Infringement Review Phase II

Infringement System Overview

Local Authorities

Collections UnitMinistry of Justice

Dec 2007

2

The Day• Welcome & introductions

• Agenda

• Ancient History - background

• Overview and discussion of proposals

• Where to from here?

Infringement Review Phase II2

3

Ancient History

4

Infringements?

• Approx 2.7m issued each year.

• Infringement fees are penalties imposed by administrative agencies.

• Does not include court-imposed fines or reparations.

• 90% traffic/vehicles related with most: speeding, parking, no reg, no WOF, driver licence breaches

• But cover all facets of society – carless days.

5

Every person commits an offence who operates a portable electronic device on board an aircraft in breach of the rules (fine not exceeding $2,500).

6

Dam owner failing to classify a Dam

7

Infringement system

• Established in 1968.

• Started out as a simplified procedure for parking and heavy vehicle offences.

• An administratively efficient way of deterring (and penalising) “lower-end” offending.

• This benefits the State, through lower prosecution/adjudication costs, and defendants, who avoid defence costs and/or possible convictions.

Premised on the assumption that most people can afford to pay infringement fees and will voluntarily

comply with the penalty imposed.

8

How the system works

Reminder notice sent

Must act by due date

Ticket issued

Notice of fine sent

7 daysb4 duedate&

Enforcement costs & action

9

Who issues infringementsMost infringements filed

• NZ Police• Auckland City Council• Wellington City Council• Manukau City Council• Christchurch City

Council• Waitakere City Council• Dunedin City Council• Hamilton City Council• Rotorua District Council• Palm. Nth City Council• North Shore City Council

10

Police

Local Authorities

Other

Who issues infringements

11

0

100000

200000

300000

400000

500000

600000

700000

Local Authority Police Court Imposed

Number of fines filed last 5 years(2002/03 to 2006/07)

12

0

50

100

150

200

Local Authority Police Court Imposed

$ value of fines filed - last 5 years(2002/03 to 2006/07)

13

460000

470000

480000

490000

500000

510000

2003/04 2004/05 2005/06 2006/07

Total debtors(2003/04 - 2006/07)

14

05

1015

202530

35

Judgeremittals

Alternativesentences

OtherRemittals

Remittals - last 6 years(2001/02 to 2006/07)

15

The issue ?

16

What’s the issue• Huge growth in number of infringement schemes

– 20 Active Infringement schemes

– 11 more enacted but not yet active – 20 more proposed.

– There were 9 ten years ago (1998)

– Developed in an ad hoc manner with little oversight

• Key assumption – Voluntary compliance– 46% of NZ Police issued offence notices paid voluntarily

– a decreasing percentage.

– 63% for Local Authorities.

– 65-80% internationally.

17

The issue …

• $331.5 million filed at Court in 2006/07– 5.9% increase.

• Overall outstanding debt increasing– $755.8m at 30 June 2007

– overdue now 57% at $433.8 m.

• 85% of profiles will have a new fine within c.2 years– Not changing behaviour or new business

– Not able to collect more $

18

Overdue

Under Arrangement

Other Not Overdue 5.9%

37.2%

56.9%

00

100

200

300

400

500

600

700

800

Oct

-05

Nov

-05

Dec

-05

Jan-

06

Feb

-06

Mar

-06

Apr

-06

May

-06

Jun-

06

Jul-0

6

Aug

-06

Sep

-06

Oct

-06

Nov

-06

Dec

-06

Jan-

07

Feb

-07

Mar

-07

Apr

-07

May

-07

Jun-

07

Jul-0

7

Aug

-07

Sep

-07

$ (0

00,0

00s)

19

0

100

200

300

400

500

2001/02 2002/03 2003/04 2004/05 2005/06 2006/07

Total overdue debt(2001/02 - 2006/07)

20

0

100

200

300

400

500

600

700

800

2001

/02

2002

/03

2003

/04

2004

/05

2005

/06

2006

/07

$m

Receipts

Total debt

Total overdue

Total $ filed

21

22

Worth knowing• 28% of individuals owe less than $200

• 29% of individuals owe between $200 and $500

= 57% owe less than $500

• Average owing across all profiles is $1,450 ($2,342 for aged 15 – 25)

• Largest single amount owing is $1.8m (overseas)

• 87 profiles owe more than $65,000 (18 in prison or overseas)

23

Mind stickers …• Rapid growth

• Unsustainable numbers

• Premised on an assumption that does not hold true

• Particular groups it is just not working for – eg. young infringement offenders

• Continuing to do what we have been doing just won’t cut the mustard

• Credibility of the Justice sector being impacted

24

Decision to review

Infringement Review announced in 2004

Two main reasons for the review:

• The sustained and continual growth in infringements and numbers filed in court – base assumption clearly not working.

• Increase in high profile of cases where large dollars are remitted.

25

Work to date

• Review announced in 2004.

• November 2004 discussion paper issued.

• August 2005 Law Commission Report.

• December 2005 Minister agrees the review would target discreet enhancements.

• May 2007 Cabinet agrees to progress specific series of discreet enhancements.

• August 2007 Operational Policy development starts

• December 2007 – guidelines report to Cabinet.

• July 2008 – progress report to Cabinet on other proposals.

• December 2008 – Cabinet report on research into referral programmes

26

The package of reformsFive main themes:

• Governance framework– Development of guidelines – a framework

• Increased voluntary compliance rates– Transfer of PIB receipting to the MoJ

• Early Interventions– Automatic Court referrals– Positive referrals for young infringement offenders

• Enhanced enforcement– Driver licence suspensions– Release of details to credit reporting agencies– Low value/heavily financed vehicle confiscations

• Alternative sanctions– MoT review – GDLS – demerits rather than fines

27

Impact on daily Collections work

28

Mind stickers …• There are no silver bullets

• Package of reforms that work together

• Each has a different target and focus

• On their own, none will solve the world’s ills

• Focus on quality resolutions and a whole-of-government perspective

• We are deliberately moving away from a “one size fits all” approach towards measures targeted at specific defendant segments

29

Contact details

For any questions, further information required

Policy TeamCollections Business UnitMinistry of Justice

Angela Holmes 04 978 7024Andre Chatvick 04 978 7079Kelvin Ratnam 04 978 7087Richard Ward 04 978 7027

@justice.govt.nz