to be estimated.
The estimates in this section include the organised element within both those
detected attempting to enter the UK in 2010/11 and those already in the UK but
detected in 2010/11 as having abused legitimate entry processes on arrival. These
figures do not account for activity unknown to the authorities. As such, this should be
considered an underestimate of organised activity. Cost estimates focus on those
who are successful in entering the UK and those who are detected and returned at
the point of entry.
Scale
This section is based on management information provided by the UK Border
Agency, highlighting detected activity. In 2011, there were:
 22,200 forged supporting documents cases, where migrants attempt to obtain
a visa to enter the UK;
 1,900 forged enabling document cases, where migrants already residing in the
UK attempt to change their immigration status80;

76 This is previously unpublished management information. It is derived from live UK Border Agency
administrative systems and, as such, may be liable to change. All figures have been rounded to the
nearest 100.
77 The report allows for the inclusion of physical and emotional costs to irregular migrants without
leave to remain in the UK which do not always result in costs to UK public services.
78 This includes costs of health and education provision and benefits of additional tax revenues. For
further information see Migration Advisory Committee (2012).
79 A sham marriage, or marriage of convenience, is contracted between (a) a British citizen, a person
settled in the UK, a European Economic Area (EEA) national, or a non-EEA national with existing
leave, and (b) a non-EEA national without leave or whose leave is about to expire, solely as a basis
for trying to enable the latter to enter, remain in or extend their leave in the UK.
80 This figure includes migrants applying to change their immigration status in the UK who were found
to be using fraudulent or stolen documentation.

39

 2,000 visa port refusals, where migrants were denied entry to the UK after
obtaining a genuine visa81;
 1,000 enforcement arrests of migrants already in the UK82;
 1,700 Section 24 reports83 of registration officers‟ suspicions of sham
marriages.
The scale of organised abuse of legitimate entry is estimated as the fees paid to
organised criminals by migrants attempting to enter or remain in the UK. In this
report, it is assumed that approximately 75 per cent of forged supporting document
cases, in-country enforcement arrests, and sham marriages can be attributed to (that
is, enabled or facilitated by) organised crime. This is a conservative assumption
reflecting intelligence that most, but not all, activity in these areas is attributable to
organised crime. Intelligence suggests that approximately 80 per cent of visa port
refusals and in-country forged document cases are the result of organised crime.84
These assumptions result in an estimate of almost 22,000 incidents of abuse of
legitimate entry attributable to organised crime in 2011. The value of this activity is
estimated using the average fees migrants paid in order to enter or remain in the
UK85. The scale estimate for detected organised activity in this area is therefore
approximately £26 million.
Costs
The social and economic costs of organised abuse of legitimate entry include the
costs of removing irregular migrants detected both at the border and within the UK,
the costs of asylum claims resulting from removal processes being started, and the
costs of detaining irregular migrants prior to removal. The costs of operating the
National Document Fraud Unit (NDFU) have also been included86. These costs
amount to approximately £11 million.
Other costs to the UK Border Agency of organised immigration crime have been
considered in the organised people smuggling section. These include UK Border

81 These are visa port refusals where individuals were denied entry to the UK despite having obtained
a genuine UK visa after initial decisions to grant a visa were revised following further inspection of the
evidence.
82And who were matched to a valid visa and encountered within 12 months of that visa being issued.
These include those individuals who were arrested but did not require a visa to enter the UK (e.g.
Brazilians or those from USA). As these people are encountered within 12 months of their visa being
issued, visa overstayers (who are unlikely to be involved in organised immigration crime) are likely to
be excluded. Those who are encountered and arrested could be breaking the terms of their visa
without the involvement of organised crime groups. To reflect this, an organised proportion has been
applied to these numbers.
83 Section 24 reports provide an indication of the possible scale of sham marriages. They are used by
registration officers to notify the UK Border Agency when they suspect that a marriage they have been
asked to officiate may not be genuine.
84 For forged enabling documents of in-country immigration applications varying proportions of
organised crime involvement are assumed. These assumptions can be found in Annex 1.
85 Further details of prices can be found in Annex 1.
86 Attributing approximately 80 per cent to organised crime.

40

Agency expenditure to protect UK borders from the threat of organised immigration
crime. It has not been possible to divide this expenditure between the organised
immigration crime types considered in this report.
b. Human trafficking
Scope
Human trafficking is the exploitation of human beings for profit. It is a national and
international crime involving the recruitment, transportation, transfer, harbouring or
receipt of persons by means of threat or use of force or other forms of coercion,
abduction, fraud, deception, or abuse of power87. Forms of exploitation include
sexual exploitation, forced labour, criminal exploitation and domestic servitude.
Historically, most adult victims of human trafficking identified were female victims of
sexual exploitation. However, other forms of exploitation, as well as the trafficking of
men and children, have become more prominent. For instance, a recent report from
the UK Human Trafficking Centre (UKHTC) suggests that sexual exploitation
accounted for 31 per cent of victims encountered by law enforcement agencies
(SOCA, 2012), with the remainder accounted for by other forms of exploitation such
as labour exploitation and domestic servitude.
The estimates of human trafficking in this report focus on the trafficking of foreign
women for the purposes of sexual exploitation as this is where the data are most
robust. Only an overview is provided on the scale and costs of human trafficking for
other types of exploitation, such as labour exploitation or the trafficking of children
and men. Domestic trafficking, which is thought to involve a significant level of
organised crime, is not included in this section. This is because the focus here is on
immigration crime. Sufficient data do not exist to estimate the scale or social and
economic costs of domestic trafficking.
Scale – sexual exploitation
The scale of organised human trafficking for sexual exploitation estimated in this
report is the revenue generated by victims of human traffickers. This is not a
measure of the income of the trafficked victims, rather a measure of the revenue
available to their traffickers.88 Project ACUMEN89 identified 2,600 foreign women in
England and Wales who were victims of human trafficking for the purposes of sexual
exploitation in 2009/10. A further 9,200 were identified as vulnerable to being
trafficked or may have been trafficked previously but are not included in this estimate.

87 Taken from the United Nations Convention against Transnational Organised Crime (UN, 2000).
88 There is limited evidence to suggest what proportion of revenue is kept by the trafficked victim.
Webb and Burrows (2009) suggest that between 10 and 50 per cent could be kept by the victim.
89 Project ACUMEN commenced in January 2009 as a multi-agency, year long initiative to improve
knowledge and understanding of the scale of human trafficking for sexual exploitation in England and
Wales. A report of its findings was published in August 2010.

41

Unlike other estimates for organised immigration crime in this report, this is an
attempt to fully quantify the scale of the market and not just what is known. Separate
data are used for Scotland and Northern Ireland where 73 and 23 victims
respectively were identified or recovered in 2010/11.90 The Scottish Crime and Drug
Enforcement Agency (SCDEA) estimated the annual revenue generated by one
female sex worker as £48,000 (SCDEA, 2011). This would suggest that the scale of
human trafficking of foreign women for the purposes of sexual exploitation in the UK
is valued at approximately £130 million, all of which can be attributed to organised
crime. This estimate is based on a limited number of identified victims in Scotland
and Northern Ireland so is likely to underestimate the true scale of the market.
Scale – other forms of exploitation
A recent UKHTC intelligence assessment (SOCA, 2012) highlighted that, of the
2,077 potential victims of trafficking encountered by law enforcement agencies in the
UK in 2011, 69 per cent91 were involved in types of exploitation that were not sexual
exploitation. This included 461 individuals identified as potential victims of labour
trafficking, 353 victims of criminal exploitation, 222 victims of domestic servitude, and
two victims of trafficking for organ harvesting.92 These estimates are likely to
underestimate the scale of human trafficking as the report includes only encountered
victims. Despite these estimates of the number of victims, it has not been possible to
estimate the scale of these forms of human trafficking as the revenue from each type
of exploitation is not known and is likely to differ from that of sexual exploitation.
Costs – sexual exploitation
The social and economic costs of human trafficking for the purposes of sexual
exploitation include costs incurred by victims at the hands of traffickers as well as
clients. These include physical and emotional costs and the costs of restrictions to
freedom of movement. Health costs incurred by public services in dealing with victim
injuries and illnesses including unplanned pregnancies and sexually transmitted
infections are also included together with the costs of victim services and CJS costs
for the prosecution of human trafficking offences93. Total costs are estimated at £890
million. Enforcement costs to the police and the UK Border Agency should also be
included but could not be estimated at this time.
Costs – other forms of exploitation
It has not been possible to estimate the social and economic costs of human
trafficking for the purposes of labour exploitation, criminal exploitation, or domestic

90 Data taken from the Scottish Crime and Drug Enforcement Agency (SCDEA) and the Organised
Crime Taskforce in Northern Ireland, respectively.
91 Including those who were involved in multiple or unknown forms of exploitation.
92 Some of these potential victims of trafficking will be from the UK and so are victims of domestic
rather than international trafficking.
93 These are likely to be an underestimate as intelligence suggests prosecutors will often use other
offences to secure a conviction. It was not possible to identify these other offences.

42

servitude. This is because of a lack of research evidence and data quantifying the
harms of these forms of exploitation.
c. People smuggling
Scope
People smugglers are involved with facilitating the entry of irregular migrants into the
UK. Evidence suggests that people smugglers collaborate, operating flexibly to move
migrants wanting to travel to the UK. This can involve supplying migrants with the
necessary documents to enter the UK or providing transport from the country of
origin to the UK. These figures are based on accusations and detections of illegal
activity and so do not account for activity unknown to the authorities. As such, they
should be considered a partial representation of organised activity. Scale estimates
reflect detected attempts to enter the UK clandestinely, whether successful or not.
Cost estimates focus on those who are successful in entering the UK and those who
are detected and returned at the point of entry.
Scale
As with the abuse of legitimate entry, this section uses management information from
the UK Border Agency on detected activity to inform estimates. In 2011, there were:
 7,800 clandestine entrants94;
 2,100 inadequately documented arrivals (IDAs)95;
 3,000 in-country enforcement arrests of migrants who could not be matched to
a visa96.
This scale of organised abuse of legitimate entry is estimated as the fees paid to
organised criminals by migrants attempting to enter the UK. In this report it is
assumed that 75 per cent of these categories are attributable to organised crime.
These assumptions suggest that organised crime groups facilitated the entry of
almost 10,000 people97 detected in 2011. The average fee paid by migrants to
organised crime groups varies by country of origin98 and, in the case of inadequately
documented arrivals, the route taken99. This gives an estimate of the total scale of

94 The number of clandestines reported here is based on operational data that includes any illegal
entrants who the police or immigration officers are satisfied have arrived in the UK within the last 72
hours. Clandestine entry includes concealment in vehicles, evading controls at port or landing at an
uncontrolled point such as from a small boat.
95 IDAs are non-UK or non-EEA nationals who knowingly arrive at the UK border without the proper
documentation and/or entry clearances.
96 As these migrants could not be matched to a visa it is likely that they entered either clandestinely or
as an IDA. This report assumes that 50 per cent entered clandestinely and 50 per cent as
inadequately documented arrivals. Further details can be found in Annex 1.
97 Detected either on arrival or subsequent to their arrival.
98 Figures have been taken from Webb and Burrows (2009). Prices range from £2,000-£3,000 for
journeys starting in Europe to over £20,000 for journeys starting in China and India.
99 Different costs have been assumed for journeys via different locations. Further details can be found
in Annex 1.

43

organised people smuggling of £88 million. This figure is partial, reflecting only
attempts to enter the UK detected by authorities; it does not include unsuccessful
attempts stopped before reaching the UK border or successful attempts undetected
by authorities.
Costs
The social and economic costs of organised people smuggling include the costs of
any asylum application processed by those successfully entering the UK illegally100,
the costs of removing irregular migrants detected both at the border101 and within the
UK, and the costs of detaining irregular migrants prior to removal. These costs
amount to approximately £140 million. They include UK Border Agency expenditure
on the Risk and Liaison Overseas Network (RALON) and Regional Crime Teams that
is attributable to organised crime. These will apply to all aspects of organised
immigration crime as well as contributing to the work of the UK Border Agency more
broadly. As a result, this could overestimate the costs of organised people
smuggling.
Organised intellectual property crime and counterfeiting
Scope
Intellectual property (IP) crime includes the wilful infringement of registered
trademarks (counterfeiting) and the unauthorised copying and use of material
protected by copyright (piracy) (Intellectual Property Office, 2011). It can include both
physical and digital goods sold both online and offline. It has been necessary to draw
boundaries in this research in order to prevent any overlap with cyber crime, which is
excluded from the scope of this report. As such, only the sale of physical goods
infringing intellectual property rights, whether using the internet or not, is considered
within the scope of this report. Due to data availability, the only goods considered in
this section are CDs, DVDs, computer games, business software, and clothing and
footwear.
Scale
The scale of organised IP crime and counterfeiting has been estimated at £90 million.
Estimates have been calculated on the basis of seizure data so will only capture part
of the market as it not known what proportion of the illicit market these seizures
represent. Average street prices, obtained by expert stakeholders102, have been

100 It is estimated that 15 per cent of asylum applications result from organised clandestine arrivals (20
per cent of asylum applications are estimated to be clandestine entrants, and 75 per cent of these are
assumed to have been facilitated by organised crime. Asylum applications made by clandestine
entrants and IDAs trying to avoid enforced removal are also considered in scope.
101 Deemed to be unsuccessful attempts.
102 Stakeholders consulted include the Alliance Against Intelligence Property Theft, the Business
Software Alliance, the Federation Against Copyright Theft (FACT), the British Phonographic Institute,
and the Association for UK Interactive Entertainment (UKIE), the Medicine and Health Regulatory
Agency (MHRA), and the Intellectual Property Office.

44

combined with estimated volumes in order to monetise the scale of the market and
assumptions have been made as to the organised involvement in the counterfeiting
of each type of good.
The average proportion of organised crime involvement in IP crime and counterfeiting
is estimated at 81 per cent. A more detailed breakdown is provided in Annex 1. This
is an estimate of physical IP crime and counterfeiting as it relates to certain goods
and is not designed to capture the scale of the entire market that, according to expert
stakeholders, is increasingly focused on the digital environment.
Costs
The social and economic costs of organised IP crime and counterfeiting have been
estimated at £400 million. These include estimates of lost revenue to legitimate
business, lost revenue to the exchequer, lost jobs,103 and enforcement costs,
including CJS costs as a result of pursuing prosecutions.104 It has not been possible
to quantify other relevant costs such as the impact on brand reputation or the costs
suffered by individual recipients of poor quality counterfeits.
Organised wildlife crime
Scope
Wildlife crime in the UK involves the illegal trade in endangered species and damage
to protected UK species and habitats. It can threaten critically endangered plants and
animals. In 2010 the National Wildlife Crime Unit (NWCU) had six priority areas:
 badger persecution;
 bat persecution;
 Convention on International Trade in Endangered Species of Wild Fauna and
Flora (CITES) issues (specifically trade in caviar, ivory, ramin (a tropical
hardwood), tortoises and traditional medicines);
 freshwater pearl mussels;
 poaching (including deer and fish poaching and hare coursing); and
 raptor persecution (especially golden eagle, white-tailed eagle, red kite, hen
harrier and goshawk) (NWCU, 2010).
The often high level of profit available from wildlife crime has become attractive to
some organised crime groups, who often operate on a global scale (ibid.).
It has not been possible to estimate the scale or social and economic costs of
organised wildlife crime. Instead, data that give some indication of the potential scale
are included.

103 Figures taken from Frontier Economics (2009).
104 Using estimates provided by industry bodies.

45

Scale
The NWCU has identified several UK based organised crime groups involved in
wildlife crime. (NWCU, 2010) In 2010 the NWCU assisted with two successful cross-
border operations coordinated by Interpol. Operation TRAM targeted the illegal trade
in traditional medicines containing wildlife products, involved 18 countries across five
continents and resulted in seizures of more than £8 million worth of illegal medicines
worldwide. Operation RAMP involved participants from 51 countries across five
continents in an effort to fight illegal trade in reptiles and amphibians and led to more
than £20 million worth of animals and product being seized.105
Costs
The social and economic costs of organised wildlife crime are likely to include the
costs of enforcement in preventing the illegal trade in endangered species, the costs
of protecting the endangered species from poachers and thieves, reductions in
tourism, and the costs of any prosecutions resulting from organised illegal activity.

105 „Wildlife Crime‟, Written Evidence Submitted by INTERPOL, Environmental Audit, Parliament
Publications, 5th March 2012,
http://www.publications.parliament.uk/pa/cm201012/cmselect/cmenvaud/writev/1740/wild17.htm.

46

4. Conclusions
This research improves our ability to provide a scientific approach to understanding
the scale of organised crime markets and the impact of the harms that they cause.
The findings from this research will sit alongside law enforcement intelligence
assessments of the scale of the threat to the UK from organised crime, and provide
an important foundation for future work in this area.
The research demonstrates that the impact of organised crime on the UK, expressed
as estimates of the social and economic costs caused, is significant. As would be
expected from previous work in this area, drugs, organised fraud and organised
immigration crime types all have major impacts on the UK; the other, less familiar
organised crime types also have substantial impact on the wellbeing of the UK.
 Illicit drugs supply (£10.7 billion social and economic costs) are associated
with substantial amounts of drug-related acquisitive offending as well as health
costs and drug-related deaths, impacting on individuals, families, and
communities.
 Organised fraud costs to the UK are estimated to be substantial (£8.9 billion),
and these, along with the costs of counterfeit currency (£7 million) and
organised intellectual property crime (£0.4 billion), damage the prospects and
reputation of UK businesses and financial services as well as reducing tax
revenue.
 The suffering caused by human trafficking (£890 million) is extensive, despite
our ability to capture only a small proportion of those harms in the current work
and the work also needed to map the costs of people smuggling (£140 million)
and abuse of legitimate entry (£11 million).
 The damage caused by organised child sexual exploitation is well evidenced.
Quantitative data are limited but the harms are still extensive (£1.1 billion).
 The six organised acquisitive crime types (from £27 to £920 million) cause
damage to individuals, communities and businesses, whether through the
physical and emotional harms caused to victims, the financial losses incurred
through disruption of business, or the direct losses incurred.
 The costs of organised violence and homicide have not been included in the
current work, nor have we been able to capture the violent offending
associated with the drugs markets. However an estimate of the social and
economic costs of firearms supply (£160 million) illustrates a small part of the
damage by violence caused by organised crime.
 Organised environmental crime and organised wildlife crime cause pollution
and damage individuals, communities and businesses in the UK. There are

47

insufficient data to currently estimate costs, but there is clear evidence on the
types of damage caused.
 We estimate that the total social and economic costs of organised crime are
at least £24 billion per year.
Alongside the cost estimates we have also produced scale figures; these develop
our understanding of the scale of criminal activity and the revenues earned by
offenders in each market106.

Unsurprisingly, here too drugs supply and organised fraud are dominant. The less
familiar organised crime types such as organised acquisitive crime, counterfeit
currency, and organised intellectual property crime are also estimated to be
substantial. The scale of some markets remains unknown, and further work is
needed to address this gap.

Law enforcement partners, as part of their work to disrupt and dismantle organised
crime groups, often seek to seize criminal assets and deny offenders the benefit of
their illegal activities. Estimates of the scale of these markets will support law
enforcement partners in assessing the breadth and depth of their engagement with
different organised crime types.
Ideally, the current work would fully map the scale and the social and economic costs
of organised crime, providing estimates of the true extent of criminal activities and the
harms to the UK. In the absence of perfect data, estimates have been provided of
those areas that can be robustly estimated. The report takes a cautious approach
and applies high standards to the data, only including data on harms where there is a
strong degree of confidence in accuracy. This means the figures will inevitably, and
to differing degrees for each crime type, underestimate both the scale and the impact
of organised crime on the UK. Variation in our confidence about the degree to which
the data and estimates fully capture costs is indicated in Table 3.1.
For the policy maker and law enforcement audience it is essential to consider this
report alongside other sources of information; law enforcement intelligence
assessments and in-depth professional subject knowledge provide important context
for understanding and operationalising the implications of this report.

106 Note that it does not set out the costs to offenders, and further work would be needed to assess the
profit to offenders.

48

References
ACPO (2012) Tougher Legislation on metal theft, Press release (11 October 2012).
Available at: Accessed January 2013.
Anderson, R., Barton, C., Bohme, R., Clayton, R., van Eeten, M. J. G., Levi, M.,
Moore, T. and Savage, S. (2012) „Measuring the Costs of Cybercrime‟. Presented at
Economics of Information Security workshop, Berlin, Germany, 25 June 2012.
Available at:< http://weis2012.econinfosec.org/papers/Anderson_WEIS2012.pdf>
Accessed August 2012.
Barnardos (2012) Cutting them free: How is the UK progressing in protecting its
children from sexual exploitation? Available at:
Accessed January 2013.
Barnardos (2011a) Puppet on a string: The urgent need to cut children free from
sexual exploitation. Available at:
Accessed
January 2013.
Barnardos (2011b) 'Not a world away': The sexual exploitation of children and young
people in Northern Ireland. Available at:
Accessed January 2013.
Berlowitz, S., Firmin, C., Edwards, G., Gulyurtlu, S. (2012) “I thought I was the
only one. The only one in the world”: The Office of the Children’s Commissioner’s
Inquiry into Child Sexual Exploitation in Gangs and Groups. Interim Report.
November 2012. Available at:

Accessed January 2013.
Brand, S. and Price, R. (2000) The economic and social costs of crime. Home Office
Research Study 217. London: Home Office. Available at:
Accessed March 2012.
CEOP (2011) Out of Mind, Out of Sight: thematic assessment. Child Exploitation and
Online Protection Centre. London: CEOP. Available at:
Accessed January 2013.
Chaplin, R., Flatley, J. and Smith, K. (eds) (2011) Crime in England and Wales
2010/11. Home Office Statistical Bulletin 10/11. London: Home Office. Available at:

49

Accessed March 2012.
CITS (2011) Combined Industry Theft Solutions Quantify Equipment Theft.
Combined Industry Theft Solutions. Available at:
Accessed January 2012.
Department for Education (2011) Tackling Child Sexual Exploitation: Action Plan.
London: Department for Education. Available at:
Accessed January 2012.
Dubourg, R., Hamed, J. and Thorns, J. (2005) The Economic and Social Costs of
Crime against Individuals and Households 2003/04. Home Office Online Report
30/05. London: Home Office. Available at:
Accessed March 2012.
Edwards, D. J. (2007) Plant and Equipment Theft: A Practical Guide. The Off-
highway Plant and Equipment Research Centre (OPERC). Available at:
Accessed May 2012.
Environment Agency (2011) Hazardous Waste, August 2011. Available at:

Accessed March 2012.
Environmental Investigation Agency (2011) System Failure: The UK’s harmful
trade in electronic waste. London: Environmental Investigation Agency. Available at
Accessed
February 2012.
Frontier Economics (2009) The Impact of Counterfeiting on Governments and
Consumers. A report commissioned by Business Action to Stop Counterfeiting and
Piracy (BASCAP). Available at:
Accessed March 2012.
HM Government (2009) Extending Our Reach: A Comprehensive Approach to
Tackling Organised Crime. London: Home Office. Available at: Accessed March 2012.
HM Government (2011) Local to Global: Reducing the Risk from Organised Crime.
London: Home Office. Available at:
Accessed January 2012.
HM Revenue and Customs (2012) Measuring the Tax Gaps. London: HM Revenue
and Customs.

50

Home Affairs Select Committee (2010) Firearms Control. Third Report of Session
2010/11. London: The Stationery Office.
Home Office (2003) Tackling Distraction Burglary. Distraction Burglary Taskforce.
London: Home Office.
Home Office (2011a) Future Directions for Organised Crime Research. London:
Home Office. Available at: Accessed March 2012.
Home Office (2011b) Human Trafficking: The Government’s Strategy. London:
Home Office.
Home Office (2011c) Revisions made to the multipliers and unit costs of crime used
in the Integrated Offender Management Value for Money Toolkit. London: Home
Office. Available at: < http://www.homeoffice.gov.uk/publications/crime/reducing-
reoffending/IOM-phase2-costs-multipliers?view=Binary> Accessed May 2012.
Home Office (2012a) Consultation on Legislative Changes to Firearms Control.
London: Home Office. Available at:
Accessed April 2012.
Home Office (2012b) Homicides, Firearms Offences and Intimate Violence 2010/11:
Supplementary Volume 2 to Crime in England & Wales. London: Home Office.
Home Office (2012c) Home Office Counting Rules for Recorded Crime. London:
Home Office.
Intellectual Property Office (2011) IP Crime Report 2010/11. London: Intellectual
Property Office.
Interpol (2012) „Wildlife Crime‟. Written evidence submitted to Environmental Audit,
Parliament Publications, 5 March, 2012. Available at:
Accessed March 2012.
Kosaraju, A. (2009) „The true cost to families of child sexual exploitation‟. CROP
Conference 2009 Briefing Paper.
Levi, M. and Burrows, J. (2008) „Measuring the impact of fraud in the UK: A
conceptual and empirical journey‟, British Journal of Criminology, vol. 48, pp 293–
318.
Migration Advisory Committee (2012) Analysis of the impacts of migration.
London: Home Office.

