The Conversation Yearbook 2019 by John Watson

Author:John Watson
Language: eng
Format: epub
Publisher: Melbourne University Publishing

NZ has dethroned GDP as a measure of success, but will Ardern’s government be transformational?

David Hall

Senior Research Officer—Social Science and Public Policy, The Policy Observatory, Auckland University of Technology

When you’re in politics, words are a high-stakes game. Voters and journalists hold you to them and there is a risk in using words that are hard to live up to. This is particularly true for politicians whose reputation is founded on sincerity and authenticity.

New Zealand Prime Minister Jacinda Ardern saddled herself with the word ‘transformational’. She used it heavily in the heady days of the 2017 election campaign, although less so in the compromised reality of a coalition government. Still, it is the aspiration she is held to. The 2019 well-being budget is held to it by association.

But how do we know transformation when we see it?

Beyond the status quo

Obviously, transformation must go beyond the status quo. But to be transformative, it must also go beyond mere reform.

A reform agenda recognises that trouble is brewing, that social, economic and environmental trends are on the wrong track. It accepts that major changes to policy and lifestyle may be required. As sustainable development research shows, it does ‘not locate the root of the problem in the nature of present society, but in imbalances and a lack of knowledge and information’.

It tends to reach for existing policy levers and to hang its hopes on technical solutions. It reacts to the toughest choices by devising new frameworks for analysing them.

The well-being budget easily goes this far. Finance Minister Grant Robertson is entitled to say, as he did in his budget speech, that this is a government ‘not satisfied with the status quo’.

Most important, New Zealand’s well-being approach decentres GDP as the principal measure of national success, using instead the multidimensional living standards framework. In doing so, Ardern’s government has acted upon doubts that are as old as GDP itself, and gained traction in the years after the 2008 global financial crisis.

As economists Joseph Stiglitz, Amartya Sen and Jean-Paul Fitoussi argued in their influential analysis of what went wrong:

What we measure affects what we do; and if our measurements are flawed, decisions may be distorted.

By arguing for more nuanced national accounting that captures quality of life, they made a case for reform that Ardern’s government is putting into practice.

Beyond reform

A transformative agenda goes further. It sees problems as rooted in the present structure of society. It isn’t only about managing the flaws and oversights of the dominant system, but overturning the system itself. This involves an order of ambition that the well-being budget lacks.

Consider, for instance, its centrepiece investment: NZ$455 million (over four years) for a new frontline service for mental health. This is vital support for those in need, complemented by wider reforms recommended by He Ara Oranga, the report of the inquiry into mental health and addiction.

But its primary focus is to address existing suffering. It doesn’t aim for the socioeconomic or historical causes of many people’s misery and strain. Other aspects of government

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