Asia-Pacific

New Zealand prepares 'wellbeing' budget

Jacinda Ardern. Source: AAP

New Zealand's government is set to unveil a budget that measures wellbeing next to economic growth, but questions are being asked about what will change.

As New Zealand's government prepares to unveil its national budget, it's promising something different: a set of accounts guided by wellbeing, not just the bottom line.

The country's Labour-led administration will on Thursday hand down a so-called "Wellbeing Budget", its second go at the books and one set to feature explicit measures of public welfare alongside economic growth.

"Nobody wants to live in a country where, despite a strong economy, families are homeless," Prime Minister Jacinda Ardern said last week.

While all the usual economic measures will be there, the books will show the government's planned spending against five main goals: supporting mental health, reducing child poverty, lifting opportunities for Maori and Pasifika residents, boosting innovation and moving toward a low-carbon economy.

The new framework reflects a growing push by the Organisation for Economic Cooperation and Development towards looking at outcomes beyond economic figures, and the OECD is monitoring the Kiwi effort.

But questions remain about the extent of the changes.

New Zealand Institute of Economic Research principal economist Peter Wilson said the framework had prompted changes to measurement of outcomes, but looked set to be more incremental than revolutionary.

"The fact that the current government is saying that there's more to government policy than GDP, and making that explicit, is good," he said.

"If you look below the rhetoric, are you seeing fundamental changes about how they think about solving policy problems? I haven't quite seen that yet."

Speaking at the World Economic Forum Davos earlier this year, Ardern described the new model as a move towards embedding kindness and empathy.

"Our people are telling us that politics are not delivering and meeting their expectations. This is not woolly, it's critical," she said.

Her government has already announced a $NZ320 million ($A303 million) package addressing sexual and family violence, made the country's largest investment into tackling homelessness and flagged a new mental health policy.

Victoria University wellbeing and public policy professor Arthur Grimes said the framework appeared to have focused bids for the government's money this year, but despite much hype on the world stage, was less stringent than welfare rules already employed by some European countries.

"Every government has done work on health, education and policing ... I think it's more focused, and the rhetoric has been cleverer," Grimes said.

"But it's early days, and it may be that it becomes more ambitious."

Whether the policy would survive into future administrations would ultimately depend on what exact budgetary measurements were unveiled, he said.

But Ardern says the attempt will be different to that seen elsewhere, although she admits it won't' be perfect in its first run.

"We are dealing with a long period of time in under-investment ... You can't turn that around in one budget. But we are trying to create the foundation for change," she told reporters on Tuesday.

While Australia's government is still looking to get its books back in the black, New Zealand's last year ran an operating surplus and plans to continue the trend in coming years, while paying down debt.

Economic forecasts for the economy have, however, slightly slowed and may give policymakers less wiggle room.

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