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Genuine Progress Index for Atlantic Canada Indice de progrès véritable - Atlantique Measuring Wellbeing and Sustainability in the GPI and CIW Wellington,

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Presentation on theme: "Genuine Progress Index for Atlantic Canada Indice de progrès véritable - Atlantique Measuring Wellbeing and Sustainability in the GPI and CIW Wellington,"— Presentation transcript:

1 Genuine Progress Index for Atlantic Canada Indice de progrès véritable - Atlantique Measuring Wellbeing and Sustainability in the GPI and CIW Wellington, 24 November, 2004

2 Indicators: Where we are at in Canada and New Zealand Recognized inadequacy, flaws of conventional GDP-based measures of progress Understood potential power of indicators, role in determining policy agenda, and necessity for more accurate, comprehensive indicators Developed data sources, methodologies, reporting mechanisms for wide range of social, economic, environmental indicators

3 NZ on the leading edge Marilyn Waring’s pioneering work Quality of Life in NZ’s 8 Largest Cities -> 12 Monitoring Progress Towards a Sustainable NZ Social Reports (MSD) Tomorrow’s Manukau: A vision into the future Local Government Act 2002 Linked indicators project

4 Reaffirm goal: Indicators should help communities:  foster common vision and purpose, and track progress in achieving goals;  identify strengths and weaknesses = learn;  affect policy and public behaviour = action;  hold leaders accountable at election time  improve wellbeing and ensure sustainable future for our children

5 Limitations & Next Steps Some new social targets, but not yet shifted policy agenda in fundamental ways, nor effectively challenged power and dominance of conventional measures Fringe, satellite vs mainstream No integrated, coherent system: - NZ – Social Report, QOL in 8 Cities report, Sustainable NZ report; - Canada – GPI, IEW, PSI, NRTEE – ESDI, QOLIP, etc.

6 In Canada, we’ve concluded four steps are needed: New measures can no longer just be “add-ons” or satellites, but must challenge and critique the still dominant GDP-based measures of progress One coherent, integrated framework to become new core measure of progress Internationally, regionally comparable Beyond indicators to a new set of national accounts – full national wealth

7 + Language / Communication: Two key questions underlying CIW: How are we doing as a nation? and What kind of world are we leaving our children?

8 Canadian Index of Wellbeing Partnership of Canada’s foremost indicator practitioners National Working Group of 20 includes: 3 govt. agencies (Statcan, Envt.Can, CIHI) + experts from 8 universities, 7 provinces, 5 non-government research organizations The process: Letting go….. Funded by Atkinson Charitable Foundation Spokesman – Roy Romanow

9 Key purposes of the new Canadian Index of Wellbeing To articulate vision of Canada’s future To account accurately for both current wellbeing and sustainability so trade-offs are clear and transparent To bring key social and environmental issues, often neglected, onto the policy agenda To enhance accountability To inform policy, improve performance, and evaluate program effectiveness

10 Purpose in relation to GDP CIW intent – To become Canada’s core, central measure of progress, and to replace misuse of GDP for that purpose (not abolish GDP!) To relegate GDP to function for which it was originally designed and intended – as measure of size of economy (Kuznets) To redefine ‘healthy economy’ in terms of wellbeing outcomes instead of growth, so that misleading signals will no longer blunt initiatives to reduce GHGs, poverty, inequity; conserve resources; prevent illness, etc.

11 CIW Key Principles Will measure wellbeing and sustainability in same reporting framework: Legacy (wellbeing of future generations + ours) = cross-cutting theme within every domain. This is unique (cf NZ, QOL) Will focus on outcomes for key conditions of wellbeing Will report on determinants & infrastructural inputs (e.g. health care) within each outcome domain Framework = sustainability circle vs 3-legged stool or triple bottom line: Relationship

12 Natural environment Society Economy

13 Values, elements of wellbeing Health Security Knowledge Community Freedom Ecological integrity Equity(+ lit. review)

14 Outcome domains in the CIW Standard of living Time use (and balance) Healthy populace Educated populace Community vitality Ecosystem services Governance

15 Process and reporting Disaggregation - geographic (national, provincial, municipal) and demographic Multiple audiences: Report limited # of key messages for public, policy audience, but experts can drill down for analysis (iceberg metaphor) + technical rigour (e.g. KPMG) Double review process, public consultation, “cabinet” approach at release (challenge!)

