The wellbeing economy is our chance to tackle Scotland’s challenges at their source

Scotland and its communities are living through very difficult and uncertain times, and the creation of a Cabinet position in the Scottish Government to promote and deliver the wellbeing economy is to be welcomed. 

Today our citizens face multiple and debilitating challenges, most of which have their roots in various decisions about the economy taken over many decades. The cost-of-living crisis is sending more and more people into poverty, often facing a choice between heating their home and feeding their children.

Real wages are falling at a rate matched only by the relentless rise in profits of many across our energy sector. Inequalities in income, health and housing are reaching levels that are stretching our social fabric to breaking point. 

Globally the world faces an ever-worsening environmental crisis. The resulting extreme weather events, rising ocean levels, floods, bushfires, etc. are affecting everyone now, but the vulnerable are most and worst hit. To not take this seriously is either ignoring the evidence, or not caring about the lives already being lost and the hopes of future generations. 

Faced with this reality, even its most ardent enthusiasts find it difficult to argue that the conventional approaches to economic policy are working for enough people. The orthodoxy that simply maximising the rate of economic growth will raise the prospects of individuals and societies is, demonstrably, fallible.

We have ceased to see the ‘trickle down’ benefits so beloved by the libertarian right, or the ‘redistributive promises’ of the democratic left. Instead we have seen the relentless rise in individual profits and the continued degradation of our welfare system. Put bluntly, the economic policy orthodoxy is no longer working in the interests either of people or planet. 

Shifting our focus to a wellbeing economy approach offers the prospect of developing measures that will tackle the challenges experienced in Scotland and beyond at their source, rather than merely ameliorating the fall out of the current system.

Some of the necessary reconfiguration is obvious and can be adopted relatively quickly. In-work poverty, poor housing, inadequate access to health care, protecting the interests of children and looking after the most vulnerable in society can and should be tackled by public policies.

But we have to go much further than putting more and perhaps better sticking plasters on the damage done by our outdated approach to economic policy. Even on its own terms this is an expensive and inefficient way of doing things, given the fiscal price tag of those sticking plasters.

More upstream changes are required, changes that reflect the principle that the economy is there to work for people, not that people are there to work for the economy as the very few reap ever-higher rewards from that work. Now is the time for a new economic approach that untangles means and ends and deliberately structures the economy to prioritise collective wellbeing. 

To be clear (and we need to be explicit given some recent commentary that seems not to have taken the time to explore the evidence and ideas behind the wellbeing economy agenda): a wellbeing economy is absolutely about wealth in the financial sense. Wellbeing has a very real material basis.

But in the current scenario too many people do not have enough to meet their basic needs, while others are accumulating more and more. A wellbeing economy would question who is getting the benefits of growth? What is being grown and why? It is about being deliberate about the direction and composition of growth, rather than simply seeking to accelerate its rate and assuming that will do the job.

This requires focusing on a wider suite of metrics than GDP alone, since GDP - as almost all economists will acknowledge - is blind to distribution and cannot distinguish between useful or harmful economic activity. 

Businesses are pivotal to the transformation required. The goods and services they provide, the jobs they offer, the investments they make, and the way they treat the natural world through their production and consumption systems all shape outcomes that matter. The wellbeing economy is about bringing out the best of business so it is part of delivering solutions to society’s challenges and needs, not profiting from today’s problems.

Building a wellbeing economy in Scotland is an opportunity to build an economy fit for today’s challenges and opportunities, not simply reusing failed recipes. It is a ‘preventative’ agenda that says patching and repair is no longer enough: it is time to look upstream and be bold enough to undertake substantial change where it is needed to get things right the first time.

There is growing support for the wellbeing economy approach. Opinion polls repeatedly indicate support for the ethos and component parts of a wellbeing economy. Last year a letter signed by over 100 charities, businesses, trade unions and economists called for urgent transition to a wellbeing economy and for the Scottish Government to be bolder in its actions. 

Other countries are adopting this agenda - Scotland can be a leader, but it certainly isn’t alone.

Dr Aileen McLeod is a council member of the Wellbeing Economy Alliance (WEAll) and former Scottish Government Minister for the Environment

Dr Katherine Trebeck, is co-founder of the Wellbeing Economy Alliance (WEAll) & writer-at-large at the University of Edinburgh