51

Ministry of Justice (2012) Impact Assessment: Tackling Metal Theft – prohibit cash
payments and higher fines. London: Ministry of Justice. Available at:
Accessed June 2012.
National Fraud Authority (2012) Annual Fraud Indicator 2011. London: National
Fraud Authority. Available at:
Accessed April 2012.
Pudney, S., Badillo, C., Bryan, M., Burton, J., Conti, G. and Iacovou, M. (2006)
„Estimating the size of the UK illicit drug market‟. In Measuring different aspects of
problem drug use: methodological developments, Singleton, N., Murray, R. and
Tinsley, L. (eds). Home Office Online Report 16/06. London: Home Office. Available
at:
Accessed March 2012.
SCDEA (2011) Human Trafficking Intelligence Assessment Summary. Scotland:
Scottish Crime and Drug Enforcement Agency.
Sidebottom, A. (2012) Metal Theft, UCL Jill Dando Institute. Available at
. Accessed February 2013.
Smith, A., and Walmsley, R. (1997) The Nature and Extent of Construction Plant
Theft. London: Home Office. Available at:
. Accessed April 2012.
SOCA (2012), UKHTC: A Baseline Assessment on the Nature and Scale of Human
Trafficking. London: SOCA.
TruckPol (2010) Annual Report 2009.
TruckPol (2011) Annual Report 2010.
UK National Wildlife Crime Unit (2010) UK National Wildlife Crime Unit Annual
Report 2010, p.12. London: Department for Environment, Food and Rural Affairs.
Available at:
Accessed March 2012.

Wainer, L. and Summers, L. (2011) Understanding the Harms of Cash and
Valuables in Transit (CViT) Robbery. London: Jill Dando Institute.
Walby, S. (2009) The Cost of Domestic Violence: Update 2009. Available at:
Accessed August 2013.

52

Annex 1: Technical annex
Hannah Mills, Peter Blyth, Anna Lacey, Sara Skodbo and Neil Warren
Introduction
This technical annex provides further detail of the methodology for the scale and the
social and economic costs estimates presented in this report. Methodology, data
sources, and underlying assumptions are set out for each crime type. For those
crime types where it was not possible to estimate the scale or social and economic
costs of organised activity, there is no corresponding section in this annex.
In general, there are a very limited range of potential sources from which to gather
data. Where a choice of sources was available, a judgement was made on what data
were most appropriate based on criteria such as quality, robustness, and reputation
of source. Where only one source was available, the same criteria were used to
judge whether it was appropriate to include. Wherever possible data for 2010/11
were used. However, in some cases older data had to be used. Where necessary
prices were uprated to account for inflation using the HM Treasury deflator series.
This work makes extensive use of the Home Office costs of crime methodology, both
in scoping the relevant costs for each organised crime type and in using the most
recent unit costs estimates published for 2010/11.107 Wherever there are references
to the Home Office costs of crime estimates, this is referencing this latest publication
unless otherwise stated.
Organised acquisitive crime
a. Cash and valuables in transit
Scale
Data covering the total losses resulting from cash and valuables in transit (CViT)
robberies have been provided by SaferCash. SaferCash is a security initiative,
operated by the British Security Industry Association (BSIA), which shares
intelligence between industry and the police, recording information and data relating
to CViT attacks. These data cover reported losses resulting from such robberies in
the UK in 2010. Total losses of approximately £12 million were reported by
SaferCash with the average value of losses reported as just over £15,000. This has
not been scaled up to account for losses to non-BSIA members. As BSIA members
account for approximately 70 per cent of products and services in the security

107 These were published alongside the Integrated Offender Management Value for Money Toolkit
http://www.homeoffice.gov.uk/publications/crime/reducing-reoffending/IOM-phase2-costs-multipliers

53

industry108 this is unlikely to represent a considerable underestimate but it is likely to
underestimate the true scale. From this an estimate of the number of offences can be
derived; there were approximately 750 CViT robberies in the UK in 2010. Because of
the methods and organisation involved in committing these offences, it is assumed
that 100 per cent of these robberies are carried out by organised criminals.
Costs
The main components of the social and economic costs of cash and valuables in
transit robberies are the losses sustained by banks and businesses, the physical and
emotional costs sustained by victims, property damaged during a CViT robbery, and
any resulting criminal justice system (CJS) costs.
The losses resulting from these robberies are illustrated in the scale estimate. The
„robbery – commercial‟ unit costs of crime, excluding the value of property taken, is
used to quantify the additional costs of these offences.
It is estimated that approximately 30 per cent of Cash and Valuables in Transit
robberies involve injuries to victims (Wainer and Summers, 2011). Of these injuries
79 per cent are minor, seven per cent are moderate injuries, and 1 per cent are
serious injuries.109 Minor injuries are approximated using the costs of crime estimate
for „common assault‟, moderate injuries with „other wounding‟, and serious injuries
with „serious wounding‟.
It is estimated that approximately six per cent of CViT robberies include damage to
property (ibid.). This has been approximated using the costs of crime estimate for
„criminal damage‟. The CJS component of the unit costs of these offences are not
included as it is unlikely that they would be prosecuted separately from the main
commercial robbery offence. CJS costs are considered in the unit costs of crime of
„robbery – commercial‟.
Table A1.1 highlights the incidents and the relevant unit costs.
The total social and economic costs of organised cash and valuables in transit
robberies are estimated to be £28 million.

108 According to the information on the BSIA website.
109 For the remainder of cases, the extent of injury is not known.

54

Table A1.1 Total costs of cash and valuables in transit (CViT) offences, 2010,
UK

Number of
offences
Unit costs per
offencea
Total costs
(£m)
CViT offences with no injury
506
£36,036
£18.2
CViT offences with minor injury
177
£37,482
£6.7
CViT offences with moderate
injury
15
£44,659
£0.7
CViT offences with serious
injury
2
£46,347
£0.1
CViT offences with damage to
property
48
£36,939
£1.8
Total
750
-
£27.5
Source: SaferCash data, injury data from Wainer and Summers (2011), Home Office costs of crime estimates.
Notes: Figures may not sum due to independent rounding. Total figures have been rounded to one decimal place,
otherwise figures are rounded to the nearest integer.
Notes:
a)
All unit costs include the cost of CViT offence with no injury. There is assumed to be no overlap between
offences that include additional injury and damage to property. In reality some offences may include both
injury to victims and damage to property. However, this will not change the estimate of costs.
b. Distraction burglary
Scale
The definition of a distraction burglary used for these offences is:
“Any crime where a falsehood, trick or distraction is used on an occupant of a
dwelling to gain, or try to gain, access to the premises to commit burglary. It
includes cases where the offender first enters premises and subsequently
uses distraction burglary methods in order to remain on the premises and/or
gain access to other parts of the premises in order to commit burglary.” (Home
Office, 2012)
Distraction burglary is recorded separately by the police from other domestic burglary
offences. This is the main source of data for this crime type. There were a total of
5,480 distraction burglaries110 recorded by police in England and Wales in 2010/11.
(Chaplin et al., 2011) Not all offences are reported or recorded. To reflect this, the
number of distraction burglaries has been combined with a multiplier111 to obtain the
total number of offences occurring in 2010/11. As a separate estimate is not available
for distraction burglary, the multiplier for domestic burglary was used instead. This
results in a revised estimate of 15,344 distraction burglary offences in England and
Wales in 2010/11. This may be an overestimate as distraction burglaries may be less

110 Excluding those that were attempted but unsuccessful.
111 Multipliers are used in the Home Office costs of crime work and are calculated by comparing crime
from the Crime Survey of England and Wales with police recorded crime. Multipliers for 2010/11 were
published alongside the Integrated Offender Management (IOM) Value for Money toolkit available at:
http://www.homeoffice.gov.uk/publications/crime/reducing-reoffending/IOM-phase2-costs-
multipliers?view=Binary

55

likely to go unreported than domestic burglaries. But with no Crime Survey for
England and Wales112 data for distraction burglaries, an estimate based on the
domestic burglary multiplier is judged to be the best available. This total was
subsequently scaled up to the UK using population estimates.113 There were an
estimated 17,294 distraction burglary offences in the UK in 2010/11.
The average loss from these burglaries is assumed to be £2,040 (R Chaplin et al.,
2011). This figure is the average value of property stolen during a domestic burglary,
as reported in the Crime Survey for England and Wales. This may be an imperfect
measure of the losses sustained in a distraction burglary but in the absence of
appropriate data, the domestic burglary figure is judged to be the best available
proxy.
The estimated scale of distraction burglary is £31 million in England and Wales in
2010/11. After scaling up to the UK, this becomes over £35 million. This assumes
that the prevalence and nature of distraction burglary is consistent between the
countries of the UK.
The total scale is assumed to be entirely the result of organised crime as distraction
burglaries are committed by
“extremely professional criminals who…may travel hundreds of miles in a day,
committing 20 or 30 offences across…[police] force areas in order to avoid
detection.” (Home Office, 2003)
Costs
The main components of the social and economic costs of distraction burglaries are
the value of goods stolen, the physical and emotional costs sustained by victims, and
any resulting CJS costs. These are estimated using the Home Office costs of crime
estimate for „burglary in a dwelling’ – £4,955.114 This may be an imperfect measure of
the costs of distraction burglary but it is judged to be the best available proxy. Using
the UK estimate of 17,294 successful distraction burglary offences together with the
unit cost gives estimated social and economic costs of successful distraction
burglaries in the UK of £86 million.
The costs of attempted burglaries are also included. It is estimated that there were
1,717 attempted distraction burglaries in the UK in 2010/11.115 It is assumed that
these will incur the same costs as a completed distraction burglary with the exception

112 Previously the British Crime Survey.
113 While recorded crime figures for domestic burglary are available for Scotland and Northern Ireland,
there is no separate, recordable offence of distraction burglary.
114 The 2010/11 unit cost of crime for burglary in a dwelling has been amended to account for the
updated data on the value of property stolen. As such it is not comparable to updated estimates
issued by the Home Office in 2011.
115 Using police recorded crime offence 28D and the multiplier used for successful distraction
burglaries to account for unreported or unrecorded attempted distraction burglaries.

56

of the value of property stolen. It is assumed that the attempted distraction burglary is
unsuccessful and, as a result, that there is no property stolen.
The total estimated costs of all distraction burglaries in the UK, both successful and
attempted but unsuccessful, is £91 million as shown in Table A1.2.
Table A1.2 Total costs of organised distraction burglary, 2010/11, UK

Volume
Unit costs
Total costs
(£m)
Successful distraction
burglary
17,294
£4,955
£85.7
Unsuccessful distraction
burglary
1,717
£2,915
£5.0
Total
19,011
-
£90.7
Source: Police recorded crime figures; Home Office costs of crime estimates.
Notes: Figures may not sum due to independent rounding. Total figures have been rounded to one decimal place,
otherwise figures have been rounded to the nearest integer.
c. Metal theft
Scale
It is estimated that there were between 80,000 and 100,000 police recorded metal
theft offences in 2010/11. Further details can be found in “Impact assessment:
Tackling Metal Theft – prohibit cash payments and higher fines”116 (Ministry of
Justice, 2012). Intelligence from the British Transport Police suggests that the
proportion of these offences which are organised is approximately 20 per cent. This
means that between 16,000 and 20,000 metal theft offences are estimated to be
carried out by organised crime groups. There are no accurate estimates of the
average scrap value of metal stolen. Instead, the expenditure on replacing stolen
metal by victims of metal theft is used as an indication of the scale of organised metal
theft.
Replacement expenditure includes both the expenditure on new materials as well as
the labour costs of fitting the replacement. Expenditure on replacing stolen metal,
whether organised or not, is estimated to be approximately £128 million (Ministry of
Justice, 2012). This estimate is a conservative estimate based on the responses of
selected telecommunications, rail transport, and utilities companies. It has not been
extrapolated to account for affected companies or industries not reporting
replacement expenditure. As around 20 per cent of this expenditure is assumed to be
attributable to organised crime the estimated scale of organised metal theft is
approximately £26 million.

116 http://www.justice.gov.uk/downloads/legislation/bills-acts/legal-aid-sentencing/laspo-metal-theft-
ia.pdf

57

There are three issues with the precision of this estimate.
 As the estimate of the replacement expenditure is based on figures from a
small number of companies and industries, the expenditure stated for
replacing stolen metal is likely to understate the total expenditure on replacing
stolen metal.
 Replacement expenditure overstates the actual revenue to organised
criminals (and the value of the market) as it includes both expenditure on new
material and labour, and because the scrap value of the metal is likely to be
lower than the value of replacement materials.
 In addition, this estimate makes no allowance for the fact that organised metal
theft offences are likely to have a higher average value than non-organised
offences (Sidebottom, 2012) as no firm data on this exists.
Costs
Recent Home Office analysis estimated the cost of metal theft to be £220 million per
year. This was acknowledged to be a conservative estimate since it is based on only
a selection of companies and industries affected by metal theft and does not cover all
of the costs of metal theft such as CJS costs and defensive or preventative costs.117
Costs have not been extrapolated to the whole of the UK. Details of the methodology
behind this estimate can be found in the impact assessment (Ministry of Justice,
2012).
Since approximately 20 per cent of metal theft is thought to be organised applying
this proportion to the estimate of the social and economic costs gives an estimated
cost of organised metal theft of £44 million. This is likely to further underestimate the
costs associated with organised metal theft as it relies on the assumption that
organised metal thefts have the same average cost as those which are not
organised. The average cost of metal theft offences is not known.118 In reality, it is
likely that the costs attributed to organised metal theft offences are higher than the
cost of other metal theft offences, as organised crime groups are likely to target
higher value and larger metal items. These high value offences are likely to result in
greater disruption to the railways and public utilities, which in turn results in higher
costs compared with non-organised metal offences. As there are no data available
with which to refine this assumption, this is the best available estimate.

117 This includes expenditure by the British Transport Police and the Association of Chief Police
Officers to tackle metal theft, both organised and non-organised.
118 While there are estimates both of the number of metal theft offences and the cost of metal theft to
the UK, it has not been possible to calculate an average cost per offence. This is because the two
estimates do not have the same coverage. Any average cost calculation based on these estimates
would be misleading.

58

d. Plant theft
The sources and estimates of the scale and social and economic costs of organised
plant theft are fully discussed in the main report, section 3.
e. Road freight crime
Scale
The estimated scale of road freight crime in the UK in 2010 is the value of goods
stolen as recorded by TruckPol. TruckPol was a national intelligence unit that formed
part of the Association of Chief Police Officers (ACPO) Vehicle Crime Intelligence
Service (AVCIS). Until its closure, in March 2012, it collated and analysed road
freight theft throughout the UK. The scale estimate provided by TruckPol is the
combined recorded value of the vehicles and loads stolen (TruckPol, 2011). TruckPol
suggests that this should be taken as a minimum value as there are likely to be
differences between values reported to the police and the actual value of the load or
vehicle.
There were 2,567 incidents of road freight crime119 recorded by TruckPol in 2010.
The total value of vehicles stolen was £26 million and the value of loads stolen was
about £26 million, giving a combined value of £52 million.
Intelligence from TruckPol suggests that road freight crime is an area where there is
significant organised involvement, with many crimes involving deception. As a result,
it has been assumed that 100 per cent of road freight crime is organised.
Estimates have not been scaled up to account for offences that are not reported to
TruckPol.
Costs
The estimated social and economic costs of road freight crime include the value of
property stolen, the costs of any physical and emotional injuries sustained by victims,
lost output resulting from the theft, as well as anticipatory defensive expenditure and
responsive CJS costs. The value of the goods stolen is taken from the scale estimate
described above. The remaining costs are estimated using the Home Office costs of
crime estimate for „theft of vehicle – commercial’ as a proxy. The value of property
stolen is removed from the costs of crime estimate to avoid double counting but the
remaining costs are multiplied by the total number of road freight crime incidents to
obtain an estimate of the additional costs of road freight crime.
In 2009, 27 violent incidents were recorded as occurring with the incidents of road
freight crime recorded by TruckPol. The costs of these incidents are estimated using
the Home Office costs of crime estimate, excluding CJS costs, for „violence against

119 Including theft of and theft from a vehicle.

59

the person’, and have been included in the estimated total costs which are set out in
Table A1.3.
Table A1.3 Costs of road freight crime, by type, 2010, UK
Costs description
Volume
Unit cost
Total costs (£m)
Road freight thefts
2,567
£24,655
£63.3
Violent incidents
27
£10,328
£0.3
Total

£63.6
Source: TruckPol data with Home Office costs of crime estimates.
Notes: Figures may not sum due to independent rounding. Total figures have been rounded to one decimal place,
otherwise all figures have been rounded to the nearest integer.

f. Vehicle crime
Scale
The estimated scale of organised vehicle crime is constructed using police recorded
crime for 2010/11 for the UK. Separate figures for the number of offences in England
and Wales, Scotland, and Northern Ireland are used but the assumptions regarding
the proportion of organised involvement are identical across the UK. It is assumed
that approximately 60 per cent120 of all theft of vehicle offences in 2010/11 can be
attributed to organised crime. This is a common assumption made on the basis that
unrecovered stolen vehicles are a good indicator of the involvement of organised
crime in vehicle theft.121 The recovery rate of stolen vehicles in 2011 was estimated
in the Crime Survey for England and Wales as approximately 40 per cent (Chaplin et
al., 2011).
In addition to this, approximately six per cent of all domestic burglaries involve theft
of car keys (ibid.) with organised criminals committing car key burglaries to steal high
value vehicles. It is assumed that all car-key burglary meets the definition of
organised crime used in this report.122
The data used in constructing the scale estimates is in Table A1.4. Recorded crime
figures for England and Wales, Scotland, and Northern Ireland are uprated to
account for unreported crimes using existing multipliers.123

120 Based on data from Chaplin et al. (2011).
121 As unrecovered vehicles are assumed to have been exported, broken down for parts, or altered to
be unrecognisable. All of these are assumed to require a degree of organisation, preparation, and
planning to complete.
122 This assumption has been made given the nature of car-key burglary as elements of planning and
coordination are required in order to first steal the keys and then the car.
123 Multipliers are used in Dubourg et al (2005); they have been updated for 2010 data and published
in September 2011.

60

Table A1.4 Number of organised vehicle thefts, 2010/11, UK

Vehicle thefta
Car-key burglaryb Organised vehicle
thefts
England & Wales
74,855
43,369
118,224
Scotland
6,572
2,122
8,694
Northern Ireland
1,862
1,061
2,923
Total
83,289
46,552
129,841
Source: Recorded crime for England and Wales, Scotland and Northern Ireland.
Notes:
a)
Recorded crime figures for theft of vehicle offences.
b)
Recorded crime figures for burglary in a dwelling. Six per cent of these offences involve theft of a car key and
subsequently the vehicle.

In order to monetise the scale of organised vehicle crime, the average value of a
stolen vehicle was multiplied by the number of vehicles assumed to be stolen by
organised criminals. A number of estimates exist for the value of a stolen vehicle with
some as high as £20,000. This report uses the average value of a stolen vehicle,
whether recovered or unrecovered, reported in the Crime Survey for England and
Wales. In 2010/11, this is £2,506. This may be an underestimate but is the best
available proxy based on robust data. Anecdotal evidence suggests organised
criminals may target higher than average value vehicles in order to maximise
revenue from the theft. This seems particularly likely for car-key burglaries, where
higher value vehicles could be specifically targeted. The scale of organised vehicle
theft is estimated to be £325 million.
Table A1.5 Scale of organised vehicle crime, 2010/11, UK

Volume
Unit cost Total scale (£m)
Vehicle theft
83,289
£2,506
£209
Vehicle theft following car-
key burglary
46,552
£2,506
£117
Total
129,841
-
£325
Source: Recorded crime for England & Wales, Scotland and NI, Crime Survey for England and Wales, Home
Office costs of crime estimates.
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to three significant
figures, otherwise inputs have been rounded to the nearest integer.
Costs
Costs of crime estimates are used to estimate the social and economic costs of
organised vehicle crime. In 2010/11 129,841 thefts of vehicles and 46,552 burglaries
are attributed to organised vehicle crime. The cost of domestic burglaries have been
included to account for the social and economic costs of car-key burglaries as
anecdotal evidence suggests that criminals targeting car-keys in domestic burglaries
will steal other items. The Home Office costs of crime estimates for „theft of vehicle –
personal’ and „burglary in a dwelling’ are used to calculate the social and economic
costs of organised vehicle crime which is estimated at approximately £920 million.
The breakdown of these costs is highlighted in Table A1.6.

61

Table A1.6 Total costs of organised vehicle crime, by type, 2010/11, UK
Cost type
Volume
Unit costs
Costs (£m)
Vehicle thefts
129,841
£5,298
£690
Car-key burglaries
46,552
£4,955
£230
Total costs (£m)

£920
Source: Home Office costs of crime estimates.
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant
figures, otherwise inputs are rounded to the nearest integer.
Organised child sexual exploitation
Scale
The estimate of the scale of organised child sexual exploitation is taken from the
Office of the Children‟s Commissioner‟s Inquiry into the sexual exploitation of children
by groups124 and gangs125 (Berelowitz et al., 2012). While other studies (including
Barnardos (2012); CEOP (2011); and Barnardos (2011a)) have attempted to
estimate the overall scale of child sexual exploitation, none have attempted to identify
the extent of organised crime involvement in this activity.
Berelowitz et al. (2012) used a narrower definition of child sexual exploitation in their
study which focused on groups and gangs and most closely matches the definition of
organised crime used in this report. The Inquiry found that there were 2,409
confirmed victims of child sexual exploitation by either gangs or groups between
August 2010 and October 2011. This estimate is based on evidence submissions
from a range of agencies working in this area; 115 evidence submissions were
received but only from agencies in some police force areas in England.126 While this
estimate covers a 14 month period, it is still likely to underestimate the true scale of
child sexual exploitation by groups and gangs as it only captures known victims of
child sexual exploitation identified by agencies submitting evidence to the Inquiry.
As organised child sexual exploitation by groups and gangs does not always involve
financial motives for the organised crime groups involved127, it is not meaningful to
estimate the potential revenue for organised criminals.128 Instead the scale estimate
highlights the number of known victims.

124 Groups are defined in Berelowitz et al. (2012) as “people who come together in person or online for
the purpose of setting-up, co-ordinately and/or taking part in the sexual exploitation of children.”
125 Gangs are defined in Berelowitz et al. (2012) as “comprising men and boys aged 13-25 years old,
who take part in many forms of criminal activity. […] While children can be sexually exploited by a
gang, this is not the reason why the gang is formed.”
126 Further details of the methodology used in the Office of the Children‟s Commissioner‟s Inquiry can
be found in the Appendix to Berelowitz et al. (2012).
127 Motives of offenders often include the exertion of power and control, the desire to humiliate, and a
belief in an entitlement to sex (Berelowitz et al., 2012).
128 Any monetised estimate of the scale would only partially reflect the extent of organised activity.

62

Costs
The harms of organised child sexual exploitation are diverse, with abuse often lasting
for many months or even years. This estimate of the social and economic costs of
organised child sexual exploitation focuses on the harms likely to occur as a result of
one year of victimisation. This may underestimate the costs for some individual
victims, but is judged to be the most appropriate way of presenting an annual
snapshot of the costs of this type of organised crime – the measure used throughout
this report. Some costs resulting from this one year of victimisation occur over many
years. Examples include the costs of exclusion from school and the costs of prison
sentences. Such future costs are discounted appropriately.129
For this estimate of the social and economic costs of organised child sexual
exploitation, the following process is assumed. Violence and sexual assault are used
to coerce victims. Victims are then passed around the organised groups or gangs
and may be repeatedly sexually assaulted and raped. While often occurring at the
same time, the costs of coercion and the costs of sexual exploitation have been
considered and estimated separately. The range of physical and emotional harms
resulting from both the coercion and the sexual exploitation of children are quantified
and detailed in Table A1.7 below.
Costs of coercion
Organised criminals often use violence and sexual assault to coerce and control their
victims. (Berelowitz, 2012) According to submissions in the Office of the Children‟s
Commissioner‟s Inquiry, this can involve punching, hitting, kicking, attempted
strangulation, and burning with cigarettes. (ibid.) This has been approximated using
estimates of „non-sexual severe domestic force‟ and „serious sexual assault‟ (Walby,
2004). Walby estimates that, on average, „non-sexual severe domestic force‟ against
females includes 18 assaults per year; 3.5 chokings, 14.5 kicks or punches130.
„Serious sexual assault‟ compromises one severe sexual assault and one rape on
average per year. (ibid.) The Walby estimates are considered the most appropriate
available for the costs of violence suffered by victims. This approach is consistent
with that used to estimate the harms to victims of human trafficking for the purposes
of sexual exploitation.131
In line with Walby‟s (2004) approach, these offences have been mapped to the Home
Office costs of crime categories as serious wounding, other wounding, sexual

129 This discounting of costs occurring in to the future is consistent with appraisal methods outlined in
HM Treasury‟s Green Book. A discount rate of 3.5 per cent is used.
130 The volumes of offences are estimated using the number of victims of domestic violence in Table
3.2 and the average number of incidents per female victim presented in Table 3.4 in Walby (2004).
131 The coercion experienced by victims of human trafficking for sexual exploitation and victims of child
sexual exploitation is assumed to be similar. For more details on the costs of human trafficking for
sexual exploitation please see the relevant section further on in this technical annex.

