The NSW government has ruled out decriminalising drugs but is considering changes to divert users away from drugs rather than sending them to prison.
NSW Attorney General Mark Speakman says he is "ambitious" for drug diversion measures to be introduced "pre court" or within the the court system.
"I think I've made my position crystal clear that we need a rethink on our approach to drugs," Mr Speakman told budget estimates on Wednesday.
Diversion measures were a cheaper option than jailing drug offenders, the attorney general said.
It comes after the NSW government ruled out five key recommendations from a 2020 inquiry into ice use, including decriminalising drugs found in quantities for personal use.
The recommendation was ruled out by cabinet largely over the idea of "normalising" drug use, Mr Speakman said.
"We ruled that out but we have not ruled out other diversions," he said.
"Pre-court or court diversion to recognise at the end of the day, drug use is a health issue and people use drugs for a variety of reasons," he said.
"But they don't choose to, or not use drugs because of a criminal law process.
"Other than decriminalisation, we are looking at what we can do inside the criminal law space."
In December 2020 following the ice inquiry, the cabinet had broadly agreed to a proposal by the attorney-general that would have seen small amounts of drugs decriminalised.
Then police minister David Elliot and conservative National MPs opposed the plan and it was scrapped.
Premier Dominic Perrottet, who was then treasurer, said at the time the government wouldn't be rushed into changing its drug policy.
The inquiry found $7.3 billion of ice is consumed each year in Australia, and made 109 recommendations, including syringe programs in jails, substance testing, more injecting centres and reducing the use of drug detection dogs.
When asked why the government had not made decisions on this earlier, Mr Speakman said he was "disappointed", adding there was more than 100 recommendations and they were being considered "closely".
