A waste of taxpayers’ money?

What should be the ultimate goal of government?

If you’ve been following UK politics for the past decade (or more) you’d be forgiven for thinking the answer is simply economic growth. The same is true in many countries across the world, yet this approach on its own is—at best—short-sighted and—at worst—downright negligent.

The ultimate goal of any government should be the wellbeing of its people.

Progress in the UK has been slow and steady compared to our friends in the Nordic countries, New Zealand, and most recently Australia. Although the UK Treasury has published guidance on how wellbeing may be considered in appraising new policies, its use to date has been limited.

That’s why, with a team of researchers at the London School of Economics, we have just published our own report assessing the benefit/cost ratio of a series of policies. Put simply, how much wellbeing does each policy deliver per (net) pound it costs the government?

Our findings should be clear to any rational policymaker. The best policies are those which save the government more money than they cost, by getting people back into work. Expanding NHS Talking Therapies, for example, would more than pay for itself within two years of implementation.

Elsewhere, we have converted the wellbeing benefit of certain policies into their monetary equivalent. Using this method we see that the benefit/cost ratio of increased police in the community is as high as 12:1.

At the other end of the spectrum, policies which are traditionally used to stimulate GDP growth, like building roads and bridges, drop down the priority list when we look at their wellbeing benefit to the taxpayer.

Although these numbers are for the UK, the lessons learned here can be applied far beyond these shores. After all, it’s not the economy, stupid; it’s wellbeing, stupid!

Prof Lord Richard Layard
Editor, World Happiness Report

Read, watch and listen

The best analysis, hand-picked by our editors

Value for money: How to improve wellbeing and reduce misery

Read the full report by Prof Lord Richard Layard and team, published by LSE’s Centre for Economic Performance, plus coverage in The Guardian and Financial Times (requires subscription).

How can public spending do better at improving wellbeing?

Watch a recording of the launch of LSE’s Value for Money report, with analysis from an expert panel including the Director General of Public Spending at the UK Treasury, Conrad Smewing.

Voters’ feelings matter

Considering population wellbeing isn’t just financially prudent for politicians – research shows that happier people are more likely to vote for the incumbent government. Read more about happiness and voting behaviour in this chapter from the WHR archive.

What it takes to move ‘beyond GDP’

How can we make a wellbeing-first agenda a reality? Lord Gus O’Donnell, former UK Cabinet Secretary, shares what it takes to apply wellbeing research insights in the real world in this extended interview for the World Wellbeing Movement.

Wellbeing and state effectiveness

This analysis from WHR 2023 delves further into the question of what should be the ultimate goal of an effective government.

Chris Murphy: A US Senator’s view on WHR 2024

Findings from World Happiness Report 2024 have already made their way into the hands of policymakers. Watch Connecticut Senator Chris Murphy delivering remarks on the US Senate floor.