The Government’s ‘Wellbeing Budget’ aims to tackle long-term challenges for New Zealand, including mental health, child poverty and homelessness.
The Budget announcements include an increase in the annual operating allowance from $2.4 billion to $3.8b.
The SMC asked experts to comment on the Wellbeing aspects of the Budget.
Dr Anna Matheson, Senior Lecturer in Health Policy, Victoria University of Wellington, comments:
“It is sobering that this is the first time we have had a national Budget that explicitly focuses on well-being. The challenges facing humanity globally – increasing inequality, rising populism and rapid environmental degradation, including the crisis with our climate – show how governments worldwide are missing the crucial and pivotal role they play in stewardship, and in creating and maintaining collective well-being.
“I am particularly heartened to see in this Budget a strong focus on social and ecological relationships. Child poverty, mental health, family violence and homelessness are areas where substantial resources and action is long overdue. But also important is the recognition of how we use land and its impact on well-being and the focus on incentivising businesses towards a low emissions future.
“The Budget adds strength to the extensive reviews already being undertaken of the health, education and welfare systems and other recent funding announcements to break cycles of violence, inequality and deprivation. Together these initiatives have huge potential to improve well-being if they are implemented with integrity, and with the urgency needed.
“The evidence we have is comprehensive and compelling that approaches to well-being need go beyond specific topic areas and also focus on the way that policy itself is delivered. It is great to see an appreciation of this evidence through the rhetoric associated with this Budget. With emphasis being placed on horizontal and vertical integration of policy and services, as well as factoring in the long-term.
“However, it is easy for platitudes to prevail with exciting, easy-to-see big system levers. The real test of this well-being Budget will be not only seeing greater cross-sectoral collaboration within the public sector, but whether resources reach local communities in a way that allows for diverse local needs and real transformational action.”
No conflict of interest.
Professor Arthur Grimes, Senior Fellow, Motu Research; Professor of Wellbeing and Public Policy, Victoria University of Wellington, comments:
“Wellbeing budgets have been delivered every year in New Zealand since the 1890s when the Liberal Government introduced old age pensions, free primary education and built the first state houses. In 1905, Prime Minister ‘King Dick’ Seddon defended the fiscal cost of state housing with exactly the sentiments used for today’s wellbeing approach.
“The introduction of the ‘welfare state’ under the 1935-1949 Labour Government was based on similar sentiments, as was Bill English’s boost to welfare benefits in 2016; so too were less justifiable policies such as Muldoon’s introduction of generous universal superannuation at age 60.
“‘Wellbeing’ is not a new approach to policy: indeed ‘welfare’ is given as a one-word definition of ‘wellbeing’ in the Oxford English Dictionary. So a ‘wellbeing budget’ is the same as a ‘welfare budget’ as per Michael Joseph Savage. Internationally, the Australian Treasury Wellbeing Framework was initiated in 2004, France passed a Budget Law in 2015 to assess major new reforms against 10 wellbeing indicators, while other countries as diverse as the United Arab Emirates, Wales and Ecuador have wellbeing approaches.
“So what is new with the 2019 ‘Wellbeing Budget’? Well, we do seem to have a clearer focus on (at least some of) the five priorities listed in December by Minister of Finance, Grant Robertson. Mental health services are benefiting, although – as Phil Twyford has realised with housing – it will take some years to get the mental health workforce up to the numbers required to make a real difference. One bright spot here is the use of regional pilot programmes linking mental health and addiction services together in two regions – far too few pilots have been used to trial public policy initiatives in the past.
“Major initiatives to address family and sexual violence also have a strong wellbeing focus, and are much needed. However, the programmes targeted specifically to assist Māori and Pacifika communities appear lightweight by comparison. In particular, Whānau Ora remains a poor cousin to mainstream social initiatives.
“Another disappointing aspect of the budget is its lack of targets for policy. After canning the last government’s Better Public Services targets, we do now have meaningful child poverty reduction targets (e.g. the proportion of children in poverty after housing costs is targeted to be reduced from 23% in 2018 to 10% in ten years). Unfortunately, however, we do not see similar targets for other key areas that are being tackled in this Budget.
“One example is that Government has refused to put a target on suicide prevention – despite having a target for road toll prevention. Outcome targets focus the mind by holding officials, ministers and governments to account. Crucially, they enable proper policy evaluation to take place. It is not enough to state what will be spent; one must also state what benefits one expects to reap as a result of making these expenditures. A government that is serious about improving wellbeing would wish to be accountable in this way. Instead, we see the typical approach of officials and ministers to trumpet expenditures while ensuring there are few markers to enable verdicts to be made in future on the success or otherwise of the programmes put in place.”
Conflict of interest statement: My son is Grant Robertson’s press secretary.
Dr David Hall, Senior researcher, The Policy Observatory, AUT University, comments:
“The significance of the Wellbeing Budget has two aspects. One is inward-facing and bureaucratic, focused on how government agencies do business. The other is outward-facing and public, focused on the old political question of who gets what, when and how.
