Principles for an effective wellbeing budget

This report outlines how Australia can develop a wellbeing-focused federal budget to ensure the economy supports societal and environmental wellbeing. It argues that government priorities, policies, and spending must shift towards improving people’s wellbeing and planetary health. A wellbeing approach should be holistic, outcomes-focused, long-term, preventative, and participatory. It should move from addressing immediate problems to preventing them, using evidence and innovation to guide policy.

The report highlights that Australia can learn from international wellbeing budgeting practices and embed wellbeing considerations across decision-making processes. It identifies key features such as setting explicit wellbeing goals, aligning budgets with these goals, and integrating measurement and accountability mechanisms.

What we would like to see from a wellbeing budget

Introducing clear wellbeing goals and measures is a critical first step. The October Federal Budget is presented as an opportunity to begin developing a wellbeing framework grounded in explicit goals and supported by measurable indicators. These should connect wellbeing outcomes directly to policy decisions.

Investment is required to improve timely and disaggregated data to monitor wellbeing across demographics and geographies. Indicators must evolve as data quality improves, allowing flexibility to incorporate new metrics. Budget allocations should closely align with these wellbeing goals, resourcing policies that deliver on desired outcomes.

The report also notes that Australia can go beyond existing international models by legislating the vision, reporting schedules, and delivery mechanisms. Public involvement, especially from marginalised communities, is essential to ensure legitimacy. Reviews of government activities must consider wellbeing impacts across sectors, not only new policies. Ministerial accountability and coordination across departments will be necessary to ensure alignment.

Invest in upstream analysis

A wellbeing budget should drive long-term structural change rather than short-term fixes. Addressing wellbeing deficits through temporary funding is insufficient. Instead, governments should invest in upstream analysis — understanding the root causes of wellbeing challenges and developing preventative strategies.

This requires shifting from annual to multi-year budgeting processes. Funding should support research on the causal dynamics influencing wellbeing and promote innovation through pilot initiatives. Lessons can be drawn from initiatives such as Victoria’s early intervention programs and the Department of Social Services’ Try, Test and Learn Fund.

Building on expertise in the public service

Implementing a wellbeing approach requires cultural and procedural change within the public service. New frameworks for priority setting, analysis, and decision-making must be developed. Public servants will need training, guidance, and a shared language for wellbeing-focused governance.

The report recommends building coordination across departments, with dedicated resources to mobilise staff, drive implementation, and maintain transparent mechanisms for stakeholder engagement.

Beyond October

Regularly assess progress – The report recommends that the Treasurer release regular statements outlining wellbeing goals, progress, and future priorities. These updates could align with existing publications such as the Treasury’s Intergenerational Report or reports from the Productivity Commission.

Systematically embed wellbeing considerations in decision-making – Budget rules should be revised to evaluate policies based on their wellbeing impacts, alongside fiscal and economic outcomes. Departments should articulate how their activities contribute to wellbeing objectives. This process must move beyond compliance, encouraging innovation and long-term thinking.

Establish independent accountability

The report proposes establishing a politically neutral and independent office to oversee wellbeing outcomes. This office would assess departmental performance, promote consistency, and support capacity-building. Models include Wales’ Future Generations Commissioner or Australia’s own Evaluator General or Productivity Commission structures.

Dialogues with the community

Ongoing public consultation is essential to maintain alignment with community priorities. Deliberative processes can build public understanding of wellbeing and support for preventative investment. Continuous dialogue helps ensure that government remains responsive to changing needs and values.

Conclusion: The bold road to greater wellbeing

The report concludes that the wellbeing budget represents a long-term transformation in how Australia makes fiscal and policy decisions. While challenging, such change will lead to more efficient, equitable, and sustainable outcomes.

Drawing on lessons from the Wellbeing Economy Governments partnership and other global examples, Australia is well-placed to advance this agenda. The COVID-19 pandemic demonstrated both the vulnerabilities of many Australians and the capacity of government to act decisively. The report calls for continued commitment to aligning budget processes with wellbeing goals to create an economy that serves people and the planet.