63

assault, and rape.132 CJS costs of these offences have been excluded as they are
unlikely to be individually reported to the police. The lost output component of the
costs of crime estimates has also been excluded as these offences are committed
against children. As they are not working, there will be no lost output for the economy
through any time they are unable to work through injury.
As the Home Office costs of crime estimates are calculated for victims of crime aged
16 to 59, a multiplier has been applied to the unit costs to account for higher physical
and emotional costs likely to occur as the victims are children. This multiplier has
been calculated using a study from Minnesota (Miller et al., 2007) which compares
the costs of child and adult rape and sexual abuse, and is estimated to be
approximately 1.2.133 The costs of violent coercion are estimated to be approximately
£285,000 per victim per year. All victims identified in the scale estimate are assumed
to incur these costs.
As part of the coercion exerted by organised criminals, victims are also assumed to
have restrictions placed on their quality of life. This includes some problems with
performing usual activities, moderate pain or discomfort, and moderate anxiety or
depression. These costs have been estimated in line with existing methodology using
Quality Adjusted Life Years.134 These costs amount to approximately £17,000 per
victim per year and are assumed to be relevant to all the victims identified in the
scale estimate.
Costs of sexual exploitation
In addition to the coercion described above, victims are also sexually exploited by
organised groups. They may be moved around locations and sexually assaulted and
raped by offenders, in many cases repeatedly. (Berelowitz et al., 2012),There is little
quantified evidence on the harms of repeated rape or sexual assault so the cost of
this sexual exploitation is approximated by the physical and emotional cost of one
rape and one sexual assault each year. This is almost certainly an underestimate.
As for the costs of coercion, the unit costs of these offences have been combined
with a multiplier to account for the higher physical and emotional costs likely to occur
because the victims are children.135 The multiplier of approximately 1.2 is used to
account for the additional physical and emotional suffering for child victims. The

132 Chokings are assumed to be the same as serious wounding. Kicks and punches are assumed to
be other wounding. Comparisons between offences and costs of crime unit costs can be seen in Table
3.6 in Walby (2004).
133 This is obtained by comparing the costs of „suffering and lost quality of life‟ for rape of a child (aged
0 to 17) and rape of an adult (aged 18 or over) in Miller et al. (2007).
134 For this analysis, a value of £30,000 is used for each Quality Adjusted Life Year (QALY). The
estimated loss of QALYs for the restrictions placed on victims of organised child sexual exploitation is
approximately 0.48. This is taken from previous research on the costs of human trafficking.
135 Home Office costs of crime estimates are calculated using data for victims of crime aged between
16 and 59 years.

64

estimated unit cost is approximately £125,000 per victim per year. All victims are
assumed to incur these costs.
In addition, other harms that are a consequence of the ongoing exploitation are
included. These are sexual health issues, self-harm, attempted suicide, mental health
issues, exclusion from school, and going missing from home. The report from the
Office of the Children‟s Commissioner (Berelowitz, 2012) provides estimates of the
prevalence of these harms which are presented in Table A1.7. These are combined
with appropriate unit costs which are detailed in the notes to Table A1.7.
Total costs
The social and economic costs of organised child sexual exploitation are estimated at
approximately £1.1 billion each year as can be seen in Table A1.7. In many cases
these costs could underestimate the true cost of organised child sexual exploitation.
This is particularly likely for the costs of sexual exploitation presented in this report.
Due to an absence of data on the costs of repeated rape and sexual assault, the
estimates for sexual exploitation are lower than those for coercion. In reality we
would expect the opposite to be true.
There are a range of other costs which should be included in the estimated social
and economic costs but for which sufficient data were not available. These include
costs incurred by agencies trying to prevent children from becoming victims of sexual
exploitation. These costs will mostly be borne by local authorities but some
expenditure will form part of larger central government programmes of work. These
costs of preventing organised child sexual exploitation could not be identified
separately.
Other harms of organised child sexual exploitation include substance misuse, family
breakdown, criminalisation of victims, and victims placed in social care.136 These
harms could not be estimated as there is little quantified evidence about their
prevalence or costs. The CJS costs also could not be estimated as organised child
sexual exploitation offences could not be separated from other sexual offences
against children.

136 There is limited evidence to suggest that, as a result of child sexual exploitation, some victims who
were not previously in social care are placed into care. As there is no evidence specific to organised
child sexual exploitation, this has not been included in the estimates.

65

Table A1.7 Costs of organised child sexual exploitation, 2011, UK

Prevalence
Unit cost
Total cost
(£m)
Costs of coercion

£726.3
-
Violence
100%
£284,235a
£684.7
-
Restrictions on quality of life
100%
£17,279b
£41.6
Costs of exploitation

£298.1
-
Rape
100%
£88,467c
£213.1
-
Sexual assault
100%
£35,278d
£85.0
Other costs

£25.9
-
Sexual health issues
75%
£59e
£0.1
-
Self-harm
31%
£427f
£0.3
-
Attempted suicide
16%g
£51,746h
£19.3
-
Mental health issues
27%
£342i
£0.2
-
School exclusionj
12%
£70,081k
£2.6
-
Missing childrenl
58%
£2,145m
£3.4
Total

£1,050.4
Source: Prevalence estimates are taken from Berelowitz et al. (2012) unless otherwise stated. Unit cost sources
vary and are individually provided.
Notes: Total costs rounded to 1 decimal point.
a.
Unit cost calculated using Home Office cost of crime estimates, based on Walby (2004).
b.
Unit cost calculated using the value of a QALY of £30,000.
c.
Unit cost calculated using the Home Office cost of crime estimates.
d.
Unit cost calculated using the Home Office cost of crime estimates.
e.
Unit cost for treating a sexually transmitted infection. Taken from NHS Reference costs (2011).
f.
Unit cost for treating poisoning. Taken from NHS Reference costs (2011).
g.
Prevalence taken from Melzer H., et al. (2002) and is the estimated prevalence of attempted suicide amongst
16-24 year olds based on the Psychiatric Morbidity survey. Melzer et al. (2002) noted that approximately half
of young people who had self-harmed had also attempted suicide. This proportion has been applied to
estimates for self harm. This was felt to be the best available proxy for victims of organised child sexual
exploitation, although it could underestimate the costs.
h.
Unit cost taken from Johnson (2009). This includes costs to social services, the police, NHS (including
accident and emergency costs), and mental health services.
i.
Unit cost for outpatient attendance for child and adolescent psychiatry. Taken from NHS Reference costs
(2011).
j.
Permanent exclusion of pupils following child sexual exploitation.
k.
Unit cost taken from Goodall et al. (2007). This includes only the cost associated with providing alternative
education to mainstream schooling for excluded pupils. It does not include the lifetime costs associated with
permanent exclusion.
l.
Children who are victims of child sexual exploitation who subsequently go missing from home or care. It is
assumed that each child who goes missing only does so once. This could underestimate the costs.
m. Unit cost of running a missing persons police investigation. Taken from Greene & Pakes (2012).

Counterfeit currency
The scale of organised counterfeit currency is estimated using data from the Bank of
England and the Association of Commercial Banknote Issuers (ACBI). The number of
counterfeit sterling notes withdrawn from circulation in the UK in 2010 is included in
Table A1.8. It is assumed that all counterfeit currency is the result of organised

66

criminal activity due to the sophisticated processes and equipment137 needed to
produce counterfeit notes. The scale of organised counterfeit currency is estimated to
be the „face value‟ of counterfeit notes withdrawn from circulation, which is
approximately £7 million. This is a partial estimate as it only includes counterfeit
sterling notes withdrawn from circulation. Data were not available for sterling coins or
other currencies. The proportion of counterfeit sterling notes in circulation and not
withdrawn is also not known.
Table A1.8 Number and value of notes withdrawn from circulation, 2010, UK
UK Sterling notes
Volume
Total
£1a
12
£12
£5
9,781
£48,905
£10
23,694
£236,940
£20
313,005
£6,260,100
£50
3,273
£163,650
£100
12
£1,200
Total
349,775
£6,710,807
Source: Bank of England data; Association of Commercial Banknote Issuers data, 2010.
Notes:
a)
These are £1 notes removed from circulation.
Drugs supply
Scale
Organised crimes groups and networks are required to produce, supply, and
distribute drugs within the UK. There will be some exceptions where, for example,
cannabis is grown and used by the same person, but this is unlikely to considerably
affect scale estimates.
The scale of the illicit drugs supply is best estimated by considering the demand for
illicit drugs. This is calculated by estimating the amount of money spent by drug
users buying certain illicit drugs. The estimate in this report builds on the
methodology used by Pudney et al. (2006) to calculate the scale of the illicit drugs
market. The estimate uses data from the Arrestee Survey and the Offending, Crime
and Justice Survey (OCJS) in order to estimate the amount spent on eight drugs:
amphetamines, cannabis, crack cocaine, ecstasy, heroin, LSD, magic mushrooms,
and powder cocaine.138
Legitimately prescribed drugs are not produced or supplied by organised crime
groups and are therefore excluded from the scope of this report. Similarly, there is an
absence of evidence to suggest that any trade in unprescribed methadone uses
organised crime networks. New psychoactive substances are within the scope of this

137 Demonstrating that elements of planning and coordination are required to commit serious crime.
138 These eight drugs were chosen for data availability reasons but include the three most prevalent
drugs used in the UK; cannabis, powder cocaine, and ecstasy.

67

report but have not been included in the estimates presented due to a lack of data
availability within the surveys used.
Improvements have been made in comparison with the methodology of previous
estimates, particularly around the data used for the drugs market for those aged
under 17. Table A1.9 provides the scale of the market for each drug type included.
These results are not directly comparable with those of Pudney et al. (2006) due to
changes in methodology and differing base price years used in estimation. Further
details of the revised methodology can be found in Annex 2 of this report.139 This
includes revised estimates for 2004 using the improved methodology illustrating the
impact that changes to the methodology have as well as providing an indication of
trends over time. Changes in the scale of the illicit drugs supply cannot be fully
measured as the survey data on which the estimates are based has not been
updated.
Due to the surveys used to estimate the scale of the illicit drugs market, there is a
possibility that certain elements of the drug using population may have been
underrepresented. As such the estimates presented may underestimate the true
scale of the market for certain drugs. Survey data were only available for England
and Wales so estimates were scaled up to the UK. Separate scaling factors were
calculated for the arrestee and non-arrestee populations using arrest and population
data respectively140. This is consistent with previous attempts to value the UK drugs
market (Pudney et al., 2006)141 but assumes that drug use among arrestee and non-
arrestee groups in Scotland and Northern Ireland is the same as England and Wales.
Due to differing rates of drug use across the countries of the UK, this could lead to
the estimates underestimating the scale of the illicit drugs supply due to differing
rates of opiates and crack use across the countries of the UK.

139 As there are substantial revisions to existing Home Office estimates, Annex 2 fully details the
changes to the methodology and the data used.
140 As arrest statistics reflect the level of enforcement activity among police forces, using these data to
calculate scaling factors requires the assumption that enforcement activity is the same throughout the
UK. This assumption does not significantly affect results and the scaling factor based on arrest
statistics is highly similar to the scaling factor based on population alone. Separate results have not
been presented. As no arrest statistics were available for Scotland, the England and Wales arrest rate
was used.
141 See Pudney et al. (2006), Appendix 7.

68

Table A1.9 Scale of the illicit drugs supply, by drug type, 2010, UK

England & Wales
(£m)
UK (£m)
Amphetamines, ecstasy, LSD and
magic mushrooms
£240
£270
Cannabis
£1,110
£1,200
Crack cocaine and heroin
£1,110
£1,300
Powder cocaine
£810
£920
Total
£3,300
£3,700
Source: Offending Crime and Justice Survey data; Arrestee Survey data.
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant
figures.
Costs
The social and economic costs considered in this report are the consequences of the
supply of illicit drugs. These include the costs of drug-related acquisitive crime, health
costs, drug treatment, and the cost of enforcing drug offences.142
The costs of drug-related acquisitive crime are estimated using data from the OCJS
and the Arrestee Survey. These data are used to determine the proportion of
acquisitive crime that is committed by users of certain drugs in order to support drug
use143. It does not include broader offences closely associated with drugs use such
as psycho-pharmacological offending, or violence due to a lack of suitable data. Full
details on how these proportions were calculated can be found in Annex 3 of this
report.144 These proportions were applied to the total costs of acquisitive crime for
2010/11 calculated using Home Office costs of crime estimates. An estimated 44 per
cent of all acquisitive crime in England and Wales is drug-related (Roe et al., 2012).
This proportion is calculated using survey data from England and Wales but
assumed to apply across the UK. Due to differing rates of opiates and crack use
across the countries of the UK, this could lead to underestimation of the proportion of
drug-related crime. The total cost of drug-related acquisitive crime in the UK in
2010/11 is estimated to be approximately £5.8 billion. Table A1.10 shows the
estimated proportions of drug-related crime by crime type and the associated costs.

142 Drug offences included are unlawful importation of Class A, B, C or unspecified; unlawful
exportation of Class A, B, C or unspecified; production, supply and possession with intent to supply a
controlled drug – Class A, B, C or unspecified; possession of a controlled drug – Class A, B, C or
unspecified; inciting another to supply a controlled drug – Class A, B, C or unspecified; and other drug
offences.
143 Calculating the proportion of acquisitive crime committed by those using heroin or crack cocaine
more than twice a week. This definition was used as it is thought to best capture economic compulsive
crime (acquisitive crime committed to obtain money or drugs to support drug use) which shows strong
links with drug use.
144 As there are substantial revisions to existing Home Office estimates, a separate report fully details
the changes to the methodology and the data used. This has been attached at Annex 3.

69

Table A1.10 Costs of drug-related acquisitive crime committed by individuals
who use heroin and/or crack cocaine at least twice weekly, 2010/11, UK

Drug-related
proportion
Unit costs
of crime
Costs of
drug-related
crime
(England
and Wales,
£m)
Costs of
drug-
related
crime (UK,
£m)
Vehicle theft
24%

£450
£490
-
Theft of vehicle
16%
£4,970
£100
£110
-
Theft from vehicle
31%
£1,034
£350
£370
Burglary
47%

£2,600
£2,800
-
In a dwelling
57%
£3,925
£1,600
£1,700
-
Not a dwelling
43%
£4,608
£1,100
£1,100
Robbery
25%

£680
£710
-
Personal
19%
£8,810
£560
£580
-
Commercial
36%
£9,372
£130
£130
Theft from person
39%
£1,016
£250
£260
Theft from a shop
66%
£124
£400
£450
Other theft
14%
£763
£190
£210
Fraud
35%
-
£730
£830
-
Benefit fraud
21%
-
£250
£250
-
Credit fraud
40%
-
£150
£150
-
Identity fraud
-a
-
£420
£420
Total
44%
-
£5,300
£5,800

Source: Offending Crime and Justice Survey data; Arrestee Survey data.
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant
figures.
a)
Based on drug-related proportions of fraud.

The estimated costs to the NHS of illicit drug use are divided into five parts:
i.
mental and behavioural health due to illicit drug use;
ii.
overdoses and poisoning due to illicit drug use;
iii.
neonatal diagnoses due to illicit drug use;
iv.
HIV/AIDS for injecting drug users; and
v.
deaths due to illicit drug misuse in terms of lost productivity, the human cost
and medical and ambulance costs.

Due to data availability, the costs estimated do not give a full picture of the costs
incurred by the NHS as they focus on inpatient episodes. For most NHS costs, data
are only available for England and Wales so estimates are scaled up to the UK on

70

the basis of population. This does not account for differing rates of drug use across
the countries of the UK. This is more fully explained for each type of NHS cost.
i. Mental and behavioural health costs due to illicit drug use
Illicit drug use can lead to mental illness such as psychotic disorders. (Hall, 1988)
The costs to the NHS include the cost of intensive care of patients with drug-related
mental illness as well as acute care and rehabilitation. Personal Social Services
Research Unit (PSSRU) unit costs of adult mental health inpatient bed days are used
to estimate the costs to the NHS. (PSSRU, 2011) The PSSRU has used the NHS
reference costs to calculate an average cost of inpatient attendances. (NHS, 2011)
Data on the volume of individuals in England and Wales with drug-related mental and
behavioural health problems in 2010/11 are taken from the Hospital Episode
Statistics (HES, 2011a)145 and Patient Episode Data for Wales (PEDW, 2011)146
respectively. An example of the diagnoses included are „psychotic disorder due to
use of opioids‟ and „amnesic syndrome due to use of cocaine‟.147 HES and PEDW
data are only available when the episode has been appropriately coded so the
number of episodes is likely to be an underestimate. Additionally, some of the
diagnoses include the effects of legal drugs, such as caffeine, which will lead to
additional cases being counted. The data only cover inpatient episodes. Equivalent
data do not exist for outpatient episodes or care in the community. Therefore, in this
report, only the costs to the NHS of treating inpatients has been included. This is
likely to underestimate the cost to the NHS of mental and behavioural health due to
illicit drug use.
The number of hospital episodes requiring paramedic services has been estimated
using HES data for England and PEDW for Wales. The number of emergencies is
recorded in these data and is assumed to represent the number of episodes requiring
paramedic services. The cost of paramedic services has been taken from NHS
referral costs for „psychiatric/suicide attempt: mental/emotional‟ and is used as a
proxy.148

145 ICD-10 codes for mental and behavioural episodes used were F11.0 – F16.9 and F19.0 - F19.9
(excluding codes ending .2 to avoid double counting with treatment budgets and excluding F13.6,
F14.7, F15.6, F16.6). Data were taken from Hospital Episode Statistics 2010/11, Primary Diagnosis,
http://www.hesonline.nhs.uk/Ease/servlet/ContentServer?siteID=1937&categoryID=214 for England.
146 Patient Episode Data for Wales (PEDW) data were used, which are available from the NHS Wales
website.
147 Diagnoses included are mental and behavioural disorder due to use of: opioids; cannabinoids;
sedatives/hypnotics; cocaine; other stimulants; hallucinogens; or multiple/psychoactive drugs.
148 An average unit cost is used of three categories of paramedic response.

71

Table A1.11 Estimated costs to the NHS of illicit drug-related mental health and
behavioural disorders, 2010/11, UK

Volume
Unit
costs
Total
costs
(£m)
Drug-related mental and behavioural disorders
(bed days – England and Wales) 149
85,796
£321
£27.5
-
Proportion requiring paramedic services
(England and Wales)
3,895
£198
£0.8
Estimated drug-related mental and behavioural
disorders (bed days – UK)
96,701
£321
£31.0
-
Estimated proportion requiring paramedic
services (UK)
4,399
£198
£0.9
Estimated total cost (UK)

£31.9
Source: Hospital Episode Statistics (HES); Patient Episode Data for Wales (PEDW).
Notes: Figures rounded to one decimal place unless otherwise stated.
Sufficient data were not available for Scotland and Northern Ireland so estimates are
scaled up to the UK using population estimates.150 Due to differing rates of problem
drug use across the countries of the UK this could lead to inaccuracies.
ii. Cost of illicit drug overdoses
In 2010/11 there were over 16,000 drug-related overdoses in England and Wales.151
The number of overdoses has been taken from the HES for England in 2010/11 and
PEDW. Only overdoses of illicit drugs have been included, but some categories
included can include poisoning resulting from prescribed drugs152 as well as from
legal drugs with potential for misuse. Equivalent data were not available for Scotland
and Northern Ireland so population data are used to estimate the volume of
overdoses in the UK. This relies on the assumption that incidence of drug overdoses
was the same in each country.153
The costs to the NHS of treating a drug overdose are taken from the NHS Reference
Costs 2010/11 of treating „poisoning, toxic, environmental and unspecified effects‟ as
well as the cost to paramedic services of an „overdose/ingestion/poisoning‟. (NHS,
2011b) The proportion of drug overdoses requiring paramedic services was

149 This is using ICD-10 codes F11.0-F16.9 and F19 – excluding codes ending .2 to avoid double
counting with treatment budgets.
150 This assumes that equal proportions of the population in each country had patients presenting with
drug-related mental and behavioural problems.
151 Using ICD-10 codes T40.1-T40.7, T40.9 and T43.6. Data taken from Hospital Episode Statistics
2010/11, Primary Diagnosis,
http://www.hesonline.nhs.uk/Ease/servlet/ContentServer?siteID=1937&categoryID=214
152 Such as morphine or codeine in the other opioids category.
153 As previously stated, this may lead to inaccuracies due to the differences in rate of problem drug
use in the different countries of the UK. Population statistics taken from ONS, Key Statistics Feb 2012
available at: http://www.ons.gov.uk/ons/publications/re-reference-tables.html?edition=tcm%3A77-
242593

72

estimated using HES data for England and PEDW data for Wales.154 This cost does
not include any permanent harm resulting from a drug overdose and therefore only
reflects the immediate costs to the NHS of an overdose.
Table A1.12 Estimated costs to the NHS of illicit drug overdoses, 2010/11, UK

Volume
Unit
costa
Total
cost (£m)
Number of drug overdoses (England and
Wales)
16,113
£723
£11.7
-
Proportion requiring paramedic services
(England and Wales)
13,136
£197
£2.6
Number of drug overdoses (UK)
18,161
£723
£13.1
-
Proportion requiring paramedic services
(UK)
14,806
£197
£3.0
Estimated cost to the NHS (UK)

£16.1
Source: Hospital Episode Statistics; Patient Episode Data for Wales.
Notes: Figures rounded to one decimal place unless otherwise stated.
a)
This is a weighted average.
iii. Costs of neonatal diagnoses due to illicit drug use
A foetus or newborn can be affected by maternal use of illicit drugs. (Wang, 2012)
The costs to the NHS of treating drug-related neonatal diagnoses such as babies
suffering from withdrawal of addictive drugs are estimated using the 2010/11 NHS
reference costs of treating major and minor „neonatal diagnoses‟. (NHS, 2011) The
number of cases is estimated using the HES for England and PEDW data for Wales
in 2010/11 (HES, 2011c)155, which have been scaled up by population to the UK. As
with mental and behavioural episodes and drug overdoses, paramedic services costs
have been estimated using NHS referral costs for „pregnancy/childbirth/miscarriage‟.
The proportion of episodes requiring paramedic services has been estimated by
using the number of emergencies recorded in HES and PEDW data as a proxy. This
estimate is likely to be an underestimate as it does not include the costs of midwives,
health visitors and specialist clinics for pregnant drug users.

154 This was calculated as for mental and behavioural episodes using the number of full consultant
episodes (FCEs) that were emergencies. This proportion was assumed to be the same throughout the
UK, in the absence of equivalent data for Scotland and Northern Ireland.
155 Using ICD-10 codes P04.4 and P96.1. Data from Hospital Episode Statistics 2010/11, Primary
Diagnosis (available at:
http://www.hesonline.nhs.uk/Ease/servlet/ContentServer?siteID=1937&categoryID=214) and Patient
Episode Data for Wales 2010/11

73

Table A1.13 Estimated costs to the NHS of drug-related neonatal effects,
2010/11, UK

Volume
Unit
costa
Total
cost (£m)
Neonatal diagnoses (England and Wales)
1,456
£1,190
£1.7
-
Proportion requiring paramedic services
(England and Wales)
131
£210
£0.1
Estimated neonatal diagnoses (UK)
1,641
£1,190
£2.0
-
Proportion requiring paramedic services
(UK)
148
£210
£0.1
Estimated cost to the NHS (UK)

£2.0
Source: Hospital Episode Statistics; Patient Episode Data for Wales.
Notes: Figures rounded to one decimal place unless otherwise stated.
a)
This is a weighted average.
iv. Costs of injecting drug users
Injecting drug users bring additional costs to the NHS from needle use. Sharing
needles can lead to transmission of infectious diseases including Hepatitis C and
HIV. The Health Protection Agency (HPA) estimates that around one-half of injecting
drug users (IDUs) in the UK have been infected by Hepatitis C and one-sixth with
Hepatitis B. (HPA, 2011a) By the end of 2010, an estimated 91,500 people were
living with HIV in the UK (including those undiagnosed), which includes 2,300 people
(3%) who inject illicit drugs.(HPA, 2011b)
The gross expenditure on „Infectious diseases- HIV and AIDS‟ in England in 2010/11
(Department of Health, 2011) was used to estimate the costs to the NHS of IDUs with
HIV. To estimate the costs to the UK it was assumed that the cost of HIV treatment
per individual in the rest of the UK would be equal to the cost per individual in
England (£16.97).156 This is combined with the estimated proportion of individuals
diagnosed with HIV living in the UK who are injecting drug users. It should be noted
that some individuals may have contracted HIV through sexual intercourse rather
than needle exchange. However, as sharing needles is proven to be a common route
of HIV transmission, it is not unreasonable to assume that the majority of IDUs
contracted HIV through needle sharing.157 It is also assumed that all those individuals
diagnosed with HIV who are IDUs seek treatment. There is no direct evidence to
support this. But, as these individuals must have actively sought testing, it seems fair
to assume that they would also be willing to accept treatment.

