Why wellbeing is a big deal, by Warren Hatter

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I’ve held back from blogging on the moves to introduce an ‘official’ wellbeing or happiness measure, as I think of a new angle on the issue about twice a day, but it’s important stuff so I’ve decided to focus on one key point: that central government introducing such a measure is a great opportunity to embed localism.

Jo Swinson MP argues that the move is good for policy, good for democracy and of symbolic value. I’d like localists to go further: to ensure that the move is good for local policy, local democracy, and more than symbolic.

To do this, we need to start treating the new measures as paradigm-changing. Instead, it feels to me as though the mainstream response has been a narrow one: that measuring wellbeing means that policy-makers will focus more on enhancing wellbeing, with the commentator’s view resting on whether or not they think that this is appropriate.

So in what way is this stuff paradigm-changing? As the Stiglitz Commission and others have ably demonstrated, relying on gross domestic product as the main measure of a nation’s success is fatally flawed, for two main reasons. First, our success is about much more than economic success; second, GDP is flawed even as a measure of economic success. The prime minister’s adoption of much of this analysis in launching the initiative shows how mainstream this view has become. It also, I hope, opens the door to a more radical interpretation of the move than I’ve described above. I’ve blogged about these ideas before for some time, so won’t repeat myself much here.

However, in respect of Stiglitz & co, we need to start by recognising the limitations of a wellbeing or happiness measure. The case for measuring wellbeing should not be simply that our current metrics are lacking a bit, but that our current metrics are fundamentally flawed, as they do not have a true understanding of our wealth. The Stiglitz Commission proposed measuring wealth in terms of a number of different capitals (natural, human, social and physical). Do this, and we can track our success much more effectively than we can by looking purely at the size of the economy.

This is not easy. Many details and practicalities are not yet clear, but it is the future, because we manage what we measure, and economic growth has now outstripped our planet’s ability to cope. But the cat is out of the bag; already, it is expected that wellbeing measures will be shot through the Treasury’s famous Green Book.

Jill Rutter, currently at the Institute for Government, suggests that the real test for wellbeing is whether explicitly incorporating it into policy making makes governments do different things. She adds that the Treasury looked at this a few years ago and concluded the answer was no. I think that this supports my argument; if it’s just seen as a clever piece of social research, or evidence to feed into some evidence-based policy, then we are limiting not only its scope, but its impact.

This sounds, though, like an argument about the national accounts; so why should localists argue this case?

First, a wealth measure such as that suggested by Stiglitz would give us all the chance to understand how well our places are doing, which strikes at the heart of what local government is for. I’ve often said that the central duty of a local authority should be to secure the future viability of the place, and it seems to me that a ‘capitals’-based measure of wealth is a big part of measuring how well this is being done. Regeneration by shopping mall would make much less sense if decision-making were driven by a truer, more rounded definition of wealth.

Second, and linked, is the understanding – both unremarkable and unnoticed – that national wealth is the sum total of our local wealth. Given that these measures will be people-centred, is there really a case to be made that my wellbeing or happiness is different from a national or local (or sub-local) perspective? Surely not. I have different feelings about my neighbourhood, borough, city/county and nation but, as a citizen, I do not have a ‘national wellbeing’ and a separate ‘local wellbeing’.

If we work towards a capitals-based measure of wealth being both the core local and core national metric, then we will have solved the problem of top-down, centralised target setting for good. I don’t believe that this is pie in the sky. Look at Maryland, a US state that has introduced the GPI (genuine progress indicator) as the main measure of success, replacing GSP (gross state product).

So, for this opportunity to be realised, localists need to put two main arguments. First, that the new measure should provide both local and national metrics, with a clear understanding that national wellbeing is the sum total of wellbeing in all localities; second, that a course should be explicitly charted towards such measures being part of the national accounts. These are achievable goals, it seems to me. But the local government family is not yet making the case.

It’s important to look at the challenges, as has the Local Government Information Unit’s Jonathan Carr-West, but I believe that we can aim higher than this. We can see this as the vital first step to measuring our success and wealth at local level in a way that will: give local government and residents a holistic way of understanding our places’ success; in the long-term, drive the primacy of local indicators over centrally driven ones; and, progressively, reward rounded, sustainable decision-making.

Warren Hatter is a researcher and adviser on climate change, innovation and local leadership

3 comments on Why wellbeing is a big deal, by Warren Hatter

  1. Laura Stoll says:

    This is something that is discussed in a new report ‘The role of local government in promoting wellbeing’, commissioned by Local Government Improvement and Development and the National Mental Health Development Unit and written by Nef (the New Economics Foundation).
    It looks at how local government can influence wellbeing at the national level, and provides case studies of local governments from around the UK who are already doing pioneering work in this area. The report can be accessed at http://www.neweconomics.org/publications/the-role-of-local-government-in-promoting-well-being

  2. John Jenkins says:

    Warren – How do you see this in relation to the debate generated by the work of Richard Wilkinson and Kate Pickett on more equal societies ‘doing better’? Surely national wellbeing isn’t just the sum total of levels of local wellbeing. How do we take on board the impact of differences between groups and between areas?

  3. Warren Hatter says:

    Great question, John. I suspect my answer is deceptively simple; straightforward in principle but difficult in practice: ensure that measures of equality are significant in the capitals-based measure of ‘wealth’ used. To which I’d add that inequality would have an impact on measures of social capital, whether we measure it directly or not.

    I’m advocating the idea that national wellbeing is the sum total of local ‘wellbeings’ – as long as wellbeing is measured in terms of our ‘wealth’ in the broadest sense (including, as above, equality).

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