1. Building back better lives: Using a well-being lens to refocus, redesign, realign and reconnect
After an initial focus on the emergency response to COVID-19, governments are now developing recovery strategies that could lay the foundations for future well-being, shaping the long-term paths for economies and societies. This chapter looks at how a well-being lens can inform policy prioritisation and the design of recovery strategies, and can help achieve stronger strategic alignment across public agencies and between public, private and civil society organisations. Building on the evidence presented in the following chapters, it identifies common well-being priorities across OECD countries in the wake of the pandemic. The chapter then describes five strategic policy channels that can help address these well-being priorities in ways that simultaneously raise current and future well-being while promoting opportunities for all. Ultimately, achieving such well-being synergies requires new ways of working within the system of government and across the public and private sectors and civil society.
The COVID-19 crisis has highlighted the strong interdependencies between social, economic and environmental outcomes. The pandemic rapidly cascaded from a public health crisis to a global economic and social crisis, impacting people’s lives in a multitude of different ways, with both short- and potentially long-term consequences. The effects of the pandemic have been aggravated by pre-existing well-being challenges, ranging from air pollution (Cole, Ozgen and Strobl, 2020[1]; Wu et al., 2020[2]) to crowded households (Chen and Krieger, 2021[3]), and from job and financial insecurity (OECD, 2020[4]) to obesity (Alberca et al., 2020[5]; Dietz and Santos-Burgoa, 2020[6]) and cigarette smoking (Patanavanich and Glantz, 2020[7]; Reddy et al., 2021[8]). The pandemic has also brought increased attention to how threats to biodiversity, such as habitat destruction and wildlife exploitation, can increase the risk of infectious diseases being transferred across species (United Nations, 2020[9]; Gottdenker et al., 2014[10]). COVID-19 has been described as both a wake-up call and a dress rehearsal for other crises, including climate change (Guterres, 2020[11]).
After an initial focus on addressing the health emergency and the economic and jobs crises that accompanied it, governments’ attention has now turned to stimulus measures to support the recovery. Across OECD countries, the fiscal stimulus in response to the COVID-19 crisis has been larger than that which followed the 2008 financial crisis, with additional spending or foregone revenues implemented or planned between January 2020 and mid-March 2021 amounting to around 16.4% of GDP on average (OECD, 2021[12]). COVID-19 recovery packages will have considerable implications for the long-term paths of societies (Buckle et al., 2020[13]). At the same time, governments face several interconnected economic, social and environmental challenges that predate the health crisis, implying that a return to business as usual would miss an important window to tackle these underlying vulnerabilities and risks (OECD, 2020[14]; OECD, 2020[15]; Hepburn et al., 2020[16]). Instead, well-designed recovery packages could serve dual purposes in building back better: on the one hand, repairing the damage caused by COVID-19, and on the other, setting countries on a stronger, greener, more inclusive and more resilient path, ready to tackle the upcoming crises of the future (OECD, 2020[14]; OECD, 2021[17]; Hepburn et al., 2020[16]).1
A well-being lens can be used to shape a more comprehensive and balanced approach to building forward, by helping to:
refocus – firmly focusing government action on what matters most to the well-being of people and society, building on evidence about both current and future well-being outcomes, as well as inequality of opportunity across all dimensions of people’s lives (Box 1.1)
redesign – designing policy in a coherent and integrated way that systematically considers potential impacts across multiple well-being objectives, inclusion and sustainability, rather than focusing on a single (or very narrow range of) objective(s) “here and now” independently of others
realign – aligning the system of government such that it is better able to collaboratively work towards societal priorities, by shifting the focus from narrower outputs of individual departments towards shared outcome-based objectives, and
reconnect – strengthening the connections between government, the private sector and civil society based on a joint understanding of what well-being means and how it can be improved.
This chapter explores each of these four ways in which a well-being approach can help to build back better in more detail. Based on the well-being evidence analysed throughout the report, the first section of this chapter identifies common well-being priorities for recovery. These include the need to: increase the job and financial security of households, and particularly those most affected by the crisis; promote equality of opportunity and mitigate the scarring effects of the crisis on the most vulnerable individuals and workers, with a focus on youth, women and the low-skilled; lift the burden of poor physical and mental health; take strong action on climate change and environmental degradation; contain the increase of child poverty; and reinforce trust in others and in public institutions as the basis for greater social cohesion in the future.
The second section of this chapter illustrates how a well-being perspective can help inform the redesign of public policy by systematically considering well-being outcomes in policy development upstream rather than correcting for negative impacts ex post. To provide some concrete examples, five strategic policy channels are outlined that can simultaneously address multiple objectives (for current well-being, inclusion and sustainability) in the wake of the pandemic. These are: 1) supporting the creation of inclusive and high-quality jobs in the low-carbon economy; 2) broadening access to lifelong learning where it is needed the most; 3) using a whole-of-government approach to raise the well-being of disadvantaged children and young people; 4) strengthening mental and physical health promotion and prevention; and 5) reinforcing trust by enhancing public sector transparency and decision-making, establishing meaningful citizen participation on a more ongoing basis, and investing in local communities and social capital.
The third and fourth parts of this chapter look at the institutional mechanisms that are needed to support a well-being approach to public policy. More coherent and effective approaches to raising societal well-being require new ways of working within government as well as between the public sector, private sector and civil society. Recent decades have seen a growing number of governments using well-being frameworks and evidence to help inform government agenda-setting and budgeting, to help embed a longer-term focus within the system of government and to strengthen policy coherence (both between sectors and between different levels of government) in working towards well-being objectives. A well-being approach can also help create stronger connections between public, private and civil society actors in working towards well-being. Practical examples of this are presented in the last section of this chapter.
The OECD Well-being Framework guides the OECD’s work on monitoring trends in current well-being outcomes, inclusion and the sustainability of well-being across member and partner countries. It underpins the How’s Life? report series published on a bi- or triennial basis since 2011. The Framework (Figure 1.1) features two central pillars: current well-being (on top), which addresses living conditions here and now, as well as inequalities in their distribution; and resources for future well-being (on the bottom), which considers the stocks, flows and risk and resilience factors that shape well-being over time and for future generations (OECD, 2020[18]).
Current well-being comprises 11 dimensions. For the purposes of this report, the dimensions have been clustered into three broad groups:
Material conditions, encompassing Income and Wealth, Housing, and Work and Job Quality
Quality-of-life, spanning Health, Subjective Well-being, Knowledge and Skills, and Environmental Quality,
Community relations, which covers Social Connections, Work-Life Balance, Safety and Civic Engagement.
National averages often mask large differences in how different population groups are doing. Moreover, inequalities in one well-being dimension (e.g. Health, Housing, or Safety) can produce inequalities of opportunity in other dimensions. Measuring the distribution of well-being is therefore a core aspect of the approach. The inclusion section of this report (Chapters 5, 6 and 7) addresses in particular how COVID-19 has affected population groups differently, as well as overall deprivation rates.
The final section of the evidence scan relates to sustainability. In the OECD Well-Being Framework, the systemic resources that underpin future well-being are expressed in terms of four types of capital, i.e. stocks that endure over time but are also affected by decisions taken (or not taken) today. Economic Capital includes both man-made (physical) and financial assets. Natural Capital encompasses natural assets (e.g. stocks of natural resources, land cover, species biodiversity), as well as ecosystems and their services (e.g. oceans, forests, soil and the atmosphere). Human Capital refers to the skills and future health of individuals. Finally, Social Capital refers to the social norms, shared values and institutional arrangements that foster co-operation.
Source: OECD (2020[18]), How’s Life? 2020: Measuring Well-Being, OECD Publishing, Paris, https://dx.doi.org/10.1787/9870c393-en.
The COVID-19 crisis has highlighted the unique and fundamental role of government in safeguarding people’s well-being. From the timely and extensive interventions to manage the health and sanitary crisis, to the strong financial support provided to households, workers and small and medium companies, governments have demonstrated an unprecedented leadership in protecting people's lives and livelihoods. This focus ought to be maintained when designing recovery packages, whilst also integrating actions to address long-standing threats to well-being, such as biodiversity loss and climate change.
Directly targeting well-being outcomes, by explicitly building well-being considerations into policy upstream, is an efficient and cost-effective way to design policies that address social and environmental pressures of both a structural and cyclical nature. A well-being approach is about attending to the root causes of social and environmental vulnerabilities and imbalances and creating economic systems that do good for people and the planet by design (Nozal, Martin and Murtin, 2019[19]; Trebeck and Williams, 2019[20]). The post-pandemic recovery creates new opportunities to set in place the foundations for more resilient, equitable and sustainable societies and economies (OECD, 2021[21]). While a strong economic recovery is essential, ultimately it is the quality and form of the recovery that will determine its contribution to societal well-being.
Common well-being priorities for COVID-19 recovery strategies
What outcomes would COVID-19 recovery strategies prioritise if the well-being of current and future generations were front and centre? Determining policy priorities for a strong recovery is a challenging task for any government given the multiplicity of objectives to be simultaneously achieved. A well-being approach can give structure to this priority-setting process, by providing a framework for systematically scanning evidence on current well-being, distributional outcomes and resources for future well-being, to identify the areas of greatest need. This type of systematic evidence scanning is best done at the national and subnational level, since both pandemic experiences and economic, social and environmental contexts and policy settings vary substantially both across and within OECD countries. Nevertheless, building on the evidence presented in the following chapters, some concerns that are common to many OECD countries can be identified (Figure 1.2).
While OECD countries had markedly different patterns of performance across the dimensions of the OECD Well-Being Framework before the pandemic (OECD, 2020[18]), this evidence scan highlights several common priorities that need to be central in country recovery strategies. These include the need to:
increase the job and financial security of individuals and households hit hardest by the pandemic
promote opportunities for all and mitigate the scarring effects of the crisis on minorities, youth and women
lift the increasing burden of poor physical and mental health
take strong action on climate change, biodiversity loss and environmental degradation
improve well-being outcomes for vulnerable children and young people, and
The pandemic has raised the urgency of addressing existing well-being concerns
Increasing the job and financial security of individuals and households hit hardest by the pandemic
Increasing job and financial security is a key priority in response to one of the worst jobs crises since the Great Depression (OECD, 2020[22]). Job and household financial insecurity were already of concern prior to the pandemic and addressing these issues has become critically urgent now. Around 2016, more than a third (36%) of people in OECD countries were already financially insecure, meaning they would risk falling into poverty if they had to forgo three months of their income (OECD, 2020[18]). Similarly, the share of non-standard workers (i.e. part-time, temporary and self-employed workers) has been growing in recent decades,2 with more than a third of workers in OECD countries being in non-standard employment (ILO, 2016[23]; OECD, 2019[24]).
The pandemic’s impact on employment and hours of work at the onset of the crisis was, on average, ten times bigger than that observed in the first months of the Global Financial Crisis in 2008 (OECD, 2020[22]). By October 2020, 37% of respondents in a representative sample of 25 000 adults from 25 OECD countries who participated in the 2020 OECD Risks that Matter survey indicated that their household had experienced at least one job-related disruption, such as a job loss, a reduction in work hours and/or a pay cut (OECD, 2021[25]). Among households that lost a job during the pandemic, 68% indicated having trouble paying bills (OECD, 2021[25]). In addition to non-standard workers, women, youth and low-income workers have been particularly exposed to the risk of job losses (see Chapter 5).
Housing cost overburden is putting further pressure on the financial security of low-income households (OECD, 2021[26]) (see Chapter 2). Real house prices as well as rental prices increased in most OECD countries between 2005 and 2019, constraining the ability of low-income households to spend on other essentials, such as food, health care and education (OECD, 2020[18]). Between 2019 and 2020, real house prices continued to grow significantly in most OECD countries, while rent prices remained stable or grew only slightly – likely due to caps on rent prices and other artificial rent suppression measures (OECD, 2021[26]). The economic fallout of COVID-19 has heightened housing insecurity for some households (OECD, 2021[27]). For example, in April-May 2020, 10% of people in 22 OECD European countries reported being behind in paying utility bills and 8% in making rent or mortgage payments (Eurofound, 2020[28]). An August 2020 study found that 25% of United States adults had trouble paying bills and 16% had problems paying their rent or mortgage; among lower-income adults, the same shares were 46% and 32% respectively, i.e. around twice as high (Parker, Minkin and Bennett, 2020[29]). The recent OECD report on Building Better Housing Policies provides an overview of what governments can do to design policies for more efficient, inclusive and sustainable housing (OECD, 2021[30]).
Promoting opportunities for all and mitigating the scarring effects of the crisis on minorities, youth and women
The unequal impacts of the pandemic are compounding both long-standing inequalities of opportunity across OECD countries and declining social mobility. Around 2016, the average income of the richest 10% of the OECD population was already about nine times that of the poorest 10%, up from seven times in the mid-1980s (OECD, 2019[31]). This report shows that people and groups who were already vulnerable before the COVID-19 pandemic have been particularly affected by it. Those with lower levels of education or income, women, young people and people with dependent children are more likely to have lost their jobs, to have experienced job-related disruption and to report financial difficulties (see Chapter 5). For example, on average across EU countries, the labour income loss following the pandemic was 4 times higher for workers in the bottom income quintile than for those in the top income quintile. The learning loss caused by school closures has particularly affected already disadvantaged children who have faced higher barriers and challenges to remote learning (see Chapter 6) (OECD, 2020[32]). In the Netherlands, which features an equitable system of school funding and one of the world’s highest rates of broadband access, learning losses still proved to be up to 60% larger among students from less-educated homes compared to the general population (Engzell, Frey and Verhagen, 2021[33]).3 Other reports have emphasised the increased risks of domestic violence that women and children have faced during the shutdown (OECD, 2020[32]; OECD, 2021[34]). While mental health deteriorated for everyone in 2020, certain groups – including women, those with lower education levels, the unemployed, young people, the elderly and frontline workers – have experienced especially large declines (see Chapter 6). The limited data that are available suggest that the well-being of migrants and certain racial and ethnic communities has also been hit particularly hard (see Chapters 5, 6 and 7). In addition, regional differences – both between and within countries – have further magnified, emphasising the importance of place-based recovery approaches (OECD, 2021[35]). Unless strong policy action is taken, these growing inequalities in well-being outcomes will not only undermine the well-being of those who are worse off, but also that of society at large, as inequality in society goes hand in hand with lower educational and population health outcomes (Wilkinson and Pickett, 2007[36]; Pickett and Wilkinson, 2015[37]), lower levels of interpersonal trust (Uslaner, 2002[38]; Zak and Knack, 2001[39]) and lower economic performance (OECD, 2014[40]; McAdams, 2007[41]).
