What is government actually for?
It’s a question we don’t often stop to ask in Parliament, but the answer shapes everything that follows. At its core, government is there to keep people safe, to make sure things are fair, and to provide the things we all rely on but which markets alone won’t deliver – clean air, clean water, flood protection. It’s there to support people through illness, unemployment and old age, and to help us make shared decisions about the kind of future we want.
Put simply, government is how we come together to do what none of us can do alone.
So here is the question that should be on the mind of every Member of Parliament: how well does GDP measure whether government is succeeding at any of those things?
The answer is poorly, partially, and in some important respects not at all.
GDP does not measure whether people feel safe – but it does count the cost of building more prisons. It tells us nothing about fairness or distribution – a country can post record growth while most people struggle and a small minority accumulate extraordinary wealth.
GDP has no entry for clean rivers, healthy soil or functioning flood defences. In my constituency, the Thames headwaters and the Cotswold water meadows underpin food security, flood resilience and community health – yet GDP cannot see any of it. It records the cost of clearing up pollution, but never the value of preventing it.
GDP counts antidepressant prescriptions and ambulance call-outs as contributions to national output – but not the value of unpaid care, conservatively estimated to be worth £184 billion, about the same as the entire NHS budget. By GDP’s logic, even a crisis can look like growth.
Using GDP to assess whether government is doing its job is like using a thermometer to decide whether a patient has recovered. Their temperature may be normal, even as their leg has fallen off.
In 1968, Robert F. Kennedy warned that GDP “measures everything… except that which makes life worthwhile.” Even Simon Kuznets, the economist who first developed GDP during the 1930s as an attempt to measure recovery from the Great Depression, made the same point. Both understood its limits. We chose to ignore them.
Last week I was at the Wellbeing Economy Forum in Reykjavik, alongside policymakers and economists from around the world. Three things were clear: the intellectual case is settled, the technical frameworks exist, and what is missing – in too many countries, including our own – is political will.
Britain is not starting from scratch. In 2010, David Cameron launched the ONS National Wellbeing Programme, recognising that GDP alone was not enough. Since 2011, the ONS has tracked wellbeing across dozens of indicators – from health and relationships to environment and trust in institutions. Earlier this year, it introduced a set of headline measures aligned with the UN’s emerging “Beyond GDP” framework.
This data tells us things GDP cannot: that self-reported health has declined since the pandemic, that trust in government rises and falls in ways that matter deeply to how society functions, and that inequality is breeding resentment and anger. These are not side issues. They are central to whether a country is thriving.
And yet these measures sit largely unused. They are published, but not embedded in decision-making. Available, but not acted upon.
Elsewhere, countries are moving ahead. Iceland has rebuilt its economy with a focus on wellbeing. Wales has placed a legal duty on public bodies to consider the interests of future generations. The New Zealand Treasury has a Living Standards Framework that guides decisions and budgets, prioritising policies based on their impact on people’s lives rather than economic growth alone.
If they can do it, so can we. What we measure shapes what we prioritise – and what we prioritise shapes the country we become.
It is time to stop treating GDP as the final word on progress, and start treating it as one measure among many.
Above all, it is time to measure what matters – the wellbeing of our people, the health of our natural world, and the future we are leaving for the generations to come.