“To start with bureaucratic process, Romina Boarini and Conal Smith helpfully suggest that wellbeing frameworks can contribute to alignment, analysis and accountability. We see this taking shape in the 2019 Wellbeing Budget. It aligns government agencies by requiring them to collaborate in the bidding process, oriented toward particular outcomes that the Government prioritises. It fosters analysis through the Living Standards Framework Dashboard by specifying 61 indicators across twelve domains of present well-being and four capitals that support inter-generational well-being. And it seeks to deepen accountability, especially over the coming years, by embedding the wellbeing approach into the Public Finance Act 1989, agency reporting, and State Sector reform.
“These are all noble causes, and worth doing in and of themselves. But these reflect the insular worries of policy-makers, designed to overcome problems like silo-isation and bureaucratic drift that most New Zealanders would not expect of government agencies in the first place.
“What I think that many voters – and indeed many ministers – expect from a wellbeing approach is a tangible shift in public investment. So, to the three-As of alignment, analysis and accountability, I would add a fourth: additionality. In other words, the wellbeing approach ought to change the minds of decision-makers, so that they address social, environmental and economic issues that would otherwise not be addressed under the status quo.
“Has the 2019 Wellbeing Budget achieved this? There is new funding being directed toward the Budget’s five priority areas: (1) improving mental health; (2) improving child wellbeing; (3) supporting Māori and Pasifika aspirations; (4) improving productivity; and (5) transitioning to a sustainable, low-emissions economy.
“For example, the centrepiece commitment of $455 million for new frontlines services for mental health speaks directly to the Health and Subjective Wellbeing domains in the Living Standards Framework. Similarly, $40 million for suicide prevention connects directly to the suicide rate as an indicator.
Cynics will say that this spending would have happened anyway – wellbeing approach or not. These choices simply reflect the pre-occupations of the governing parties.
But look at Whānau Ora. Its survival was far from certain since the change of government in late 2017. Labour has sometimes seemed indifferent toward the programme, while New Zealand First positively hostile. Accordingly, in Budget 2018, Whānau Ora received no new money at all. But in Budget 2019, it is receiving an $80 million boost. If it had it not, I believe that the well-being approach would have exposed itself as arbitrary.
“After all, Whānau Ora shares with the Living Standards Framework a common genealogical connection to Amartya Sen’s capability approach. Sen’s work influenced the Māori Statistics Framework and Te Kupenga, the Māori Social Survey, which in turn informed the culturally-grounded design of Whānau Ora. In its aim to improve whānau wellbeing and capabilities, Whānau Ora can be regarded as a successful operationalisation of the capability approach, adapted for tikanga Māori. Valuing this was a test of the Living Standards Framework’s commitment to enhancing capabilities – and it passed.”
No conflict of interest.
Professor Paul Hansen, Head of Economics Department, University of Otago, comments:
“The Wellbeing Budget 2019, a central plank of the Labour-NZ First Coalition’s vaunted ‘year of delivery’, was touted as being transformational – a world first, no less! Traditional macroeconomic measures like GDP (Gross Domestic Product) and economic growth (the change in GDP) – the focus of previous governments in New Zealand and around the world – were too narrow. And so they were to be de-emphasised, and, in effect, replaced with a broad set of indicators related to the quality of New Zealanders’ lives: to our wellbeing.
“So I waited with bated breath to see how this budget, which ‘signals a new approach to how government works, by placing the wellbeing of New Zealanders at the heart of what we do’, would be fundamentally different from, and better than, budgets past. Did it live up to the hype?
“Nah, not really… It seems to be mostly business as usual. I don’t mean this as a criticism of the Government’s specific spending and revenue plans per se (which, because everyone has their own priorities, can be seen as ‘good’ or ‘bad’ relative to alternative use of the resources). What I mean is, this manifestation of the philosophical underpinnings of the Wellbeing Budget doesn’t seem to be all that fundamentally different – certainly not transformational – relative to earlier budgets.
“A simple test is to ask if previous New Zealand governments – before the advent of the wellbeing framework – would have been capable of delivering a budget similar to this year’s one? Of course they would! For example, in his 2017 Budget speech, National’s Steven Joyce said ‘Today I am announcing a $2 billion a year Family Incomes Package… The Package particularly focuses on assisting low income families with young children and those experiencing high housing costs.’ Obviously, this policy was intended to improve people’s wellbeing – like this year’s $1.9 billion over five years spent on mental health services.
“All governments have a focus on improving their constituents’ wellbeing (via direct and indirect means) because, at a cynical level, that’s how they get re-elected! Wikipedia defines GDP as ‘a monetary measure of the market value of all the final goods and services produced in a period of time, often annually’. The main reason why most governments are so interested in GDP is because that’s where the resources available for improving people’s lives (e.g. both reducing poverty and restoring the environment, etc) come from. Also, high GDP is usually associated with positive contributors to wellbeing like high employment and low crime.
“Nonetheless, one of the first things you learn in first-year Economics is that GDP, which was ‘invented’ in the 1930s/40s, has some very obvious weaknesses as a direct measure of the wellbeing of each individual in the economy (e.g. see the Wikipedia article). GDP is simply an indicator of people’s standard of living ‘on average’, subject to the above-mentioned well-known criticisms. The current Government acts as if they are the first people to have understood these basic ideas.”
No conflict of interest.