Lifting the burden of poor physical and mental health
Recovery strategies will also need to lift the burden of mental and physical ill-health that weighs heavily on individuals, societies and economies. Addressing the health emergency has been the top priority for policy makers following the pandemic outbreak. It will need to remain a long-term priority going forward, with a strong focus on both physical and mental health outcomes. Losses of loved ones, jobs and incomes, disruption of essential health services and deferred care, increased social isolation and loneliness, and heightened stress and anxiety all have long-term consequences for people’s physical and mental health, over and above the direct impacts of the crisis on excess mortality (see Chapters 3 and 6). Across 15 OECD countries in the period between April and December 2020, over 70% of people on average avoided going to hospitals or health centres to seek treatment, due to fear of exposure to the virus, thus putting physical health outcomes at risk (Chapter 3). Evidence from eight OECD countries with comparable pre-pandemic data show that risk for anxiety and depression rose significantly in the onset of the pandemic, from April through December 2020, and these rates remained elevated in the early months of 2021 (Chapter 3) (OECD, 2021[42]). Since the outbreak started, many adults reported experiencing “stress, anxiety, or sadness that was difficult to cope with alone”, including 33% of people in the United States, between 23% and 26% of people in Canada, Australia, New Zealand and France, and between 10% and 18% of people in Sweden, the Netherlands and Norway (The Commonwealth Fund, 2020[43]) (OECD, 2021[42]). At the same time, across OECD countries, many mental health services were completely or partially disrupted following the pandemic outbreak, with 57% of OECD countries reporting disruptions to services for older adults; 57% reporting disruptions in psychotherapy, counselling, and psychosocial interventions; 48% in work-related mental health programmes; and 52% in school mental health programmes (Chapter 3).
The COVID-19 health impacts are adding to existing concerns about worsening health outcomes across OECD countries. Across OECD countries, more than half of the population is now overweight (OECD, 2019[44]), and life expectancy already showed signs of plateauing or declining in some OECD countries prior to the pandemic (OECD, 2020[18]). In the EU, around 550 000 people of working-age die prematurely every year due to non-communicable diseases, amounting to 3.4 million life-years and EUR 115 billion in economic potential lost annually (Nozal, Martin and Murtin, 2019[19]). Mental health issues are one of the largest and fastest-growing categories of the burden of disease worldwide, with half of people across the OECD area experiencing a mental health issue in their lifetime (OECD, 2019[45]). At the same time, there is an enduring gap between the need for mental health treatment and people’s access to it: around 2016, on average across OECD countries, 67% of working-age adults with mental distress reported that they wanted help but did not get it (OECD, 2021[46]). As the flow-on effects of ill-health on wider personal and societal outcomes are significant, affecting educational outcomes, employment outcomes, child well-being outcomes and subjective well-being, both physical and mental health are urgent priorities that should lie at the core of countries’ recovery packages (United Nations, 2020[47]; Nozal, Martin and Murtin, 2019[19]).
Investment in ongoing critical well-being concerns needs to be accelerated to safeguard the sustainability of well-being going forward
Taking strong action on climate change and environmental degradation
As countries battle the COVID-19 crisis, they are also in a race against time to avoid an environmental catastrophe (OECD, 2021[48]) (see Chapter 11). Environmental challenges such as climate change, biodiversity loss and air pollution pose severe systemic risks to the well-being of current and future generations in ways that are highly unequally distributed (OECD, 2021[48]). A wide range of studies show how climate change and environmental degradation negatively affect physical health (Manisalidis et al., 2020[49]; Rossati, 2017[50]; Karbalaei et al., 2018[51]), mental health (Filipova et al., 2020[52]; Cunsolo and Ellis, 2018[53]; Hayes et al., 2018[54]; Obradovich et al., 2018[55]), livelihoods and poverty (Kabir and Serrao-Neumann, 2020[56]). Recent OECD analysis emphasised how the impacts of environmental degradation are concentrated among vulnerable groups and households, who are more likely to be exposed to their harmful effects, more susceptible to negative impacts, and more limited in their abilities to cope and recover from them. These groups include lower socio-economic households, as well as the young and the old (OECD, 2021[48]; Islam and Winkel, 2017[57]).
COVID-19 recovery efforts therefore need to be strongly integrated with concerted action on the environmental crises. While an early fall in greenhouse gas (GHG) emissions over the pandemic may have seemed like a positive effect, it is highly unlikely that these reductions will outlive the pandemic (OECD, 2021[48]; O’Callaghan and Murdock, 2021[58]) (see also Chapter 11). Initial short-term reductions in CO2 emissions will not have a significant impact on future climate risks unless they are coupled with robust mitigation measures as part of the recovery packages (Buckle et al., 2020[13]). As the environmental crises could cause social and economic damages far greater than those caused by COVID-19, strong action on climate change and other environmental crises is critical for achieving a resilient recovery (OECD, 2021[48]). The OECD is supporting countries in this endeavour through policy analyses and recommendations to tackle the COVID-19 crisis in a holistic way that concurrently addresses environmental, social and economic well-being priorities (OECD, 2020[14]; OECD, 2020[59]; OECD, 2019[60]; OECD, 2020[15]; OECD, 2021[48]; Buckle et al., 2020[13]).
Timely action is needed now to mitigate greater risks in the future
Improving well-being outcomes for vulnerable children and youth
Putting vulnerable children and young people at the heart of the recovery is essential to ensure a resilient recovery. Children and young people have been less at-risk of developing severe physical health symptoms linked to COVID-19 than older age cohorts (WHO, 2020[61]). Nonetheless, the crisis has had significant impacts on their current well-being (especially in terms of employment, education, mental health and disposable income) as well as on their future opportunities and trajectories (particularly for students from disadvantaged backgrounds, those with learning disabilities, young people from racial and ethnic minority groups and those in temporary employment) (see Chapters 6 and 9) (OECD, 2020[32]; OECD, 2020[62]). School closures, social distancing and confinement have increased learning gaps and the risk of poor nutrition among children and young people. They have worsened their exposure to the impacts of poor housing quality, domestic violence and abuse, and raised their anxiety and stress, while at the same time reducing their access to vital family and care services (OECD, 2020[32]).
COVID-19’s impact on children and young people could have long-term effects on their well-being outcomes. Early projections suggest that the pandemic could lead to significant rises in child poverty rates (OECD, 2021[63]). Children are over-represented amongst those living in poverty: in 2017-18, children made up 26% of those living in income poverty across OECD countries, despite representing only around 21% of the population (OECD, 2021[63]). The loss of relationships and learning opportunities that early care and education programs provide can exacerbate the large achievement gaps between children from low-income families and their peers (Office of the Assistant Secretary for Planning and Evaluation, 2021[64]; Barnett and Jung, 2021[65]). Learning losses due to school closures could also have long-term impacts. Estimates from the World Bank suggest that during the first phase of the crisis, students in primary and secondary school may have lost one-third of a school year of learning (see Chapter 3). These learning losses are likely to exacerbate pre-existing educational inequalities, as they are greater for already disadvantaged children who are less likely to live in good home-learning environments (OECD, 2020[66]; OECD, 2021[63]). The amount of learning loss is also likely to differ between countries, as countries with the lowest educational performance tended to fully close their schools for longer periods of time in 2020. This implies that education systems with poorer learning outcomes in 2018 were more likely to suffer from greater losses of in-person learning time in 2020 (OECD, 2021[67]).
Available evidence points to a rising prevalence of mental distress among young people (see Chapter 6) (OECD, 2021[68]). In most countries, mental health issues among young people have doubled or more following the pandemic outbreak (OECD, 2021[68]). Whereas prior to the pandemic, young people were less likely to report symptoms of anxiety or depression than the general population, post-pandemic most countries are seeing a higher share of young people experiencing such symptoms compared to the general population (OECD, 2021[68]). In the United States, more than one in four young people in a nationally representative survey of 13 to 19 year olds reported losing sleep because of worry, feeling unhappy or depressed, feeling constantly under strain, or experiencing a loss of confidence in themselves (Margolius et al., 2020[69]).Young people’s life satisfaction has also fallen more than that of any other age cohort (Chapter 6) (OECD, 2020[62]). Levels of loneliness, a key risk factor for mental health, have been particularly high among young people (Varga et al., 2021[70]; Weissbourd et al., 2021[71]). Across 27 European countries, 18-34 year-olds were the most likely to report feeling lonely “more than half of the time”, “most of the time” or “all of the time” in spring 2020 (32%) and summer 2020 (28%), well above the general population shares of 26% and 21% respectively (OECD, 2021[68]).
Young people have also suffered from a higher risk of job and income loss than other age cohorts (see Chapter 5). While the number of young people not in education, employment or training (NEET) has been declining over the past few years, the pandemic has led to a reversal of this trend (Chapter 9). In the second quarter of 2020, the OECD average unemployment rate for workers aged 15-24 was 18.5%, more than twice as high as that of workers aged 25 or over (7.4%) (OECD, 2021[72]). This was partly driven by the fact that young people are more likely to work in non-standard employment or jobs in customer-facing industries (OECD, 2020[22]). The earnings loss has also been higher for young workers (aged 16-34) compared to middle-aged workers (aged 35-65) (respectively 5.8% and 4.5%) (see Chapter 5). Faced with this loss of income, young people are more likely to fall into poverty, as they have fewer savings to fall back on. With fewer than 5 in 10 young people expressing trust in government across OECD countries, these heightened challenges can further deteriorate youth’s relationship with public institutions and democratic processes, as already experienced in the aftermath of the 2007-2008 financial crisis (OECD, 2020[62]). Taken together, the well-being deprivations and inequalities that children and young people face not only compromise their well-being now, but are also likely to shape their health, educational, employment and civic participation outcomes later in life (Chapter 9) (OECD, 2020[32]; OECD, 2019[73]). A resilient recovery should therefore put children and young people at the centre so as to prevent the crisis from leaving long-lasting scars on their well-being going forward (OECD, 2021[74]).
Reinforcing trust in others and in public institutions
Reinforcing trust is fundamental to building back better. Social capital has played a vital role in determining the effectiveness of countries’ emergency response to the COVID-19 crisis (Borgonovi and Andrieu, 2020[75]). Social capital refers to the social norms, shared values and institutional arrangements that foster co-operation within and between groups in society (see Chapter 10). It includes trust in public institutions and in others in society and a willingness to contribute to shared outcomes that have been pivotal in government strategies to combat the pandemic, such as through adherence to social distancing requirements, the use of contact tracing and the roll-out of vaccine programmes. Data from across OECD countries shows that both trust in institutions and interpersonal trust were key factors for successful pandemic management (Chapter 10). For instance, across European regions, trust in policy makers pre-outbreak was associated with higher decreases in mobility around the time of lockdown announcements in mid-March 2020 (Bargain and Aminjonov, 2020[76]). Data up until July 2020 from Europe and the United States, as well as a study including all OECD members, indicate that higher interpersonal trust has been associated with more hygienic practices, greater compliance with social distancing and, consequently, lower mortality rates (Bartscher et al., 2020[77]; Helliwell et al., 2021[78]; DIW, 2021[79]; Makridis and Wu, 2021[80])4 (see Chapter 10).
Despite initial increases in trust following the pandemic outbreak, social capital cannot be taken for granted, and it is an essential area requiring more investment. While people’s trust in institutions in 2020 was at its highest since records began in 2006, still only 50% of people in OECD countries reported confidence in national governments in 2020 (see Chapter 10). Many countries have experienced an increase in trust in government following the pandemic outbreak, and some have seen rises in trust in other people in the first half of 2020, pointing to a unifying or “rallying around the flag” effect in the face of a common threat (Chapter 10). However, it remains to be seen whether these increases in trust are long-lived. Previous pandemics and crises, such as the 1918–19 Spanish flu and the 2008 Global Financial Crisis, have had long-lasting negative effects on trust in others and in government. By early 2021, many countries were observing a turning point in their trust in government’s capacities to handle the crisis and to implement coherent policies (OECD, 2021[12]). Data from the third round of the Eurofound Living, Working, and COVID-19 survey show that trust in government started to decline among the 22 OECD countries in the sample, from 5.2 on a scale of 1 to 10 in June-July 2020 to 4.2 in February-March 2021, with similar patterns observed in other OECD regions (Chapter 10). Trust in others, for which more limited data are available, continued to rise until early 2021 in Germany, but returned to 2018 baseline levels by September 2020 in New Zealand (Chapter 10). In addition, after being split in June-August 2020 on whether the pandemic has brought people together, by February-May 2021 the majority of adults in 12 OECD member countries found their country to be “more divided now than before the coronavirus outbreak” (Chapter 10).
The unequal impacts of the crisis, widespread disinformation and difficult recovery times ahead are likely to challenge levels of trust going forward. Increasing levels of inequality in societies are set to weaken trust in others and in public institutions (Uslaner, 2002[38]; Zak and Knack, 2001[39]). Despite the large expansion of social protection systems in OECD countries during the crisis, many people feel that governments should do more to ensure economic and social security and to address gaps in social protection (OECD, 2021[25]). Data from the third round of the Eurofound Living, Working, and COVID-19 survey show that only 14% of people across 22 European countries surveyed in spring 2021 felt that support measures were fair, down from 22% in summer 2020. Additional challenges are being posed by the wave of disinformation that has accompanied the spread of COVID-19 and has magnified distrust among certain groups (OECD, 2020[81]; OECD, 2021[12]). With difficult recovery times ahead, the value that social capital brings to societies should not be taken for granted, making investment in it an essential underpinning of effective recovery strategies (OECD, 2021[82]; OECD, 2021[12]; Brezzi, Gonzáles and Prats, 2020[83]; The British Academy, 2021[84]).
Given their interdependencies, well-being priorities for building back better cannot be achieved in isolation. This stands in stark contrast with the traditionally siloed approach to policy design within government ministries and departments, where policies on economic, environmental and social issues are often conceived, developed and implemented largely separately from each other. Siloed government systems in which each ministry works towards its own set of objectives, provide few incentives for departments to invest in outcomes that fall under the responsibility of other departments (APPG, 2014[85]). Policy designed this way is less likely to lead to a coherent and sustainable strategy and is more likely to miss opportunities for synergies than policy designed through a common framework and an agreed set of outcomes that transcend individual departments.
