Income based traffic fines

Adopting a proportional traffic fine system would be fairer and offer modest increases in revenue for most states, according to a new report from The Australia Institute.

Several countries have proportional fines. In its report Finland’s fine example The Australia Institute has researched how Finland’s system could be implemented in Australia, seeing lower income drivers pay less and higher income drivers pay more for offences.

“Australia’s system doesn’t consider a driver’s income when calculating a traffic fine, making the Finnish system much fairer,” said researcher Jesper Lindqvist.

For speeding 20 km/h over the limit, the average Australian fine is $236, regardless of if you’re a millionaire or on a very low income. Under the Finnish model, the lowest income earners would be fined $100, while the highest income earners would pay over $1,000.

“These fines represent equal financial hits for drivers as a proportion of their disposable income. As fines are designed as a disincentive to dangerous driving, it would send the same message to people of different incomes: speeding is costly.

“The Finnish model strives for equity, and in-turn a more effective fine system and safer roads, and that’s something that every country is interested in,” Lindqvist said.

Table 1: Finnish model of traffic fines in Australia

Traffic Offence

Number of day fines

Median fine currently

Fine Floor

Q1 New Fine

Q2 New Fine

Q3 New Fine

Q4 New Fine

Q5 New Fine

Exceed speed limit by less than 10 km/h

3

$130

$30

$33

$71

$107

$150

$295

Exceed speed limit by 10 to 19 km/h

7

$236

$70

$78

$166

$249

$351

$687

Fail to stop at red traffic light

14

$361

$140

$155

$332

$499

$701

$1,375

Using mobile phone while driving

6

$361

$60

$67

$142

$214

$301

$589

Fail to wear seat belt

4

$373

$40

$44

$95

$143

$200

$393

Source: TAI’s calculations based on official state rules and official documents provided by Finland and Victoria.

Table 2: Change in face value of traffic fines per income quintile

State

Q1

($M)

Q2

($M)

Q3

($M)

Q4

($M)

Q5

($M)

Overall

($M)

Overall % change

 

NSW

-$53.91

-$29.38

-$4.69

$22.02

$124.61

$58.66

15%

QLD

-$39.41

-$18.01

-$1.80

$18.82

$78.75

$38.35

14%

SA

-$25.43

-$18.27

-$12.65

-$4.81

$15.92

-$45.23

-26%

TAS

-$0.58

-$0.04

$0.38

$0.89

$2.26

$2.92

57%

NT

-$1.51

-$0.40

$0.30

$1.26

$3.02

$2.67

23%

Total

-$120.82

-$66.08

-$18.5

$38.05

$224.33

$57.39

12%

Source: TAI’s calculations, unpublished data provided to TAI by each state except for South Australia.



Note: Other states did not provide sufficient data for these calculations.

“Expiation Notice System Data,” Data SA, accessed December 11, 2015, https://data.sa.gov.au/data/dataset/expiation-notice-system-data.

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