156 Using ONS population figures - ONS, Key Statistics Feb 2012: http://www.ons.gov.uk/ons/publications/re-
reference-tables.html?edition=tcm%3A77-242593
157 www.avert.org

74

Table A1.14 Estimated costs to the NHS of treating IDUs with HIV/AIDS,
2010/11, UK
Estimated proportion of individuals living with HIV in the
UK who are IDUs
3%
Gross expenditure on HIV/AIDs in England
£886m
Estimated gross expenditure on HIV/AIDs in the UK
£1,060m
Total estimated cost to the NHS of treating IDUs with
HIV/AIDs
£27m
Source: Health Protect Agency.
Notes: Figure may not sum due to rounding. All outputs have been rounded to two significant figures.
Hepatitis C is highly prevalent amongst IDUs, with approximately 90 per cent of all
new diagnoses being acquired through injecting drug use (HPA, 2011a). The HPA
estimates that over 9,000 IDUs were diagnosed with Hepatitis C in 2010 (ibid). The
course of Hepatitis C is unpredictable, and is associated with a wide range of health
outcomes.158 As a result, the costs to the NHS of Hepatitis C have not been included.
One report (Hepatitis C Trust and University of Southampton, 2005) estimated that
Hepatitis C would cost the NHS £1.8 billion over a ten year period.159
The costs of treating other infectious diseases that are spread through needle
sharing, including Hepatitis B, have also not been included. This is due to a lack of
data on the number of newly diagnosed IDUs. Other health problems that arise from
injecting drugs include bacterial infections at the injecting site. The necessary data
are not available to be able to estimate costs from such health outcomes.
v. Costs of deaths due to drug misuse
In some cases use of illicit drugs can lead to death.160 The cost of a death is taken
from the Department for Transport‟s (2011) cost of a fatal casualty in a road
accident.161 This is a widely used figure and, while the cost of a drug-related death is
not directly comparable with the cost of a road traffic accident death, it is considered
the best available estimate.
The number of deaths due to drug misuse for the UK was taken from three sources.
For England and Wales the estimate is from the Office for National Statistics (ONS,
2011), for Scotland it is from the National Records of Scotland (NRS, 2011) and for
Northern Ireland it is from the Northern Ireland Statistics and Research Agency
(NISRA, 2011). The cases included were defined as those where illicit substances

158Hepatitis C- NHS choices website, http://www.nhs.uk/conditions/Hepatitis-
C/Pages/Introduction.aspx
159 The Hepatitis C Trust and the University of Southampton. The UK vs. Europe: Losing the Fight
Against Hepatitis C, 29 September 2005.
160 This can be a result of the difficulty of ascertaining the purity of illicit drugs, but also because of the
insanitary conditions of use.
161 Department for Transport, Valuation of Road Accidents, September 2011, Table RAS60001,
available at: http://www.dft.gov.uk/statistics?orderby=title&post_type=table&s=ras60

75

were mentioned on the death certificate.162 Deaths following misuse of prescribed
drugs such as benzodiazepines have not been included. Deaths resulting from
misuse of the prescribed drug methadone have been included as they are assumed
to stem from pre-existing opioid dependency. (Department for Health and devolved
administrations, 2007)
Table A1.15 Estimated cost of deaths due to drug misuse, 2010, UK

Number of deaths
Unit costs per
death (£m)
Total Costs (£m)
England and Wales
1,357
£1.6
£2,200
Scotland
464
£1.6
£770
Northern Ireland
25
£1.6
£41
Total
1,846

£3,000
Source: Office for National Statistics (ONS, 2011); Northern Ireland Statistics and Research Agency (NISRA,
2011); National Records of Scotland (NRS, 2011).
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant
figures.

The total estimated costs of drug-related deaths of £3.0 billion are higher than
previous estimates, such as in Singleton et al. (2006) which estimated the costs of
Class A drug-related deaths to be £923 million. This is partly due to inflation in prices
but also because this estimate includes deaths due to a wider range of drug use. It
should also be noted that previous estimates have focused on England and Wales,
whilst this estimate is for the UK and that trends in drug misuse deaths have been
increasing.163
The costs of drug treatment have also been included in the social and economic
costs of illicit drug use. The budget for drug treatment in 2010/11 in the UK is
estimated to be £720 million.164 This may overestimate costs as it can include
funding for treatment for misuse of prescription drugs. A breakdown of these figures
can be seen in Table A1.16.

162 Illicit substances included: amphetamines (including ecstasy), cannabis, cocaine, heroin, and
mephedrone.
163 Looking at statistics for England and Wales, Scotland and Northern Ireland all show an increase in
the number of drug misuse deaths from 2000, with a slight decrease in 2010 compared with 2009
figures.
164 Data have been taken from the UK Focal Point on Drugs 2011 edition which provides treatment
budgets for England and each of the devolved administrations. Budgets for Wales include treatment
for alcohol misuse so a proportion has been removed to account for this. This proportion equals the
proportion of total referrals where alcohol was the main problem identified.

76

Table A1.16 Drug treatment expenditure, 2010/11, UK by country

Treatment budget for illicit drugs (£m)
England
£640
Walesa
£16
Scotlandb
£57
Northern Ireland
£8
UK
£720
Source: UK Focal Point on Drugs (2011).
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant
figures.
a)
For 40 per cent of treatment referrals drugs were the main problem. This proportion has been applied to the
total treatment allocations report in the UK Focal Point on Drugs (2011).
b)
In addition to the drug treatment funding highlighted in UK Focal Point on Drugs (2011), £28 million was
spent on methadone prescriptions. This has been included in the total for Scotland.

Enforcement Costs
The cost of enforcing drug offences has been calculated using “Criminal Justice
Statistics 2010” (Ministry of Justice, 2011a) to estimate the CJS costs of drug
offences, as well as estimates of police and UK Border Agency budgets spent
enforcing drugs supply. There were over 70,000 drug offences165 resulting in court
proceedings in England and Wales in 2010. Methodology concerning the CJS costs
of drug offences can be found later (page 46) in this technical annex. The costs of
these offences, scaled up to the UK using population data, are approximately £680
million.
Additional police costs were calculated using Activity Based Costing (ABC)166 data
for 2007/08 which states that approximately three per cent of police budgets were
spent enforcing drug offences.167 Applying this proportion to the police budget in
2010/11 suggests that the costs of drug enforcement to the police is approximately
£362 million for England and Wales. Scaling this up to UK level by population
suggests an estimated £370 million spent by the police enforcing drug offences. The
total costs of drugs enforcement in the UK is approximately £1.1 billion. The
breakdown of these costs can be seen in Table A1.17.
This does not include enforcement costs resulting from Serious Organised Crime
Agency (SOCA), UK Border Force, or Ministry of Defence enforcement activity. Data
were not available to estimate these costs but they are within the scope of this report.
While the entire SOCA budget is a cost in response to organised crime, it has not
been possible to break this down by organised crime type.

165 Including importation, exportation, production, supply and possession offences.
166 ABC breaks down policing costs by the activities the police perform. These exclude overhead
costs.
167 Hansard House of Commons Debate, 27 January 2010, c910W.

77

Table A1.17 Costs of drug enforcement, by type, 2010/11, UK

Costs (England and
Wales, £m)
Total costs (UK, £m)
Policing
£360
£370
Criminal Justice System
£610
£680
UK Border Agency
-
£70
Total

£1,100
Source: Various.
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant
figures.

Total costs
The total social and economic costs of organised illicit drug supply in the UK are
estimated at £10.7 billion. The breakdown of these costs can be seen in Table A1.18.

Table A1.18 Total social and economic costs of illicit drugs, 2010/11, UK
Type
Total costs (£m)
Drug-related crime
£5,800
NHS costs
£80
Drug-related deaths
£3,000
Drug treatment
£720
Enforcement costs
£1,100
Total
£10,700
Sources: Hospital Episode Statistics; Patient Episode Data for Wales; Office for National Statistics (ONS, 2011);
Northern Ireland Statistics and Research Agency (NISRA, 2011); National Records of Scotland (NRS, 2011).
Notes:
a)
Figures may not sum due to independent rounding.
b)
All outputs have been rounded to two significant figures.
Firearms supply
Scale
Due to data availability issues, it has not been possible to estimate the scale of the
supply of illicit firearms by organised crime groups in the UK.
Costs
The use of firearms is not generally organised but their supply for use in particular
offences often is. Organised crime groups can provide firearms for use through
international importation but also through domestic supplier models. The social and
economic costs of firearms supply capture the harms resulting from the use of
firearms supplied by organised crime groups. This has been calculated using the
estimated number of incidents where certain firearms168 were fired or used as

168 In England and Wales those weapons excluded are: air weapons; imitation firearms; and other
firearms or weapons for which no licence is required. For Scotland: air weapons; imitation firearms;
and unidentified firearms are excluded.

78

weapons. Estimating this number precisely is not possible so proxies have been
used and assumptions made; these are set out below.
Police recorded crime can be used to identify and exclude those offences committed
with less serious firearms such as air weapons, imitation firearms, and other firearms
for which a licence is not required.169 The remaining offences were committed using
a firearm that requires the owner to hold a licence. As “licensed firearms do not
appear to be used in the majority of [crime] cases” (HASC, 2010), when such a
firearm is used to commit an offence it is assumed to have been supplied by
organised crime groups. This could lead to an overestimate of the costs resulting
from organised crime as some firearms used in these offences could have been
misappropriated170 rather than provided by organised crime groups. There is also the
possibility that the offences would have taken place even without the provision of a
firearm. In the absence of data on misappropriated firearms, it is assumed that 100
per cent of these offences are attributable to organised crime. Data are available for
England, Wales, and Scotland and are presented in Table A1.19. Similar data were
not available for Northern Ireland and estimates were not scaled to account for
this.171
Home Office costs of crime estimates have been applied to these volumes. The costs
of crime estimates have been adjusted to reflect the assumption that all offences
committed with a serious firearm are recorded.172 The amended costs of crime
estimates are displayed in Table A1.19 and are only used in conjunction with gun
crime offences where the assumption of 100 per cent reporting is used.
As described above, this approach may overestimate the volume of offences
committed. However, the total cost of the supply of illicit firearms is likely to be an
underestimate because the impact on the communities in which these crimes take
place could not be estimated.

169 The full list of weapons excluded is: unconverted starting gun; imitation hand gun; soft air weapon;
ball bearing gun; blank firer; other imitation; supposed type unknown; air weapon; CS gas; pepper
spray; and stun gun.
170 These are legally held firearms that have subsequently been stolen or obtained by fraud or forgery,
or handled dishonestly. Also, a small number of offences will still have taken place had the firearm not
been available.
171 Given the different uses of firearms in Northern Ireland, it is not appropriate to scale up on the basis
of population.
172 This means that the CJS cost component of the unit cost will be higher as the total CJS costs are
now averaged across recorded crimes rather than total crime.

79

Table A1.19 Number of offences committed using serious firearms, 2010/11,
Great Britain
Offence
Volume Unit costa (£)
Total cost
(£m)
Attempted murder
504
£39,269
£19.8
Burglary
107
£5,537
£0.6
Criminal damage
124
£1,378
£0.2
Homicideb
49
£1,774,681
£87.0
Offences against vehicles
2
£5,008
£0.01
Other offences
133
£1,951
£0.3
Other theft offences
8
£1,951
£0.02
Other violence against the person
922
£19,383
£17.9
Robbery
2,195
£14,491
£31.8
Sexual offences
12
£36,952
£0.4
Total
4,056

£157.9
Source: Police recorded crime, 2010/11.
Notes:
a)
These are the relevant Home Office costs of crime unit costs. the CJS component of these costs has been
adjusted to reflect the assumption that 100 per cent of gun crimes are recorded.
b)
As data for 2010/11 includes offences committed by Derrick Bird on 2nd June 2010 these offences have been
excluded from this table as his 12 victims were all killed with a licensed firearm.
Organised Fraud
Scale
The scale of organised fraud draws on estimates by HM Revenue and Customs
(HMRC) and the work of the National Fraud Authority (NFA).
The organised crime proportion of the tax gap173 is published annually by HMRC.
This includes Missing Trader Intra-Community (MTIC fraud), the smuggling of alcohol
and tobacco, and VAT repayment fraud. In 2010/11, the organised attacks on the tax
system accounted for approximately £5 billion (HMRC, 2012).
In addition, organised fraud is assessed by the National Fraud Authority as part of
the “Annual Fraud Indicator” (NFA, 2012). This work calculates the scale of
organised fraud including mass marketing fraud, insurance fraud and card fraud.174 It
also includes the HMRC organised crime tax gap figure. The most recent estimate
(NFA, 2012) assesses organised fraud in 2010/11 and incorporates the HMRC
estimate of organised fraud for 2009/10 (£6 billion). Since publication of the most
recent Annual Fraud Indicator (NFA, 2012) the HMRC element has subsequently
been updated (£5 billion for 2010/11, HMRC 2012).

173 The tax gap is defined as the difference between tax collected and the tax that should be collected
if all individuals and companies complied with both the letter and HMRC‟s interpretation of intention of
Parliament in setting law. The tax gap is net of HMRC‟s compliance activity. (HMRC, 2012)
174 These estimates are scaled up to allow for undetected fraud, which could cause them to
overestimate the scale of organised fraud losses.

80

Estimates have been adjusted downwards to reflect the newer HMRC figures. The
total scale of organised fraud in the UK is therefore estimated at £8.9 billion175.
Costs
The main economic costs of fraud considered in this report are the losses
experienced by victims of fraud, which are estimated in the scale section. In addition
there are CJS costs associated with organised fraud offences that should be
included. CJS costs for all fraud offences in 2010 have been estimated and a
proportion attributed to organised crime. This proportion has been estimated using
the proportion of organised fraud losses of total fraud losses, both reported in the
NFA‟s “Annual Fraud Indicator” (2012) which is approximately 15 per cent. This gives
CJS costs resulting from organised fraud of approximately £22 million.
Other victim costs of fraud could be included in the social and economic costs of
organised fraud but it has not been possible to estimate these. They include
preventative costs incurred by individuals and businesses to avoid becoming victims
of fraud, costs of fraud prevention bodies and strategies, social and emotional costs
to victims of fraud, and government expenditure on tackling organised fraud.
The estimated social and economic cost of organised fraud is approximately £8.9
billion.
Organised immigration crime
Three broad types of organised immigration crime are considered in this section:

 abuse of legitimate entry;
 human trafficking for sexual exploitation; and
 people smuggling.
Scale and costs estimates are intended to capture successful attempts to enter,
those detected on arrival, and those prevented from entering the UK. The data and
estimates presented reflect what is known about organised immigration crime. This
includes those detected at the border, encountered by authorities in the UK or, in the
case of forged supporting documents, detected in visa applications. With the
exception of human trafficking for the purposes of sexual exploitation, this section
does not include estimates of hidden populations of irregular migrants residing in the
UK.
The costs and impacts of migration are not considered in this section as they are
beyond the scope of this report. They are also only indirectly related to organised
crime and the focus of this report is the direct costs. Further information of the social

175 This is based on the NFA estimate of £9.9 billion for organised fraud but accounting for more recent
data from HMRC on the scale of criminal attacks on the tax system.

81

and economic impacts of migration can be found in the reports of the Migration
Advisory Committee.176
This section uses previously unpublished management information. This is derived
from live UK Border Agency administrative systems and may be liable to change. All
management information included has been rounded to the nearest 100 cases.
a. Abuse of legitimate entry
Scale
The scale of organised abuse of legitimate entry is defined as the fees paid by
migrants to organised criminals to ensure their entry to the UK. This is estimated
using data on suspected cases of:

 sham marriages;177
 visa port refusals;178
 forged supporting document cases of those refused entry clearance;179
 forged enabling document cases of those residing in the UK but applying to
change their immigration status;180 and
 enforcement arrests of migrants matched to a visa issued within the past 12
months181.

Management information for each of these categories has been provided by the UK
Border Agency for 2011.
The information provided only reflects cases detected by authorities. Therefore
estimates calculated using these data are partial. Individuals entering the UK through
sponsorship from a college of concern, asylum applications resulting from legitimate
visa holders182, and visa overstayers are all thought to have organised elements and
therefore fall within the scope of this report. However no data or information exists on
the proportion of organised involvement for these offences.

176 These can be found:
http://www.ukba.homeoffice.gov.uk/sitecontent/documents/aboutus/workingwithus/mac/27-analysis-
migration/
177 A sham marriage, or marriage of convenience, is contracted between (a) a British citizen, a person
settled in the UK, an European Economic Area (EEA) national, or a non-EEA national with existing
leave, and (b) a non-EEA national without leave or whose leave is about to expire, solely as a basis
for trying to enable the latter to enter, remain in or extend their leave in the UK.
178 Those migrants denied entry to the UK after obtaining a genuine UK visa.
179 Those migrants encountered using forged supporting documents to apply for entry clearance to the
UK.
180 Those migrants encountered using forged enabling documents to change their immigration status.
181 Enforcement arrests made by UK Border Agency officials of migrants matched to a visa issued
within the previous 12 months or those requiring no visa to enter the UK.
182 Data are available on the number of asylum applications resulting from legitimate visa holders but
the proportion of organised involvement in this activity is not known.

82

An indication of the scale of sham marriages, or marriages of convenience, is
provided by Section 24 reports.183 These reports are completed by registration
officers to notify the UK Border Agency when they suspect that a marriage, which
they have been asked to officiate at, may not be genuine. This may overestimate the
number of sham marriages as not all suspicions will be proved to be marriages of
convenience. However, no data are available to indicate what proportion of Section
24 reports are accurate. For all other types of abuse of legitimate entry, data have
been provided by the UK Border Agency on the number of cases of abuse detected.
It has been assumed that 75 per cent of Section 24 reports, forged supporting
document cases of migrants attempting to enter the UK, and visa-matched
enforcement arrests are the result of organised crime. This 75 per cent proportion is
a working assumption reflecting intelligence that suggests that most, but not all, of
these types of abuse of legitimate entry to the UK are facilitated by organised crime.
Assumptions regarding the use of forged enabling documents in country, subsequent
to arrival, depend on the type of forgery recorded by the National Document Fraud
Unit (NDFU). On average, organised crime involvement is approximately 80 per cent.
It is estimated that approximately 80 per cent of visa port refusals are facilitated by
organised crime.184
Based on these assumptions, over 22,000 people were detected either entering the
UK or attempting to remain in the UK by abusing legitimate entry procedures with the
involvement of organised criminals in 2011. This is likely to be a conservative
estimate for several reasons. Firstly, the data used to calculate this estimate reflect
only the detected elements of activity, a proportion of which is organised. Secondly,
there are a number of types of abuse for which sufficient data are not available for
them to be included in any estimates despite remaining in scope. Finally, it is
possible that the proportion of organised involvement in abuse of legitimate entry
could be an underestimate.
Scale estimates were obtained by multiplying the volume of illegal entrants by the
fees they paid in order to arrive in the UK. Table A1.20 displays the volume and unit
costs for each type of abuse of legitimate entry. The unit cost of a sham marriage
was taken from evidence obtained during Operation Golding I.185 For all other types
of legitimate entry, it is assumed that the price paid by the migrant to organised

183 This relates to Section 24 of the Immigration and Asylum Act 1999 under which registrars have a
duty to report suspicious marriages.
184 This is calculated by examining the country of origin of migrants refused entry at port. Those
countries of origin with a large number of refused migrants are assumed to have organised crime
networks facilitating entry attempts. While there will be many other factors influencing organised crime
involvement, this was felt to be the best proxy measure.
185 This was a coordinated enforcement activity operation targeting immigration crime including illegal
working, sham marriages, colleges of concern, and organised crime.

83

criminals in order to enter the UK is the price of buying a forged supporting
document. A median price186 was calculated using data from the NDFU.
Table A1.20 Scale of organised abuse of legitimate entry, 2011, UK

Volume
Organised
crime
involvement
Unit cost
Total cost
(£m)
Sham marriages
1,700
75%
£6,325a
£8.3
Forged supporting
documentation cases
(entry clearance)
22,200
75%
£850b
£14.2
Visa port refusals
2,000
83%
£850b
£1.4
Forged supporting
documentation cases
(in-country)
1,900
84%
£850b
£1.3
Enforcement arrests
1,000
75%
£850b
£0.6
Total
28,800

£25.8
Source: UK Border Agency, various sources; National Document Fraud Unit.
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to one decimal place.
a)
This is an average of prices reportedly paid by migrants to arrange a sham marriage. Taken from Operation Golding I.
b)
This is the median price paid for forged enabling documents. Taken from NDFU data for 2011.

Costs
This report only considers the direct social and economic costs of organised abuse of
legitimate entry. This includes the cost of asylum applications resulting from those
who had entered the UK through legitimate entry procedures with the help of
organised crime groups. The costs of removing these irregular entrants, and the
associated costs of detention prior to removal are also in scope, together with the
costs to the UK Border Agency and the NDFU of preventing organised immigration
crime. Data from UK Border Agency were used to determine the volume of irregular
entrants187 who claimed asylum, were removed, and required detention prior to
removal, as well as how long, on average, they were detained.188 Table A1.21 shows
the relevant volumes and unit costs.

186 Median price was used rather than the mean as there was a large range of prices reported in the
data.
187 Those entering the UK having abused legitimate entry procedures with the help of organised crime
groups.
188 Separate unit costs have been used for those who claimed asylum prior to removal and those who
did not. Unit costs for asylum applications include the costs of subsequent removal and detention.

84

Table A1.21 Direct social and economic costs of organised abuse of legitimate
entry, 2011, UK

Volume
Unit cost
Total costs (£m)
Asylum applications
700
£15,215
£8.5
Enforcement arrestsb
1,000
£210c
£0.1
Removalsd
200
£2,548e
£0.4
Detentionf
3,800
£102
£0.3
National Document Fraud
Unit costs
-

£1.8
Total

£11.1
Source: UK Border Agency, various sources.
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant figures.
a)
Unit cost taken from the UK Border Agency‟s Asylum Performance Framework Measures
189. This is an internal revision of
the published figure. It is based on the asylum work in progress caseload and includes the cost of processing the asylum
application, the costs of asylum support, removals and detention costs.
b)
These are non-asylum cases only.
c)
Average police cost of an arrest. No equivalent figure was available for the cost of a UK Borer Agency enforcement arrest
so this was assumed to be the best available proxy.
d)
Number of removals for those irregular entrants not claiming asylum. Any removals of those claiming asylum have been
costed within the asylum application unit cost.
e)
Unit cost provided by the UK Border Agency. it is an average cost across all removals and includes transfers within the
detention estate.
f)
The number of nights of detention required before removal for those not claiming asylum. Any removals of those claiming
asylum have been costed within the asylum unit cost.

In addition to the costs identified in Table A1.21, there are UK Border Agency costs
aimed at preventing organised immigration crime, including abuse of legitimate entry,
which are within scope but could not be estimated. This would include elements of
UK Border Agency expenditure on running the Sponsor Management Unit190. Some
UK Border Agency expenditure on preventing organised illegal immigration has been
identified but could not be broken down by type of organised immigration crime. UK
Border Agency expenditure that has been identified is included in the people
smuggling section.
b. Human trafficking – sexual exploitation
Scale
Estimates in this section focus on the trafficking of foreign women for the purposes of
sexual exploitation. The trafficking of men and children, and trafficking for purposes
other than sexual exploitation involves organised crime and these other types of
exploitation are becoming as prominent as the trafficking of women for sexual
exploitation. However, equivalent data are not available to estimate either scale or
costs for these other forms of trafficking for exploitation.

189 Available at: http://www.ukba.homeoffice.gov.uk/sitecontent/documents/aboutus/further-key-
data/asylum-performance1.xls?view=Binary
190 This unit is responsible for ensuring the integrity of the Points Based System for migration. This
includes dealing with colleges where there may be concerns about the student status of those
sponsored.