The post-pandemic pressures on public finances further raise the importance for recovery measures to consider key societal goals simultaneously rather than sequentially or in isolation (Buckle et al., 2020[13]). It is more efficient to design coherent policies upstream than to have to correct for negative externalities after-the-fact. The increased pressures on government budgets make it all the more essential that governments deploy public spending in the most strategic and coherent way possible, focusing on the policies and programmes that will deliver the highest well-being returns on investment. This consideration asks for recovery pathways that focus on achieving multiple benefits in an integrated way, in order to cost-effectively generate both near-term and longer-term benefits for societal well-being across social, economic and environmental domains (Buckle et al., 2020[13]). Well-being frameworks can help identify opportunities for interventions by one policy agency to support the objectives of other policy agencies – as seen, for example, in integrated approaches to mental health, employment and skills policies (OECD, 2021[42]). At the same time, a well-being lens offers a structured approach to anticipate and mitigate risks in areas where well-intended actions in one policy area may trigger problems in others that would then require additional expenditure to address – as in the case of COVID-19 recovery strategies that could have harmful or mixed impacts on pressing environmental objectives (OECD, 2021[86])(see Chapter 11).
A well-being approach looks at government objectives as interconnected goals, focusing on the complementary roles that different policies play in improving them (APPG, 2019[87]). A well-being approach encourages governments to take a three-dimensional view of decision-making that simultaneously considers impacts on 1) current well-being; 2) inclusion; and 3) the sustainability of well-being over time. As such, well-being frameworks do not replace sectoral, inter-sectoral, regional or sub-population frameworks or analysis. They rather bring them together in an overarching, whole-of-government framework that enables policy makers to see the bigger picture and key interlinkages, like a “macroscope” for public policy (Winkler, 2009[88]; Karacaoglu, 2021[89]).
Assessing policies for their multidimensional well-being impact, ex ante rather than ex post, can lead to better strategic alignment and stronger cross-government collaboration in addressing societal priorities. In addition, multidimensional frameworks can draw attention to well-being issues that are commonly overlooked or left unaddressed in more traditional analysis, but which can nonetheless form barriers to progress in other areas. While considering externalities and spill-over effects has long been an important part of the work of policy analysts, there are often large inconsistencies between government agencies in how systematically this is done – and different parts of government have different definitions of what it means to improve people’s well-being (Whitby, Seaford and Berry, 2014[90]). Putting a set of core societal objectives at the heart of all policies makes such assessments more systematic in three important ways: 1) each agency is asked to assess the impacts of its policies and practices on multidimensional outcomes; 2) the domains and dimensions of societal well-being considered by each agency are more comprehensive; and 3) the indicators used to measure and report on these domains and dimensions are more consistent.
Five illustrative examples of recovery channels that can simultaneously raise current, distributional and future well-being outcomes
The nature and scope of recovery pathways will vary across countries, reflecting national priorities and circumstances (Buckle et al., 2020[13]). Every country context is different, and no one-size-fits-all policy solutions to improve societal well-being exist. Nonetheless, this section provides illustrative examples of recovery channels that can simultaneously contribute to addressing current well-being concerns, promoting equal opportunities, and improving future well-being outcomes in the wake of the pandemic (“triple win channels”). Examples of such channels are:
Supporting the creation of sustainable, inclusive and high-quality jobs
Using lifelong learning to reduce inequalities of opportunity
Strengthening mental and physical health promotion and prevention
Using a whole-of-government approach to raise the well-being of disadvantaged children and young people
Reinforcing trust by strengthening public sector competencies and values, and by encouraging meaningful citizen participation.
These “triple win” channels are not exhaustive, nor do they represent a comprehensive recovery agenda focused on well-being. They are rather meant as examples of how well-being frameworks can help identity strategic directions for recovery packages that can contribute to well-being across multiple dimensions, groups and time-periods (i.e. short and long-term) (see Table 1.1). They point to the value of embedding broader outcome-based frameworks across government that encourage more systematic consideration of the range of outcomes that shape societal well-being throughout policy development and implementation. The examples further illustrate how a well-being lens can help draw policy attention to important determinants of societal well-being that often remain unaddressed (e.g. the importance of social connectedness for mental and physical health outcomes). Applying a well-being lens also encourages broadening other policy tools and frameworks that determine what has value for public investment (e.g. cost-benefit analysis, the system of national accounts). Lastly, the examples illustrate how taking a wider well-being lens can support a more preventative approach to public policy by systematically considering well-being both today and tomorrow.
Supporting the creation of sustainable, inclusive and high-quality jobs
Work plays a central role in recovery strategies and is where many challenges of current well-being, lack of equal opportunities, and future well-being intersect (Sandbu, 2020[91]; OECD, 2020[15]; Hepburn et al., 2020[16]). In the matter of a few months, the COVID-19 pandemic turned from a public health crisis into a jobs crisis whose full extent is still unfolding (OECD, 2020[22]; OECD, 2021[72]). Job creation is therefore an essential component of any recovery strategy. Importantly, from a well-being perspective, the quality and form of job creation matters as much as its quantity. Two broad areas offer strong opportunities for making jobs work for raising current and future well-being and for promoting equal opportunities: 1) the green economy; and 2) the education, health and wider care sectors.
Supporting job creation while greening the economy
Greening the economy can create new opportunities to enhance current well-being, reduce inequalities and contribute to a more sustainable future. Policy choices made in the COVID-19 recovery will shape whether these opportunities are realised (OECD, 2020[15]; OECD, 2021[48]). Various sectors offer significant prospects for rapid green job creation, including in renewable energy, energy efficiency, green transport and ecosystem restoration (OECD, 2020[15]; Hepburn et al., 2020[16]; O’Callaghan and Murdock, 2021[58]). Investment in these sectors can create jobs quickly, and can contribute to more equitable and sustainable economic development (O’Callaghan and Murdock, 2021[58]):
Investment in housing and building energy efficiency can reduce the cost of living and improve health outcomes (OECD, 2021[27]) (OECD, 2020[92]). This is particularly so for vulnerable groups, as the energy costs and the health burden of poorly insulated housing disproportionally falls on lower-income households, ethnic minorities, families with children, the elderly and households with disabilities (OECD, 2020[92]; González-Eguino, 2015[93]).
Investment in renewable energy offers both short- and long-term employment opportunities. In addition, it can help improve electricity affordability (Dowling et al., 2020[94]) and create health benefits through reduced air pollution (Alvarez-Herranz et al., 2017[95]; Kampa and Castanas, 2008[96]).
Investment in green transport and infrastructure helps to improve health outcomes, both by reducing air pollution (Buckle et al., 2020[13]; Buekers et al., 2014[97]) and by encouraging active transport (Pucher et al., 2010[98]).
Investment in natural ecosystem restoration and conservation can create relatively low-skilled jobs quickly and in the longer-term helps support food security and poverty reduction (Adams, 2004[99]; Zhen et al., 2014[100]). In addition, increased access to green spaces can help promote mental and physical health (Chapter 3).
A strong focus on inclusiveness is needed to ensure that economic support for green job creation can indeed improve well-being for all (OECD, 2021[48]). Gains in green employment will come with job losses in other sectors, and those who will be able to pick up green jobs are not necessarily those who have lost or will lose their jobs. Inclusive policies are therefore pivotal to carefully navigate the differential impacts of the green transition on regions and people and to support a just transition. For example, while the sectors that are most negatively affected by the green transition are largely male-dominated, at the same time women remain under-represented in many green growth sectors, such as renewable energy, pointing to the need for gender-sensitive policies (OECD, 2021[48]; IRENA, 2019[101]). To date, green jobs also tend to score low on ethnic diversity. In the United Kingdom, for example, environmental jobs are the second-least ethnically diverse profession, after farming (Norrie, 2017[102]). Older workers – who make up a relatively large share of workers in carbon-intensive industries in some countries – are more vulnerable, since they often face above-average displacement challenges (OECD, 2021[48]). An integrated approach is therefore needed that accompanies investment in green growth with policies to facilitate labour reallocation, as well as ensuring well-targeted income support measures for those who initially stand to lose (OECD, 2021[48]). Measures to support the geographic mobility of workers at risk of losing their jobs in shrinking industries are also important (OECD, 2021[35]), as are reforms to improve access to affordable housing. In addition, strong place-based policies are needed – building on social dialogue – to ease the structural adjustment of local economies (OECD, 2021[48]).
Improving worker well-being means a focus on creating good jobs, not just more jobs. Attention needs to be given to earnings quality, labour market security and the quality of the working environment (OECD, 2015[103]). Although having a job promotes mental health and well-being, work of poor psycho-social quality (e.g. characterised by low levels of control, high job demands, high job insecurity and/or unfair pay) is not associated with any better mental health and sometimes even worse mental health than unemployment (OECD, 2015[104]; OECD, 2012[105]; Milner, Krnjacki and LaMontagne, 2017[106]; Butterworth et al., 2013[107]). High-quality jobs benefit firms’ productivity as well as workers’ well-being (Saint-Martin, Inanc and Prinz, 2018[108]). Longitudinal data from Australia further indicates that when parents hold poor-quality jobs their children show higher emotional and behavioural difficulties, after controlling for income, parent education, family structure and work hours (Strazdins et al., 2010[109]). Ensuring that job creation goes hand in hand with good job quality is therefore essential for workers and their families as well as for businesses and wider society.
A recent OECD working paper describes how focusing on wider well-being outcomes can accelerate progress in addressing the COVID-19 and environmental crises. The paper Addressing the COVID-19 and climate crises provides an analytical framework to assess recovery policy options in the light of potential synergies between climate goals and wider well-being goals, with a particular focus on recovery measures in the surface transport and residential sectors (Buckle et al., 2020[13]).
The paper distinguishes between three stylised pathways for the pandemic recovery in relation to climate goals: 1) a Rebound pathway, which prioritises a rapid re-establishment of economic growth and macroeconomic stability, without prioritising CO2 emissions reductions and progress on wider social or environmental objectives; 2) a Decoupling pathway, which aims to restore economic growth and macroeconomic stability as well as achieving an absolute decoupling of CO2 emissions (i.e. emissions would be flat or falling while GDP rises); and 3) a Wider well-being pathway, which integrates economic recovery, CO2 emission reductions and wider well-being outcomes.
The paper lays out what the three pathways would mean in the case of the transport and residential sectors, using modelling data to contrast the three scenarios. In the case of transport, for instance, a Rebound scenario focuses on boosting economic growth, jobs and disposable incomes by fostering low-occupancy private vehicle ownership without introducing environmental conditionality. The policy rationale behind a Rebound approach is centred on physical movement (vehicles, passengers and ton-kilometres) and speed as central performance indicators for the sector. In a Decoupling pathway there would be strong incentives for low-carbon mobility, with associated well-being benefits from a reduction in environmental impacts (e.g. reduced air pollution and related improvements in health outcomes). However, a Decoupling pathway remains rooted in a “supporting mobility for economic growth” mindset and does not seek to transform transport systems. As a result, private, low-occupancy car use remains the dominant model, disfavouring shared and active transport modes. In contrast a Wider well-being recovery pathway shifts the focus towards cleaner vehicles and fuels, and redesigns the transport and urban system so that shared and active transport become central.
Urban transport scenarios mirroring such principles show that CO2 emissions related to vehicle use would increase by 8% between 2015 and 2030 in a Rebound (business-as-usual) type scenario. In the Decoupling scenario – focused on automation and electrification with private vehicles remaining dominant – CO2 emissions would fall by 7%. The biggest gains would be achieved in the Wider well-being scenario, which shifts the focus from mobility to accessibility by complementing accelerated automation and electrification with the transformation of the surface transport sector towards a higher use of shared and high-occupancy vehicles, as well as walking and cycling. The Wider Well-being scenario could reduce CO2 emissions related to vehicle use by an estimated 30% as well as generating wider well-being benefits in terms of health, affordability of services, and safety and security.
A Wider well-being pathway could therefore considerably speed up emission reductions in addition to generating well-being benefits, by focusing on systemic change rather than incremental improvement of existing systems. While some investments in Wider well-being pathways may imply higher up-front costs, these pathways would have higher returns in terms of both climate and well-being outcomes. Moreover, some actions within this strategy (e.g. road-space redistribution) could both imply lower costs and result in rapid and significant improvements for both the environment and well-being.
Supporting job creation in the education, health and wider care sector
The education, health and wider care sector provides another important avenue to create sustainable jobs that contribute to the well-being of current and future generations and can help promote opportunities for all (NEF, 2020[110]). The pandemic has highlighted the importance of certain economic sectors, sometimes referred to as the “foundational economy”, that are particularly important for meeting basic needs and making a “good life” possible by “keeping us safe, sound and civilised” (The Foundational Economy, n.d.[111]). Following the 2008 financial crisis, important parts of the foundational economy, including the health and wider care sector, have been a target for reduced spending, leading to a “care deficit” that has weakened many countries’ resilience in the face of the COVID-19 crisis (De Henau and Himmelweit, 2020[112]; Van Gool and Pea, 2014[113]; Aponte et al., 2020[114]). Yet these activities play an important role in building the human and social capital that underpin both well-being and a healthy, sustainable economy, something that current national accounting practices are not well-equipped to incorporate (see Box 1.3).
Building social infrastructure can contribute to current well-being, reduce inequalities and deliver long-term benefits. Effective and well-targeted investment in social infrastructure, such as education, health and wider care services, can strengthen human capital by increasing educational and health outcomes, and address the inequalities within them, whilst also boosting employment and enabling sustainable economic growth (Nozal, Martin and Murtin, 2019[19]). Moreover, as a job creation strategy, the employment boost of investing in social infrastructure is often larger than that associated with investments in physical infrastructure (Richardson and Denniss, 2020[120]; Hill, 2020[121]; De Henau and Himmelweit, 2020[112]). Data for Australia, Denmark, Germany, Italy, Japan, the United Kingdom and the United States indicate that investment in the construction industry would generate half the number of new jobs that would be generated by a similar level of investment in the care industry (De Henau et al., 2016[119]).
The overarching well-being goals of society are not equally considered in traditional national accounting (Canry, 2020[115]). The core national accounting frameworks are still largely structured around labour and physical capital as the two major production factors, accounting for the value of some forms of natural capital and human capital only in satellite accounts.1 This means that, while public expenditure on the construction of schools, hospitals, care homes and nurseries, including the wages of building workers, is classified as capital expenditure (i.e. “investment”), expenditure to pay for the wages of teachers, doctors, nurses and care workers is classified as current expenditure in the central framework (i.e. “consumption”) and is recognised as investment in human capital only in satellite accounts (Elson, 2016[116]). In addition, social capital is not accounted for in the system of national accounts (World Bank, 2005[117]). This has important consequences, as government rules and practices tend to be more tolerant of deficits incurred through making capital rather than current expenditure (Truger, 2016[118]). This partly explains the popularity of spending on physical (rather than social) infrastructure to reinvigorate the economy in recessionary times (De Henau et al., 2016[119]).
