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Anatomy of a road fatality

Sydney Morning Herald

Friday 22 Jun 2001

Even before you're involved in an accident, there's no escaping it - you're a statistic. Deborah Cameron reports.

A FATAL or serious road crash is immediately two things: a calamity and a statistic. Putting a price on human tragedy is a task that is beyond economics, but not beyond coolly counting costs.

When everything is added in from the moment an ambulance is dispatched to beyond the day of the funeral a road death costs an average of $1.5 million, the Bureau of Transport Economics says.

The team of economists who made the assessment were, in their own way, like dark-suited undertakers. The opening lines of their study described the work in morbid overtones.

"For the individuals involved, the outcomes of a road crash may be devastating and it may not seem to them to be necessary or appropriate to place dollar values on these outcomes.

"However, to make decisions about crash prevention and risk-minimisation expenditure, it is necessary to have reasonably accurate estimates of the costs of road crashes ... This information is important when scarce funds are to be allocated to reduce the incidence of specific crash and injury types."

Looking at 1996, a year in which 1,970 people died on Australia's roads, the BTE reported in its publication Road Crash Costs in Australia, released last year, that the total cost of fatal crashes was $2.92 billion. The cost of all crashes lumped together minor and major was $15 billion, $6 billion more than the estimate for 1988.

The report is one of those rare times when statistics rivet. There are many grim insights, among them that police spend four hours with the next of kin telling them of the death and then arranging for formal identification of the body. (At $100.90 an hour for two officers in a car, the costs quickly rise.) A funeral costs an average $1,700 for each fatality.

Joe Motha, the deputy executive director of the BTE's sea, air and safety branch, says counting the cost is an important part of understanding the social burden of road deaths and the components of it.

"It puts things in perspective ... the human cost, the vehicle costs and the other costs."

To get a clear picture, imagine a crash scene where a highway is blocked. According to the BTE's assessment this is the worst kind of accident, much worse in economic terms than when a car slews across a road and into a tree.

The first important expense is for the ambulance but, as the report says, even this is complicated these days because of ``the spread of mobile phones".

Multiple calls about the same crash mean that more than one ambulance is sometimes sent, immediately increasing the costs. But even if only one crew is called, a highway accident involves costs that are about 20 per cent more than other ambulance work because of the time, drugs, bandages and other resources used.

The immediate economic effect of fatal crashes is obvious enough in the wrecked cars, the term of hospitalisation (people who die because of a road crash spend an average of 2.1 days in hospital), the coroner's court hearing and the lost productive output of the dead.

And while no single cost component comes close to the value of life itself which was put at $860,000 (see story below) the report sheds light on some unexpected and new areas.

It assessed travel delay costs, which is the inconvenience suffered by other motorists whose journey is held up by a bad smash.

"The police and emergency services, in carrying out initial investigations and clean-up and in taking necessary precautions, may further restrict traffic flow.

"Such delays impose costs as the time lost queuing in traffic has a productive value," the report said.

Based on research that accounted for the time and place of the crash and the value of the lost time, the report concluded that crashes cost other road users $1.45 billion. (Lost time was valued at between 44 and 68 per cent of wage rates.)

The researchers found that 8 per cent of fatal and serious crashes involved a traffic delay and that in Sydney and Melbourne it took 38 minutes for the road to be cleared.

"In this time, about 833 vehicles will be affected, with an average delay time per vehicle of about 16 minutes, the longest delay time being about half an hour."

While it might seem a statistical flight of fancy, the report's writers say that it is not, because valuations of travel time are routinely used when governments and corporations decide to invest in new highways or spend money on roadworks.

The report also valued the death of a person who contributed to a household or to the community, particularly with housework or bringing up children.

"Although such work is unpaid, it is essential to the quality of life for individuals, their families and the wider community," the report said.

Using a formula that involved deciding an income level for ``each potential year of life", they valued the loss in serious and fatal accidents at $573 million.

Any estimate of the economic consequences of death would be incomplete without discussing the death itself. It was a problem that the economists confronted with brutal logic, admitting that they did not try to put a value on the lost quality of life of relatives and friends of crash victims.

"Death is difficult to fit logically into the scale of quality of life losses, because, although the loss should increase as injuries become more severe, there is no ongoing suffering after death."

Adrian Beresford-Wylie, the director of safety programs and support in the Australian Transport Safety Bureau, said that death and car crashes would remain an inevitable risk for road users. He said that there had been debate in road safety circles about adopting a ``vision zero" no deaths which was ultimately ruled out by transport ministers who thought it was unrealistic.

Instead, last year the ministers adopted a National Road Safety Strategy that aimed to reduce road deaths to 5.6 deaths per 100,000 population, down from the present level of 9.5 per 100,000. Australia is already ahead of the United States, where road death rates are at 15.3 per 100,000.

Beresford-Wylie says the success of the national strategy depends on better roads and safer driving along with improved vehicle standards. If it works, Australia will be able to claim a common link with Iceland a low road fatality rate.

THE PRICE OF A LIFE

Without being emotional about it, you are worth $859,030 all up

To get over the dilemma of valuing a real person, the bureau opted for an unknown or "statistical" life.

THE biggest question of all - what is the price of life? - has been pondered by many. But none quite like the Bureau of Transport Economics.

Last year when the bureau considered the cost of road crashes in Australia, it decided "an explicit value" should be put on life. Rationalists, particularly in government, need grim details such as this if road safety campaigns meant to save people are to be properly evaluated.

With neither lawyer nor jury present to argue for an extravagant price, a small group of transport economists boiled "a statistical life" down to the bones.

An average life, they decided, was worth $319,030 for quality plus $540,000 in lost labour to the economy.

The deputy executive director of the Bureau of Transport Economics, Joe Motha, who worked on the study, realises it is a delicate subject. "As economists we are not the people to value human life," he said. "What we are doing is valuing a person's lost productivity. We are not valuing in any sense the value of that person's life, which is a philosophical, ethical, moral question beyond the scope of economic valuation."

And yet without sentimentality, and at the same time as they were totting up other costs incurred in road crashes, they put a number on it: $859,030 in total.
In an explanatory note in the final report, the researchers grappled with the question of life's worth and the task they had set for themselves.

"People generally value their own lives very highly," they wrote. "Indeed, life can be argued to be priceless, as without life money would be of no use.

"This view is supported by the many publicised incidents where large amounts of money have been spent to save the life of an identified person. However, at the other end of the spectrum much lower implicit values are placed on lives everyday."

It is an issue that has long caused debate. American transport economists, asked the same question, used a different method and valued a life at $5.5 million.

"It causes a lot of emotion," said Motha.

"You might be inclined to say that an Australian life is worth only so much, but that is a terrible misconception."

He said that the bureau's estimate was "very much a lower-bound estimate" because it was difficult to put a price on the loss of someone to relatives, friends and family.

To get over the dilemma of valuing a real person, the bureau instead opted for an unknown or "statistical" life.

"A statistical life is unidentified and so does not have the emotional and moral overtones associated with a known life," the report said. "In practical terms, the distinction means that much smaller sums are allocated to saving statistical lives than may be spent in saving identified lives."

Deborah Cameron