Education standards, the quality of health services and the state of the environment will form the starting point for the nation’s first “wellbeing” budget as Treasurer Jim Chalmers attempts to measure what matters to Australians.
Next week’s federal budget will devote a section to wellbeing, including how it will be measured and what parts of society will be tracked over time to determine if government policy is working.
Treasurer Jim Chalmers will deliver the country’s first wellbeing budget as part of the traditional budget on October 25.Credit:Alex Ellinghausen
Measures of wellbeing that go beyond traditional budget metrics such as GDP, inflation and unemployment have started to appear in overseas government financial documents over the past decade. The New Zealand annual budget contains a full wellbeing budget alongside government spending and revenue.
Tuesday’s main budget paper will contain a chapter devoted to methods used in other jurisdictions to measure wellbeing such as the Organisation for Economic Co-operation and Development’s long-running wellbeing framework.
While no indicators have been agreed upon as yet, the chapter will canvass measures of educational outcomes, access to health, changes in environmental conditions and childhood disadvantage.
Chalmers said it was critical that issues that mattered to the country were measured and tracked to see whether they improved over time.
He said the work would add to traditional economic indicators, not replace them, arguing that with the budget under extreme pressure the government had to meet multiple objectives.
“The October budget is the start of this important discussion – it explores international best practice and how we can best apply it here at home,” he told this masthead.
“Measuring what matters is crucial to building a stronger, more resilient economy that creates more opportunities for more Australians.”
In February, then-treasurer Josh Frydenberg ridiculed the concept of a wellbeing budget, deriding Chalmers – the member for Rankin in the outer southern suburbs of Brisbane – as a “spiritual leader” for raising the idea.
“I was thinking yesterday, as the member for Rankin was coming into the chamber fresh from his ashram deep in the mountains of the Himalayas, barefoot … robes flowing, incense burning, beads in one hand, wellbeing budget in the other, I thought to myself what yoga position the member for Rankin would assume … to deliver the first wellbeing budget,” he said at the time.
The comments prompted criticism from parts of Australia’s Hindu community, which labelled them “brazen, racist and Hindu-phobic”.
Co-founder of the Wellbeing Economy Alliance and strategic adviser to the Centre for Policy Development think tank, Katherine Trebeck, said a wellbeing budget went far beyond the cheap criticisms of Frydenberg.
“It’s not about ashrams and yoga retreats. It’s about the wellbeing of the entire economy,” she said. “It’s about more than just raw employment numbers – it’s about the quality of those jobs. It’s looking at the impact on the environment.”
Adding wellbeing to the federal budget is about measuring what matters to people, says Katherine Trebeck.
Trebeck noted a traditional approach to the budget looked only at government spending or the size of the economy as outcomes.
While GDP or inflation were important economic indicators, they failed when it came to understanding if a policy option was working or improving the life of a community.
She said a wellbeing budget should enable governments, particularly the public service, to intervene early to prevent problems rather than just reacting to existing issues.
“You don’t just deal with the symptoms. That’s pulling out the chequebook, and doing it time after time,” she said.
“It’s easy to hand out food parcels rather than helping people who might need a little bit of government assistance to set up a community garden or improve their financial security.”
The federal government is already heavily involved in a wellbeing measure outside traditional economic indicators. The national Closing the Gap agreement has 19 socio-economic targets to improve outcomes for Indigenous Australians that are updated annually.
Its No.1 target is to close the gap in life expectancy between Indigenous and non-Indigenous Australians by 2031. Between 2005-07 and 2015-17, the gap has narrowed for males from 11.4 to 8.6 years while for females it has shrunk from 9.6 to 7.8 years.
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