85

The scale estimate is calculated to reflect the operation of the trafficking market
within the UK. As such it reflects the revenue generated by trafficked workers as an
indication of the revenue earned by traffickers. The entire market is assumed to be
attributable to organised crime.191
The estimated number of victims in the UK comes from a number of sources. Data
for England and Wales are available from Project ACUMEN192 which estimates the
number of foreign women trafficked for the purposes of sexual exploitation. Unlike
other data sources for elements of organised immigration crime, this is an attempt to
estimate the entire market, including the hidden elements.
For Scotland and Northern Ireland similar data were not available so instead the
number of victims recovered in 2009/10 and 2010/11 respectively were used. This is
the number of victims encountered by law enforcement agencies and so does not
represent an estimate of the total number of victims in Scotland and Northern Ireland.
Since not all victims are recovered, these numbers are likely to be significant
underestimates. Table A1.22 shows the number of victims.
The Scottish Crime and Drug Enforcement Agency (SCDEA) estimated that the
average annual revenue generated by one female sex worker is approximately
£48,000 (SCDEA, 2011). Combining this figure with the number of victims identified
in Table A1.22 gives an estimated scale of human trafficking for the purposes of
sexual exploitation of approximately £130 million. This is not an estimate of the
totality of human trafficking. There are many different forms of exploitation not
captured by this estimate and recent intelligence suggests that some forms are
becoming as prominent as sexual exploitation (SOCA, 2012).193 Additionally,
estimates provided for sexual exploitation itself are unlikely to be complete.

191 This is because of the networks and organisation required to transport victims between locations.
192 The estimate of trafficking is built up from an examination of the off-street prostitution sector in
seven regions, which were then generalised to represent England and Wales as a whole. A further
group of migrant women involved in prostitution were considered to be vulnerable to being trafficked. It
should be noted that these figures are substantially higher than any attempts to identify human
trafficking victims including Operation Pentameter. Pentameter was a multi-agency operation designed
to target human trafficking. Part 1 identified 88 victims of human trafficking, while Part 2 identified 167
victims.
193 This recent intelligence assessment by the UK Human Trafficking Centre (UKHTC) captures the
number of potential victims encountered by a range of law enforcement agencies as well as NGOs. It
suggests that 50 per cent of the 2,077 potential victims encountered were trafficked for purposes other
than sexual exploitation, such as labour exploitation, criminal exploitation (including in cannabis
factories and farms), domestic servitude, and, for the first time in the UK, organ harvesting.

86

Table A1.22 Scale of human trafficking of foreign women for the purposes of
sexual exploitation, 2009/10, UK by country

Number of victims
Unit Cost Total Cost (£m)
England & Walesa
2,600
£48,000
£120
Scotlandb
73
£48,000
£4
Northern Irelandb
23
£48,000
£1
Total
2,696

£130
Source: Project Acumen (2010, England and Wales); Scottish Crime and Drug Enforcement Agency (2011, Scotland);
Organised Crime Taskforce (2010, Northern Ireland).
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant figures.
a)
This provides an estimate of all foreign women who have been trafficked for the purposes of sexual exploitation, whether
detected by law enforcement or victim support agencies.
b)
These are the number of victims that have been identified by law enforcement agencies.
Costs
As with the scale estimate, the costs estimate focuses on the operation of the market
for the sexual exploitation of women within the UK. Therefore, costs considered
include the harms of being a victim of trafficking for sexual exploitation in the UK and
not any harms resulting from journeys to or from the UK. The social and economic
costs of human trafficking for sexual exploitation include physical and emotional
costs sustained by victims at the hands of both traffickers and clients, and restrictions
placed on victims‟ quality of life. CJS costs of enforcement against trafficking
offences are also considered together with the cost of providing victim services and
costs to other agencies, including SOCA and the UK Border Agency, of trying to
prevent human trafficking.

The harms sustained by the victims of trafficking at the hands of traffickers have
been approximated using the costs of ‟non-sexual severe domestic force‟ and
„serious sexual assault‟ (Walby, 2004). This consists of 20 assaults; 3.5 chokings,
14.5 kicks or punches, 1 severe sexual assault, and 1 rape on average per year
(ibid.).194 In line with Walby‟s (2004) approach, these have been approximated to the
Home Office costs of crime categories of serious wounding, other wounding, sexual
assault, and rape, respectively. CJS costs have been excluded as these offences are
committed against people who are unlikely to report them. Also, as individuals who
have been trafficked are not working in legitimate jobs, there will be no lost output for
the economy through any time they are unable to work through injury, so the lost
output component of the costs of crime estimates has also been excluded. The
resultant physical, emotional, and healthcare costs caused by traffickers is estimated
at approximately £235,000 per victim.

Beyond the harms perpetrated by traffickers, there are those inflicted by clients on
victims of trafficking. This has been approximated by the physical and emotional
costs of one rape. This is almost certainly an underestimate as each session with a
client would amount to rape but there is little quantified evidence on the harms of

194 Based on work completed by Sylvia Walby (2004).

87

repeated rape. The emotional cost of one rape, approximately £75,000 per victim, is
used here as an absolute minimum value of the harm sustained by a victim of
trafficking. There are also costs associated with restrictions on the quality of life of
trafficking victims. It is assumed that all victims incur these costs but this may in fact
be an overestimate of the victim costs.195

In addition to these costs there are the costs of adult victim services. In England and
Wales this is provided under the Government‟s contract with the Salvation Army and
costs £2 million each year. Separate costs were not available for Scotland and
Northern Ireland but similar contracts are in place. There are also costs of providing
support to child victims of trafficking, but these could not be identified. The cost of
victim support can be wholly attributed as a cost in response to organised crime.

Other enforcement costs, including CJS costs, should also be included. There were
24 proceedings for trafficking offences in England and Wales in 2010 (Ministry of
Justice, 2011). The costs of these proceedings is estimated and then extrapolated to
Scotland and Northern Ireland on the basis of population. This could underestimate
the CJS costs as evidence suggests that prosecutors can use other offences to
secure a conviction.196 This has not been possible to estimate as these other
offences could not be identified. The costs of these proceedings are estimated at
approximately £570,000. In addition, enforcement costs incurred by SOCA, the UK
Border Agency, and the police should be included but could not be quantified.

The total social and economic costs of human trafficking for the purposes of sexual
exploitation are estimated to be approximately £890 million as can be seen in Table
A1.23.

195 Intelligence from Project ACUMEN suggests that not all victims of trafficking face the same
restrictions on their movement or quality of life.
196 For example prosecuting for rape, in the case of sexual exploitation, rather than trafficking.

88

Table A1.23 Social and economic costs of human trafficking for sexual
exploitation, 2010/11, UK

Volume
Unit cost
Total costs (£m)
Victim costs
2,700
£327,775
£880
Victim support costs
-
-
£2
CJS costs
24
£23,701
£1
Total

£890
Sources: Walby (2004); Project Acumen (2010), Scottish Crime and Drug Enforcement Agency (2011); Organised Crime
Taskforce (2011).
Notes: Figures may not sum due to independent rounding. All outputs have been rounded to two significant figures.
c. People smuggling
Scale
The scale estimate of those illegally entering the UK having been facilitated by
organised crime consists of three main components:

 those detected arriving clandestinely;
 those arriving with inadequate documentation; and
 those successfully entering clandestinely or as an inadequately documented
arrival but subsequently arrested by the UK Border Agency in the UK.
As with abuse of legitimate entry, data used in this section only reflect detected
cases, a proportion of which are attributed to organised crime. No estimates are
made of the hidden population of irregular migrants.
The number of clandestine entrants detected has been provided by the UK Border
Agency. Intelligence suggests that the journey of most clandestines will have been
facilitated by organised crime networks at some point. As it is not possible to
estimate the exact proportion that has some organised crime involvement, it has
been assumed that 75 per cent197 of clandestines have been facilitated by organised
crime groups.
The fees individuals paid organised crime groups for their facilitation to the UK are
used to monetise the scale of people smuggling. Intelligence suggests that the fees
paid by individuals depend on the country of origin of the individual being smuggled.
As this information is not typically captured by the UK Border Agency, proxies have
been used based on the country of origin of clandestine migrants. Limited information
is available on the prices paid by illegal migrants to enter the UK. As a result, it has
been necessary to categorise arrivals by region, rather than country, of origin.

197 This is designed to reflect that most but not all clandestines are likely to have been facilitated by
organised crime during their journey.

89

Table A1.24 shows the region of origin of irregular migrants who have been detected
entering clandestinely as well as the average fee for facilitation assumed to be paid
by each individual seeking entry to the UK.
Table A1.24 Clandestine entrants attributable to organised crime, 2011, by area
of origin
Area of origin
Proportion of
clandestines
Average fee for
facilitationa
Africa
31%
£2,200
Americas
0%
£37,500
Asia
30%
£23,800
Europe
9%
£3,200
Middle East
31%
£8,800
Oceania
0%
£37,500
Other
0%
£8,400
Total
100%
£10,700b
Source: UK Border Agency management information, 2011.
Notes: All figures have been rounded to the nearest £100.
a)
Average figures taken from Home Office Research Report 15, “Organised Immigration Crime: A post conviction study”
b)
This represents the weighted average fee for facilitation, rounded to the nearest £100.

Inadequately documented arrivals (IDAs)198 are also assumed to be largely facilitated
by organised crime. Again 75 per cent organised crime involvement is assumed. A
similar approach has been used to quantify the scale of the market as for clandestine
entrants. Intelligence suggests that the price paid by migrants for facilitation into the
UK varies depending on a number of factors including the route taken to the UK and
the time the migrant is prepared to spend travelling.199 Data held by the UK Border
Agency provide the last known port of entry of IDAs but not the entire journey. These
data have been used to make assumptions about the route taken. Limited
information was available regarding the prices paid by migrants so assumptions were
made about similar routes and an average price used for all other routes. Table
A1.25 shows the assumed routes taken by IDAs together with the relevant prices
paid.

198 IDAs are non-UK or non-EEA migrants knowingly arriving at the UK border without the proper
documentation or entry clearances. They do not include „technical‟ IDAs who arrive, for example, not
realising they require a visa to enter the UK.
199 With more direct routes thought to be more expensive than less direct ones.

90

Table A1.25 Inadequately documented arrivals attributable to organised crime,
2011, by route taken
Route taken
Proportion of IDAs
Average fee for
facilitation
Via Central Europe
38%
£1,000
Via Western Europe or North Africa
20%
£4,700
Via Eastern Europe
9%
£9,500
Via Central Asiaa
10%
£13,000
Via South-Easta Asia
2%
£17,500
Other
21%
£3,900b
Total
100%
£4,600c
Source: UK Border Agency management information, 2011.
Notes: All figures have been rounded to the nearest £100.
a)
These are likely to reflect direct flights but data are not available to determine whether this is the region of origin.
b)
This is a weighted average of the prices from all other regions based on the proportion of inadequately documented
arrivals from each route.
c)
This represents the weighted average fee for facilitation, rounded to the nearest £100.

Finally, those arrested by the UK Border Agency enforcement officers in the UK who
cannot be matched to a visa are assumed, in many cases, to have been largely
facilitated by organised crime. It is not known how these migrants reached the UK
but, given the lack of a visa match, it is likely that many will have entered
clandestinely or as an inadequately documented arrival. It is assumed that 75 per
cent of these enforcement arrests are attributable to organised crime, in line with the
proportions used for clandestine entrants and IDAs. In this report, 50 per cent of
those arrested are assumed to have arrived as clandestines and the remainder are
assumed to have arrived as IDAs. The weighted average price of facilitation for each
type of entrant is applied to each category.
This gives a total scale estimate of approximately £88 million. This is likely to be a
conservative estimate of the scale of organised people smuggling due to the data
available and the assumptions made. Table A1.26 shows the three main components
of the scale estimate of organised people smuggling.

91

Table A1.26 Scale of organised people smuggling, 2011, UK

Number
Organised
proportion
Average fee
for
facilitationa
Total (£m)
Clandestines
7,800
75%
£10,700
£63
Inadequately
Documented
Arrivals
2,100
75%
£4,600
£7
Enforcement
arrests
3,900
75%
£7,700b
£17
Total
13,900

£88
Source: UK Border Agency management information.
Notes:
a)
Weighted average of facilitation costs for each type of smuggling.
b)
It is assumed that 50 per cent of those arrested are clandestines and 50 per cent are IDAs. The weighted averages
displayed in this table are used for each of these.
Costs
The estimate of the social and economic costs of organised people smuggling
presented here reflects the costs associated with detected organised activity. The
broader costs of migration are not within scope as they are not a direct cost of
organised activity. Instead, only those costs directly related to organised people
smuggling are considered. This includes the cost of processing asylum applications
and removals and any detention costs associated with removal.
It is estimated that approximately 15 per cent of those coming to the UK and claiming
asylum are clandestine entrants, facilitated by organised crime at some point during
their journey. This is based on work carried out by the UK Border Agency to profile
clandestine entrants. Analysis of management information on all in-country asylum
applicants for 2011 showed that approximately 20 per cent of in-country asylum
applicants were served removal papers for clandestine entry. Of this proportion, 75
per cent are assumed to be the result of organised crime. As a result, the costs of
almost 3,000 asylum applications in 2011 can be attributed to organised crime.200 In
addition, management information provided by the UK Border Agency suggest a
further 3,900 asylum applications were made by smuggled or clandestine entrants in
order to avoid removal processes begun during 2010.201 There is the potential for
double counting of asylum applications attributable to organised crime. It is possible
that the additional asylum applications resulting from irregular entrants trying to avoid

200 This was not a cost that could be used for the abuse of legitimate entry category as this captures
those applying for asylum in the UK who have entered clandestinely. As irregular migrants in the
previous section entered through legitimate entry procedures there was no equivalent population to be
considered there.
201 UK Border Agency management information was used to identify irregular entrant case types that
were linked to organised crime. The 3,900 asylum applications relate to individuals served with
removal papers during 2010 for clandestine entry or no evidence of lawful entry. 10,088 irregular
entrants in these categories were served removal papers during 2010, 5,153 of whom claimed asylum.
It is assumed that 75 per cent of these were facilitated by organised crime.

92

removal also have been counted in the costs of those claiming asylum having arrived
clandestinely in the UK. There is no evidence as to the scale of potential double
counting, but it is likely therefore that costs may have been overestimated.
Based on the assumptions stated in the scale section, an additional 1,600 removals
in 2011 can be attributed to organised crime.202 The costs of these removals together
with the associated detention costs have also been included. On average, those
being removed spent approximately 45 days in detention prior to removal. These
costs together with the costs of enforcement arrests are detailed in Table A1.27.
Table A1.27 Direct social and economic costs of organised people smuggling,
2011, UK

Volume
Unit Costs
Total Costs (£m)
Asylum applications
6,800
£15,215a
£104
Enforcement arrestsb
2,300
£210c
£1
Removalsd
1,600
£2,548e
£4
Detentionf
7,300
£102
£1
Risk and Liaison Overseas
Network
-
-
£7
Regional crime teams
-
-
£19
Total

£140
Source: various UK Border Agency.
Notes: Figures may not sum due to independent rounding.
a)
Unit cost taken from UK Border Agency‟s Asylum Performance Framework Measures (available at:
http://www.ukba.homeoffice.gov.uk/sitecontent/documents/aboutus/further-key-data/asylum-
performance1.xls?view=Binary. This is an internal revision of the published figure. It is based on the asylum work in
progress caseload and includes the cost of processing the asylum application, the cost of asylum support, and removals
and detention costs.
b)
These are non-asylum cases only.
c)
Average police cost of an arrest. No equivalent figure was available for the cost of a UK Border Agency enforcement arrest
so this was assumed to be the best available proxy.
d)
Number of removals for those illegal entrants not claiming asylum. Any removals of those claiming asylum have been
costed within the asylum application unit cost.
e)
Unit cost provided by the UK Border Agency. It is an average cost across all removals and includes transfers within the
detention estate.
f)
The number of nights of detention required before removal for those not claiming asylum. Any removals of those claiming
asylum have been costed within the asylum unit cost.
Organised intellectual property crime and counterfeiting
Scale
The intellectual property (IP) crime report (IP Crime Group, 2011) describes IP crime
as certain types of infringements of IP rights, including the wilful infringement of
registered trademarks (counterfeiting) and the unauthorised copying and use of
material protected by copyright (piracy) which are criminal offences. “The use of the
internet to sell physical products and distribute digital content has increasingly
become an additional threat” (ibid.).

202 This is in addition to those asylum applicants who had their application denied and were
subsequently removed. Removal costs are already included in the cost of processing an asylum
application.

93

It has been necessary to draw boundaries in this research in order to prevent any
overlap with cyber crime, which is excluded from the scope of this report. In
consultation with industry stakeholders and government agencies, it was decided that
an appropriate distinction between the IP crime considered in this report and IP crime
that would fall under the heading of cyber crime is between „physical‟ and „digital‟
crime. Any sale of physical goods infringing intellectual property rights, whether using
the internet or not, is considered within the scope of this report.
The counterfeiting of CDs, DVDs, games, business software, and clothing and
footwear are all considered in this report. The list of goods could have been much
longer but these goods were thought to be the main targets for organised
criminals.203 This assumption also reflects available evidence at the time of
publication; threats in this area are constantly changing. The focus is on the physical
piracy and counterfeiting of these goods with seizure data available to estimate the
market size. Using seizure data means only part of the physical market for these
goods is captured in estimates particularly as many organisations are now focussing
more on digital rather than physical piracy, which is reflected in their enforcement
activity. Despite this, seizure data are the most consistent information available for all
media types. Seizure data were provided for all goods included in this estimate with
the exception of business software figures which were taken from the Business
Software Alliance (BSA) Global Piracy Study which detailed the commercial value of
software pirated in 2010 in the UK. This will be discussed separately.
For those media with seizure data, an average „street value‟204 of the goods has been
obtained205 and multiplied by the number of items seized to calculate the illicit
market. Proportions of organised involvement have then been applied to estimate the
market size attributable to organised crime. The proportions attributable to organised
crime are estimates based on available intelligence and the definition of organised
crime used in this report. This approach may well lead to overestimates of organised
involvement in some cases. Table A1.28 outlines the seizure data used together with
estimates of the average „street value‟ and organised proportion.
Estimates for business software have been calculated using information from BSA
publications. The BSA‟s annual “Global Piracy Trends” publication estimated that the
commercial value of pirated software in the UK was $1.8 billion.206 The BSA‟s
definition of piracy includes underlicensing software, where copies of the software
are installed on more PCs than the user has purchased licences for. This is unlikely
to meet the definition of organised crime used in this report because it does not
require the same planning and coordination as other forms of counterfeiting and
piracy considered. As a result, the estimate of organised piracy of business software

203 Based on discussions with researchers and operational colleagues at the Intellectual Property
Office (IPO).
204 This is the value of the counterfeit or pirated goods sold.
205 Anecdotal evidence sourced from industry bodies within the Alliance Against IP Theft.
206 Approximately £1.3 billion using a GB£ to US$ conversion rate of 1.486 (Source: US Embassy in
London) for 2010.

94

is likely to be an overestimate. The BSA‟s Global Survey of PC User Attitudes
estimated that seven per cent of UK respondents would only acquire software in
ways that are typically illegal. This proxy is being used to estimate the proportion of
organised involvement pirated software although with the caveat that this is likely to
be an overestimate as the BSA definition of piracy includes underlicensing.
Discussions with the BSA suggest there is little difference between the commercial
value of legitimate software and the „street value‟ of pirated software so no
adjustments need to be made to the commercial value of pirated software estimated
by the BSA. The market size of organised software piracy in the UK in 2010 is
therefore assumed to be seven per cent of the commercial value of pirated software
in the UK, approximately £87 million.
Table A1.28 Scale of organised intellectual property theft and counterfeiting,
2010, UK
Media
Number of
items seized
Street
value
Organised
involvement
a
Total scale
(£m)
Business software
-
-
7%
£86.9
Music – CDsb
188,181
£3.50-£5
100%
£0.7
Film – DVDs
766,324
£3
100%
£2.3
Games
32,600
£5
80%
£0.1
Clothing & footwear
27,322
£10
100%
£0.3
Total

£90.3
Source: Business Software Alliance; British Phonographic Industry; Federation Against Copyright Theft; The Association for UK
Interactive Entertainment; Intellectual Property Office.
Notes:
a)
Games figure has been provided by The Association for UK Interactive Entertainment (UKIE) based on intelligence. For
other media in this table, these figures are estimates based on information provided by stakeholders. It is likely that the
majority of these markets are organised and that items seized are seized from organised criminals.
b)
This is made up of both CDs and compiled DVDs (with several albums stored on them) that have been seized. The range
of street values quoted reflect the different music items seized.

The total estimated scale of organised physical IP crime is approximately £90 million.
As previously mentioned, this only reflects physical counterfeiting and piracy of
selected goods. The total scale of organised IP crime is likely to be far higher.
However, sufficient data were not available to calculate this.
Costs
The main social and economic costs considered in this estimate are lost profit/sales
to business, lost revenue to exchequer, lost jobs to industry, additional benefit
payments resulting from lost jobs, and enforcement costs by media stakeholders.
There are other costs, such as costs to brand reputation and reduced incentives to
invest in research and development, which could also be included but sufficient data
were not available to quantify these costs.

95

In order to estimate the impact of the consumption of counterfeit goods on legitimate
sales it is necessary to distinguish between sales of counterfeit goods that displace
sales of legitimate goods and those that do not. Not all counterfeit goods purchased
will displace a legitimate sale so Table A1.29 highlights the cannibalisation rate for
each type of good considered together with the average retail value of a legitimate
sale. Cannibalisation rates for each type of good considered have been provided by
industry bodies, indicating the proportion of counterfeit goods that will result in a lost
sale for legitimate retailers.207 This cannibalisation rate, together with the value of
legitimate goods sold, yields an estimated value of lost legitimate sales due to
counterfeiting of £48 million.
Table A1.29 Cannibalisation rates of counterfeit goods, 2010, UK
Media
Cannibalisation
rate (%)
Organised
involvement
Average
legitimate
sale valuea
Total
Cost
(£m)
Business software
50b
7%
-
£43.5
Music – CDs
45c
100%
£8
£0.6
Films – DVDs
60d
100%
£7
£3.2
Games
50e
80%
£25
£0.4
Clothing & footwear
40f
100%
£50
£0.8
Total

£48.5
Source: Business Software Alliance; British Phonographic Industry; Federation Against Copyright Theft; The Association for UK
Interactive Entertainment; Intellectual Property Office.
Notes:
a)
These figures are an average price for each type of good.
b)
This is an assumption based on figures for music, films, and clothing.
c)
45 per cent of counterfeit buys who Ipsos questioned about their recent purchases reported that they would definitely have
bought an official release if the counterfeit had been unavailable. (BPI, 2006)
d)
Ipsos research for the British Video Association (BVA) in 2010 concluded that 60 per cent of those who had purchased
counterfeit film releases would have bought an official release if the counterfeit had been unavailable.
e)
This is an assumption based on figures for music, films, and clothing.
f)
Ledbury research conducted in 2007 concluded that approximately 40 per cent of those who had bought counterfeit items
would have bought a genuine item from the same or another known brand of label.
The costs to the exchequer in the form of lost business taxes as well as an increase
in unemployment figures and associated increases in benefit payments are taken
from recent research for the International Chamber of Commerce World Business
Organisation carried out by Frontier Economics (2009). This considers the impact of
four types of counterfeited goods; luxury goods, software, pharmaceuticals, and food
and beverages. These estimates, of lost business taxes due to reduced company
profits and lost income tax from job losses, are estimated to be 80 per cent
attributable to organised crime208, contributing approximately £350 million to the
social and economic costs of organised IP crime.

207 There has been much scepticism previously surrounding cannibalisation rates, as those knowingly
purchasing counterfeit goods are unlikely to purchase the genuine alternative, particularly when
considering high value designer items. The estimates of cannibalisation rates from stakeholders are
the best available, but could still overstate the displacement of legitimate sales by counterfeit goods.
208 This is the average of organised involvement across all types of counterfeit goods.

96

Enforcement costs are calculated from reported enforcement costs by Alliance
Against IP Theft members attributing 80 per cent to organised crime. This yields a
further £6.5 million to the costs of organised IP crime.
The total social and economic costs of organised IP crime are estimated to be £400
million. This is likely to underestimate the true costs of this organised activity as
estimates are reliant on seizure data, which only captures part of the market, and
because there are other costs that should be considered but are not possible to
quantify. These costs include the physical and emotional harms sustained by victims
as a result of using poor quality counterfeits, reputation damage sustained by brands
where consumers are unknowingly using a counterfeit item, and reduced investment
in research and development as a result of counterfeiting which could have impacts
for the whole economy.209 It has not been possible to quantify these costs due to a
lack of existing data and research.
Criminal justice system
For many crime types it has been possible to use existing Home Office costs of crime
estimates to estimate, among other things, the costs of organised crime to the
criminal justice system (CJS). Costs of crime estimates include a CJS component,
which provides average CJS costs for each type of crime. These are average costs
for each type of offence across all offences committed, whether or not they were
reported to or recorded by police. In some cases, these figures have been amended
to be used in conjunction with recorded crime data rather than total crime, as
measured by the Crime Survey for England and Wales.
However, for some crime types,210 costs of crime estimates were not available and
an alternative methodology was used to estimate the relevant CJS costs. The
following methodology is applied to certain fraud and immigration crime offences.
The costs to the CJS of organised crime are estimated by analysing all available
offences where there are organised elements and applying a proportion that is
estimated to be organised crime related.211 The costs to the CJS of each offence are
calculated by summing the cost of arrests for those proceeded against, pre-charge
decision cost to the Crown Prosecution Service (CPS), magistrate and Crown court
costs,212 cost of immediate custody, cost of probation, cost of community sentence,
and the cost of cautioning.

