What would a wellbeing budget 2017 look like?

Over 50 years of research has told us how we can improve wellbeing through Government policy. Will these feature in the budget?

Work and the Economy

  • Think creatively about incentivising ‘good jobs’

This budget needs to prioritise reducing unemployment and creating high quality jobs.

Previous business rate proposals meant that rates for pubs, shops, GP surgeries hospitals could be set for increases as high as 400 per cent. This creates a short-term danger that a business’ biggest overhead could be cut: employees.  Unemployment is one of the most important things the Government should care about in a wellbeing budget.

Becoming unemployed has among the most damaging effects on wellbeing and mental health, alongside health and relationships. The wellbeing impacts of unemployment go beyond the impacts of income.  If someone is unemployed for more than a year, their wellbeing will  permanently be lower – it increases once back in employment, but doesn’t increase back to previous levels. Where a parent has been unemployed in the past, their adolescent children will have lower wellbeing and self confidence, years later and after their parents are back in employment.

Being in a job is good for wellbeing and being in a ‘high quality’ job is even better. We don’t mean a certain skill level, type or industry. It’s about what makes a job worthwhile for us. Things like how secure it is, the social connections we have, autonomy and purpose, among other things.  A people-centred Budget needs to address the fact that  fewer than 3 in 10 (28%) people in the UK reported high satisfaction with their job.

The Budget needs to encourage high quality jobs.   For example, business rates could be lower for organisations taking action to create high quality jobs, or ensuring higher wellbeing for employees at work. This would have benefits for the wider economy as well. Organisations that strive to improve employee wellbeing tend to have better productivity, higher levels of innovation and creativity and lower costs associated with absenteeism, presenteeism and staff retention(1).

  • Improve commuting

We know that a longer commute is negative for wellbeing.  Importantly, we never adapt to a poor commute. As anyone who has to catch the 7.41 from Hove to Farringdon can tell you, it affects us daily. Research shows that merely switching from commuting by car to walking improves our wellbeing. We need a budget that promotes job creation nearer to residential areas, and make sure those jobs are open to local people.

  • Encourage lifelong learning and improve training system

Evidence shows that continuing to learn throughout life is not only useful for developing skills and improving job prospects; it can improve and maintain our mental wellbeing.  Learning throughout life is associated with greater satisfaction and optimism, and improved ability to get the most from life. People who carry on learning after childhood report higher wellbeing and a greater ability to cope with stress. They also report more feelings of self-esteem, hope and purpose whilst setting targets and hitting them can create positive feelings of achievement. Learning often involves interacting with other people and this can also increase our wellbeing by helping us build and strengthen social relationships.

A shake-up of the current training system has the potential to provide young people with a quality learning route. Research shows this is important for personal wellbeing, as well as productivity gains. Typically, lower level and technical qualifications result in lower financial and wellbeing returns than higher education qualifications. It’s argued this stems from the perception of technical qualifications by employers as poorer quality and lower value . Creating a qualification that has value to both employers and employees could yield significant benefits for personal wellbeing as well as productivity.

  • Provide adequate support for those at the end of their careers

Those who are involuntarily forced into retirement, without a financial safety net, experience the greatest drop in wellbeing.  A wellbeing budget would provide incentives for firms to support employees in planning for their retirement – this might include the option of reduced hours or other forms of “bridging’’ employment.

Health and social care

  • Improve work for those in the sector

There are not two cultures in the workplace: how you treat staff is how patients will be treated. Social care is a key priority for many local areas, but care work can be viewed as low paid, precarious and undesirable, making recruitment difficult. The quality of care has often come under scrutiny and many working in care homes are unskilled and hold few formal qualifications.

We know what works to improve conditions, increasing wellbeing as well as productivity in the health social care sector. A forthcoming Centre review of the published evidence will show that training in the workplace, combined with changes in job design, can improve the quality of the job, improving conditions for staff as well as  improving performance, reducing absenteeism and conflict.

  • Think across departments – prevention matters

Acute responses to crises have high costs. Prevention has a long pay-back. Those with higher wellbeing are less susceptible to illness and are more likely to recover faster. Even the emotional support in the first 3 years of a child’s life can hugely influence later outcomes.

We know that physical activity can prevent and improve a range of mental health conditions and music and singing can improve wellbeing, especially for older people. There are clear health and wellbeing benefits from a connection with the natural world, including national parks, local pockets of green space, canals, rivers, or the coast.

The budget would recognise the valuable role which social connections play. Countries where everyone has someone to rely on have significantly higher wellbeing compared to countries where no-one has someone to rely on- around 10% higher, even when other factors like health and income are accounted for. Individuals with higher loneliness have significantly lower wellbeing. In countries where everyone feels that most people can be trusted, the country tends to have around 20% higher average wellbeing compared to those where no-one answers positively to their levels of trust.

And what can Government or local authorities do? What works for social relations? An upcoming Centre review will lay out the existing evidence. We already know that community and housing design play an important role – those living in walkable, mixed use neighbourhoods are more likely to know their neighbours and trust others.

The wellbeing budget would promote cross-departmental cooperation, working together to support social care of the elderly and creating an environment which is sociable. Continuing the positive steps already taken by the Department of Health, the wellbeing budget would continue to recognise the importance of wellbeing and the role of culture, sport and ‘green’ interventions for preventing and improving diagnosed conditions.

Taxes and stability

  • Tax increases, tax cuts, spending… and stability

The main insight from current wellbeing research into taxation is that poor individuals get more wellbeing from an additional pound than rich people. Once we reach a certain income, increases in our income only increase our wellbeing by a small amount – studies have estimated that doubling our household income would increase life satisfaction by a little over 1% (2).

Because we compare ourselves to others, our wellbeing won’t increase if the income of all those around us increases at the same rate. The level of national income has surprisingly little effect on wellbeing, as long as it does not go down. Measures of wellbeing are more than twice as sensitive to negative economic growth as compared to positive growth. Economic stability is important.

Why should the Government care about the wellbeing budget?

Where people have lower wellbeing, the leaders are more likely to be voted out.

The wellbeing budget – what next?

These are just examples of some of the evidence of what influences our individual and community wellbeing. Beyond this, our national wellbeing rests upon how this adds up as a whole – now and going forwards. Based on the evidence, a Government would prioritise investments to improve national wellbeing, current and future. However, there is still a lot to learn. We need to test which approaches work best, in what format, to understand how wellbeing can be improved. Especially for those with the worst lived experiences. We don’t need to roll out new approaches before testing – we need to try new things in a way which lets us understand what works – and what works for wellbeing.

You may also like: How a spending review would look if the government wants a happier Britain 

(1)  Prof. Alex Edmans, London Business School,2015, BITC/Ipsos MORI 2010, The Wellness Imperative: World Economic Forum 2010.

(2) The regression coefficient on log income in a BCS life-satisfaction regression (controlling for other adult outcomes, childhood outcomes and family background) is 0.20
Doubling household equivalent income is predicted to raise life satisfaction by oneseventh of a point.

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