Imprisonment terms that ‘cut out’ or result from fine debt

Recommendation 12–1            Fine default should not result in the imprisonment of the defaulter. State and territory governments should abolish provisions in fine enforcement statutes that provide for imprisonment in lieu of, or as a result of, unpaid fines.

12.30  The ALRC recommends that statutory provisions permitting imprisonment resulting from unpaid fines should be repealed. Fines are penalties imposed in response to usually minor infractions—conduct that the legislature and the courts have determined not to warrant a term of imprisonment.[50] Imprisonment for fine default results in punishment disproportionate to the offending conduct, and contradicts the principle of imprisonment ‘as a last resort’.[51]

12.31  Fine enforcement provisions provide for stepped enforcement actions. It is the view of the ALRC that when a fine defaulter is unable to pay a fine or infringement notice; has not applied for time to pay or other payment options; has no income or property to be the subject of civil orders; and is unable to complete a CSO, that person requires assistance, not prison.

12.32  The RCIADIC recommended that all governments ensure that sentences of imprisonment were not automatically imposed for the default of payment of a fine.[52] While the direct link between fine default and imprisonment has been removed from statutes nationwide, and fine payment options have been introduced, fine enforcement regimes still provide pathways from fines to imprisonment.

12.33  The NSW Government did not support abolition of a court’s ability to order imprisonment for fine default altogether, as it considered that the ‘principle of imprisonment as a last resort protects against imprisonment for fine default unless necessary’.[53] The vast majority of stakeholders to this Inquiry, however, supported the abolition of statutory provisions that provide for imprisonment in lieu of, or as a result of, unpaid fines.[54] Many pointed out the absurdity of imprisonment for such a ‘crime’. Legal Aid WA observed that imprisonment for fine default ‘normalises imprisonment, undermining the effectiveness of the deterrence element of the sentence of a term of imprisonment and detracting from the policy position that a sentence of imprisonment should be a last resort’.[55] The NSW Bar Association strongly supported any reforms that

prevent incarceration, directly or indirectly, solely as a result of the non-payment of fines. Deprivation of liberty for this reason is not compatible with a modern, civilised society and has had a manifestly disproportionate impact upon Aboriginal and Torres Strait Islander people. Fines are a debt and should only be enforced as such.[56]

12.34  The Law Society of NSW Young Lawyers Criminal Law Committee (YLCLC) suggested that imprisonment as a result of fine default ‘offends both principle and pragmatism’.[57]

12.35  The Infringement Working Group in Victoria is a joint working group of the Victorian Federation of Community Legal Centres and Financial and Consumer Rights Council. Its joint submission with the Victorian Aboriginal Legal Service to this Inquiry (VALS/IWG) expressed ‘strong’ support for the proposal to abolish the possibility of a person being imprisoned for unpaid fines.[58]

12.36  VALS/IWG advised that, in Victoria, the most common way infringements can lead to imprisonment is when a ‘person does not pay their fine, is arrested and brought before the Magistrate’s Court for a penalty enforcement warrant (PEW) hearing and is then placed on an “imprisonment in lieu of payment” order (IIL order)’. This means that any default in payment leads to the automatic issuing of an imprisonment warrant which enables the person to be taken directly to prison without further court oversight. They advised that people can be on an IIL order for years, with one lasting as long as 40 years. VALS/IWG reported there to be 8,000 imprisonment warrants in existence in Victoria. So, although the court does impose imprisonment in Victoria, imprisonment is then contingent upon actions of the defaulter and the matter does not go back before the court when a person has not paid. It is not known how many warrants issued are for Aboriginal and Torres Strait Islander people. VALS/IWG observed that, as Aboriginal and Torres Strait Islander people ‘disproportionately experience factors making IIL order default more likely, including financial hardship, insecure housing, poor health including mental health and cognitive impairment, involvement with Chid Protection and problematic substance misuse’, it was ‘likely that Aboriginal and Torres Strait Islander people are over-represented amongst this group’.[59]

12.37  VALS/IWG reported that up to 272 people in Victoria were received into custody for fine default only between 2010 and 2016.[60] The median time in prison was 24 days, whereas the longest was 345 days.[61]

12.38  Some states and territories are considering reform to their fine default regimes. WA is reviewing their fine enforcement system while, in NSW, the Commissioner of Fines Administration has established a steering committee to review the impact of the penalty notice system on Aboriginal and Torres Strait Islander people in NSW.[62] The NT Government also advised that it is ‘currently considering alternative options to infringements’.[63] Many jurisdictions are also adopting the WDO scheme from NSW (discussed below).

12.39  VALS/IWG outlined the approach taken by the Department of Economic Development, Jobs, Transport and Resources in Victoria, which has included increasing the training of decision makers at the frontline to help guide the exercise of discretion. This training aims to ensure that people who make mistakes or who are experiencing disadvantage are not penalised. Further, a person who receives a fine is given an opportunity to provide evidence of their special circumstances to avoid the enforcement of a fine.[64] VALS/IWG suggested this approach as a model for reform.

12.40  The ALRC is cognisant that removing prison as an option removes both a final incentive to pay and a ‘short and sharp’ option for people without the means to discharge their fine debt to become debt-free. The Public Interest Advocacy Centre (PIAC) submitted to this Inquiry that, accordingly, there is the need for better alternatives to be in place before the final option of prison is removed in some jurisdictions.[65]