Changes to future budget reporting outlined by finance minister

Economic "well-being" becomes a new test.

Finance Minister Grant Robertson says the Coalition government will make economic “well-being” a core part of future budgets and will amend the Public Finance Act to make this a priority.

Starting in Budget 2019, all budgets will report on a wider range of well-being indicators, Mr Robertson says.

He says the government has instructed the Treasury to develop a set of living standard frameworks, based on OECD examples, to better assess people’s overall well-being.

The framework will include measuring environment issues, people’s skills, knowledge and mental health, social capital (cultural identity and rule of law) and financial capital (things which make up physical and financial assets.)

Indicators of child poverty will also be involved in the measures.

It will require an amendment to the Public Finance Act that would oblige the finance minister to report on measures such as child poverty reduction at each budget.

Mr Robertson says he believes this will be a “major change” to the way economic success is measured in New Zealand and will be a world first.

“We want to measure the success of our economy better – we aren’t satisfied with just measuring GDP growth.

“While [GDP growth] is a good measure of activity in the economy, it doesn’t tell us enough, or indeed very much at all, about the quality of the activity in our economy.”

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