Gross National HappinessA noble path for regional Australia?

Dr Kim HoughtonDirector, Strategic Economic Solutions

Adjunct Associate Professor, University of Canberra

BhutanBhutan

• Small, poor, developing country– 720,000 people– 50% under 25 years old– Capital is Thimpu population 110 000Capital is Thimpu, population 110,000 and elevation 2300m

– 38,000 sq km (300km x 170km)• Tasmania is 62 000sq km with abt• Tasmania is 62,000sq km with abt500,000 pop

– 60% of Bhutan's labour force work in agriculture (Aust is 2.5%), average of g ( ), g1.8 workers per ha

– New democracy, imposed by His Majesty

Gross National HappinessGross National Happiness

• Proposed by Bhutan’s 4th King in 1972Proposed by Bhutan s 4 King in 1972

• GNH is a “multi‐dimensional development approachGNH is a  multi dimensional development approach that seeks to achieve a harmonious balance between material well‐being and the spiritual, emotional and g pcultural needs of our society.” 

Th GNH diThe GNH paradigm concludes that “economic 

h i d igrowth is not an end in itself but rather a means 

hi ito achieve more important ends”….happiness. 

PurposesPurposes

• Track progress  • Dilutes dissentp g(benchmarking)

• Screening policies and j t (diff t t

Dilutes dissent• Justifies and 

reinforces inward looking policies (egprojects (different to 

GPI*)

• Strengthens 

looking policies (egcar import ban, alcohol, cigarette bans)g

leadership and trust in leadership

L d

bans)• Based on and 

reinforces national • Long term roadmap

• Patient regional development (eg

values• Reinforces reliance on 

Indiadevelopment (egelectricity in 2010)

*Gross Progress Indicator seeks to recalibrate GDP to take account of ‘bads’ as well as goods

Is GNH relevant in regional Australia?Is GNH relevant in regional Australia?

• Holistic measures of progress are moreHolistic measures of progress are more meaningful to communities– Include issues of environmental concern– Health and emotional balance– Government performance

• We have no tools for screening policies and programs against agreed community objectives

• How much trust do we have in leadership?

Regional developmentRegional development

• Issues in the regions g– Mobile telephony– RoadworksC f l t f t i– Careful management of tourism

– Loss of young people – urban drift– Loss of agricultural workersoss o ag cu u a o e s– International competition– Land management – forestry and farming assetsTV b d i– TV broadcasting

– Electricity– WaterWater

What role for agriculture in regional prosperity?

Not as a job generator ….

Where is regional Australia in this picture?Where is regional Australia in this picture?

MLA Attracting and retaining staff in Australia’s pastoral industries Dec 2008MLA, Attracting and retaining staff in Australia s pastoral industries, Dec 2008

Agricultural output and employmentAgricultural output and employment

450.0

500.0

300.0

350.0

400.0

oyed

 (FT & PT)

150.0

200.0

250.0

usan

d pe

ople empl

Ag support

Agriculture

50.0

100.0

Thou

0.0

Nov‐198

4

Oct‐198

5

Sep‐19

86

Aug

‐198

7

Jul‐1

988

Jun‐19

89

May‐199

0

Apr‐199

1

Mar‐199

2

Feb‐19

93

Jan‐19

94

Dec‐199

4

Nov‐199

5

Oct‐199

6

Sep‐19

97

Aug

‐199

8

Jul‐1

999

Jun‐20

00

May‐200

1

Apr‐200

2

Mar‐200

3

Feb‐20

04

Jan‐20

05

Dec‐200

5

Nov‐200

6

Oct‐200

7

Sep‐20

08

Aug

‐200

9

Jul‐2

010

Jun‐20

11

May‐201

2

Agriculture Ag supportServices climbing:

Agriculture Ag support1985 372.1 18.6 5.0%1995 362.3 18.9 5.2%2005 304.4 26.6 8.7%2012 294.4 24.3 8.3%

Value of productionValue of production60000

50000

ed $20

11

30000

40000

$m infla

tion

 adjuste

Aust

20000

ss value

 agprod

n$

NSW

0

10000

Gro

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

ABS 7503 Value of agricultural commodities produced, ABS 6401 CPI series

Labour productivityLabour productivity160000

120000

140000

orker

80000

100000

of ag prod

n pe

r wo

Aust

NSW

40000

60000

Real value

 ($)  NSW

0

20000

Has improved 2.7% per annum

0

ABS 7503 Value of agricultural commodities produced, ABS 6401 CPI series, ABS 6291 Labour Force Aust

More production, fewer jobsMore production, fewer jobs

1.4

1

1.2

al VAP

0.8

1

rs per $10

0,00

0 rea

Aust

0.4

0.6

Num

ber o

f worke NSW

0

0.2

ABS 7503 Value of agricultural commodities produced, ABS 6401 CPI series, ABS 6291 Labour Force Aust

A tale of 8 shires(or the perils of averages)

Local Government

Population Agricultural workers

Ag workers as % of

GVAP per agworker

GVAP per resident

Projected agworkers inGovernment

Areaworkers as % of 

populationworker resident workers in 

2021 

Walgett 6,454 671 10.4% 574,963 59,777 500‐540

Warrumbungle Shi 9,588 971 10.1% 116,787 11,827 720‐730Shire 9,588 971 10.1% , , 720 730

Narrabri 12,925 1,248 9.7% 316,186 30,530 920‐1,000

Liverpool Plains 7,480 711 9.5% 218,003 20,722 520‐540

Gunnedah 12,066 870 7.2% 224,483 16,186 640‐770

Tamworth Regional 56,294 1,644 2.9% 156,144 4,560 1,210‐1,250

Walcha 3,021 630 20.9% 99,048 20,655 560‐550

Uralla 6,034 476 7.9% 110,084 8,684 350‐420

Namoi Region 113,862 7,221 6.3% 223,736 14,819 5,320‐5,780

What future?What future?

• Local supply chains will determine local flow‐on effects• What’s possible within big trends?• What values underpin possible scenarios?

G th i i t t l ti– Growth in income, output, population– Society, culture, environment– National and regional governance

• How can scenarios be evaluated?• RIRDC sponsored tool – a bottom‐up approach to GNH

Securing wealth and wellbeing of rural communities– Securing wealth and wellbeing of rural communities– www.rirdc.gov.au/research‐project‐details/custr10_DRC/PRJ‐008426