← 1. While some types of natural resources such as land mineral and energy reserves, non-cultivated biological resources, water resources and other natural resources are recognised in the central national accounting framework, other types of natural resources as well as human and social capital are currently not recognised in the central framework of national accounts. A lot of relevant information is currently captured in the form of satellite accounts in several countries, for example, focusing on human capital (UN, 2016[265]), education and training (UN, 2020[266]), health care spending (OECD/Eurostat/WHO, 2017[267]), environmental-economic accounts (UN, n.d.[268]), and ecosystem accounting (UN, n.d.[269]). Work in relation to better capturing well-being and sustainability in the system of national accounts is ongoing as part of the System of National Accounts Research Agenda, aiming to bring more of these assets into the central framework (Eurostat, OECD and UNECE, 2020[270]).
Economic support for the education, health and wider care sectors can also play an important role in helping to reverse the damaging impacts of COVID-19 on gender equality (Hill, 2020[121]). Whereas investment in the construction industry would increase the gender employment gap, social infrastructure investment decreases this gap (De Henau et al., 2016[119]). The gender impacts of recovery spending are important as women, despite having been on the frontline of the fight against COVID-19, are bearing a disproportionate share of its negative impacts. In many countries, women have been particularly badly affected by higher financial insecurity, the increased burden of unpaid care, worsening mental health, increased loneliness as well as higher domestic violence (OECD, 2020[122]; Aponte et al., 2020[114]) (see Chapters 5, 6 and 7). Support measures for the education, health and wider care sectors can help counteract some of these negative impacts in two important ways. First, investment in good-quality early childcare enables more women to take up employment. Second, as women make up 70% of the global health and social care workforce (Aponte et al., 2020[114]), investment in social infrastructure can help balance fiscal support for industries that remain male-dominated, including many green growth sectors.5
Promoting opportunities for all through lifelong learning
Lifelong learning is another area of possible multiple benefits and is vital for effective re-employment strategies following the pandemic (OECD, 2021[48]; Ramos et al., 2020[123]; Hepburn et al., 2020[16]). Lifelong learning is a central component of promoting a just transition to greener economies, which many countries are aiming to accelerate in the wake of the pandemic, both by facilitating labour reallocation and by addressing existing skills gaps and shortages in a number of green sectors, such as renewable energy and energy and resource efficiency (OECD, 2020[15]; OECD, 2021[48]; OECD, 2021[124]). Moreover, the growing focus on digitalisation alongside existing trends of automation, globalisation, population ageing and increased migration flows means that a pro-active approach to lifelong learning is gaining further importance (OECD, 2021[124]; OECD, 2019[125]) (Box 1.4). Lifelong learning also has important benefits for subjective well-being and physical and mental health (Dolan, Fujiwara and Metcalfe, 2012[126]; Manninen et al., 2014[127]). Participation in learning strengthens adults’ psycho-social resources, which promotes their self-esteem, identity, purpose and social integration and helps them cope with change and adversity (Hammond, 2004[128]; Manninen et al., 2014[127]). These benefits of participation in adult learning are particularly strong for vulnerable groups, including people with lower levels of education and the elderly (Manninen et al., 2014[127]; Narushima, Liu and Diestelkamp, 2018[129]).
Currently, disadvantaged adults receive little training in most OECD countries (OECD, 2019[130]; OECD, 2021[124]). While lifelong learning has a unique potential to raise current and future well-being outcomes and to help address inequalities, the adults who need further training and learning the most are the least likely to benefit from it. Evidence from the Programme for the International Assessment of Adult Competencies (PIAAC) shows that most adult learning is job-related (Desjardins, 2020[131]). Adults who have low educational qualifications, earn little and are unemployed and/or older have the lowest chances of participating in job-related formal and non-formal training (Figure 1.3). In contrast, highly skilled adults make ample use of the broader range of opportunities that are available to them to upskill or reskill, thereby further increasing the gap between the high- and low-skilled (OECD, 2019[125]). Where lifelong learning has been specifically targeted towards vulnerable groups, early school leavers and migrants appear to be the main target groups, leaving the learning needs of many other vulnerable groups unaddressed (Tuparevska, Santibáñez and Solabarrieta, 2020[132]).
Note: Average of 30 OECD countries participating in PIAAC 2012-2015. This average excludes Colombia, Costa Rica, Iceland, Latvia, Luxembourg, Mexico, Portugal and Switzerland.
Source: Survey of Adult Skills (PIAAC) 2012, 2015, as reported in Chart 2, OECD (2019[130]), Policy brief. Future-ready adult learning systems, OECD Publishing, Paris, http://www.oecd.org/employment/skills-and-work/adult-learning/Policy-Brief-Future-ready-adult-learning-2019-EN.pdf.
Ensuring inclusive approaches to lifelong learning is even more relevant given the growing importance of digital skills in the wake of the pandemic (OECD, 2021[124]). The COVID-19 pandemic has highlighted the value of digital skills and solutions in times of crisis, and is accelerating the rise of the digital economy. Digitalisation holds great potential for lifelong learning, and online course offerings are growing rapidly. However, while online courses can make access to training easier for many adults by addressing barriers of time, scheduling and location, the pre-requisite to have basic digital skills and devices risks further limiting access to learning opportunities for those with lower levels of digital proficiency or limited access to digital infrastructure (OECD, 2020[133]). Data from PIAAC (2012, 2015, 2018) show that, on average across OECD countries, 43% of adults score at the lowest levels of digital proficiency (Level 1 or below, on a scale ranging from Level 1 to Level 36) (OECD, 2019[134]). Addressing this digital divide has become increasingly important to make sure that lifelong learning can benefit all (OECD, 2021[124]).
A comprehensive policy agenda is needed to increase the future readiness of countries’ adult learning systems (OECD, 2019[135]). The OECD report Getting Skills Right: Future-Ready Adult Learning Systems includes an online dashboard on priorities for online learning, comparing countries in terms of: the urgency of updates to the adult learning system; the learning system’s coverage and inclusiveness; the flexibility of learning opportunities and the availability of guidance; alignment with labour market needs; perceived impact; and financing (OECD, 2019[136]). To improve learning system’s coverage and inclusiveness, the report includes best practice examples of ways to: 1) reach out and provide information and guidance on opportunities for education and training; 2) remove common barriers to participation by vulnerable groups; 3) offer targeted support to those most in need of up- and re-skilling, but least likely to participate; and 4) further engage employers in the provision of adult learning. The report stresses the importance of strong and ongoing collaboration across the many stakeholders in the adult learning system. This includes stronger alignment both between different ministries and sectors (e.g. the education and training, labour market and employment, and social welfare sectors) as well as between local, regional, and national levels of government. Analysis of PIAAC data indeed finds that countries with high and broad participation in adult learning have well-developed governance structures that foster coordination among stakeholders; financing structures that align incentives and foster co-investment; and provision structures that focus on open, flexible and targeted opportunities that are designed to mitigate barriers to participation (Desjardins, 2020[131]).
Using a whole-of-government approach to raise the well-being of disadvantaged children and young people
Investing in child and youth well-being is essential to make sure that COVID-19 does not further widen the gap between advantaged and disadvantaged children and young people, with long-lasting personal and societal consequences. School closures and other COVID-19 mitigation measures have affected the well-being of children and young people, particularly for those who were already disadvantaged. These deprivations and inequalities do not only compromise child and youth well-being now, but also shape individual and societal outcomes going forward (OECD, 2020[32]). The societal well-being returns from investing in children and young people are very high: for instance, a longitudinal study following children through to the age of 35, shows that each dollar invested in high-quality birth-to-five programs for disadvantaged children generated a benefit of over 7 dollars by the age of 35, taking into account the children and their parents’ subsequent life outcomes, including their health, educational outcomes, employment outcomes, and participation in crime (García et al., 2016[137]; Reynolds et al., 2011[138]; OECD, 2016[139]). Not all intervention programmes for children show the same cost-benefit ratio, but there is wide evidence that the benefits outweigh the costs for many of them (Hendren and Sprung-Keyser, 2020[140]; Rea and Burton, 2020[141]; Rosholm et al., 2021[142])
The multifaceted challenges in raising child and youth well-being calls on governments to develop comprehensive child and youth well-being strategies that can guide inter-agency collaboration (OECD, 2019[73]; OECD, 2020[143]). Vulnerable children and young people need coherent and coordinated support throughout child and young adulthood and in their transition to an autonomous life. As of April 2020, while 76% of OECD countries had an operational national or federal multi-year youth strategy in place, only 20% of them are fully participatory, budgeted, monitored and evaluated according to the OECD Assessment Framework of National Youth Strategies (OECD, 2020[143]). In most OECD countries, child and youth policies are developed in silos without sufficient consideration of how the range of factors shaping child and youth well-being interact (OECD, 2019[73]). Individual agency approaches that focus on single aspects of child and youth well-being, such as learning difficulties, early school leaving or childhood obesity, are unlikely to be effective if they do not address other barriers to healthy child and youth development, such as family circumstances, housing security, domestic violence, or mental health problems (OECD, 2015[144]).
Comprehensive child and youth well-being strategies can help overcome siloed approaches by identifying overarching child and youth well-being objectives against which policies can be assessed, efforts can be aligned, and accountability can be enhanced. A lack of institutional mechanisms for horizontal coordination across ministries represents a significant barrier to effective whole-of-government approaches, as indicated by 45% of government entities who are in charge of youth affairs across OECD countries (OECD, 2020[143]). At the strategic level, whole-of-government approaches to child and youth policies require clear allocation of mandates and responsibilities across ministerial portfolios and different levels of government (OECD, 2020[143]). Ideally, one ministry or a dedicated agency should take responsibility for coordinating the strategy and ensuring overall accountability (OECD, 2019[73]). At the implementation level, a joined-up strategy forms the basis for more integrated, person-centred service provision, for example through co-location or case management, which is associated with better programme outcomes for vulnerable groups (OECD, 2015[144]). OECD work identifies six priority policy areas around which comprehensive child well-being strategies could be organised, building on best-practice examples from a wide range of countries (Box 1.5), and forthcoming work will describe how various OECD governments are tackling a more strategic approach to child well-being (OECD, 2021[145]).
The OECD report Changing the odds for vulnerable children outlines six priority areas around which child well-being strategies should be organised:
1. Policies empowering vulnerable families, focused on early intervention and prevention. For example, providing opportunities for parents to gain parenting skills, knowledge, and resources; working together with families to reduce specific risks to child well-being; and investing in whole-of-community approaches to support vulnerable children.
2. Policies strengthening children’s emotional and social skills. For example, enhancing the role of schools in promoting good emotional and social well-being; providing timely and accessible early intervention for children with mental health difficulties; ensuring smooth transitions of young people onto adult mental health services; providing opportunities for vulnerable children to build relationships with supportive adults and role models, as well as access to extra-circular activities; and empowering children online and building digital resilience.
3. Policies strengthening child protection. For example, making child protection services more child-centred and accessible, and investing in improving outcomes for children in out-of-home care.
4. Policies improving educational outcomes. For example, increasing participation of vulnerable children in early childhood education and care; improving the quality of early childhood education and care that vulnerable children receive; adopting measures to reduce inequity in education; preventing early school leaving and providing early action for school leavers; and supporting the integration of migrant children in schools.
5. Policies improving health outcomes. For example, improving the quality and accessibility of pre-natal care for key groups; improving access to parental leave for low-income families and those with children with additional needs; ensuring access to health care for children from low-income families and with additional health needs; and ensuring access to adequate nutrition for low-income children and pregnant women.
6. Policies reducing income poverty. For example, creating better quality jobs for working parents and removing barriers to taking up employment; and ensuring social benefits reach the poorest families and those with children with additional needs.
Source: (OECD, 2019[73]) Changing the odds for vulnerable children. Paris: OECD Publishing.
Strengthening mental and physical health promotion and prevention
The pandemic has made the incorporation of health in all policies a reality, albeit not in the way it was intended (Van den Broucke, 2020[146]). Improving mental and physical health was already an important policy priority before the pandemic hit and has become even more urgent now, given the possible long-term implications for physical and mental health outcomes. Investing in physical and mental health has strong benefits for both current and future well-being as well as reducing inequalities. Health is one of the strongest factors associated with people’s satisfaction with life (Boarini et al., 2012[147]; Dolan, Peasgood and White, 2008[148]). Poor health weighs heavily on individuals as well as society as a whole by limiting people’s opportunities to lead fulfilled, productive lives (OECD, 2021[149]; OECD, 2021[46]; OECD, 2019[44]; OECD, 2019[45]). For example, poor mental health contributes to worse educational outcomes, higher unemployment, and poorer physical health (OECD, 2019[150]; Hewlett and Moran, 2014[151]). Similarly, harmful alcohol consumption and obesity increase the risk of chronic disease, reduce life expectancy, and are related to worse mental health outcomes as well as higher risk of unemployment (OECD, 2021[149]; OECD, 2021[46]; OECD, 2019[44]).
Improving health outcomes is key to addressing inequalities and raising the well-being of future generations. People who are disadvantaged tend to have worse health outcomes than the better-off or better educated (OECD, 2019[152]). A two-way causal relationship, often referred to as the “health-poverty trap”, means that disadvantaged people can get trapped in a negative feedback loop between poor health and poverty (Ridley et al., 2020[153]). For example, poor mental health makes it harder to do well in school and work, which can lead to greater risk of poverty, which is itself a risk factor for poor mental health. Improving parental mental health outcomes is also an important part of supporting child and youth well-being. Parental mental health problems can have intergenerational well-being effects through their impact on children’s cognitive, emotional, social, and behavioural development as well as their physical health (Harvard University Centre on the Developing Child, 2009[154]; Jarde et al., 2016[155]; Manning and Gregoire, 2006[156]).
