In Canada, people who break the law pay a “victim fine surcharge.” For federal offences, the surcharge is 15 percent of any fine imposed. For criminals who are not fined, a set surcharge of $50 or $100 is imposed, depending upon the severity of the crime. The funds raised through these fines stay in the province where the offence occurred, and are used to fund victim services.

The Conservative party platform promises “to double the victim surcharge.” According to the platform, in a majority of cases, the fine is not imposed: “Criminals are let off the hook, and victim support services are left without adequate funding.” Therefore the Conservatives promise that, if elected, they will make the victim surcharge “mandatory in every case without exception.”

A 2006 study of sentencing in New Brunswick confirms the claim made in the Conservative platform – the majority of federal offenders in that province had their victim surcharge waived. Yet this average hides significant variation by type of case. For DUI (Driving Under the Influence) convictions, victim fine surcharges were imposed in 84 percent of New Brunswick cases between 2000 and 2005. The victim surcharge was imposed in three quarters of "fine dispositions" – cases where the guilty party was required to pay a fine. For "summary convictions" – cases involving relatively short amounts of jail time – the imposition rate was 16 percent.  And for "indictable convictions" – ones involving relatively long amounts of jail time – the imposition rate was 9 percent.  

The victim surcharge can be understood as a tax on criminals. It is not restitution. Restitution – direct compensation of a victim by an offender – does occur within the Canadian criminal justice system, but is separate from victim surcharges. Canada also has separate restorative justice programs.  

Victim surcharges are a tax imposed in order to raise revenues for victim support services. The surcharge was introduced as a replacement for earlier federal/provincial cost sharing programs that funded provincial victim crime compensation programs.

There is a certain logic to taxing criminal behaviour. Taxing behaviour discourages it, and surely criminal behaviour is something we want to discourage?

Unfortunately, the magnitude of the victim surcharge bears little relationship to the actual harm caused by the crime. As one judge interviewed for the New Brunswick study put it, the paradox of victim fine imposition process is that:

“…the worse the offender, the bigger the fine, the heavier the fine, the more it is perceived as too great a burden so then the fine (and federal victim surcharge) are waived … On the other hand, those that are not fined and are headed to custody are viewed as having no means to pay the fine so the federal victim surcharge is again not imposed – who is left? Typically those with smaller fine amounts – those who have imposed the least amount of damage on victims…”

Anyone who has ever paid a $15 or $20 victim surcharge on $100 traffic ticket will understand immediately what this judge is talking about.   

The ability of victim surcharges to deter criminal behaviour is also limited by the interaction between victim surcharges and other penalties. As another judge interviewed for the New Brunswick study put it: “…when I am deciding on the fine amount I always am considering it in terms of the total monetary penalty…..for example if I think they can pay $500 then I work backwards and apply a lesser fine so the total including the federal victim surcharge will not exceed the $500…”. To the extent that judges have discretion over sentencing, they will impose the punishment they wish to impose, factoring in any possible effects of the surcharge.

Indeed, there is something strange about the idea of a victim fine surcharge as deterrence. One would think that the purpose of our criminal code is to specify punishments that fit each crime – if the punishments are inadequate or inappropriate, why not just change the criminal code?

No, the victim surcharge is a tax – and the reason that the Conservatives give for making it mandatory is that more revenue is needed: at present "victim support services are left without adequate funding."

Federal and provincial victim fines raised $52 million in Ontario in 2010. Yet according to the Ontario Attorney General's office, these fines are not the only source of support for victim services – programs for victims of crime also receive funds from general government revenue.

Victim fine surcharge revenue puts a lower limit on victim services spending. Unless that lower limit is binding – which in Ontario, anyways, it is not – spending on victim services is determined, not by the amount of revenue raised from the victim fine surcharge, but by the amount that provincial governments choose to spend on these services. Governments face budget constraints, and choose the best allocation of funds given those constraints:

An increase in victim surcharge revenue will shift both the red victim surcharge revenue line and the blue provincial budget constraint line outwards. Unfortunately, I can't draw the the effect of this revenue shift to scale. Victim fines overall represent less than 0.1 percent of Ontario provincial government revenue - and that includes the revenue from the 20 percent provincial surcharge imposed on every traffic ticket (except for parking tickets). The people who currently have the federal victim surcharges waived – for example, people heading off for long custodial sentences – have minimal ability or incentive to pay a victim surcharge. The net revenue gain from imposing mandatory surcharges on these offenders would likely be fairly small. There is greater revenue potential from increasing the surcharge on fines from 15 to 30 percent. Although, as noted above, to the extent that judges base the total fine on the offender's total ability to pay, basically all that changes is the 'earmarking' of the revenue, and not the total amount of revenue raised.

So here, with the revenue gain from raising the victim surcharge blown up out of all proportion, is the impact of an increased victim surcharge:

As long as the desired level of victim services is greater than the revenue raised through victim surcharges, then increased victim surcharges will have the same impact on provincial expenditures as anything else that would shift the provincial budget constraint outwards. As drawn, spending on victim services increases to V', spending on other government services increases to G'.

As the net impact of an increased victim surcharge is to increase provincial revenues, it can be evaluated using the standard tools economists use to evaluate taxes. Is the tax increase progressive – people who have greater ability to pay do so? Or is it regressive – the people who have the least ability to pay to do so? 

I don't have much information on the demographics of the federal offender population. It's easy to find statistics about types of offences, sentences, etc – the data can be downloaded by anyone from the Statistics Canada website. The biggest crime categories in the adult criminal court system are administration of justice crimes (e.g. failing to comply with conditions of parole), impaired driving, theft and assault. In other words, offenders are basically people with drug, alcohol, poverty, self-control or mental health issues.

Of the 183,114 adult criminal court cases in Canada in 2009, just 29,564 resulted in some kind of fine. The most common sentence was "other" – probation, community service, suspended sentence, and so on. Restitution – direct compensation to the victim of the crime – occurs even less frequently than a fine. Restitution was ordered in 6,754 cases in Canada in 2009.  

Judges' sentencing choices can be understood by thinking about parenting decisions.

Imagine that you're a parent. Your child has just broken a vase. What do you do?

You can send the child to his/her room – incarceration.

You can say "that's coming out of your allowance" – and withhold the child's allowance payments for the next six months.

Or you can sit down and repair the vase together. 

"It's coming out of your allowance" appears to hold the child responsible for paying for the vase. But you know – and the child knows – that withholding the child's allowance makes the most minimal difference to your ability to pay for a new vase. It makes no difference to your decision about whether or not you will replace the vase. It just transfers money from the child to the parent.

Repairing the vase, on the other hand, allows the child to to take responsibility for his/her actions (and learn valuable vase-repairing skills). Through his or her labour, the child compensates you for the breakage. 

But sitting down with your child and teaching him or her new skills and new responsibilities is much more effort than yelling "go to your room – and no more allowance until you're 12." The same is true of constructive ways of making people pay, for example, giving offenders an opportunity to work off their fines through community service. They could easily end up costing more in staff time than the fines would raise in revenue. 

In sum:

It is a good idea to deter crime.

It is a good idea to give offenders an opportunity to make reparations for the harms that they have caused.

It is a good idea to provide adequate funding services to victims of crime.

The victim fine surcharge is being asked to meet all three of these goals simultaneously. It just isn't up to the task.