Blog Post

Rethinking prosperity and how to achieve it in 2016

As the new year begins, it is common to make resolutions with the objective of making this year better than the previous. There is a deeply rooted ideal about improvement manifesting itself at both personal and societal level. Most people simultaneously strive to increase their personal well-being, and believe that we should leave a better world than the one we were born into as a legacy for our children, grandchildren, and subsequent generations.

The views about what constitutes a good and successful life vary, but various surveys suggest that there is a core set of factors that the vast majority of people tend to regard as crucial. Based on several consultation exercises on what the British public prioritise in well-being, The New Economics Foundation identified five areas as essential: 1. secure, well-paid work, 2. high levels of personal life satisfaction, 3. a healthy environment, 4. low levels of economic inequality, and 5. effective public services that guarantee good health and education.

However, policies tend to approach progress, well-being and success only in economic terms. The narrow focus on economic growth and short-term gains ignores the wider consequences of decisions taken today, and the complexity and interconnectedness of economic, environmental and social well-being.

This approach is reflected in the way that Gross Domestic Product (GDP) is constantly used as a synonym for national success and prosperity. However there are many limitations to this metric. For instance it does not reveal how well a country succeeds in delivering the qualitative aspects of economic, social and environmental well-being, which are most important to the public.

A growing number of indicators with different methodologies are being proposed that could allow us to shift the focus of decision-making away from economic phenomena (for a review see our report Measuring the Long Term). Academic literature has suggested a variety of composite indicators. There have been initiatives to produce new sets of indicators to measure different aspects of sustainable development and well-being for example in the UK, Italy and Finland. As part of the Well-being of Future Generations Act in Wales, the Welsh Government have launched a consultation on indicators to measure national well-being. The results will be released before the summer.

The global community has a new year’s resolution to work towards. From 1 January, countries are seeking to implement the 2030 Agenda for Sustainable Development, to meet 17 Sustainable Development Goals and supporting 169 targets. New policies will need to be introduced and existing policies will need to be realigned to support this agenda. A key element in this process is measuring the progress towards the goals by establishing indicators, which will be agreed upon and adopted by the UN in the coming months.

Using a different set of indicators can reveal the unsustainable social and environmental consequences of economic growth and more accurately monitor whether macroeconomic policies are enabling long-term progress for everyone. To evaluate whether the indicators really offer potential for new kinds of policy options, certain guidelines were identified by the BRAINPOoL project (Bringing Alternative Indicators into Policy). New indicators cannot be simply used in parallel with traditional economic indicators, but instead they need to form part of an integrated policy process with a more holistic approach to policy-making. The indicators need to clearly measure and monitor the availability and sustainable use of natural resources, as this is the basis of the well-being and survival of current and future generations. They should also help to determine the effectiveness of policy interventions and explore new policy options.

Several institutional actions and innovations can support and help the adoption of alternative indicators. To effectively institutionalize improved ways of measuring and monitoring well-being, new indicators should be adopted by local and national governments, and collected and monitored as official statistics. Assuring the cooperation of finance and economics ministries is essential in introducing sustainable social and environmental well-being as the main goal in policy-making. This process can be strengthened by institutional innovations, such as specialist roles or offices which support the shift in measurement and policy objectives by identifying and advocating good practices, and help tailor them to local needs.

One such measure would be to establish Commissioners or Guardians for Future Generations at all governance levels, who can advocate policy-making and tools such as innovative indicators that target interconnected environmental, social and health concerns and serve the interests of future generations alongside the needs of the present. As an independent office they can keep an eye on policy developments, intervening and exposing the long-term implications of today’s decisions. Examples of existing Commissioners around the world offer innovative models in multi-disciplinary working, embedding a longer-term horizon into policymaking.

A multitude of solutions are emerging on global, national and local levels, including unprecedented international efforts such as the adoption of the SDGs and the Paris Climate Agreement. We need to hold governments accountable and encourage them to go beyond the minimum of what they have agreed to. Adopting and implementing new indicators and measurements that are capable of revealing true progress towards this direction is a key element in creating a genuine change at systemic level.

Image by Aikawa Ke

Posted by Future Justice on 8 January 2016

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