With health systems already under pressure, a more preventative health approach is urgently needed (OECD, 2019[44]; OECD, 2015[157]; Patel et al., 2018[158]). Policies targeting the root causes of ill-health are increasingly important given the mounting pressures on the health system due to the pandemic, ongoing population ageing, and the growing prevalence of people with multiple chronic conditions (OECD, 2019[44]). Currently, on average, OECD countries allocate less than 3% of their health spending to prevention activities, with most of it spent on monitoring programmes, such as check-ups and dental examinations (Gmeinder, Morgan and Mueller, 2017[159]; European Commission, 2017[160]). While the cost-effectiveness of preventative health measures depends on a wide range of factors, including the successfulness of policy targeting, there are many preventative health measures that are highly cost-effective (OECD, 2021[149]; OECD, 2021[46]; OECD, 2019[44]; Masters et al., 2017[161]). For example, interventions in the areas of mental health promotion, promoting healthy behaviours, housing interventions, screening, vaccination, and healthy employment programmes have been shown to have early returns on investment within the first 5 years, with additional benefits in the longer-term (WHO, 2014[162]). Careful analysis of the costs and benefits of specific interventions, rather than broad generalisations, nonetheless remains critical. In doing so, it is important to account for the wider well-being benefits of preventative health care spending, including impacts on educational, employment, and child development outcomes, rather than limiting cost-benefit analysis to the health care sector alone.
A well-being approach can help support a more preventative approach to improving health outcomes. Firstly, well-being analysis helps to clarify the interconnections between health and other well-being outcomes. This enables more comprehensive and pro-active interventions to enhance health outcomes that recognise the drivers of good health as well as those of illness (Patel et al., 2018[158]) (Box 1.6). Secondly, a well-being approach makes health promotion a shared objective across government rather than leaving it up to one ministry or part of government. This is fundamental because progress on the health agenda necessitates a whole-of-government approach (OECD, 2015[157]; OECD, 2019[44]; OECD, 2019[45]), where health is seen as a vehicle to enable people to do what they have reason to value rather than merely a destination, like a hospital or a care home (Button, 2021[163]). Thirdly, a well-being approach helps to embed a stronger future-focus in the system of government, encouraging greater appreciation of the long-term value of investments made in health today. Forthcoming OECD work illustrates these points in relation to population mental health, by describing the interrelationships between mental health and wider well-being (including social connections, safety, housing, jobs, income and more), and discussing evidence on the benefits of more integrated policy approaches (OECD, 2021[164]; OECD, 2021[165]).
A preventative approach to public health needs to consider the importance of social connectedness for physical and mental health outcomes. Chapters 4 and 7 describe how the need for social distancing following the pandemic outbreak has disrupted people’s sense of connectedness. For example, data from several countries shows that feelings of loneliness doubled to nearly tripled during lockdown and extended beyond lockdown periods.
Social relationships can “get under our skin”
A lack of social connectedness predicts early death as much as major health risk behaviours like smoking (Berkman et al., 2000[166]; Cacioppo and Cacioppo, 2018[167]). Supportive relationships can help buffer the adverse effects of life’s stressors on health outcomes and can strengthen the immune system (Uchino, 2006[168]). For example, in studies of patients with HIV, those who had less emotional support in the baseline year were found to have fewer helper T-cells1 in subsequent years to combat the disease (Theorell et al., 1995[169]). Social connectedness also leads to more functional and adaptive coping styles and better self-regulation (Cohen and Wills, 1985[170]). Experiments show that participants who are exposed to social exclusion are less likely to engage in healthy behaviour, quit sooner on a frustrating task, and are less able to focus their attention (Baumeister et al., 2005[171]). In addition, social connections influence health behaviours through processes of social influence, giving rise to growing interest in social network approaches for health behaviour changes (Hunter et al., 2017[172]).
Social connectedness has persistent and cumulative effects on mental health
Social connectedness also plays an important role in protecting against poor mental health. Loneliness is a unique predictor of depression and anxiety (Cacioppo et al., 2006[173]). For children, loneliness and social isolation have persistent and cumulative effects on later mental health outcomes (Caspi et al., 2006[174]; Qualter et al., 2010[175]). For young adults, family and school connectedness are powerful determinants of their levels of anxiety and psychological distress (Bond et al., 2007[176]). Social relationships also play an important role in protecting older people against depression (Cruwys et al., 2013[177]) and cognitive decline (Bennett et al., 2006[178]; Haslam, Haslam and Jetten, 2014[179]). The size of these effects is considerable: studies have shown that memory loss among older people who were least socially connected worsened at twice the rate of those who were most connected over a six-year period (Ertel, Glymour and Berkman, 2008[180]).
Social prescribing as part of a “whole-person” and preventative approach to health care
Several countries are starting to apply a more preventative and holistic approach to health care that more explicitly considers the importance of the social determinants of ill-health. For instance, in the United Kingdom, “social prescribing” enables GPs, nurses, hospital discharge teams, police, and other primary care professionals to refer patients and clients to trained “link workers”. Link workers support people in developing and achieving a personalised set of health and social goals by engaging with local, non-clinical services and initiatives. These can range from debt management workshops and career coaching to gym classes and walking groups. Social prescribing can particularly benefit people with long-term conditions, those who need support with their mental health, who are lonely or isolated, and/or have complex social needs which affect their well-being (NHS, n.d.[181]).
Note: 1. T-cells play a central role in the body’s immune response system.
Source: (Frieling, Krassoi Peach and Cording, 2018[182])
Reinforcing trust by strengthening public sector competencies and values, encouraging meaningful citizen participation
COVID-19 has demonstrated the important role of social capital in determining societal well-being outcomes. Social capital has influenced the effectiveness of countries’ responses to the COVID-19 crisis. In addition, earlier research has shown how shared pro-social norms and institutional arrangements that foster cooperation between groups are associated with better democratic performance (LaPorta et al., 1997[183]; Putnam, 2000[184]; Algan and Cahuc, 2013[185]; Berning and Ziller, 2017[186]), increased economic growth (Zak and Knack, 2001[39]; Knack and Keefer, 1997[187]), higher overall educational performance (Putnam, 2000[184]; Knack and Keefer, 1997[187]), greater safety in society (Wilkinson, Kawachi and Kennedy, 1998[188]; Sampson, Raudenbush and Earls, 1997[189]), and higher overall experienced well-being (Algan and Cahuc, 2013[185]; OECD, 2017[190]).
Recovery strategies should focus on ensuring high public sector competencies and values as well as ensuring meaningful citizen participation (OECD, 2017[191]). Despite the likely temporary boost to institutional trust in 2020, still only 51% of people trust their government, which weakens governments’ ability to raise support for ambitious recovery plans. Widespread mis- and disinformation further undermines trust, amplifies fears, and sometimes leads to harmful behaviours (OECD, 2020[81]). Low trust is associated with resistance, even to things that seem to be in a person’s overall best interest (OECD, 2017[191]). For example, hesitancy about Covid-19 vaccination has been evident in many countries and governments’ actions to garner trust are essential to the successfulness of vaccination campaigns (OECD, 2021[82]). This means that strong public sector competencies (responsiveness and reliability) and values (integrity, openness/ inclusiveness, and fairness) are even more important now as key drivers of institutional trust (OECD, 2017[191]; OECD, 2020[192]; Murtin, Fleischer and Siegerink, 2018[193]; OECD, 2021[12]). In turn, trust in public institutions forms the basis for strong collective action in building forward (OECD, 2017[191]).
Open government reforms can foster a culture of governance based on the principles of transparency, integrity, accountability, and stakeholder participation (OECD, 2016[194]). As the last section of this chapter will discuss in more detail (see Using a well-being lens to Reconnect), transparent and timely public communication, as well as ongoing and inclusive citizen participation in the design of recovery strategies, are essential to better understand and address public concerns and to strengthen public confidence in the effectiveness of recovery pathways (OECD, 2020[81]; OECD, 2021[82]). The OECD Toolkit and Case Navigator for Open Government offers practical guidance for building an open government programme, from concept development through to implementation and monitoring and evaluation (OECD, 2021[195]). In addition, the OECD Serving Citizens Framework helps to assess country performance in terms of access, responsiveness, and quality of services (OECD, 2019[196]; OECD, 2021[12]).
The pandemic has highlighted the important role that social protection plays in times of crisis – as well as the gaps in coverage that weaken its effectiveness. The COVID-19 crisis has exposed weaknesses in OECD countries’ social protection systems (OECD, 2020[197]; OECD, 2021[72]). Even in countries with the most advanced systems of social protection, certain groups of workers and their families have missed out on adequate social protection: workers with non-standard jobs – including the self-employed, temporary and informal workers, and those who work very short hours – are often not covered by insurance-based unemployment and sickness benefit schemes. Others, who were already out of work before the crisis, have faced prolonged hardship (OECD, 2020[197]). The situation is worse in countries with large informal sectors and weak social protection systems, where many people have lost or will lose work without any access to income support (OECD, 2020[197]). Surveys highlight that despite the large expansion of social protection systems in OECD countries during the crisis, demands for greater government support are common, regardless of experienced job security during the pandemic; on average, 68% of all participants to the OECD Risks That Matter survey felt that their government should be doing more to ensure citizens’ social and economic security, ranging from 41% in Denmark to 93% in Chile (OECD, 2021[25]).
Ex ante screening of policy impacts on specific population groups can identify where policy risks creating or exacerbating inequalities of opportunity. For example, the Canadian government uses its Gender-based Analysis Plus (GBA+) to mainstream assessments of the potential impacts of government actions on diverse groups of people, based on gender, as well as other factors such as age, ethnicity, indigenous heritage, geographic location, socio-economic status, family status and disability status. In response to the COVID-19 crisis, Canada has used its GBA+ system to understand how emergency response and recovery spending was likely to impact on existing inequalities and experiences of diverse peoples (Government of Canada, 2020[198]). While half of OECD countries have now introduced gender budgeting, very few countries undertake ex ante assessments of budgetary decisions on income inequality and poverty (OECD, 2019[199]). Similarly, the use of ex-ante regulatory impact assessments to assess implications of regulatory and policy decisions for different groups in society remains limited. Nonetheless, several countries, including Austria, France, Germany, and New Zealand, have developed “youth checks” to incorporate youth considerations more systematically into policymaking and legislation (OECD, 2020[143]).
Table 1.1 provides an overview of the expected well-being gains of the five recovery channels described in this chapter, in terms of current, distributional, and future well-being outcomes. As mentioned above, these channels are not exhaustive, nor do they represent a comprehensive well-being focused recovery agenda. Ultimately, the most suitable channels to raise societal well-being depend on countries’ unique contexts. Nonetheless, the five channels provide examples of strategies that can deliver benefits in terms of improving current well-being outcomes, promoting opportunities for all and strengthening future well- being. Identifying such synergies is essential to be able to address the current impacts of the COVID-19 pandemic in an equitable and sustainable way. Importantly, the discussion of the five channels has highlighted that achieving these synergies goes beyond prioritising and allocating funding alone. It depends on strong policy design and implementation that builds in well-being considerations up front rather than trying to correct for them after the fact (OECD, 2018[200]). Regardless of their potential, even well-allocated recovery spending can have unintended consequences if impacts on other well-being outcomes are left unconsidered or unaddressed throughout the policy design or implementation process (Hepburn et al., 2020[16]; Agrawala, Dussaux and Monti, 2020[201]). The following section therefore looks at the required processes and mechanisms in the system of government to underpin an effective well-being approach.
Using a more integrated and coherent approach to building forward and raising well-being asks for a more unified governance system. The COVID-19 pandemic has highlighted the unique and fundamental role of government in safeguarding people’s well-being. The crisis has also shown that large shifts in both behaviours and policies are possible once the scale of an emergency is clear and sufficient political and public support is present, even when current pain is needed for long-term gain (Sandbu, 2020[91]; Hepburn et al., 2020[16]). Then, if the core objective of good governance is to safeguard the well-being of current and future generations, how can governance systems be better attuned to reach these goals? While the most effective approaches, models and tools will need to be tailored to local circumstances, there are at least five institutional building blocks that underpin a well-being approach to addressing the post-pandemic priorities:
Multidimensional well-being monitoring - using a multidimensional well-being lens to monitor societal progress and measure policy outcomes, including current and distributional well-being outcomes as well as resources for future well-being
Evidence-based priorities - prioritising policy objectives based on multidimensional well-being evidence
Long-term focus - embedding a long-term focus in governance systems and prioritising prevention
Integration and collaboration - strengthening horizontal and vertical policy coherence to enable an integrated and collaborative approach to addressing multiple well-being priorities
Actively connecting to private and civil society stakeholders in defining well-being issues and identifying and implementing ways to address them.
Over the last decade, components of this governance infrastructure have been implemented in various countries around the world, but not yet in a fully integrated way (Karacaoglu, 2021[89]). This section will focus on the first four of these institutional building blocks. The last section of this chapter (Using a well-being lens to Reconnect) will then look at the importance of actively connecting to civil society and the private sector to jointly drive a strong, inclusive, and sustainable recovery based on a collective sense of purpose.
Multidimensional well-being monitoring
The COVID-19 crisis calls on governments to apply a multidimensional lens to societal progress. To help inform better decision-making, a growing number of governments have broadened their measurement and monitoring frameworks to go “beyond GDP” and “measure what counts” for the well-being of people today and in the future (Stiglitz, Fitoussi and Durand, 2019[202]) (Figure 1.4). Although any well-being framework needs to be anchored within a local context, at a minimum a well-being approach requires measurement of current well-being, of inequalities across well-being outcomes, and of resources for future well-being. In addition, measures of transboundary effects help assess country impacts on well-being elsewhere, for example in terms of carbon footprints, foreign aid, or export of waste (OECD, 2020[203]; Stats NZ, 2018[204]; CBS, 2020[205]).
Establishing well-being frameworks through an inclusive and transparent participatory process is fundamental to ensure legitimacy and public support for the framework used to assess societal progress. In the development of local well-being frameworks, many governments have engaged in wide public consultation processes to develop a shared vision of what matters most to societal well-being (Exton and Shinwell, 2018[207]). For example, in 2015 the federal government of Germany initiated a 6-month long national dialogue with 200 events around the country, reaching out to a large diversity of citizens, to get a better understanding of citizens’ perspectives on well-being as the basis for the development of the Gut Leben in Deutschland (Good Living in Germany) framework. Some countries, including France, Italy, and New Zealand, as well as Scotland, have built well-being reporting requirements into legislation, with mandated opportunities for public consultation and input. For example, Scottish Ministers have a duty to consult on, develop and publish a new set of National Outcomes for Scotland at least every five years (Durand and Exton, 2019[208]). This helps ensure that public accountability for well-being outcomes extends beyond electoral cycles (Durand and Exton, 2019[209]; Ormston, Pennycook and Wallace, 2021[210]). However, a well-being-oriented recovery needs to go beyond reporting requirements alone.