209 With the exception of reduced incentive to invest in research and development, these costs will
only apply in the cases where consumers have been deceived in buying a counterfeit good rather than
when the consumer chooses to purchase a counterfeit.
210 Drugs, fraud, and human trafficking. For IP theft and counterfeiting industry bodies provided
estimates of how much they spend on enforcement costs and prosecutions.
211 This proportion is, in most cases, the same as the proportion of organised involvement in each
crime type.
212 Made up of the cost to the CPS, HM Courts and Tribunals Service (HMCTS) and legal aid.

97

Volumes have been estimated using proceedings, cautions and sentence disposal
data from the “Criminal Justice Statistics 2010” (Ministry of Justice, 2011a). These
data are combined with Ministry of Justice unit cost estimates to estimate the total
CJS costs of organised crime-related offences.
There are certain caveats to the estimates made which are set out in the following
paragraphs. Firstly, it has not been possible to estimate the cost of issuing a caution
over and above the cost of first arresting the offender; however, it is expected that
the additional cost would be low. It has also not been possible to include an accurate
estimate on the cost of fine enforcement and conditional discharge. Compensation
and fine payments received have not been included in the costs as benefits to
organised criminals or society are not within the scope of this report.
A significant assumption made was that the length of trial in the magistrates‟ court
was one hour for all offences. This is assumed to be an average accounting for
variation in lengths of trials.213 For the Crown court, estimated hearing lengths were
provided by HM Courts and Tribunals Service (HMCTS). Estimates only account for
those proceeded against or cautioned. This does not fully reflect the cost of
organised crime on the CJS as some offenders will not reach this stage but may still
be associated with costs such as police investigation.
Finally, the list of offences considered to have organised crime involvement is not
exhaustive, therefore estimates are likely to be an underestimate of the cost to the
CJS. There are also other types of civil orders that agencies can apply for when
responding to organised criminality and whose costs would be relevant.
The data used to calculate these estimates are for England and Wales. No similar
data were available for Scotland and Northern Ireland. In order to estimate the CJS
costs of organised crime in the UK it has been assumed that Scotland and Northern
Ireland have the same offending rate as England and Wales. This is a significant but
necessary assumption because of the available data but lead to inaccurate
estimates. The unit costs used in these estimates are presented in Table A1.30.

213 This could well be an underestimate as it is likely that organised crime cases will have more than
one defendant and be more complex cases.

98

Table A1.30 Unit costs used in criminal justice system estimates, 2010, UK214

Magistrates court
Crown court
Police cost per arresta
£205
£205
Pre-charge decision cost (CPS) b
£40
£40
CPS costs
£143
£2,500
HMCTS costs
£265
£405
Legal aid costs
£473
£4,200
Cost per month of immediate
custodyc
£2,500
£2,500
Cost per month of probationd
£225
£225
Cost of community sentencee
£2,700
£2,700
Notes:
a)
The police cost per arrest was calculated assuming 5.8 hours per arrest (taken from Deehan et al., 2002) used together
with Home Office estimates of the cost of police time (estimated in 2008 using Chartered Institute of Public Finance and
Accounts (CIPFA) and Annual Survey of Hours and Earnings (ASHE) data, then uprated to account for inflation using the
Treasury gross domestic product (GDP) deflator series.
b)
Court unit costs are calculated using the unit cost per defendant for the Crown Prosecution Service, HM Courts and
Tribunals Service (HMCTS) unit costs (with estimates of hearing lengths from HMCTS) (Ministry of Justice, 2011b) and
2010/11 legal aid unit costs, assuming 50 per cent are eligible for legal aid in the magistrates‟ court and 100 per cent in the
Crown court.
c)
Based on annual yearly costs of a prison place of £30,000 from Ministry of Justice (2011b). It is assumed that 50 per cent
of a prison sentence is spent in prison and 50 per cent spent on probation.
d)
The costs are based on the 2008/09 cost (Ministry of Justice 2011b), inflated using HM Treasury data to get 2010/11
nominals. These are converted into real figures in 2010/11 prices and the [Spending Review real efficiencies from
2010/11 are applied on top.
215
e)
Ibid.

214 Costs are in 2010/11 prices unless otherwise stated.
215 It is assumed that sentences under 12 months do not inflict a cost on probation services, as in 2011
Ministry of Justice re-offending compendium, available at:
http://www.justice.gov.uk/downloads/statistics/mojstats/2011-compendium-reoffending-stats-
analysis.pdf

99

References
Business Software Alliance (2011) 2010 Piracy Study. Available at <
http://portal.bsa.org/globalpiracy2010/downloads/study_pdf/2010_BSA_Piracy_Study
-Standard.pdf> Accessed May 2012.
Chaplin, R., Flatley, J. and Smith, K. (eds) (2011) Crime in England and Wales
2010/11. Home Office Statistical Bulletin 10/11. London: Home Office. Available at:
Accessed March 2012.
Berelowitz, S., Firmin, C., Edwards, G., and Gulyurtlu, S. (2012) The Office of the
Children’s Commissioner’s Inquiry into Child Sexual Exploitation in Gangs and
Groups: Interim Report, London: Children‟s Commissioner.
Davies, C., English, L., Stewart, C., Lodwick, Alan., McVeigh, J., Bellis, M., A.
(2011) United Kingdom drug situation, London: UK Focal Point on Drugs. Available
at:
. Accessed May 2012.
Deehan, A., Marhsall, E., and Saville, E. (2002) Drunks and Disorder: Processing
intoxicated arrestees in two city-centre custody suites. London: Home Office.
Department for Transport (2011) Valuation of Road Accidents, September 2011,
Table RAS60001. London: Department for Transport. Available at:
Accessed
March 2012.

Department of Health, England/Scottish Government/Welsh Assembly
Government/Northern Ireland Executive Department of Health (2007) Drug
Misuse and Dependence: UK Guidelines on Clinical Management. London:
Department of Health; Edinburgh: Scottish Government; Cardiff: Welsh Assembly
Government; and Belfast: Northern Ireland Executive.

Department of Health (2011) National Expenditure Data, Programme Budgeting
Tools and Data, 2010/11. London: Department of Health. Available at:
Accessed March 2012.
Frontier Economics (2009) The Impact of Counterfeiting on Governments and
Consumers. A report commissioned by Business Action to Stop Counterfeiting and
Piracy (BASCAP).
Goodall, E., Heady, L., and Brookes, M. (2007) Misspent Youth: The costs of
truancy and exclusion, New Philanthropy Capital.

100

Greene, Dr K., S., and Pakes, Dr F. (2012) Establishing the Cost of Missing Person
Investigations, University of Portsmouth.
Hall, W. (1988) Cannabis use and Psychosis. National Drug and Alcohol Research
Centre.

Home Affairs Select Committee (2010) Firearms Control. Third Report of Session
2010/11. London: The Stationery Office.
Hepatitis C Trust/University of Southampton (2005) „The UK vs. Europe: Losing
the Fight Against Hepatitis C‟, 29 September 2005.
HES (2011a) Hospital Episode Statistics 2010/11, Primary Diagnosis. ICD-10 codes
for mental and behavioural episodes used were F11.0 – F16.9 and F19.0 - F19.9
(excluding codes ending .2 to avoid double counting with treatment budgets and
excluding F13.6, F14.7, F15.6, F16.6). Available at:
Accessed March 2012.
HES (2011b) Hospital Episode Statistics 2010/11, Primary Diagnosis. Using ICD-10
codes T40.1-T40.7, T40.9 and T43.6. Available at:
Accessed March 2012.

HES (2011c) Hospital Episode Statistics 2010/11, Primary Diagnosis. Using ICD-10
codes P04.4 and P96.1. Available at:
Accessed March 2012.
HPA (2011a) Shooting Up: Infections among people who inject drugs in the UK 2010,
November 2011. Health Protection Agency. Available at:
Accessed
March 2012.
HPA (2011b) HIV in United Kingdom: 2011 Report, November 2011. Health
Protection Agency. Available at:
Accessed
March 2012.
Intellectual Property Office (2011) IP Crime Report 2010/11. London: Intellectual
Property Office.
Johnson, N. (2009) Assessing the Economic and Social Cost of Suicide and
Attempted Suicide, North East Mental Health Development Unit.
Melzer, H., Ladar, D., Corbin, T., Singleton, N., Jenkins, R., and Burgha, T.
(2002) Non-fatal suicide among adults aged 16-74 in Great Britain, London: ONS.

101

Miller T., R., Taylor D., M., & Sheppard M., A. (2007) Costs of Sexual Violence in
Minnesota, Minnesota Department of Health.
Ministry of Justice (2011a) Criminal Justice Statistics 2010. London: Ministry of
Justice.
Ministry of Justice (2011b) Cost Benefit Framework 2010/11. London: Ministry of
Justice.

Ministry of Justice (2012) Impact Assessment: Tackling Metal Theft – prohibit cash
payments and higher fines. London: Ministry of Justice. Available at:
Accessed June 2012.
National Audit Office (2010) Tackling Problem Drug Use.
National Fraud Authority (2012) Annual Fraud Indicator. London: National Fraud
Authority. Available at: < http://www.homeoffice.gov.uk/publications/agencies-public-
bodies/nfa/annual-fraud-indicator/annual-fraud-indicator-2012?view=Binary>
Accessed April 2012.

NHS (2011) NHS Reference Costs 2010/11, Appendix NSRC5- NHS trust and PCT
combined reference cost schedules. London: Department of Health. Available at:
http://www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAnd
Guidance/DH_131140> Accessed March 2012.
NISRA (2011) Drug related deaths registered in Northern Ireland. Belfast: Northern
Ireland Statistics and Research Agency. Available at:
Accessed March 2012.
NRS (2011) Drug Related Deaths in Scotland 2010, August 2011. Edinburgh:
National Records of Scotland. Available at:
Accessed March 2012.
ONS (2011) Deaths related to Drug Poisoning in England and Wales 2010, August
2011. Newport: Office for National Statistics. Available at:

Accessed August 2012.

ONS (2012) Key Statistics, February 2012. Newport: Office for National Statistics.
Available at: Accessed May 2012.
PSSRU (2011) Unit Costs of Health and Social Care, 2011. Personal Social Services
Research Unit, London School of Economics and the Universities of Kent and

102

Manchester. Available at:
Accessed March 2012.

Pudney, S., Badillo, C., Bryan, M., Burton, J., Conti, G. and Iacovou, M. (2006)
„Estimating the size of the UK illicit drug market‟. In Measuring different aspects of
problem drug use: methodological developments, Singleton, N., Murray, R. and
Tinsley, L. (eds). Home Office Online Report 16/06. London: Home Office. Available
at:
Accessed April 2012.
Sidebottom A. (2012) Metal Theft, UCL Jill Dando Institute. Available at
http://www.ucl.ac.uk/jdibrief/crime/metal-theft. Accessed: March 2013.
Singleton, N., Murray, R., Tinsley, L. (eds) (2006) Measuring different aspects of
problem drug use. London: Home Office. Available at: <
http://www.homeoffice.gov.uk/publications/science-research-statistics/research-
statistics/crime-research/hoor1606?view=Binary> Accessed: March 2012.
Serious and Organised Crime Agency (2012) UKHTC: A Baseline Assessment on
the Nature and Scale of Human Trafficking in 2011. London: SOCA.
Walby, S. (2004) The Cost of Domestic Violence. University of Leeds.
Wainer, L. and Summers, L. (2011) Understanding the Harms of Cash and
Valuables in Transit (CViT) Robbery. Jill Dando Institute.
Wang, M. (2012) Perinatal Drug Abuse and Neonatal Drug Withdrawal. Medscape.
Webb, S., and Burrows, J. (2009) Organised immigration crime: a post conviction
study. Home Office Research Report 15. London: Home Office.

103

Annex 2: The scale of the illicit drugs
market
Ian Vincent, Hannah Mills and Peter Blyth
Introduction
The illegal and hidden nature of the drugs market makes estimating its scale
challenging. In 2006 the Home Office published a paper on the scale of the UK drugs
market in 2003/4, estimating it at approximately £5.3 billion (Pudney et al., 2006).
This report builds on the methodology used in that paper, providing estimates for the
scale of the drugs market in England and Wales in 2004 and 2010. Revising
estimates for 2004 and producing new estimates for 2010 allows the impact of
changes in methodology and the impact of changes over time to be considered
separately. It is important to view these changes separately given the impact of
changes in methodology between the Pudney et al. (2006) publication and this
report.
Objectives
This work was commissioned under the organised crime strategy, so while it is
separate from “Understanding Organised Crime: estimating the scale and the social
and economic costs”, it was designed to fill a key gap in that work. As such,
decisions have been made about the scope of this work with the organised crime
strategy in mind. This is particularly relevant when considering which illicit drug types
are included within market estimates. Any illicit drug type where the importation,
production or supply is facilitated by organised crime groups and networks is within
the scope of this work. Equally, legitimately prescribed drugs which may be misused
have been excluded.
Key findings
The key findings of this report are:
 the estimated scale of illicit drugs market was approximately £3.3 billion in
England and Wales in 2010 (Table A2.6);
 the scale of the illicit drugs market is estimated to have decreased slightly
from £3.6 billion in 2004216 (Table A2.3);
 adults arrested in the last year account for approximately 52 per cent of
expenditure on drugs across all drug types217; when looking at heroin and
crack cocaine only, this share rises to 90 per cent (Table A2.6).

216 It should be noted that this reflects a decrease in the number of drug users; other underlying data
have not changed between the two estimates.

104

Definition
The scale of the illicit drugs market in this paper is defined as the amount of money
spent by drug users in England and Wales on amphetamines, cannabis, crack
cocaine, ecstasy, heroin, LSD, magic mushrooms, and powder cocaine each year.
These drugs were selected on the basis of data availability within the surveys of
offending and drug use used in this report. Excluded drugs include those where a
large proportion of consumption may be legitimate prescriptions like methadone or
tranquillizers as well as more recent market developments, like mephedrone218.
Legitimately prescribed drugs are not the product of organised crime and fall outside
the scope of this work. Similarly, there is an absence of evidence to suggest that any
trade in unprescribed methadone uses organised crime networks. Of those drugs
excluded from scope only four were included in the 2010/11 Crime Survey for
England and Wales (CSEW)219. These are tranquillizers, ketamine, amyl nitrite, and
anabolic steroids. The impact of each of these on final figures is thought to be
small.220 More recent market developments, which include new psychoactive
substances, are likely to be the product of organised crime but are not covered within
the survey data used in this paper.
The chosen definition reflects a narrower scope than the 2006 publication, which also
considered number of users, volume of drug consumption and seizure rates.221 This
change in approach allows more specialised and direct calculations, with fewer
assumptions about average use and the volume of drug used required. The focus on
a user spend definition is consistent with the approach used for legitimate consumer
goods. In both cases, production costs and transactions further up the supply chain
are excluded.
Previous work
The first major attempt to measure the scale of the UK illicit drugs market was a
feasibility study conducted by the Office for National Statistics (ONS) and reported in
Groom et al. (1998). The approach used a mix of supply side and demand side data
sources, along with estimates of seizure rates. This produced an estimate of between
£4.3 billion and £9.9 billion at 1996 prices.

217 Based on data from the Arrestee Survey from survey years 2003/04, 2004/05 and 2005/06.
218 The estimates provided in this annex are for 2010, before mephedrone was classified as an illegal
drug. There is limited robust evidence available on the prevalence of mephedrone use or drug users‟
expenditure on this drug. For these reasons, and due to its exclusion from both the Arrestee Survey
and the Offending, Crime and Justice Survey (as it had not been classified when these surveys were
completed), the scale of mephedrone has not been estimated in this paper.
219 Formerly known as the British Crime Survey (BCS). The name has been changed to reflect the
geographical coverage of the survey.
220 The Crime Survey for England and Wales estimates of the number of users in the last month, along
with street prices and likely dosage suggest that the market size for each of these drug types is likely
to be between £10 million and £50 million.
221 The single definition does not affect the number of drug types that are within the scope of this
paper; this remains largely unchanged from Pudney et al. (2006).

105

Subsequent work by the National Economic Research Associates developed the
ONS demand side approach, focusing on consumer data and removing the reliance
on estimated seizure rates. This reported an overall market size of £6.6 billion
(Bramley-Harker, 2001). These two attempts are described in more detail in Pudney
et al. (2006), as they developed the demand side approach further.
This report continues the process of developing the demand side methodology. The
methodology differs from Pudney et al. (2006) in two substantive ways. Firstly, this
report uses a split in methodology between adult arrestees and all other groups222.
The approach for adult arrestees, described in the following section, was used for all
groups in Pudney et al. (2006). The consistent approach used by Pudney et al.
(2006) allowed the analysis to cover a broader range of outputs, including the
estimated volume of drugs consumed. However, it also meant that data on drug
spend from the Offending, Crime and Justice Survey (OCJS) could not be used
because equivalent data were not available for adult arrestees.
Secondly the OCJS was used in this report for 11 to 15 year olds instead of the
Smoking, Drinking and Drug Use Among Young People in England survey (schools
survey) used by Pudney et al. (2006). Again, this choice reflects the reduced scope
of this paper in comparison with Pudney et al. (2006). The reasons stated, in Pudney
et al. (2006), for choosing the schools survey223 suggest that it is a more appropriate
data source for estimating the number of young drug users than other, household
surveys. In using the schools survey to estimate the scale of the drugs market
Pudney et al. (2006) assumed that a juvenile who reports drug use with a particular
frequency is spending the same amount on that drug as a similar adult. Differences
in disposable income, knowledge about what they are buying and effective dose size
could cause the average juvenile spend to be much lower. As the OCJS provides the
amount spent on drugs within the last four weeks for juveniles, no such assumptions
about patterns of drug use, drug purity and price within the juveniles‟ drugs market
are required.
Methodology
The approach used for this report considers the amount spent on illicit drugs
separately for adults arrested in the last year and all other groups. These estimates
are then combined to provide a total estimate of the scale of the illicit drugs market
as defined at the beginning of this report. Separate methodologies for these two
groups were required because of the differences in the data available in the two main
surveys.

222 „Other groups‟ are those covered by the OCJS data including adult non-arrestees, juvenile
arrestees, and juvenile non-arrestees.
223 These reasons and the difficulties in determining which data source is most appropriate are set out
in “The 2003 SS and 2003 OCJS” on page 60 of Measuring Different Aspect of Problem Drug use
(Singleton et al., 2006).

106

Main surveys
The principal data sources for this paper are the OCJS and the Arrestee Survey.
These two surveys were used together for the main part of this analysis because
they complement each other. The OCJS was a nationally representative, self-
reported offending survey that, in 2003, asked 10,000 people aged ten and over, and
resident in households in England and Wales about their attitudes towards and
experiences of offending. The survey also covered potential risk factors including
drug and alcohol use. The Arrestee Survey, which took place between 2003 and
2006, was a nationally representative survey of drugs and crime among the
population of individuals aged 17 and over representing arrest events in England and
Wales.
On its own, the OCJS (if scaled up to the entire population) would underestimate the
scale of the drugs market. While it provides an effective measure of more commonly
used drugs, those drug users who cause the most harm to themselves and society
are unlikely to be involved in a household survey, due to their chaotic lifestyles. If
scaled up to the entire population the Arrestee Survey, by itself, would overestimate
the scale of the drugs market because drug users are more likely to be arrested than
the population as a whole. Combining the two surveys provides a more accurate
picture of the true scale of the drugs market. However, using these data sources
does introduce the possibility that the most harmful drug users who have not been
arrested in the previous year may be under-represented.224 As such, estimates of
the scale of the drugs market presented in this paper could underestimate the true
scale of the illicit drugs market. There is no evidence to suggest how significant this
under-representation might be.
Adults arrested in the previous year were removed from the OCJS dataset in order to
ensure that there was no overlap between the two surveys, as this could lead to
double counting. ,
Step-by-step methodology
Separate estimates of the scale of the illicit drugs market were calculated for adult
arrestees and non-arrestees (whether adult or juvenile). This is because of the
different data available in each of the two surveys.
Non-arrestee group
The estimate for the non-arrestee group uses a direct approach as data are provided
on the amount of money spent purchasing each type of drug in the last four weeks.
This was then converted into annual expenditure by dividing by 28 to get the average
daily spend and then multiplying by 365 to obtain the annual expenditure. An outline

224 This is because the most harmful drug users are unlikely to be captured by the OCJS due to their
chaotic lifestyles. But if they have not been arrested within the last 12 months then they will not be
captured by the Arrestee Survey either.

107

of this methodology is provided in Appendix 2 of this report. This approach assumes
that drug consumption in the last four weeks is representative of drug use over the
course of the year. As these data come from a random household survey and not
following a trigger event, such as an arrest225, this is considered a fair assumption. It
does not, however, allow for the possibility of reduced consumption following
death226.
Arrestee group
The Arrestee Survey data does not include the same information on drug expenditure
so the conversion from survey responses to annual spend is more complex. The
approach for the adult arrestee group is based on the established approach227 of
using the Arrestee Survey to estimate the number of drug users and the average
number of days on which they consume drugs each year. This is combined with
arrest statistics, average consumption per day of use and average street price to
produce the annual spend for this group. A flowchart illustrating this approach is
included in Appendix 1 of this report.
The first step was to convert the survey responses for frequency of drug use into an
estimated number of days of drug use per year. This was done separately for each
respondent and each drug using the values in Table A2.1.
Table A2.1 Conversion of Arrestee Survey responses into days of drug use per
year
Frequency of drug use
(survey response)
Date last used drug
(survey response)
Days of use per year
(assumed value)
5 or more days a week
Any
277
3 or 4 days a week
Any
182
1 or 2 days a week
Any
80
A few times a year
Any
5
Less often than once a year
Within the last year
1
Less often than once a year
More than a year ago
0
Less often than once a year
unknown
0.5
Source: Arrestee Survey data.

225 Following a trigger event it is possible that the expenditure on drugs in the preceding four weeks is
not constant and could be different to the rest of the year. Using the OCJS, which is a household
survey, should cancel out any changes in drug use throughout the year.
226 Whether the death is drug related or not. As a result, this approach may overestimate consumption
for drugs that have a material effect on mortality rates. Alternatively, it may lead to an underestimate if
consumption increases in the period before death.
227 As used by Pudney et al. (2006).

108

The second step is to convert the number of days use into spend. This involves
multiplying by both an estimate of the number of units consumed per day of use and
the price per unit. The units per day‟s use are based on the Pudney et al. (2006)
estimates for intensive users and are presented in Table A2.2. No attempt has been
made to update these and using recent evidence would be less applicable to
consumption in the survey years. The consumption of the arrestee drug user
population is assumed to mirror that of intensive users228, regardless of how
frequently they consume a particular drug. Around two-thirds of Arrestee Survey
respondents who used drugs used at least one drug three or more days each
week229.
Price data were sourced from the United Kingdom Drug Situation Report 2008 (Eaton
et al., 2008) and averaged across the three main years of the Arrestee Survey.
These price data were used for their compatibility with the Arrestee Survey. While
more recent price data are available, the 2008 Drug Situation Report (Eaton et al.,
2008) provides data consistent with the Arrestee Survey years. All cannabis use is
treated as cannabis herb as this is the most common form and not all data sources
distinguished between different types.
Table A2.2 Drug usage estimates and price data for Arrestee Survey years
Drug
Units
Units per day’s
use
Mean Price
2003/04/05
Cannabis
Herb
Grams
1.20
£2.57
Amphetamines
Grams
1.00
£9.00
Ecstasy
Tabs
2.00
£4.33
LSD and magic
mushrooms
LSD tabs
1.00a
£3.00
Powder cocaine
Grams
0.80
£51.67
Crack cocaine
Grams
0.70
£93.33
Heroin
Grams
0.48
£57.00
Source: Pudney et al. (2006).
Notes:
a)
These drugs were outside the scope of earlier work. A single dose per day appears reasonable as the primary effects last
for six to eight hours. Source: US National Highway Traffic Safety Administration (2011).

