A lesson from New Zealand

 In her address to the World Eco­nomic Forum in Davos in Janu­ary, New Zealand’s Prime Minister Jacinda Ardern announced the need for her government “to address the societal well-being of our nation, not just the economic well-being”. This week, the New Zealand government presented its first “Wellbeing Bud­get”, a progressive document that has the potential to inspire other countries, including Nepal, which also presented its annual budget this week.

 

As trailblazing as it was, Ardern and her Finance Minister Grant Robertson took inspiration from different studies and experiences, including works by economists Jospeh E. Stiglitz, Amartya Sen and Jean Paul Fitoussi who, in the middle of the 2008 financial crisis, led a commission to study possible alternatives to the Gross Domestic Product (GDP) as a yardstick to assess people’s economic and social progress.

 

Ardern asked herself three questions: Is the “Wellbeing Budget” intergenerational, positively impacting future generations? Does it go beyond the narrow definition of success and take into account other aspects of life? Does it bring government agencies to work closer for achieving common goals?

 

Considered for many years as an economic “rock star” thanks to the previous center-right governments that created successful pathways for businesses to grow and prosper, now the challenge PM Ardern is taking head on is to turn New Zealand into a “rock star” for the well-being of its citizens. While economic indicators have been extremely good for many years, quite a few New Zealanders were falling behind, with youths, especially those from the Maori community and immigrants from South Pacific nations, hit particularly hard. The country also has high rates of homelessness and suicide. In short, many have been left behind despite New Zealand’s overall economic prosperity.

 

The “Wellbeing Budget” has set five priorities: transitioning to a sustainable economy, improving mental health, boosting innovation, lifting disadvantaged youth, and reducing child poverty. What is interesting is the process that led to the selection of these priorities.

 

I am talking not just about standard consultations, but a scientific approach based on a Living Standard Framework, with a baseline of around 60 indicators with complex spider graphs able to analyze and project whether selected population groups are likely to experience high levels of well-being. To be honest, it is complex and it not surprising that it has faced criticism.

 

The LSE, divided into three sections—Our People, Our Country, and Our Future—identifies four capitals (human, social, natural and financial/physical) that must be addressed to meet the aspirations of the citizens of New Zealand.

 

In a recent pre-budget speech addressing the concerns of the business community, Ardern said that “while economic growth is important—and something we will continue to pursue—it alone does not guarantee improvements to New Zealanders’ living standards”. In another pre-budget speech, Finance Minister Robertson affirmed that “Yes, we need prosperity, but we also need to care about how we sustain and maintain that and who gets to share in it”.

 

What is striking is not only the powerful moral rationale, but also the idea of bringing together all the ministries to change the status quo and achieve clear outcomes, each related to the five policy priorities. Going beyond a sectoral approach, getting various ministries to work together on multiple interlinked goals is crucial. In New Zealand, they call this “whole-of-government approach” and it means, in Robertson’ s words, “stepping out of the silos of agencies and working together to assess, develop and implement initiatives to improve wellbeing.”

 

Nepal is in a unique phase. It now has an ambitious constitution that is reinventing the way the government is run. New mechanisms and rules related to the basic functioning of the three tiers of government are being formulated. There is probably the need to identify key policy areas and invest in them strategically.

 

Many Nepalis die each year in road accidents. No matter how many committees have been set up, the frequency of accidents seems to be increasing. On education, while it is good that the concerned ministry wants model community schools around the country, the overall resources allocated to such a key sector are being trimmed. Important social security schemes have been launched, but implementation is patchy at best and really messy in some cases.

 

The right to free healthcare is still not guaranteed, with poor implementation of already weak policies that are supposed to provide free services to the neediest. The country was great at reducing the infant mortality rate, but it is failing its citizens in other health areas. (Part of the blame goes to the donors.)

 

The federal and provincial governments should put ego aside and agree, through talks, on key issues that could truly translate into reality the slogan of “Prosperous Nepal, Happy Nepalis”.

 

We should not forget that for Robertson, New Zealander’s Finance Minister, “Wellbeing means people living lives of purpose, balance and meaning to them, and having the capabilities to do so”.

 

Nepal needs an aspirational, while at the same time, realistic budget with well thought out and well-structured initiatives and programs. While identifying major issues to be addressed strategically over the next fiscal year may have been challenging, the bigger challenge will be to muster the consistency and grit to pursue budgetary goals.

 

The author is Co-Founder of ENGAGE, an NGO partnering with youths living with disabilities.

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