Well-being evidence-based priorities
Going beyond reporting requirements is essential to truly integrate well-being data in the way that recovery strategies and policies are prioritised and designed. Using comprehensive well-being evidence as the basis for COVID-19 recovery agenda setting is essential to ensure that they target the societal well-being areas that are most in need. In recent years, the government budget process, which gives form to the government’s priorities, has been used to more strongly link well-being evidence to government agenda setting and policy prioritisation (Ormston, Pennycook and Wallace, 2021[210]; Durand and Exton, 2019[208]; OECD, 2019[211]). For example, in 2019 New Zealand released its first Wellbeing Budget (Box 1.7). Following on from its GBA+ budget analysis (see above), the Government of Canada is also working to better incorporate well-being measures into its budget decision-making (Government of Canada, 2021[212]); to that end, it released a new “Quality of Life Framework”7 along with its 2021 Budget to articulate a vision of what it means to have a good quality of life in Canada. This framework serves as a tool to better identify investment priorities. Investments in federal datasets (including to improve levels of disaggregation) will help to advance Canada’s existing GBA+ practice within the context of the new Quality of Life Framework. Other countries and regions have similarly expressed an interest in more closely integrating well-being frameworks into their budgetary processes, including Ireland (Government of Ireland, 2021[213]), Iceland (Jakobsdóttir, 2020[214]), and Wales (Future Generations Commissioner for Wales, 2019[215]).
Note: Launch time refers to the actual release of a framework, rather than the commissioning of its development. Number of indicators refers to the dashboards as of Q3 2019 unless specified otherwise. Measures of Australia’s Progress was discontinued in 2013, and the Australian Treasury’s Well-being Framework in 2016. Australia’s Welfare reports have been published since 1993.
Source: Exton and Fleischer (forthcoming[206]).
In May 2019, the New Zealand Government released its first Wellbeing Budget. As part of the Budget’s development process, the New Zealand Treasury used analysis of well-being data in its Living Standards Framework indicator dashboard1, combined with advice from sectoral experts and the Government’s Chief Science Advisors, to identify 12 well-being priority areas. Following this input, ministers shortlisted seven priorities for the budget, upon which the full Cabinet decided on the final five budget priorities (Huang, Renzio and Mccullough, 2020[216]). Between 2019 and 2021, the Wellbeing Budget priorities have focused on supporting a just transition, shaping the future of work, reducing inequalities, improving child well-being, and improving physical and mental health outcomes (New Zealand Government, 2018[217]; New Zealand Government, 2019[218]; New Zealand Government, 2021[219]).
The selected budget priorities are outlined in the Budget Policy Statement, which announces the general direction of the budget. As part of its well-being approach, from 2019, the Budget Policy Statement includes a Wellbeing Outlook (an analysis of current and distributional well-being outcomes and resources for future well-being) to complement the budget’s traditional Economic and Fiscal outlook as the basis for setting government priorities. Following the release of the Budget Policy Statement (generally in December), ministries are invited to submit funding requests for policy proposals that are aligned with the identified government well-being priorities. In their proposals, ministries are required to provide evidence of how their funding request supports the identified priorities and to present evidence on expected well-being impacts building on a cost-benefit analysis model (including an optional monetary evaluation component, called CBAx) that has been specifically aligned with a well-being approach (New Zealand Treasury, 2018[220]). Those policy proposals that are considered to best support the identified well-being priorities are selected, upon which the final budget is released (usually in May).
Going forward it will be important that well-being budget analysis is not limited to new spending or policy proposals only but to also review how effectively the baseline spending of government agencies supports (or detracts from) the identified priorities, as new budgets tend to be small in comparison with baseline funding. For example, new spending announced in the 2019 New Zealand Wellbeing Budget constituted only around 4% of core Crown expenditure (OECD, 2019[221]). As a first step in this direction, the 2019 New Zealand Wellbeing Budget asked each Minister to undertake a review of their spending and identify at least 1% of baseline spending that was not aligned with the government’s well-being aims (OECD, 2019[221]).
When using a well-being framework to prioritise recovery packages, alignment needs to go both ways by curbing spending that has negative impacts, not just increasing spending that has positive impacts. In this respect, OECD analysis of COVID-19 recovery spending points to contradictory patterns. For instance, the OECD Green Recovery Database shows that the amount of environmentally positive recovery measures (USD 336 billion) is matched by recovery spending on measures with negative or “mixed” environmental impacts (equalling to USD 334 billion for those measures that have a monetary value) (Chapter 11). The billions allocated to green investment are therefore counteracted by ongoing support for environmentally harmful activities (OECD, 2021[86]). Developments in budget analysis, for example on green budgeting (OECD, 2021[86]), gender budgeting (Downes and Nicol, 2020[222]), and SDG budgeting (Hege and Brimont, 2018[223]; UNDP, 2020[224]) are an important stepping stone towards more comprehensive and coherent well-being budget approaches. France’s new methodology for green budgeting, for instance, identifies environmentally friendly as well as environmentally damaging expenditures (Fetet and Postic, 2020[225]). As most recovery funds will be spent via public procurement, the strategic use of public procurement is also an important instrument for governments to operationalise gender, green, and SGD budgeting and to ensure that recovery spending will contribute to the identified well-being priorities (OECD, 2019[226]). For example, in a recent review of the German federal public procurement system, the OECD assessed how the country’s public procurement system affects well-being in Germany, building on the OECD Framework for Measuring Well-Being and Progress (OECD, 2019[227]).
Long-term focus
Misalignment between COVID-19 recovery measures and long-term societal goals may lower well-being over time (Buckle et al., 2020[13]). Well-being frameworks can support more future-focused and anticipatory policies (Box 1.5). They can help to underpin long-term development strategies, by clarifying tensions as well as possible synergies between current and future well-being outcomes (OECD, 2019[211]). To help deal with such tensions and synergies in practice, some countries have enshrined the rights of future generations in their Constitution or have established dedicated accountability and oversight institutions, such as Finland’s Committee for the Future, to strengthen consideration of long-term well-being outcomes (OECD, 2020[143]; Durand and Exton, 2019[208]). Others, like New Zealand and Germany are looking at the impact of public procurement strategies on resources for future well-being (New Zealand Government Procurement, 2018[228]; OECD, 2019[227]). Wales created a Future Generations Commissioner, as well as establishing a legal obligation for public bodies to better incorporate long-term well-being considerations into policy making to strengthen accountability for sustainable development (Box 1.8).
The Well-being of Future Generations (Wales) Act 2015 requires all public bodies to place seven well-being goals - informed by a large-scale public consultation process - at the centre of their decision-making. These seven goals are: a prosperous Wales, a resilient Wales, a more equal Wales, a healthier Wales, a Wales of cohesive communities, a Wales of vibrant culture and thriving Welsh language, and a globally responsible Wales. The Act makes it clear that each of these goals is as important as the others and that, as much as possible, public bodies must work towards all of them rather than focusing on one or two in isolation. In addition, the Act sets out five ways of working by public bodies to achieve the seven well-being goals:
Thinking long-term: Meeting the needs of the present without compromising the ability of future generations to meet their own needs.
Integration: Considering how the public body’s objectives may impact upon each of the seven well-being goals or on the objectives of other public bodies
Involvement: Involving people with an interest in achieving the well-being goals and ensuring that those people reflect the diversity of the area which the body serves
Collaboration: Acting in collaboration with any other person (or different parts of the body itself) that could help the body meet its well-being objectives
Prevention: Acting to prevent problems occurring or getting worse to help public bodies meet their objectives
Transparency and accountability are an important part of the Act. The Future Generations Commissioner is the guardian for the interests of future generations in Wales and supports the public bodies listed in the Act to work towards achieving the well-being goals. When the Future Generations Commissioner for Wales makes recommendations to a public body, this body must publish a response. If the public body does not follow a recommendation, it must explain why, and what alternative action it will take. In addition, Audit Wales is responsible for assessing the extent to which the 44 public bodies that are subject to the duties of the Act are operating in accordance with the sustainable development principle (including the “five ways of working” mentioned above) when setting their well-being objectives and taking steps to meet them. The Auditor General must provide a report on his examinations to the National Assembly for Wales at least a year before each Assembly election (Audit Wales, 2020[229]).
Source: www.futuregenerations.wales/about-us/future-generations-act/
Integration and collaboration
The pandemic has highlighted the need for strong alignment across government to be able to deliver the most effective policy responses. The COVID-19 crisis has emphasised the need to strengthen the strategic role played by Centres of Government, beyond crisis response coordination, in establishing more anticipatory and integrated governance (OECD, 2020[203]; OECD, 2021[12]). A study of 26 OECD countries indicates that during the pandemic, 77% of Centres of Government supported more cross-ministerial co-ordination activities and 73% involved more stakeholders in co-ordination meetings. However, only around one-quarter of these centres benefitted from an increase in their financial resources, and roughly the same share experienced an increase in staffing levels (OECD, 2021[12]). More broadly, a lack of integration and coordination of strategies, policies and implementation has long been recognised as one of the main impediments to sustainable development (OECD, 2019[211]). Inconsistent policies and fragmented programmes entail a higher risk of duplication, inefficient spending, a lower quality of service, and difficulty in meeting goals. Ultimately, such shortcomings lead to a reduced capacity to deliver and to unsustainable choices and pathways that stand in the way of a resilient recovery (OECD, 2019[211]; De Coning, 2007[230]). The associated costs – both in terms of reduced well-being and resilience and of higher financial spending – are significant. In the United States, for example, the US Government Accountability Office has estimated that actions from Congress and executive branch agencies to reduce fragmentation, overlap and duplication in government programmes from 2011 to 2018 have generated about USD 262 billion in reported financial benefits (GAO, 2019[231]).
Only a unified public service can ensure the cross-agency leadership and commitment that is necessary to drive a strong, inclusive, and sustainable recovery (OECD, 2020[203]; Buckle et al., 2020[13]; OECD, 2019[211]). A well-being approach encourages this by requiring policy agencies to work together towards shared well-being objectives, aligning their own sectoral goals with overarching priorities to enhance current, distributional and future well-being outcomes. As mentioned above, even though considering policy externalities has for long been part of the work of many policy analysts and executives, there are often large differences between government agencies in terms of how this is done. For example, in the first iteration of its Wellbeing Budget process, the New Zealand Treasury found that some agencies were more accustomed to providing rigorous analysis across well-being dimensions and domains than others (Huang, Renzio and Mccullough, 2020[216]). A well-being approach can help make multidimensional assessments more systematic by defining a core set of well-being priorities against which all policy decisions need to be evaluated. This helps to ensure that all government agencies are engaged in multidimensional well-being analysis, that there is consistency in the domains and dimensions considered, and that they build on the same set of core indicators for each of these domains and dimensions.
Several institutional mechanisms can be used to support more integrated policy analysis and decision-making (OECD, 2019[211]). At a strategic level, national well-being and sustainability strategies can help align the unique roles that different agencies and bodies play in raising well-being. For example, Finland’s national sustainability strategy (The Finland we want by 2050) brings together existing sector-based long-term strategies within one overarching framework with a common timeline up to 2050. Collaboration requirements for budget proposals can also help encourage alignment of ministerial strategies towards post-crisis well-being priorities. For instance, in New Zealand, once well-being budget priorities have been defined, government ministries are required to work together to put forward budget bids that target the overarching well-being priorities. Budget bids from ministries need to demonstrate cross-agency and cross-portfolio collaboration in the development of the initiative. Ministers are appointed to coordinate the budget bids to help drive policy integration. As a result, the 2019 New Zealand budget saw as many as 10 agencies come together to jointly put in a budget bid to help address issues of family and sexual violence (Huang, Renzio and Mccullough, 2020[216]). Alongside these changes to its budget process, New Zealand has amended its Public Service Act to enable government agencies to more easily work together on cross-cutting priorities through new joint venture structures (Box 1.9).
The New Zealand Public Service Act 2020 (New Zealand Public Service Commission, 2020[232]) aims to support a more adaptive, agile and collaborative public service. It enables public sector chief executives to come together in a joint venture to promote an integrated, whole-of-government approach. Joint ventures cut through existing organisational boundaries by giving public service providers the tools and options to swiftly organise themselves around specific issues, without the cost, complexity and slowness of having to create a new, separate department.
Joint ventures create collective responsibility for achieving an agreed set of outcomes, while making it easier to join up people and resources from across the public service to work on common issues. Budget appropriations go directly to the joint venture itself, and a group of chief executives, rather than one of them, shares accountability for the budget spending, collectively reporting to one Minister. Joint ventures have their own staff, funding and assets, which make it easier to work on cross-cutting topics with suppliers and partners as they can be contracted by the joint venture itself rather than by individual agencies.
Source: www.publicservice.govt.nz
In addition to stronger horizontal alignment between ministries, an effective and efficient recovery asks for stronger alignment between the different levels of government (OECD, 2021[233]; OECD, 2019[211]). Stronger alignment and coordination between national and sub-national levels of government is needed to optimise the potential of each level of government in contributing to post-crisis priorities. Sub-national governments play a vital role in achieving well-being objectives. They carry important responsibilities for many well-being areas, such as education, social protection, health, housing and community amenities. A unique strength of local governments is that they are in more direct contact with their communities, including the most vulnerable groups, for example, through social workers and frontline staff (OECD, 2018[200]). Across OECD countries, sub-national governments are responsible for around 63% of public staff spending, 49% of public procurement, 59% of public investment and 40% of total government expenditures (OECD, 2018[200]). Increasing decentralisation across OECD countries further emphasises the importance of sound multi-level governance arrangements (OECD, 2019[234]; OECD, 2017[235]). Strong vertical alignment and coordination also provides unique opportunities for peer learning and upscaling of successful approaches by sub-national governments, who are in many ways leading the application of well-being metrics and concepts in public policy (Whitby, Seaford and Berry, 2014[90]) (Box 1.10).
Using the Amsterdam City Doughnut to refocus, redesign, realign, and reconnect
In April 2020, the City of Amsterdam released its first Amsterdam City Doughnut.1 The City Doughnut is a localised version of Raworth’s Doughnut Economics model, in which the inner ring sets out the minimum outcomes that are needed to lead a good life while the outer ring represents the ceiling of social and planetary boundaries beyond which future well-being is put at severe risk (Raworth, 2018[236]). By assessing where Amsterdam city is currently “undershooting” and “overshooting” its boundaries, the city has been able to define a set of objectives for Amsterdam to be thriving within its ecological and social boundaries.
