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New Zealand’s new budget prioritizes well-being over economic growth

The happiness of citizens is now more important than growth at all costs.

New Zealand’s new budget prioritizes well-being over economic growth
[Photo: Henry McIntosh/Unsplash]

New Zealand already ranks as one of the happiest countries in the world. But it could be doing better–and the government’s new budget is now designed around improving the well-being of its citizens, not single-mindedly focused on the country’s economic growth.

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“This approach is a significant departure from the status quo,” finance minister Grant Robertson wrote in a statement. “We are not just relying on gross domestic product (GDP), but also how we are improving the well-being of our people, protecting the environment, and strengthening of our communities.”

All new government spending has to fit into five categories: mental health, reducing child poverty, the transition to a low-emissions economy, addressing inequality in Maori and Pacific Islander communities, and thriving in a digital age.

In the budget, $1.9 billion (US$1.2 billion) will go to mental health, with half of that going to support those with anxiety and depression. There will be $346 million to provide extra funding to permanently house people who are homeless. $1 billion will go to the country’s rail network; $320 million will help address the country’s struggles with domestic violence; $535 million will support a fairer welfare system. $1.2 billion will help children in state care; $80 million will go to climate change research and cleantech; and $58 million will boost the country’s program to plant a billion trees by 2028. And the list goes on.

At Davos in January, the prime minister, Jacinda Ardern, noted that country’s economy was already healthy by standard measures, projecting 3% growth, with 3.9% unemployment. “On traditional measures, budget surpluses, people would look at us and go, ‘you’re doing okay,'” she said. “But we have homelessness at staggering rates. One of the highest rates of youth suicide in the OECD. Our mental health and well-being is not what it should be. So our plan is…a well-being budget where if you’re a minister and you want to spend money, you have to prove how you’re going to improve intergenerational well-being.”

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About the author

Adele Peters is a staff writer at Fast Company who focuses on solutions to some of the world's largest problems, from climate change to homelessness. Previously, she worked with GOOD, BioLite, and the Sustainable Products and Solutions program at UC Berkeley.

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