Let’s recap. During the midst of Australia’s federal election campaign in late May, New Zealand Prime Minister Jacinda Ardern unveiled a budget framework in which spending on measures to tackle things such as mental health, domestic violence, homelessness and addiction would be treated as an investment.
Each of those would be goals in their own right, in addition to the usual goal of growth in gross domestic product.
In truth, the idea isn’t exactly new, and for years Australia’s treasury was among those leading the way.
Once were innovators
For decades Australia’s treasury has put these words at the heart of its mission statement:
to improve the well-being of the Australian people
The wording varied over time, but encompassed:
the opportunity and freedom that allows individuals to lead lives of real value to them
the level of consumption possibilities available to the community over time
the distribution of outcomes across different social groups, geographic regions and generations
the overall level and allocation of risk borne by individuals and, in aggregate, by the community
the level of complexity confronting Australians in making decisions about their lives.
- ^ fanfare (www.themandarin.com.au)
- ^ well-being budget (www.budget.govt.nz)
- ^ treated as an investment (www.beehive.govt.nz)
- ^ well-being framework (treasury.gov.au)
- ^ Commonwealth Treasury graphic (www.scribd.com)
- ^ ditched it (www.smh.com.au)
- ^ New Zealand's 'well-being budget': how it hopes to improve people's lives (theconversation.com)
- ^ 18th and 19th centuries (plato.stanford.edu)
- ^ hedonic interpretation of utility (www.laits.utexas.edu)
- ^ Amartya Sen (www.thecrimson.com)
- ^ The search for an alternative to GDP to measure a nation's progress – the New Zealand experience (theconversation.com)
- ^ David Cameron (www.theguardian.com)
- ^ breastmilk (theconversation.com)
- ^ Mental health wins record funding in New Zealand's first 'well-being budget' (theconversation.com)
- ^ social capital (bowlingalone.com)
- ^ framework (theconversation.com)
- ^ Grand Challenge on Inequality (research.economics.unsw.edu.au)
- ^ social impact bonds (theconversation.com)
- ^ Commonwealth Treasury (treasury.gov.au)
Authors: Richard Holden, Professor of Economics, UNSW