The City Doughnut was developped based on a participative approach, including seven workshops in diverse neighbourhoods across Amsterdam, to reflect the lived experience of Amsterdam’s residents. The resulting Doughnut vision and strategy is used to bring together a network of city actors in the Amsterdam Doughnut Coalition, involving citizens’ networks, alongside government, businesses and knowledge institutions. Together, these actors work towards city-wide initiatives and co-creation for well-being, underpinned by the Doughnut framework.
New perspectives for policy development: Early examples of the Doughnut in action
The City Doughnut is used by policymakers, the wider Amsterdam Doughnut Coalition, and their stakeholders as a guide for thinking about opportunities and challenges, synergies and tensions, and alternative policy options. For example, the City Doughnut has been influential in the development of Amsterdam’s construction project, Strandeiland (Beach Island). Beach Island was reclaimed from the waters with sand carried by boats run on low-emission fuel and its foundations were laid using processes that do not hurt local wildlife. Beach Island’s future neighbourhood is designed to produce zero emissions and to prioritise social housing and access to nature. The City of Amsterdam has introduced new standards for sustainability and circular use of materials for contractors in all city-owned buildings. This means that anyone wanting to build on Beach Island needs to provide a “materials passport” for their buildings, so that whenever the buildings are taken down, the city can reuse the parts.
The City Doughnut has also influenced the city’s responses to the COVID-19 crisis. For instance, when the Netherlands went into lockdown in March 2020, the City of Amsterdam realised that thousands of residents did not have access to computers, which were becoming increasingly important to be able to take part in society. Rather than buying new devices - which would have been expensive and generate e-waste - the city arranged a collection of old and broken laptops from residents who could spare them, hired a firm to refurbish them, and distributed 3 500 refurbished laptops to those in need.
← 1. Home to 55% of the world’s population, cities have a unique responsibility and opportunity to shape intergenerational well-being outcomes. The Thriving Cities Initiative (TCI), a collaboration between C40 Cities, the Doughnut Economics Action Lab, and Circle Economy, is working with the cities of Amsterdam, Philadelphia, and Portland to pilot new ways of thinking, governance, and collaboration for a green and just future.
Source: www.amsterdam.nl, (Van Doorninck and Schouten, 2020[237]) and (Nugent, 2021[238]).
To date, very few countries have put a joint well-being framework at the heart of their multi-level governance approach, but the Welsh Well-being of Future Generations Act provides an example of how this could work (OECD, 2020[239]) (Box 1.11). Using a well-being framework across different levels of government can help streamline multi-level approaches in building back better. The Welsh example also highlights the importance of harmonised measurement of core well-being outcomes at national, regional, and local levels to support vertical alignment for raising well-being. While many countries have taken steps over the last two decades to harmonise well-being measurement at the national level (Figure 1.4), the ability to disaggregate national well-being data to regional and local levels remains a challenge in many countries (OECD, 2014[240]). Collaboration and harmonisation in data collection can bring value to both national and subnational analysis and interpretation. Lessons needs to be drawn from the well-being monitoring response to the COVID-19 crisis, which saw many public agencies from different sectors and geographic levels collect well-being data, each using their own set of instruments and survey questions. Even within central government, a lack of common frameworks for data collection and data sharing remains an important obstacle for effective cross-agency collaboration (OECD, 2021[12]).
The Welsh Well-being of Future Generations Act is unique in that it requires public bodies at all levels to work together towards the achievement of the 7 identified well-being priorities, based on the “5 ways of working” (Box 1.8). In total, 44 public bodies are currently subject to the duties of the Act, ranging from the Welsh Government to local health boards, fire and rescue authorities, the national parks authority, and several national bodies (such as the Arts Council, Higher Education Funding Council, and Sport Wales). As the Act applies to Welsh Minsters and national councils as well as local authorities, it forms an important mechanism to encourage both horizontal and vertical coherence across government towards shared well-being objectives.
The Act established Public Services Boards (PSBs) for each local authority area in Wales. These are required to consult on and publish: 1) a regular assessment of the state of economic, social, environmental, and cultural well-being in its area; 2) a local well-being plan, setting out local objectives and strategies to contribute, within the local area, to achieving the overarching well-being goals; and 3) an annual progress report, specifying the steps taken to meet the PSB well-being objectives. These local well-being assessments, plans and progress reports need to be shared with the Welsh Ministers, the Commissioner for Future Generations, the Auditor General for Wales, as well as the local authority’s overview and scrutiny committee.
The requirements of the Act thus place a well-being duty on all public bodies and support multi-level alignment in their well-being strategies. Importantly, it does so in a way that allows flexibility for context-appropriate goals and strategies at the local level.
Source: www.futuregenerations.wales/about-us/future-generations-act/
An ongoing challenge for strengthening policy integration and coherence is the need for better understandings of the interconnectedness of well-being outcomes and ways to reflect this in policy design and implementation. Civil servants responsible for policy development in specific domains may have little knowledge of the concepts of well-being, well-being metrics, or their application to public policy (Durand and Exton, 2019[208]). The need for multi-dimensional assessments can quickly push analysts beyond their areas of expertise and place considerable demands on time and capacities. Several of the well-being initiatives led by national governments have begun to include components of civil service capacity-building. For example, the United Arab Emirates’ Wellbeing Academy8 offers (virtual) programmes to federal and local government entities on how to integrate the principles of well-being into their programmes, policies, and services. In the United Kingdom, the Treasury’s Green Book provides non-technical guidance on how to appraise and evaluate policies, projects and programmes for their impact on well-being (HM Treasury, 2018[241]; Durand and Exton, 2019[208]). Multi-disciplinary teams or commissions can also play an important role in bringing together the wide array of specialist knowledge that is needed to identify integrated pathways towards greater societal well-being. Multidisciplinary capability is particularly important for central government agencies but there is also value in further considering how the knowledge base that underpins each of the post-crisis well-being priorities can be made more readily accessible across the system of government. For example, establishing advisory roles for selected well-being priorities within each government agency can help create “knowledge linking pins”. The practical reality is that being able to consult with someone internally is much more likely to happen than finding and reaching out to someone externally to provide advice, even if the internal person is only a first port of call.
Strengthening evidence on what worked can help accelerate progress on raising well-being in the post-pandemic recovery (Karacaoglu, 2021[89]). Gathering better evidence on the extent to which policies and programmes have raised well-being, and their associated costs, is essential to help inform better policies for better lives. This is even more important because most existing studies on the drivers of well-being tend to focus on average effects, whereas most policy interventions focus on very specific groups or areas of interest (Smith, 2021[242]). In a recent effort to distill lessons learned from green stimulus measures following the Global Financial Crisis that could inform recovery measures in response to the COVID-19 pandemic, the OECD has noted a remarkable scarcity of ex post evaluations (Agrawala, Dussaux and Monti, 2020[201]). This scarcity of evidence on “what worked” limits the knowledge that can be gained from past experiences to inform responses to upcoming issues. Where ex post evaluations were undertaken, distributional consequences were often overlooked (Agrawala, Dussaux and Monti, 2020[201]). This points to the importance of applying more comprehensive frameworks , encompassing current and distributional outcomes and resources for future well-being, when evaluating the success of specific government programmes. Some countries have established dedicated institutes, such as the What Works Centre for Wellbeing in the United Kingdom, to help bring together academic expertise and knowledge on “what works”, as valuable input into ongoing policy development to improve well-being (Box 1.12).
In the United Kingdom, the What Works Centre for Well-being aims to develop and share evidence that governments, businesses, and civil society can use to improve well-being across the country. Rather than focusing on a specific sector, the What Works Centre for Well-being provides advice to all government agencies on the drivers and measurement of well-being outcomes as well as on how to integrate well-being evidence into public policy. It forms part of a network of seven What Works Centres in the United Kingdom addressing different policy issues or geographic regions. These centres help ensure that high quality, independently assessed evidence shapes decision-making at every level by:
collating existing evidence on the effectiveness of policy programmes and practices
producing synthesis reports and systematic reviews in areas where they do not currently exist
encouraging policy-makers to use these findings to inform their decisions by sharing findings in an accessible way, including through regular newsletters, courses, and learning events.
Source: https://whatworkswellbeing.org
The recovery challenges ahead urge governments to more actively reach out to different stakeholders to set shared priorities, align actions and mobilise resources (OECD, 2019[211]). Diverse stakeholders – including public agencies, businesses and industry, civil society and academics – all have pivotal roles to play in alleviating the impacts of the COVID-19 crisis and in building back better (OECD, 2020[203]). A key strength of a well-being approach is that it helps connect government goals with what is most important for the well-being of current and future generations, particularly as country well-being frameworks are often based on large-scale consultations. The resulting frameworks offer a structure for dialogue between governments, citizens and other actors on how to build back better, using a language that resonates with citizens from diverse backgrounds. Well-being frameworks can help citizens better understand the current state of their society, allow them to see where they can add value, and provide them with data to hold their government to account.
Citizens’ and external stakeholder participation in public policy development and decision-making weakened during the pandemic, as did the usual system of checks and balances to a certain degree. Already before the pandemic in 2018, only 40% of people in 26 European OECD countries on average believed the political system in their country allows people like them to have a say in what the government does, with the less educated, less wealthy, unemployed, and older people feeling the least empowered to influence their institutions (OECD, 2021[12]; Murtin, Fleischer and Siegerink, 2018[193]). In autumn 2020, on average across 25 OECD countries, 49% of OECD Risks that Matter survey respondents reported that they did not think their government considered the views of people like them (OECD, 2021[25]). Indeed, the speed and scale at which governments had to implement their response to COVID-19 have posed risks for transparency and openness as governments were fast-tracking emergency regulations, policies and procurement (Chapter 10) (OECD, 2021[12]).9 Although these changes in government processes were often made in light of the extraordinary public health threat they faced, it is important to avoid risks of “mission creep”, restore a proper system of checks and balances, and strengthen citizen participation efforts as soon as possible (OECD, 2020[192]).
Effective public communication and ongoing dialogue between governments and citizens are key success factors for joining up forces to building forward (OECD, 2020[81]; OECD, 2020[243]). COVID-19 has put the spotlight on the fundamental role of timely and transparent public communication to strengthen and maintain trust in government and to mobilise collective action (OECD, 2020[81]). Among other things, it has highlighted the importance of making communication more inclusive by focusing on getting to hard-to-reach groups that are necessary for a whole-of-society response (OECD, 2021[244]). In addition, strengthening representative deliberative processes can play an important role in building a shared understanding of post-crisis priorities and to improve trust between citizens and government. Representative deliberative processes refer to a randomly selected group of people - who are broadly representative of their community - spending significant time learning and collaborating through facilitated deliberation to reach collective recommendations for policy makers (OECD, 2020[243]). Throughout such processes, governments can learn more about citizens’ perspectives, issues and concerns in response to the crisis, particularly of those who are most vulnerable. At the same time, citizens can gain deeper understandings of the - often complex - interplay between the well-being outcomes at stake and can play a more direct role in public agenda setting and decision-making.
Governments are increasingly carrying out open government reforms and are using representative deliberative processes to help deliver better policies, strengthen democracy and build trust (Figure 1.5). The range of policy issues that are being addressed through representative deliberative processes – such as citizens’ assemblies, juries and panels - has been wide and increasing (OECD, 2020[243]).10 In response to the pandemic, several OECD countries have held online public forums to consult with citizens on their experiences of, and opinions on, recovery responses. For example, the Finnish Ministry of Finance, in partnership with the Dialogue Academy and Timeout Foundation, has organised a series of Lockdown Dialogues on how the crisis has affected citizens’ lives and is reshaping their country (OECD, 2021[245]). The French parliament has hosted a virtual public forum to gather citizens’ opinions on the direction of France’s policy priorities post-COVID-19 (Open Government Partnership, 2020[246]). Some governments, including Norway and New Zealand, have also held special press conferences for children to answer their questions about the pandemic (The Guardian, 2020[247]; Financial Times, 2020[248]).
Reaching out to those who face higher barriers or are less used to or willing to “get involved” is essential to make recovery strategies more responsive to people who are under-served or less-heard. This includes youth, whose well-being has been deeply affected by the crisis but whose political weight has decreased across OECD countries due to population ageing (OECD, 2020[143]). While young people’s trust in government edged up following the pandemic outbreak - as it has for all age groups (Chapter 10) - going forward this trust may be challenged by governments’ abilities to adequately support young people’s well-being needs in the post-crisis period. The circulation of COVID-19 misinformation on social media, which is a key source of news for many young people, could also pose threats to young people’s trust in government (Brennen et al., 2020[249]). At the same time, child and youth demonstrations around the world prior to the pandemic clearly show young people’s motivation to address global challenges (OECD, 2020[143]). During the pandemic, young people and their organisations have also provided crucial help in mitigating the impact of the COVID-19 crisis on the most vulnerable in society, including the elderly (OECD, 2020[62]) (see also Chapter 10). Strengthening the relationships between youth and public institutions, by engaging them throughout the policy cycle and promoting their participation and representation in policymaking, is therefore important to further align their actions. The forthcoming OECD Youth Action Plan will set out a toolkit of measures that countries and stakeholders can use to empower young people and promote better outcomes in terms of their employment, education, and participation in public life (OECD, n.d.[250]). National Youth Strategies are also being adopted in an increasing number of OECD countries: in 2020, 25 OECD countries had a National Youth Strategy in place; 80% of these strategies aim to improve the access to and responsiveness of public services to young people; and 84% seek to integrate youths’ own views and concerns in public policies (OECD, 2021[12]).
Note: n = 282; data is based on 18 OECD countries that were members in 2019, plus the European Union. Processes that spanned over multiple years are noted by the year of their completion (except for permanent ongoing processes).
Source: OECD (2020[243]), Catching the deliberative wave, Highlights 2020, Figure 5, OECD Publishing, Paris, http://www.oecd.org/gov/open-government/innovative-citizen-participation-new-democratic-institutions-catching-the-deliberative-wave-highlights.pdf.