228 See definition in Pudney et al. (2006).
229 A total weight of 4,889 out of 7,560.

109

Scaling to England and Wales
Data taken from the surveys used need to be scaled up to England and Wales in an
appropriate manner. As with the methodology for the previous section, the approach
for scaling to England and Wales is different for the two groups considered.
Non-arrestee group
The OCJS is a household survey, making the results more representative of the
general population. As with other household surveys, the response levels were
higher for juveniles than adults and higher for women than men. To overcome this
bias, individuals not arrested in the last year were split into four age and gender
based groups, with a fifth group for 10 to16 year olds arrested in the last year.
Results for the four age and gender groups were scaled to equivalent England and
Wales levels using ONS population statistics for mid-2004, with deductions made to
avoid double counting arrestees. The fifth group was scaled to England and Wales
using arrest statistics.230
Arrestee group
Interviewees for the Arrestee Survey were selected at random from those aged 17
and over in custody suites. This means that individuals who were arrested multiple
times during the survey year were more likely to be included in the survey than those
with a single arrest. In order to produce results that are representative of everyone
arrested, some responses for individuals with multiple arrests could be discarded at
random. However, that approach loses information. These estimates are based on
the standard alternative of weighting individual responses to achieve a similar
outcome.231 Once weighted, the results were scaled to the whole of England and
Wales using arrest statistics for 2004/05232, converted into an estimate of unique
arrestees using data from the Arrestee Survey.
This methodology provides estimates for the scale of the illicit drugs market in
England and Wales in 2004 for eight illicit drug types. As Table A2.3 shows, the scale
of the illicit drugs market in 2004 is estimated to be approximately £3.6 billion. These
estimates highlight the impact of the methodological changes applied in comparison
to Pudney et al. (2006).

230 For more information on this process see Annex 3 to the report Understanding Organised Crime:
Estimating the scale and the social and economic costs.
231 For more information see Annex 3 to the report Understanding Organised Crime: Estimating the
scale and the social and economic costs.
232 Sourced from „Arrests for Recorded Crime (Notifiable Offences) and the Operation of Certain Police
Powers under PACE‟ table AB.

110

Table A2.3 Estimated scale of the drugs market, 2004, England and Wales
Drug
Arrestee
Groups
Other Groups
Total
Cannabis
£322m
£1,109m
£1,431m
Amphetamines, ecstasy,
LSD & magic mushrooms
£83m
£229m
£312m
Powder cocaine
£243m
£327m
£570m
Crack cocaine & heroin
£1,104m
£153m
£1,257m
Total
£1,752m
£1,818m
£3,570m
Source: Offending, Crime and Justice Survey data; Arrestee Survey data.
As Table A2.4 shows, the new estimate for 2004 is approximately £1.1 billion lower
than previous estimates (Pudney et al., 2006) for the same year. The main difference
is the reduction in the market for crack cocaine and heroin in the revised
methodology, compared with the previous estimates. Reductions are also observed
in most other drug types. The exception is in the market for cannabis where there
was an increase of £0.5 billion compared with previous estimates.
The main change in methodology was to source youth data from the OCJS instead of
the Schools Survey. This produces results for youth drug consumption which are
more consistent with official statistics on drug misuse deaths.
Table A2.4 Re-estimating scale by drug type, comparing previous and revised
estimates, 2004, England and Wales
Drug
Old Estimate
New Estimate
Change
Cannabis
£901m
£1,431m
£530m
Amphetamines,
ecstasy, LSD &
magic mushrooms
£515m
£311m
-£204m
Powder cocaine
£863m
£570m
-£293m
Crack cocaine &
heroin
£2,366m
£1,257m
-£1,109m
Total
£4,645m
£3,570m
-£1,075m

These estimates can be compared to those for 2010 (Table A2.5) to illustrate the
change in the scale of the illicit drugs market over time. It should be noted, however,
that because the underlying survey data have not been updated, this is not a wholly

111

accurate representation of the true trend. But it does indicate, based on the best data
available, that the scale of the market decreased slightly between 2004 and 2010.233

Updating estimates to 2010
The estimates have been updated to 2010 levels, accounting for changes in the drug
using population and in the purity adjusted drug price. No adjustments were made for
changes in the amount of pure drug consumed per drug user as no suitable data
sources were found. This section describes the methodology used to convert the
2004 estimate into a 2010 estimate.
“Drug Misuse Declared” (Roe, (2005); Roe et al., (2006); Smith et al., (2011)) is an
annual statistical bulletin that was produced by the Home Office, based on CSEW234
data. It includes estimates of the number of drug users in England and Wales for
each drug. As a survey of the general household population, the CSEW provides an
effective measure of more commonly used drugs. However, for drugs such as heroin
and crack cocaine the CSEW is likely to underestimate use. This is because
individuals with chaotic lifestyles are less likely to participate in household surveys.
Despite this, the CSEW does give a good indication of relative changes over time
and these are used to update the 2004 market size estimates for changes in the size
of the drug using population. Scaling factors were calculated using the number of
users in 2010 divided by the number of users in the survey year(s).235 The scaling
factors for each drug type can be found in Table A2.5.
Table A2.5 also includes scaling factors for changes in purity adjusted street price.
These were calculated to account for changes in the purity adjusted street price of
each drug between the survey years and 2010. They are based on data from United
Kingdom Drug Situation reports 2008 (Eaton et al., 2008) and 2011 (Davies et al.,
2011). Purity data were not available for cannabis, LSD or magic mushrooms. Purity
for these drugs was treated as constant over the period.
Both the user and price scaling factors are applied to the 2004 estimates in order to
calculate the 2010 estimates presented in Table A2.6.

233 The number of opiate and crack users has also decreased over the same period (as measured by
estimates from the National Treatment Agency).
234 Formerly the British Crime Survey; the name has been changed to better reflect the survey‟s
geographical coverage.
235 The scaling factors were calculated using an average of the survey years 2003/04, 2004/05 and
2005/06.

112

Table A2.5 Scaling factors used to produce 2010 estimates from 2004
estimates
Drug
Users scaling factor
Price scaling factor

Adult
Arrestees
OCJS
Groups236
Adult
Arrestees
OCJS
Groups
Amphetamines
0.75
0.69
1.38
1.50
Cannabis
0.73
0.66
1.10
1.11
Ecstasy
0.81
0.74
0.78
0.66
LSD & Magic
Mushrooms
0.57
0.66
1.00
1.00
Powder Cocaine
0.96
0.92
1.48
1.56
Crack Cocaine
0.96a
0.94
1.14
1.18
Heroin
0.85
0.79
0.90
0.68
Notes:
a)
The average number of crack cocaine users in the Arrestee Survey years was based on 2003/04 data and 2005/06 data
only. The 2004/05 estimate is much lower and further investigation suggested this is more likely to be a data issue than a
temporary change. Including 2004/05 data would produce a value of 1.11.
Because the underlying survey data remains the same for both the 2004 and the
2010 estimates of scale, this approach to scaling involves two implicit assumptions.
The first is that the quantity of pure drug used per drug user remains constant
between the survey years and 2010. The second is that changes in the number of
drug users inclined to participate in household surveys (such as the CSEW) are
assumed to reflect changes in the overall number of drug users. The potential impact
of these assumptions is considered later in this paper.
Results
The scale of the England and Wales illicit drugs market in 2010 is estimated to be
£3.3 billion. Cannabis is the largest single contributor, at just over £1 billion, with the
combined category of crack cocaine and heroin adding a further £1.2 billion, and
powder cocaine a further £0.8 billion. These results are presented in Table A2.6.
The illicit drugs market is split between consumers arrested within the last year237
and all other consumers for all drug types considered. Overall, arrestees account for
52 per cent of consumption while other consumers account for 48 per cent of

236 Adult non-arrestees, juvenile arrestees, and juvenile non-arrestees.
237 This includes consumers arrested for any offence within the last year, not just a drugs offence.
Results from the Arrestee Survey have been weighted to ensure that those who have been arrested
more often are not over-sampled.

113

consumption.238 The split is less even for individual drugs. For instance, 90 per cent
of crack cocaine and heroin is consumed by individuals arrested within the last year
while this group only account for around 23 per cent of cannabis consumption.
Table A2.6 Estimates for scale of the illicit drugs supply, 2010, England and
Wales
Drug
Arrestee groups Other groups
Total
Split
Cannabis
£246m
£813m
£1,059m
23%:77%
Amphetamines,
ecstasy, LSD and
magic mushrooms
£66m
£177m
£243m
27%:73%
Powder cocaine
£345m
£469m
£814m
42%:58%
Crack cocaine
and heroin
£1,060m
£112m
£1,172m
90%:10%
Total
£1,717m
£1,571
£3,288m
52%:48%
Note: The proportion of consumption associated with arrestee groups is not the same as the proportion of
consumers who are arrested. The latter is likely to be much smaller than the former because high consumption of
a particular drug type is correlated with high likelihood of arrest.
Revised estimates for 2004 show a similar pattern and a comparison is included in
the preceding section. Estimates of the split between consumers arrested within the
last year and all other consumers have not been provided for these 2004 revised
estimates. This is because the methodology is not suitable for estimating how the
split between the two groups has changed over time.
The estimated size of the drugs market in England and Wales for 2010 is £3.3 billion,
a decrease of £0.3 billion since 2004 (Table A2.7). In reality, the fall could be much
larger as these figures are reported in the street prices of the year for which they
were estimated. As the methodology used in this report is not suitable for estimating
trends in the drug market over time real terms changes have not been calculated.
The largest contributor to the change over time is cannabis with a reduction of £0.4
billion, driven by a fall in the number of users239. This is partially offset by an increase

238 It is important to note that this does not mean that 52 per cent of drug users have been arrested. It
only refers to the proportion of total consumption that is accounted for by those who have been
arrested within the last year. In 2010, persons arrested made up approximately 2.8 per cent of the
general population aged over 10 years.
239 This can be seen in the scaling factors reported in Table A2.5.

114

of £0.2 billion for powder cocaine, where although the number of users has declined
the purity adjusted price240 has increased.
Table A2.7 Estimated change in scale by drug type, comparing revised
estimates for 2004 and 2010, England and Wales
Drug
2004
2010
Change
Cannabis
£1,431m
£1,059m
-£372m
Amphetamines,
ecstasy, LSD and
magic mushrooms
£311m
£243m
-£69m
Powder cocaine
£570m
£814m
£244m
Crack cocaine
and heroin
£1,257m
£1,172m
-£85m
Total
£3,570m
£3,288m
-£282m
Level of uncertainty
Given the illegal and hidden nature of the market for illicit drugs, there are a number
of uncertainties inherent in estimations of its scale. This section explores the
uncertainties inherent in the estimates presented in this report in comparison to those
inherent in previous estimates.
The previous estimate for the scale of the drugs supply in England and Wales,
published in Pudney et al. (2006), was between £3.5 billion and £5.8 billion. The size
of this range reflected uncertainties around how to convert survey responses for
frequency of drug use into amount spent. Uncertainty around the level of drug use
amongst 11 to 15 year olds and the most appropriate data source was also identified
but was not quantified at the time.
This report helps to quantify the potential impact of the choice of youth data source
as this is the main change in methodology compared with Pudney et al. (2006). The
comparison of results included in Table A2.4 shows that the updated estimate is
around £1 billion lower as a result of this choice. This implies a high degree of
sensitivity to the choice of source data. On balance the use of the OCJS instead of
the schools survey in this report is thought to be more appropriate. Therefore the
estimate based on this approach is considered to be more accurate.

240 This is a simple way of uprating both the price and average consumption elements of expenditure.
Effectively, prices are uprated by gross street price (including cutting agents) while average
consumption is uprated by purity.

115

The overall level of uncertainty around the results presented in this report includes
some of the uncertainty present in Pudney et al.‟s methodology. This is generated
from the conversion of data for the adult arrestee group to drug market size and from
sampling error for the other groups. This means that there is a risk that the overall
scale of the drugs supply in England and Wales is around £1 billion lower or £1 billion
higher than the results stated in this report. In addition use of OCJS data in place of
the schools survey is associated with an „upside‟ risk of around £1 billion because
estimates of drug use in the schools survey are generally higher than equivalent
estimates in the OCJS. However the use of the OCJS is considered to be preferable,
as explained earlier in this paper. There is the additional risk that the use of the
OCJS and Arrestee Survey could lead to the under-representation of those drug
users who cause the most harm to themselves and society but who had not been
arrested within the last year. This increases the likelihood of underestimation, but
insufficient information exists on the size and consumption characteristics of this
missing population on which to base an estimate of the scale of potential
underestimation. These estimates are based on the best available data; however, it
is possible that future work, using other data sources could identify this missing
population.
Because the level of uncertainty around youth results is particularly high, separate
results for youths are not included in this report. In addition, some drug types have
been combined in order to reduce the impact of sampling error. Amphetamines,
ecstasy, LSD and magic mushrooms were combined because drugs with the fewest
users are the most vulnerable to this risk. Crack cocaine and heroin were combined
because of their low number of non-arrestee users. This should ensure that the
results presented are as robust as possible given the uncertainties inherent in the
data described in previous sections.
As well as the uncertainties with the choice of data sources, there are additional
uncertainties from scaling of revised estimates for 2004 to 2010. As the survey data
have not been updated for the scaled up estimates for 2010, a number of implicit
assumptions have been made. Estimates were scaled to account for relative
changes in the number of drug users as well as changes in purity-adjusted price.
This requires two key assumptions; firstly that the amount of pure drug used per drug
user remains constant over time, and secondly, that changes in the number of drug
users inclined to participate in household surveys are assumed to reflect changes in
the overall number of drug users. If these two assumptions are not true then there
are additional risks of uncertainty in these estimates.
As Tables A2.4 and A2.7 show, the changes to the methodology have a relatively
large impact on the estimates compared to the changes over time. This reflects the
data limitations in this area. As a result, caution needs to be shown when interpreting
these findings due to the age of the data and the assumptions that are required in
order to scale estimates from 2004 to 2010. The underlying data have not been

116

updated so these estimates cannot give a full indication of the changes to the scale
of the illicit drugs market over time.

117

References

Ayres M. and Murray L, (2005) Arrests for Recorded Crime (Notifiable Offences)
and the Operation of Certain Police Powers under PACE. Home Office Statistical
Bulletin 21/05. London: Home Office. Available at:
Accessed April 2012.
Bramley-Harker, E. (2001) Sizing the UK Market for Illicit Drugs. RDS Occasional
Paper no. 74. London: Home Office. Available at:
Accessed May 2012.
Department of Health/North West Public Health Observatory (2008 and 2011)
United Kingdom drug situation: annual report to the European Monitoring Centre for
Drugs and Drug Addiction (EMCDDA). 2008 and 2011. London: Department of
Health. Available at: Accessed
March 2012.
NHS (2011) Lifestyles Statistics: Statistics on Drug Misuse: England 2011. NHS
Information Centre. Available at:
Accessed August 2012.
ONS (2011) „Deaths related to drug poisoning in England and Wales‟, 2010
Statistical Bulletin. Newport: Office for National Statistics. Available at:

Workbook tables. Available at:
Accessed July 2012.
Pudney, S., Badillo, C., Bryan, M., Burton, J., Conti, G. and Iacovou, M. (2006)
„Estimating the size of the UK illicit drug market‟. In Measuring different aspects of
problem drug use: methodological developments, Singleton, N., Murray, R. and
Tinsley, L. (eds). Home Office Online Report 16/06. London: Home Office. Available
at: Accessed April 2012.

118

Roe, S. (2005) Drug Misuse Declared: Findings from the British Crime Survey. Home
Office Statistical Bulletin 16/05. London: Home Office. Available at:
Accessed April 2012.
Roe, S., and Man, L. (2006) Drug Misuse Declared: Findings from the British Crime
Survey. Home Office Statistical Bulletin 15/06. London: Home Office. Available at:
Accessed April 2012.
Smith, K. and Flatley, J. (2011) Drug Misuse Declared: Findings from the British
Crime Survey. Home Office Statistical Bulletin HOSB 12/11. London: Home Office.
Available at:
Accessed May 2012.
US National Highway Traffic Safety Administration (2011) Drug and Human
Performance Factsheet (LSD). Available at:
Accessed
September 2012.

119

Appendix 1: Calculation flowchart for adult arrestees
The flowchart below shows the steps involved in calculating the annual drugs spend by those
aged 17 and over for a single drug. The calculation was performed separately for
amphetamines, cannabis, crack cocaine, ecstasy, heroin, and powder cocaine. LSD and
magic mushrooms were combined into a single group.

Legend
Input
Interim Calculation
Output
Arrestee Survey
Data 2003/4/5
Age 17+
Estimate of days
using per year
based on usage
frequency
Days of drug
use per arrestee
over last year
Intensive
consumption
units per day
Average Street
price across
survey years
Spend per day
of drug use in
survey years
Annual spend
on drug use per
arrestee aged
17+ in 2004
Number of
unique
arrestees per
arrest
Arrests in
2004/05
Age 17+
Number of
unique
arrestees in
2004/05
Annual spend
on drug use by
arrestees aged
17+ in 2004
Number of drug
users in
2003/4/5
Number of drug
users in 2010/11
Scaling factor
for change in
number of drug
users
Price and Purity
data for 2003/4/5
Price and Purity
data for 2010
Scaling factor
for change in
purity adjusted
price
Annual spend
on drug use by
arrestees aged
17+ in 2010
Used in OCJS
methodology

120

Appendix 2: Calculation flowchart for all other groups
The flowchart below shows the steps involved in calculating the annual drugs spend for one
of five population groups and a single drug. The population groups used were under 17s
arrested within the last year, other 10 to 17 year old males, other 10 to 17 year old females,
adult males not arrested in the last year and adult females not arrested within the last year.
The calculation was performed separately for amphetamines, cannabis, crack cocaine,
ecstasy, heroin, and powder cocaine. LSD and magic mushrooms were combined into a
single group.

Legend
Input
Interim Calculation
Output
OCJS Survey
Data 2003
Drug spend in
last four weeks
per person in
each group
ONS Population
statistics for
mid 2004
Number of
unique
arrestees in
2004/05
Population
estimate for
each group
Annual Drug
spend without
arrestees aged
17+ for 2004
Average number
of drug users in
2003/04
Number of drug
users in
2010/11
Scaling factor
for change in
number of drug
users
Price and Purity
data for 2003
Price and Purity
data for 2010
Scaling factor
for change in
purity adjusted
price
Annual Drug
spend without
arrestees aged
17+ for 2010

121

Annex 3: Measuring the costs of drug-
related crime
Stephen Roe and Ian Vincent
Introduction
The illegal and hidden nature of both drug use and crime makes estimating the scale
and costs of drug-related crime challenging. Previous attempts have used data on
drug users in treatment or in contact with the criminal justice system (CJS) to
estimate the costs of drug-related crime. This report outlines an alternative
methodology which builds on previous work but incorporates more recent data on a
wider range of drug users.
Objectives
This work was commissioned under the organised crime strategy, so while it is
separate from “Understanding Organised Crime: estimating the scale and the social
and economic costs”, it was designed to fill a key gap in that work. As such,
decisions have been made about the scope of this work with the organised crime
strategy in mind. This is particularly relevant when it comes to the type of drug use
and drug-related crime considered in this report.
Key findings
The key findings of this report are:
 the estimated costs of drug-related crime in England and Wales range from
£5.3 billion to £6.6 billion (Table A3.1);
 the proportion of acquisitive crime (excluding fraud)241 that is drug-related
ranges from 44 per cent to 48 per cent. (Table A3.2);
 burglary (including burglaries both in a dwelling and in other buildings)
accounts for the largest share of the costs of drug-related crime;
 the cost of enforcing drug offences in England and Wales is estimated to be
£1.0 billion, with £0.4 billion due to the costs of policing drug offences and
£0.6 billion due to the further CJS costs. (Table A3.3).
Definition
Drug-related crime can encapsulate a range of crime types, depending on the
definition used. There are a range of different crime categories that can be
considered as drug-related (EMCDDA, 2007):

241 Fraud was excluded from the total proportion as the drug-related fraud proportion was calculated in
a different way – see Notes to Table A3.2.

122

1. Psychopharmacological crimes: violent crimes committed under the influence of
psychoactive substances.
2. Economic compulsive crimes: acquisitive crimes committed to obtain money (or
drugs) to support drug use.
3. Systemic crimes: violent offences committed to enforce or regulate the business
of illicit drug markets.
4. Drug-law offences: drug possession and supply offences committed against drug
legislation.
This estimate of the costs of drug-related crime focuses on economic compulsive
crimes and drug-law offences because evidence, such as published Arrestee Survey
data (Boreham et al., 2006; 2007), allows us to substantiate and quantify the link
between these types of crime and drug use. There is insufficient evidence to enable
us to do the same for psychopharmacological or systemic crimes242
Previous work
The first attempt to quantify the economic and social costs of Class A drug use was
made by Godfrey et al. (2002). The basic methodology used was to distinguish types
of drug user (younger recreational, older regular and problem users), estimate their
prevalence and quantify the consequences associated with each type of drug user.
Due to the lack of any evidence to suggest a connection between younger non-
regular Class A drug users or older regular Class A drug users and acquisitive crime,
drug-related acquisitive crime was considered to be a consequence specifically
relating to the dependent Class A drug users group (defined as those whose drug
use is not controlled or recreational but has become an essential element of their
life). Other Class A drug user groups only contributed to the costs of drug-related
crime in terms of costs of arrest for possession or supply.
In Godfrey et al.‟s paper, the costs of drug-related acquisitive crime were estimated
based on data from the National Treatment Outcomes Research Study (NTORS), a
study of the effectiveness of drug treatment between 1995 and 2000. These data
included both drug users‟ contact with the CJS, from which the CJS costs of drug-
related crime could be estimated, as well as their self-reported offending, from which
the victim costs of drug-related crime could be estimated. The data also allowed
differences between problem drug users in and out of treatment to be accounted for.
The rates of CJS contact and self-reported offending per problem drug user in or out
of treatment were scaled up using estimates of the prevalence of problem drug users

242 There are limited data available on the number of homicides that the police believe are drug-related
and therefore could be systemic crimes. These data are not considered robust enough to be included
in this report. It should also be noted that these data would only reflect the most serious violence
potentially linked to the operation of the drugs market.

123

(estimated through modelling techniques involving extrapolation from treatment
data). This gave an estimate of the volume of CJS contacts and offences. These
volumes were applied to the CJS and victim unit costs of crime data (Brand and
Price, 2000) to give a total cost estimate.
This method resulted in an overall estimate of £10.6 billion (£2.4 billion CJS costs
and £8.2 billion victim costs) for the economic and social costs of crime by problem
Class A drug users in 2000.
Using the same basic approach, the costs of drug-related crime were updated with
improved data sources and methodology by Gordon et al. (2006). Further analysis of
NTORS data provided a breakdown of the offence types committed by problematic
drug users (and those for which they had contact with the CJS). This information was
then applied to improved estimates of the prevalence of problematic drug users
(defined here as users of opiates and/or crack cocaine) and updated unit costs of
crime estimates (Dubourg et al., 2005).
This updated method produced an estimate of £13.9 billion costs (£4.0 billion CJS
costs and £9.8 billion victim costs) of drug-related crime in 2003/04, 90 per cent of
the overall costs of Class A drug use. Due to the methodological developments
between the estimates, the updated costs of drug-related crime for 2003/04 were not
regarded as comparable to the previous estimates for 2000.
In addition, an alternative estimate of the costs of drug-related crime was produced
as part of the Strategy Unit Drugs Report (Strategy Unit, 2003). This estimate used
data from a survey of arrestees (NEW-ADAM) conducted between 1999 and 2002 to
calculate the number of offences (including violent, sexual, criminal damage, traffic
and other offences, in addition to acquisitive crime) committed by drug users and
non-drug users, which were then applied to the Brand and Price (2000) costs of
crime figures. This analysis produced an estimate of £19 billion for the costs of drug-
related crime (Strategy Unit, 2003).
Separately, the proportion of acquisitive crime types that are drug related have been
estimated from surveys of arrestees in custody suites in order to create the Drug
Harm Index (MacDonald et al., 2005). The NEW-ADAM and Arrestee Survey were
used to estimate these proportions by dividing the number of arrests for an
acquisitive crime for which the arrestee reported use of heroin, crack or powder
cocaine in the past 30 days/4 weeks by the total number of arrests for that offence
type. These proportions were then applied to estimates of the total volume of crimes
for the relevant offence category. Total volumes were derived from the British Crime
Survey (BCS) for acquisitive crimes against individuals and households. For other
crime types not covered by the BCS, the total volume of crimes was estimated using
police recorded crime volumes divided by reporting rates243 or, for shoplifting, an

243 Reporting rates were derived from the Commercial Victimisation Survey or estimated as in Brand
and Price, 2000.

124

estimate based on the combination of two self-reported offending surveys: the
Offending, Crime and Justice Survey (OCJS) and Arrestee Survey. The volumes of
drug-related crimes for each acquisitive offence category were then applied to the
unit costs of crime (Brand and Price, 2000). No specific estimate was given for the
costs of drug-related crime in this analysis; the different costs were amalgamated to
form the Drug Harm Index. However, the proportion of acquisitive crime that was
drug-related (based on the NEW-ADAM and Arrestee Survey data) was shown to
rise from about one-third in 1999 to just under one-half in 2004 (although the trend
between these two points was highly erratic).
Methodology
The approach taken here was to build on previous work in order to estimate the
proportion of each acquisitive crime type that is drug-related and then apply these
proportions to a total cost of crime estimate for each acquisitive crime type. The
proportions were derived using two self-reported offending surveys: the OCJS and
the Arrestee Survey. This is a significant improvement on previous estimates of
drug-related crime which rely on extrapolating from one cohort of drug users to the
entire drug using population.244
Survey data
The two surveys were used in conjunction as part of the analysis because they
complement each other. The OCJS was a nationally representative, self-reported
offending survey that in 2003 asked 10,000 people aged 10 and over, resident in
households in England and Wales, about their attitudes towards, and experiences of,
offending. The Arrestee Survey, which took place between 2003 and 2006, was a
nationally representative survey of drug use and crime of arrest events of individuals
aged 17 and over in England and Wales.
On its own, the OCJS (if extrapolated to the entire drug using population) would
underestimate the proportion of acquisitive crime that is drug related, due to the
absence of the most problematic drug users who commit a high volume of offences,
who are unlikely to be involved in a household survey due to their chaotic lifestyle.
Similarly, if extrapolated to the entire drug using population the Arrestee Survey, by
itself, would overestimate the proportion of acquisitive crime that is drug-related
because the large number of non-dependent drug users who offend infrequently are
less likely to have been arrested. Adults arrested in the previous year were removed
from the OCJS dataset in order to ensure that there was no overlap between the two
surveys, as this could lead to double-counting.
This approach has advantages over previous methods of calculating the costs and
proportions of drug-related crime as it includes a broader range of drug-using

244 In many cases this relied on extrapolating from either a treatment seeking cohort or an arrestee
cohort to the entire drug using population, thereby ignoring any drug users who manage their habit
without resorting to crime or treatment.

