“This will be New Zealand’s first Wellbeing Budget”

Under New Zealand’s revised policy, all new spending must advance one of five government priorities: improving mental health, reducing child poverty, addressing the inequalities faced by indigenous Maori and Pacific islands people, thriving in a digital age, and transitioning to a low-emission, sustainable economy.

The government is promoting the new framework as bringing much-needed clarity to the budgeting process. In the past, individual government ministers vied for the new money available in each year’s budget, and “relatively arbitrary” decisions were made about who got what, the country’s finance minister, Grant Robertson, said in an interview.

— New Zealand’s Next Liberal Milestone: A Budget Guided by ‘Well-Being’

For Discussion: How will it affect the traditional approach to budgeting with the so called Well Being approach to Public Financial Management.

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The Government believes wellbeing belongs at the heart of policymaking. Economic growth is an important contributor to wellbeing but not an end in itself, and is not an adequate measure of what we value in our lives. We need to measure our success as a country, and develop our policies as government, using a broader range of indicators. These include how we support our people, protect our environment and strengthen our communities and culture.

Wellbeing economics has become commonplace in recent years and is now an integral part of policy frameworks around the world.[1] While there are many possible definitions of wellbeing, a wellbeing approach can be described as enabling people to have the capabilities they need to live lives of purpose, balance, and meaning for them. It is an intergenerational approach that seeks to maintain and improve New Zealanders’ living standards over the long-term.

A wellbeing approach is about ensuring the broad range of factors that matter to New Zealanders are central to the Government’s definition of success and drive our decision making. Faced with complex issues such as child poverty, inequality, and climate change, we cannot hope to make the best choices for current and future generations if we do not look beyond economic growth and consider social, environmental, and economic implications together. While economic growth is important for creating opportunities, our recent history shows that focussing on it alone can be counterproductive and associated with poor outcomes such as greater inequality and pollution.