Creating permanent or ongoing deliberative structures can support continuous collaboration between governments and citizens in the process of building forward. Despite positive developments in the use of deliberative processes, citizen engagement has yet to become part of the day-to-day work of policy makers. While in 92% of OECD countries, policy makers consult early on draft regulations with selected groups, open consultations tend to be more common only at a late stage of policy development (OECD, 2018[200]; OECD, 2021[12]). Moreover, to date, most representative deliberative processes for public decision-making have been one-off, with topics being defined top-down by public decision makers (OECD, 2020[243]). Further institutionalising the role of citizens in developing strategies for building back better is important to mobilise collective support and action for the chosen direction of travel. For example, in 2019, a permanent Citizens' Council was established in Ostbelgien (the German-speaking part of Belgium) to constitute its third fundamental democratic institution alongside the Parliament and the Executive. The main objectives of the Citizens’ Council are to give citizens a permanent voice in the process of decision-making, to establish a systematic monitoring system to ensure that they are heard, and to increase accountability and reinvigorate the agenda-setting power of common citizens (OECD, 2020[243]).
A well-being approach can also help inform stronger strategic alignment between the public and private sector in building back better. The involvement of businesses is important: first, because of the direct role they play in improving employee well-being; and second, because of the way their products and services affect societal well-being outcomes. A shared (outcome based) framework can help counteract the idea that the public and private sectors have opposing interests and can help further align their efforts in working towards societal well-being priorities (Wade, 2021[251]). Better measurement of and reporting on the wider well-being impacts of businesses can also improve their financial performance. Business sustainability ranking and standards have been shown to significantly impact shareholder value (Lyon and Shimshack, 2015[252]), stock-market valuation (Clark, Feiner and Viehs, 2015[253]), and companies’ financial performance (Eccles, Ioannou and Serafeim, 2014[254]; BCG, 2017[255]). More conscious consumers and investors further drive the need for businesses to better measure and report on their impacts and contributions to societal well-being (Shinwell and Shamir, 2018[256]). Using a comprehensive well-being framework adds particular value in doing so as businesses, just like many government agencies, tend to focus on certain elements of societal well-being and can easily lose sight of the bigger well-being picture.
Despite the global rise in Corporate Social Responsibility (CSR) reporting, significant data and measurement challenges persist in both official statistics and in business efforts to measure non-financial business performance. National statistical offices and the wider statistical and research communities could play an important role to help align national and business efforts to measure well-being outcomes (Shinwell and Shamir, 2018[256]; OECD, forthcoming[257]). To that end, (OECD, forthcoming[257]) uses the OECD Well-being Framework as a starting point for measuring the broad societal and environmental impacts of businesses on different groups of stakeholders – including employees, consumers, suppliers, society at large and future generations.
Social dialogue can help translate the core dimensions of well-being frameworks into business models that increase well-being for all while protecting the planet. In response to the COVID-19 pandemic, social dialogue between governments, employers and workers has played a crucial role in reaching agreements to strengthen labour market resilience, improve worker protection against the spread of the virus, and to develop flexible but balanced working-time arrangements (Global Deal, OECD and ILO, 2020[258]). Going forward, social dialogue will be fundamental to enable an inclusive and sustainable recovery. The importance of social dialogue is the driver of the Global Deal,11 a multi-stakeholder partnership that aims to encourage governments, businesses, unions and other organisations to make commitments to enhance social dialogue. In addition, Business for Inclusive Growth – a public-private partnership between the OECD and 35 major global companies – supports work to strengthen more inclusive business models (Box 1.13).
During the COVID-19 crisis the social economy has also demonstrated its unique capacity to help address market and government failures in inclusive and sustainable ways (Box 1.14). Social entrepreneurs are a natural partner for governments seeking to improve societal well-being. In line with the principles of a well-being economy (Nozal, Martin and Murtin, 2019[19]), social entrepreneurship is about “doing business for societal and environmental good”. Its main goal is to address societal challenges in an innovative way by targeting social impact primarily rather than profit maximisation. By linking economic and social value creation, social enterprises play an important role in helping to reshape the post-crisis economy by promoting more inclusive and sustainable economic models (OECD, 2020[259]). They can create new jobs, be a vehicle for better service delivery, boost citizens’ participation in their local communities, and turn innovative ideas into action for the benefit of the common good, all while generating tax revenues (European Union and OECD, 2016[260]).
Business for Inclusive Growth (B4IG) is a strategic partnership between the OECD and 35 major global companies that works to fight against inequalities of opportunities. Launched in 2019 at the G7 Leaders’ Summit, B4IG leverages relevant OECD data, analysis and standards to help companies move towards more inclusive business models.
Each Chairperson or CEO of B4IG member companies has signed the Pledge to Fight against Inequalities, which covers three main areas of inclusive growth:
advancing human rights in direct operations and supply chains
strengthening inclusion in companies’ value chains and ecosystems.
The B4IG coalition is developing a measurement framework and methodology that can be used to assess their progress in implementing the Pledge, drawing on the OECD Well-being Framework and impact measurement work stream. B4IG organises its work via three main actions: Working Groups, an Incubator, and an Inclusive Growth Financing Forum. By sharing best practices, developing new solutions, launching pilot programs, and developing metrics to better evaluate inclusive growth efforts, B4IG shows how businesses can contribute to a sustainable and inclusive future for all.
Government recovery strategies should provide a clear role for the social economy and identify actions to support their impact and scale (OECD, 2020[259]; OECD/European Union, 2017[261]). Social entrepreneurs’ values-based approach to economic activities can help transform society and the economy by:
successfully demonstrating alternative ways of conducting economic activities, inspiring other economic actors to follow and mainstream these practices;
unlocking new economic sectors such as textile recycling, which has been pioneered by social economy organisations since the 1960s and has since experienced an increase in the number of economic actors entering this field; and
revitalising local economies and providing services in remote areas. A distinctive strength of the social economy is that their economic activities typically build on local roots, mobilising and empowering local actors, including those who are vulnerable. They are therefore particularly well-suited to help respond to local well-being issues in the wake of the pandemic (OECD, 2020[259]).
Masques-Coronavirus.Brussels is a government-supported social economy initiative that worked to improve well-being by addressing market and state failures during the COVID-19 crisis. In response to shortages in personnel protective equipment, two social enterprises from Brussels, EcoRes and Travie, joined forces to meet the urgent demand for masks for frontline health care personnel.
EcoRes is a sustainable innovation lab specialised in the circular economy, while Travie is a work integration social enterprise that employs people with disabilities. With the support of the Brussels-Capital Region, a collaborative and decentralised production line of masks was established. Students from a fashion design school designed the mask pattern and conducted a tutorial on the design. Mask kits were then pre-cut and prepared by Travie and delivered by the social enterprise Urbike to a network of volunteering citizens who sewed the masks according to quality standards. More than 2 000 people were involved and produced 240 000 reusable masks for frontline caregivers in 1.5 months.
This project demonstrates the capacity of the social economy to:
address urgent well-being needs and improve quality of life for people and their communities
react with agility and foster solidarity in extreme situations
rally local actors and mobilise different resources (funding, volunteering, knowledge) from a range of actors (government, citizens, social economy organisations, professionals)
design, experiment with and consolidate innovative approaches to economic activities and new ways of working together between individuals, organisations and local governments.
Source: Adapted from OECD (2020[259]), Social economy and the COVID-19 crisis, Box 2
This chapter has considered the ways in which a well-being approach can guide the process of building back better in the wake of the COVID-19 pandemic by helping governments refocus, redesign, realign and reconnect. Using a multidimensional framework to assess key elements of current and future well-being enables governments to focus their recovery efforts on the well-being areas of greatest need - including pre-pandemic vulnerabilities that have been exacerbated by the crisis. This includes the need to increase job and financial security and to improve opportunities for all - including among children and young people as well as across generations. To build forward more resiliently, strong action on the environmental crises needs to be a central part of all recovery efforts but a pro-active approach is also needed to help reinforce trust and social capital. In addition, addressing the personal and societal burden of poor mental and physical health is critical to strengthen people’s quality of life and to enable families, communities, businesses, economies and societies to thrive.
Different pathways can enable governments to simultaneously improve current and future well-being while reducing inequalities. This chapter has identified five such pathways: 1) supporting the creation of sustainable, inclusive, and high-quality jobs, including in the green economy and the health, education and wider care sectors; 2) using lifelong learning to reduce inequalities; 3) using a whole-of-government approach to raise the well-being of disadvantaged children and young people; 4) strengthening mental and physical health promotion and prevention; and 5) reinforcing trust by strengthening public sector competencies and values and encouraging meaningful citizen participation on a more ongoing basis. These “triple win” channels constitute examples of policy directions that build on synergies between current, distributional and future well-being outcomes, rather than a comprehensive well-being policy agenda. The most suitable and effective well-being approaches will ultimately depend on country’s unique local contexts and well-being priorities. Nonetheless, the discussion of these five channels has illustrated how well-being frameworks can help to identity strategic directions for recovery that can contribute to well-being across multiple dimensions, groups and time-periods; how potential synergies between well-being objectives often remain unrealised; and how a well-being lens can help broaden policy thinking about what has value for public investment and what the best ways are to address societal concerns.
Building back better lives in a more integrated way asks for new ways of working within government and with private and civil society actors. Improving governments’ awareness of the impact of their recovery measures on the multiple dimensions of current well-being, inequalities and future well-being is fundamental to be able to build back more coherently, efficiently, and effectively. It requires all government agencies to focus on a system of interconnected goals, rather than on individual targets that can be met by individual agencies. Recent decades have seen important initiatives in this direction from governments around the world. These initiatives go beyond measuring and reporting on well-being, to actively using well-being frameworks and data to inform policy priorities and budget decisions, to encourage more holistic, coherent and forward-looking policy initiatives, and to align actions between public, private, and civil society stakeholders based on a shared sense of purpose.
The wide-ranging impacts of the pandemic on well-being highlight the need for a whole-of-government response and a joined-up, forward-looking recovery. The COVID-19 pandemic has highlighted the radical uncertainty and complexity of the world in which policy makers are acting. In these uncertain and complex environments there are no silver bullets and no single organisation holds the range of knowledge or information required to arrive at desired outcomes (Karacaoglu, 2021[89]). What is needed is a shift in the focus of public policy from looking for optimal solutions to narrowly defined problems to building resilience by investing in environmental, social, human, and economic capital (Karacaoglu, 2021[89]). Doing so builds on the core elements of collaboration, integration, and anticipation that characterise a well-being approach to public policy.
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Notes
← 1. This report complements work currently underway at the OECD to develop a dashboard of indicators to monitor the COVID-19 recovery, as discussed at the 2020 and 2021 OECD Ministerial Council Meetings. While the present report focuses on describing well-being impacts in the first year of the pandemic, the recovery dashboard is a forward-looking exercise that aims to monitor OECD countries’ progress towards a strong, green, inclusive and resilient recovery, based on a more limited set of indicators. The OECD Well-Being Framework has informed and shaped both of these activities.
← 2. The increase in non-standard workers has mainly been driven by an increase in part-time workers.
← 3. Findings are based on biannual test scores in core subjects for students aged 8 to 11 in a dataset covering 15% of Dutch primary schools from 2017 to 2020 (Engzell, Frey and Verhagen, 2021[33]).
← 4. Control variables in the study included: the median age of the population; whether the country is an island; an exposure index measuring how close a country was to infections in other countries in the early stages of the pandemic (in March 31); measures of the extent to which a country was able to remember and apply the epidemic control strategies learned during the SARS epidemic of 2003; and whether the country has a female head of government (Helliwell et al., 2021[78]). In terms of the validity of the “wallet return” question, evidence from an experiment involving large numbers of wallets being dropped in 40 countries (some containing money and some not) suggests that there is a strong positive relation (r = 0.64) between expected and actual wallet return (Cohn et al., 2019[264]).
← 5. Ultimately, a gender-responsive approach to addressing the socio-economic impacts of the pandemic on men and women from diverse backgrounds relies on a dual approach (OECD, 2021[34]). Firstly, pro-active and targeted policies are needed to close identified gender gaps and level the playing field for men and women. This includes targeted measures to tackle specific challenges faced by women, such as gender-based violence. Secondly, in line with the OECD Recommendation on Gender Equality in Public Life, it is essential to mainstream gender-inclusive considerations throughout the policy cycle, to ensure that government action does not inadvertently reinforce existing gender stereotypes and inequalities (OECD, 2016[263]). For example, the Canadian government has mandated that its Gender-based Analysis Plus (GBA+) must be undertaken on all policies and proposals, including in response to the COVID-19 crisis. GBA+ is an analytical tool that policy makers use to examine the potential impacts (both intended and unintended) of a policy, plan, programme, or other initiative on diverse groups of people. It considers gender as well as other identity factors such as age, ethnicity, indigenous heritage, geographic location, socio-economic status, family status, and mental or physical disability status (Government of Canada, n.d.[262]).
← 6. At Level 1, tasks typically require the use of widely available and familiar technology applications, such as e-mail software or a web browser. There is little or no navigation required to access the information or commands required to solve the problem. The problem may be solved regardless of the respondent’s awareness and use of specific tools and functions (e.g. a “sort” function). The tasks involve few steps and a minimal number of operators (OECD, 2019[134]).
← 7. Canada’s Quality of Life Framework, “https://www.canada.ca/en/department-finance/services/ publications/measuring-what-matters-toward-quality-life-strategy-canada.html
← 8. https://wellbeingacademy.hw.gov.ae
← 9. For example, although 20 of 26 governments (77%) consulted stakeholders on their COVID-19 response strategies, only 9 (35%) actively involved them in policy design (OECD, 2021[12]). In taking a risk-based approach in prioritising the most time-critical processes, stakeholder engagement practices used shorter consultation periods and more focused consultation activities, and in some cases, economic regulators put consultations on hold, recognising the limited ability of stakeholders to take part (OECD, 2021[12]). Moreover, with few exceptions, there were rarely formal channels created for the public to voice an opinion on or shape the evolution of the decided measures (Economist Intelligence Unit, 2020[271]). Among government initiatives in OECD countries to publish data on COVID-19 and responses in 2020, 77% were primarily for situational awareness, and there is limited evidence that open government data initiatives drove concrete action beyond public communication efforts (OECD, 2021[12])(see Chapter 10). In some countries, access to information requests by citizens were either delayed or their general timeline for completion officially extended or suspended (see Chapter 10).
← 10. Government at a Glance 2021 reports that the use of virtual consultations in regulatory policy-making has increased since 2017; from 35% to 62% of OECD countries for early-stage consultations, and from 41% to 57% of countries for late-stage consultations. In 92% of OECD countries, policy makers consult early on draft regulations with selected groups; open consultations are more common only at a late stage (OECD, 2021[12]).
← 11. Initiated by Sweden in collaboration with the ILO and the OECD in 2016, the Global Deal brings together over 100 partners representing governments, business, trade unions, and civil society. https://www.theglobaldeal.com