125

offenders. The previous estimates of the costs of drug-related crime were based on
the self-reported offending rates of only those drug users in treatment (from NTORS)
and may not be representative of all drug-using offenders. The use of the Arrestee
Survey and the OCJS broadens out the sample of drug-using offenders beyond
those in contact with treatment services.
A weakness of the approach is that, while adult arrestees were covered in the
Arrestee Survey, data on juvenile arrestees were only available from the OCJS.
Juvenile arrestees may not be well represented in the OCJS due to the fact that
household surveys are unlikely to include those prolific offenders and/or frequent
drug users with chaotic lifestyles. Also, using these surveys introduces the possibility
that offending drug users who have not been arrested may be under-represented.245
As such, estimates of drug-related crime presented in this paper could underestimate
the true scale of the illicit drugs market. There is no evidence to suggest how
significant this under-representation might be.
Data in each survey were collected in a similar fashion, further supporting the view
that they are compatible. Both surveys used Computer-Assisted Personal
Interviewing (where the interviewer reads the questions from a laptop and enters the
respondent‟s answers), complemented with Computer-Assisted Self-Interviewing
(where the respondent reads the questions themselves on a laptop and enters their
own answers) for the more sensitive questions surrounding offending and drug use.
Both surveys asked questions regarding prevalence and volume of offending in
relation to the main acquisitive crime types and for which separate costs of crime
estimates were available:
 theft of a vehicle and, separately, theft from a vehicle (excluding attempts)246;
 burglary (separately for in a dwelling and in a building other than a dwelling);
 robbery (separate estimates for personal and commercial robbery);
 theft from the person;
 theft from a shop; and
 other theft.
Fraud comprised a substantial part of the estimate of costs of drug-related crime in
2003/04 (£4.9 billion out of £13.9 billion). While the key questions on the volume of
credit and benefit fraud were asked in the Arrestee Survey, only questions on the
prevalence of fraud were asked in the OCJS. In order to incorporate fraud into the
estimate of drug-related crime, the questions from the Arrestee Survey were used to

245 The Arrestee Survey will not include offending drug-users who have not been arrested and this
group may be unlikely to respond to a household survey such as the OCJS. However, using three
years‟ worth of Arrestee Survey data (rather than a single year) helps to minimise this possibility by
extending the period in which offenders might be arrested.
246 The OCJS asked separately about attempted thefts but attempts are not covered in the Arrestee
Survey so attempted vehicle thefts are not included in the calculations.

126

calculate the proportions of benefit and credit fraud that are drug-related. These
proportions were then adjusted to reflect the effect that the inclusion of OCJS data
had on the drug-related proportions for other acquisitive crime types.247 Overall, the
acquisitive crime types covered in this estimate of the costs of drug-related crime
comprised a broader range compared with the previous estimate (Godfrey et al.,
2006).248
Questions on prevalence and frequency of use of a range of drugs were also asked
in each survey. The challenge here was to identify a group of drug users whose level
of drug use was sufficient to reasonably assume that any acquisitive offences they
committed were driven by the need to fund their consumption of drugs. The
possibility of establishing a counterfactual (the volume of offending that would have
occurred in the absence of drug use) was considered but ultimately ruled out due to
the lack of appropriate data. Instead, a tight definition of drug-related offending was
used in order to mitigate for the fact that some offending by regular drug users would
be likely to occur anyway, in the absence of drugs.
Previous estimates of problematic drug users (Hay et al., 2006) had focused on
users of heroin and/or crack cocaine and that focus was retained in this analysis.
Other definitions including use of powder cocaine and variations in the frequency of
use of these drugs were also considered, leading to the following range of
possibilities:
 use of heroin or crack cocaine at least once a week in the past year;
 use of heroin or crack cocaine more than twice a week in the past year;
 use of heroin or crack or powder cocaine at least once a week in the past
year;
 use of heroin or crack or powder cocaine more than twice a week in the past
year.
Weighting systems were used to ensure that samples were representative of the
underlying population. Weights to compensate for greater non-response amongst
certain groups work by dividing the population into a series of categories. Results for
each category are scaled up or down to compensate for the sample containing a
disproportionately low or high number of respondents in each group. For the OCJS
analysis, a basic non-response weighting system was used to ensure that there were
representative proportions of males, females, juveniles and adults in the sample. For

247 For all other crime types, the inclusion of data from the OCJS reduces the drug-related proportions
estimated using data from the Arrestee Survey. This is due to the fact that those falling within the
definitions of this paper are more likely to be captured by the Arrestee Survey than the OCJS. The
average effect of the inclusion of OCJS data is used here in the absence of data on the volume of
benefit and credit fraud in the OCJS. This may not be accurate but reflects the best evidence
available.
248 The 2003/04 estimate of the costs of drug-related crime included fraud, shoplifting, robbery and
burglary while this estimate includes those crime types as well as vehicle theft, theft from the person
and other theft.

127

the Arrestee Survey analysis, the responses were weighted by the inverse of the
number of arrests the offender had previously experienced. This helps compensate
for non-equal probabilities of selection arising from the fact that some offenders are
more likely to be arrested than others and would therefore be more likely to be
selected in the survey.
Step-by-step methodology
The precise steps taken in order to create the estimate of costs of drug-related crime
were:
1. To create variables relating to the volume of offences in each acquisitive crime
category (as shown above) in both the Arrestee Survey and OCJS datasets.

2. To create variables identifying drug users (using the range of definitions outlined
above) in both the Arrestee Survey and OCJS datasets.

3. To create weights for each survey (as described above).

4. To produce rates of offending by drug users and non-drug users for each survey
by summing the volume of weighted offences for each group and dividing by the
weighted sample size of the relevant group.

5. To scale up the volume of offences committed by the relevant groups from each
survey by multiplying by the number of adult arrestees249 in England and Wales
during 2004/05 for the Arrestee Survey and 2004 mid-year population estimates
for England and Wales for the OCJS.250

6. Adding the results from each survey together in order to calculate the proportions
of each acquisitive crime type committed by drug users.

7. Applying those proportions to the total costs of crime for 2010/11.
Costs of crime
Total costs of crime figures were based on the previous methodology (Brand and
Price, 2000; Dubourg et al., 2005), which include costs incurred in anticipation of, as
a consequence of, and in response to crime. The costs were updated (Home Office,

249 National statistics on arrests in 2004/05 were divided by the number of arrests in the previous year
per arrestee (derived from the Arrestee Survey) to calculate the number of arrestees in 2004/05.
250 The juvenile arrestees from the OCJS were separated out as part of the analysis and scaled up by
the volume of juvenile arrests in 2004/05 in the same way as the Arrestee Survey analysis was
conducted.

128

2011) to take account of inflation. Changes were also made to the multipliers used to
estimate actual crime volumes from recorded crime volumes. (ibid.)
Cost figures for fraud were taken from the Annual Fraud Indicator 2012 for the
categories of benefit fraud, plastic card fraud, cheque fraud and identity fraud, which
also relate to costs for 2010/11, although this only includes costs in terms of direct
losses to individuals and organisations (National Fraud Authority, 2012).
The cost figures for fraud from the Annual Fraud Indicator refer to Great Britain or the
United Kingdom, so these figures have been re-calculated for England And Wales
(based on the relevant share of the adult population) to ensure that all cost estimates
in this analysis refer consistently to the same geography (England and Wales).
Although the costs of crime figures used in the estimate have been updated to
2010/11, the surveys used in the estimate were conducted between 2003 and 2006
and the analysis assumes that the drug-related proportions estimated from these
surveys have remained constant since then. These estimates represent the best
available.251
Other costs
The costs of drug-law offences (drug possession and supply offences) were
calculated separately. The two main components of these costs are the costs of
policing drug offences and the further costs to the CJS of bringing these offences to
justice in terms of processing these offences through the court and administering the
sentences given. Also included are the costs that the UK Border Agency devotes to
drugs enforcement where for other enforcement agencies this breakdown was not
available. These costs are highlighted in Table A3.3.
Policing costs were estimated by applying the proportion of the police budget spent
on drug offences (including business support costs such as personnel and finance
activities), based on 2007/08 Activity Based Costing data, to the 2009/10 police
budget. This estimates the cost of police time spent tackling the demand for and
supply of illicit drugs in England and Wales. The 2010/11 police budget was not
available on a comparable basis to earlier years‟ budgets.
Further CJS costs were calculated using data on volumes of court proceedings and
sentence disposals (Ministry of Justice, 2011) multiplied by unit cost estimates.
Altogether the CJS costs include the costs of cases proceeding through the
magistrates‟ courts and Crown courts (including pre-charge decision-making by the
Crown Prosecution Service) and the costs of community and custodial sentences
(including the costs of probation supervision for those released from custodial
sentences on licence).

251 The increase in the availability of drug treatment may have reduced this proportion but there are no
data available to support this.

129

Results
The main results of the analysis described above are presented in Tables A3.1 to
A3.3 below. The analysis finds that:
 the estimated costs of drug-related crime range from £5.3 billion based on a
definition that only includes use of heroin and/or crack cocaine more than twice a
week, to £6.6 billion based on a definition of drug users that includes users of
powder cocaine, heroin and/or crack users at least once a week (Table A3.1);
 burglary (including burglaries both in a dwelling and in other buildings) accounts
for the largest share of the costs of drug-related crime. Although shoplifting
offences were very likely to be drug-related, they contribute relatively little to the
overall costs of drug-related crime due to the comparatively low total cost of
shoplifting offences. Other theft offences contribute least to the costs of drug-
related crime because these offences are least likely to be drug-related (Tables
A3.1 and A3.2);
 the cost of enforcing drug offences is estimated to be £1.0 billion, with £0.4 billion
due to the costs of policing drug offences and £0.6 billion due to the further CJS
costs. The biggest component of the CJS costs is imprisonment (£0.4 billion) on
account of the relatively long average custodial sentence length for drug offences
(Table A3.3); and
 the proportion of acquisitive crime (excluding fraud)252 that is drug-related ranges
from 44 per cent based on a definition that only includes use of heroin and/or
crack cocaine more than twice a week to 48 per cent based on a definition of drug
users that includes weekly users of powder cocaine as well as weekly heroin
and/or crack users (Table A3.2).
Comparison to previous estimates
The method used to calculate this estimate of the costs of drug-related crime is very
different from the methods used in previous estimates, so should not be seen as
comparable. Equally, changes in the various estimates over time cannot be
interpreted as a trend in the costs of drug-related crime. Nevertheless, it is clear that
this method produces a considerably lower estimate of the costs of drug-related
crime. There are a number of reasons for this, which primarily relate to
methodological improvements to the estimate.
The biggest change in costs is contained within the estimated costs of drug-related
fraud which was £4.9 billion in the 2003/04 estimate of the costs of drug-related
crime and is £0.7 billion to £0.9 billion in this estimate for 2010/11. It was
acknowledged in the paper underlying the 2003/04 estimate that cost estimates of

252 Fraud was excluded from the total proportion as the drug-related fraud proportion was calculated in
a different way – see Notes to Table A3.2.

130

fraud at the time could not be differentiated by type. The estimate of the costs of
drug-related fraud was therefore based on the estimated cost of an average fraud.
The paper acknowledged the weaknesses of that approach.
This analysis has used new estimates of the costs of specific types of fraud (benefit
fraud, credit fraud and identify fraud) and applied drug-related crime proportions for
these fraud types to produce a more robust estimate of the costs of drug-related
fraud. By limiting the fraud costs to only those specific types for which there are drug-
related proportions available, the estimate of the costs of drug-related fraud for
2010/11 is likely to be an under-estimate but provides a more robust estimate than
previously available. This is consistent with the approach taken in other work in this
area; constructing robust estimates on the basis of what is known about a particular
type of organised crime.
Further methodological differences will also have affected the size of the estimate of
the costs of drug-related crime. Previous estimates assumed that two-thirds of
current problematic drug users were not in treatment. A further assumption was that
this group would experience the consequences of Class A drug use equivalent to
those in NTORS in the 12 months before entering treatment. However, it was also
acknowledged that one-third of the „not in treatment‟ group would actually experience
fewer consequences than other problematic drug users. This was not taken into
account in cost calculations (Godfrey et al., 2002). This would have resulted in an
over-estimate of the costs of drug-related crime, especially as the level of self-
reported offending in the period prior to treatment entry (which is the level attributed
to all problematic drug users not in treatment) can be particularly high. The difficulties
involved in extrapolating from data collected on one group to other non-equivalent
groups is not such an issue in the current estimate because of the more
comprehensive coverage of the surveys used.
Irrespective of any methodological differences between this estimate and previous
estimates, the costs of drug-related crime may be expected to fall if drug-related
crimes reflect the general falls in crime over the period between 2003/04 and
2010/11. The 2003/04 estimate of the costs of drug-related crime covered the costs
of burglary, robbery and shoplifting (in addition to fraud). Police recorded crimes for
these three types of crimes have declined by around one quarter (26 per cent)
between 2003/04 and 2010/11. Due to inflationary effects on their unit costs, the total
costs of these three crime types have decreased by only eight per cent.253 If the
costs of the drug-related components of these crime types had declined in the same
way as the overall costs, then the costs of drug-related crime would be expected to
be £0.7 billion lower.

253 The comparison between 2003/04 and 2010/11 costs of crime uses the same multiplier for each
estimate so that changes to costs are limited to changes in recorded crime volumes and inflation
rather than any methodological differences.

131

The inclusion of the OCJS in the analysis was expected to lower the estimate of the
drug-related proportion of acquisitive crime due to the inclusion of lower level
offenders less likely to be frequent heroin or cocaine users. If the proportions of
acquisitive offences committed by drug users are calculated using the same
methodology as outlined in this report but only using the Arrestee Survey data, the
results show a much greater proportion of acquisitive crime to be drug-related at
around 70 per cent (compared with 44 to 48 per cent when both surveys are used).
However, the combined survey approach described in this report still produces an
estimated proportion at the top of the range of previously published estimates.254 This
is because these estimates were based on the proportion of arrests for acquisitive
crimes that were accounted for by drug users, while this new estimate is based on
the proportion of self-reported acquisitive offences committed by drug users. As
offenders will be arrested for only a small proportion of the offences they commit, the
estimated proportions of acquisitive crimes that are drug related will be higher when
based on self-reported offending than on arrest data (as shown in published Arrestee
Survey data (Boreham et al., 2006; 2007). Godfrey‟s (2006) estimate of the costs of
drug-related crime account for almost 40 per cent of the total cost of crimes against
individuals and households in 2003/04 (Dubourg et al., 2005).
Conclusion
The analysis reported above used a combination of two complementary surveys of
self-reported offending and drug use (the OCJS and the Arrestee Survey) to produce
a range of estimates of the proportion of acquisitive crime that is drug related. These
estimates were applied to the total costs of acquisitive crime. Finally, an estimate of
enforcement costs for drug offences was added to produce an overall estimate of the
costs of drug-related crime. This approach finds that 44 per cent to 48 per cent of
acquisitive crime is drug related and that the value of these crimes ranges from £5.3
billion to £6.5 billion. A further cost of £1.0 billion is estimated to result from the
enforcement of drug offences.
The methodology used represents an attempt to consider a broader range of drug
users (not just those in treatment or those in contact with the CJS) and crime types
than previous estimates. Improvements to the methodology are primarily responsible
for the considerably lower estimate in comparison to previous estimates, but falling
crime levels are also likely to have played a role.

254 In previous estimates, between one-third and one-half of acquisitive crimes were estimated to be
drug related.

132

Table A3.1 Costs of acquisitive offences by different definitions of drug users,
Arrestee Survey and Offending Crime and Justice Survey, 2010/11

Drug user definitions
Offence type
Use of
heroin or
crack
cocaine or
cocaine
powder at
least once a
week
Use of heroin
or crack
cocaine or
cocaine
powder more
than twice a
week
Use of
heroin or
crack
cocaine at
least once
a week
Use of
heroin or
crack
cocaine
more than
twice a
week
Vehicle theft
£625m
£517m
£510m
£454m
-
Theft of vehicle
£199m
£124m
£152m
£104m
-
Theft from
vehicle
£427m
£393m
£358m
£350m
Burglary
£3,114m
£2,917m
£2,677m
£2,616m
-
Burglary in a
dwelling
£1,965m
£1,861m
£1,649m
£1,613m
-
Burglary in a
building other
than a dwelling
£1,150m
£1,056m
£1,028m
£1,113m
Robbery
£965m
£822m
£699m
£681m
-
Personal
robbery
£749m
£623m
£571m
£556m
-
Commercial
robbery
£216m
£199m
£127m
£125m
Theft from the
person
£293m
£268m
£256m
£248m
Theft from a shop
£428m
£414m
£408m
£401m
Other theft
£217m
£199m
£194m
£186m
Fraud
£923m
£803m
£811m
£733m
-
Benefit fraud
£307m
£248m
£261m
£225m
-
Credit fraud
£158m
£145m
£142m
£133m
-
Identity fraud
£458m
£410m
£407m
£375m
Total
£6,566m
£5,939
£5,555m
£5,318m
Notes:
a)
Costs of identity fraud are based on drug-related proportions for fraud shown in Table A3.1 as identity fraud is an enabler
of benefit fraud and credit fraud, as well as other fraud types.
b)
Indented offence types are subsets of broader offence types.

133

Table A3.2 Proportion of acquisitive offences committed by different
definitions of drug users, Arrestee Survey and Offending Crime and Justice
Survey

Drug user definitions
Offence type
Use of
heroin or
crack
cocaine or
cocaine
powder at
least once a
week
Use of heroin
or crack
cocaine or
cocaine
powder more
than twice a
week
Use of
heroin or
crack
cocaine at
least once
a week
Use of
heroin or
crack
cocaine
more than
twice a
week
Vehicle theft
35%
28%
28%
24%
-
Theft of vehicle
31%
19%
24%
16%
-
Theft from
vehicle
38%
35%
32%
31%
Burglary
55%
51%
48%
47%
-
Burglary in a
dwelling
69%
66%
58%
57%
-
Burglary in a
building other
than a dwelling
50%
46%
44%
43%
Robbery
39%
34%
26%
25%
-
Personal
robbery
26%
22%
20%
19%
-
Commercial
robbery
62%
57%
37%
36%
Theft from the
person
46%
42%
40%
39%
Theft from a shop
70%
68%
67%
66%
Other theft
17%
15%
15%
14%
Total (excluding
fraud)
48%
46%
45%
44%
Fraud
42%
38%
38%
35%
-
Benefit fraud
28%
23%
24%
21%
-
Credit fraud
48%
44%
43%
40%
Notes:
a)
Total proportion was calculated by summing estimates of the volume of acquisitive offences committed by drug-users and
non-drug users based on both the OCJS and the Arrestee Survey. This total excludes fraud as fraud proportions were
calculated in a different way. The volume of fraud offences committed by drug-users and non-drug users based on the
Arrestee Survey was used to create a drug-related proportion that was adjusted by the average effect that inclusion of
OCJS figures had on other acquisitive crime types.
b)
Independent offence types are subsets of broader offence types.

134

Table A3.3 Costs of enforcing drug offences, England and Wales
Cost category
Cost (£m)
Policing
£362
Further CJS costs
£607
Pre-charge decision-making (CPS)
£3
Court proceedings
£150
Community sentences
£37
Custodial sentences
£383
Probation
£34
UK Border Agency
£70
Total
£969
Note:
a)
Indented cost are subsets of broader cost categories.
b)
Police costs in 2009/10 prices; CJS costs in 2010/11 prices.
c)
All costs are for England and Wales with the exception of UK Border Agency which is for the UK.

135

References
Boreham, R., Fuller, E., Hills, A. and Pudney, S. (2006) The Arrestee Survey
Annual Report: Oct 2003 – Sept 2004. Home Office Statistical Bulletin 04/06.
London: Home Office. Available at:
Accessed March 2012.
Boreham, R., Cronberg, A., Dollin, L. and Pudney, S. (2007) The Arrestee Survey
2003–2006. Home Office Statistical Bulletin 12/07. London: Home Office. Available
at:
Accessed March 2012.
Brand, S. and Price, R. (2000) The economic and social costs of crime. Home Office
Research Study 217. London: Home Office. Available at:
Accessed March 2012 .
Chaplin, R., Flatley, J. and Smith, K. (eds) (2011) Crime in England and Wales
2010/11. Home Office Statistical Bulletin 10/11. London: Home Office. Available at:
Accessed March 2012.
Dubourg, R., Hamed, J. and Thorns, J. (2005) The economic and social costs of
crime against individuals and households 2003/04. Home Office Online Report 30/05.
London: Home Office. Available at:
Accessed March 2012.
EMCDDA (2007) „Drugs and crime: a complex relationship‟, Drugs in focus 16.
Lisbon: European Monitoring Centre for Drugs and Drug Addiction. Available at:

Accessed March 2012.
Godfrey, C., Eaton, G., McDougall, C. and Culyer, A. (2002) The economic and
social costs of Class A drug use in England and Wales, 2000. Home Office Research
Study 249. London: Home Office. Available at:
Accessed March 2012.
Godfrey, C., Stewart, D. and Gossop, M. (2004) „Economic analysis of costs and
consequences of the treatment of drug misuse: 2-year outcome data from the
National Treatment Outcome Research Study (NTORS)‟, Addiction, 99, pp 697–707.

136

Gordon, L., Tinsley, L., Godfrey, C. and Parrott, S. (2006) „The economic and
social costs of Class A drug use in England and Wales 2003/04‟. In Measuring
different aspects of problem drug use: methodological developments, Singleton, N.,
Murray, R. and Tinsley, L. (eds). Home Office Online Report 16/06. London: Home
Office. Available at:
Accessed March 2012.
Hay, G., Gannon, M., MacDougall, J., Millar, T., Eastwood, C. and McKeganey,
N. (2006) „Local and national estimates of the prevalence of opiate use and/or crack
cocaine use (2004/05)‟. In Measuring different aspects of problem drug use:
methodological developments, Singleton, N., Murray, R. and Tinsley, L. (eds). Home
Office Online Report 16/06. London: Home Office. Available at:
Accessed March 2012.
Home Office (2011) Revisions made to the multipliers and unit costs of crime used
in the Integrated Offender Management Value for Money Toolkit. London: Home
Office. Available at: Accessed May 2012
MacDonald, Z., Tinsley, L., Collingwood, J., Jamieson, P. and Pudney, S. (2005)
Measuring the harm from illegal drugs using the Drug Harm Index. Home Office
Online Report 24/05. London: Home Office. Available at:
Accessed March 2012.
Ministry of Justice (2011) Criminal Justice Statistics 2010. London: Ministry of
Justice.
National Fraud Authority (2012) Annual Fraud Indicator 2012. London: National
Fraud Authority. Available at:
Accessed April 2012.
Strategy Unit (2003) Strategy Unit Drugs Report Phase One – Understanding the
Issues. London: Strategy Unit. Available at:
Accessed March 2012.

137

ISBN 978-1-78246-236-1 ISSN 1756-3666

Published by the Home Office © Crown Copyright 2013