16 Unresolved (parked) issues Some domains require further definition, indicator selection, literature review, data and methodology development – esp. education, community vitality, governance vs democracy, some environmental indicators and natural resource accounts (e.g. forests – qualitative + quantitative depreciation, water resources, waste) “Index” and aggregation to single # or sub- indices

17 More unresolved issues Beyond indicators to accounting framework: FCA and the capital approach (sustainability and monetization)? Global dimension - ethical relations w. other nations Communications and release strategies: - gradual as early results available or all at once? Data challenges – e.g. frequency (time use cf GDP). CIW function = create new data demands

18 E.g. Unresolved: Defining community vitality Safe communities Cohesion Inclusion Multiculturalism Identity Religion/spirituality Family Culture, arts, recreation

19 Fundamental approach to unresolved challenges Not allow the “tyranny of the best” to stand in the way of practical movement towards the “best possible” Transparent, open to change – better methodologies and data sources Not defensive – recognize that valuation of human, social, natural wealth, however imperfect, is far more accurate than omission or de facto ‘zero’ valuation

20 Resolved – build on existing work. E.g. Standard of living Median income Income and wealth distribution (GINI, quintiles, SFS) Poverty and low income rates Income volatility (dynamics) Economic security (incl. social safety net) Employment, unemployment, underemployment, job security, work arrangements

21 E.g. Population health – health status and health care Self-rated health; functional health Disability-adjusted life expectancy Infant mortality, low birth weight Mortality + morbidity: circulatory diseases, cancers, respiratory diseases, diabetes Depression, suicide BMI, teen smoking, 2 nd -hand smoke exposure, physical activity

22 Resolved – e.g. 2 sides of sustainability equation Production (supply) and consumption (demand): CIW will reflect outcomes (resource supply), but demand reported as determinant = the “why” Ecological footprint shifts onus to consumer - > shared responsibility, and can mobilize citizens Recognizes global consequences of local actions Brings together the environmental and social aspects of sustainability (e.g. equity-Brundtland)

23 Brundtland Commission's seminal definition of Sustainable Development Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs... Even the narrow notion of physical sustainability implies a concern for social equity between generations, a concern that must logically be extended to equity within each generation. – World Commission on Environment and Development (Brundtland Commission), 1987. Our Common Future, Oxford University Press, New York.

24 Statistics Canada: 1997, Econnections: Linking the Environment and the Economy: A consensus has emerged that sustainable development refers at once to economic, social and environmental needs... A clear social objective that falls out of the definition (of sustainable development) is that of equity, both among members of the present generation and between the present and future generations… It is clear that the spirit of sustainable development implies that all people have the right to a healthy, productive environment and the economic and social benefits that come with it.

25 Global, equity dimensions: 20% of world’s people in highest-income countries account for 86% of consumption spending. Poorest 20% account for 1.3% Richest 20% consume 45% of all meat and fish, poorest 20% consume just 5% Richest 20% = 58% of total energy, poorest 20% = <4% Richest 20% =84% of paper, poorest 20% = 1.1% Richest 20% =87% of world's vehicle fleet, the poorest 20% = <1%

26 Translation to Behaviour (eg PEI): e.g. Estimated Transportation Footprint, NS 1985-2025

27 Reduction in Commuting Footprint

28 From Principles to Practicality: Sample Results in GPI - Policy Policy penetration: e.g. Office of Health Promotion; volunteer work; forest accounts; school curricula; media – call-in shows But last election sobering – requires quantum leap forward CIW will build on existing work, including NS GPI = pilot project (GPI adds economic valuation, full-cost accounting)

29 GPI recognizes environmental, social assets have economic value  Economic valuation add-on – based on, always points to underlying physical indicators (Waring)  Natural resources (eg forests) are capital assets (wealth). Health, free time, unpaid work (voluntary and household), and education have “value.”  Sickness, crime, disasters, pollution are costs  Reductions in greenhouse gas, crime, poverty, ecological footprint are progress  Growing equity signals progress  No bottom line (eg air quality Auckland/Christchurch)

30 Nova Scotia Genuine Progress Index: 22 Components Natural Capital: Soils and Agriculture Forests Marine Environment/Fisheries Water Resources / Water Quality Nonrenewable Subsoil Assets

31 Nova Scotia Genuine Progress Index: Twenty-two Components Environment: Greenhouse Gas Emissions Sustainable Transportation Ecological Footprint Analysis Air Quality Solid Waste

32 Nova Scotia Genuine Progress Index: Twenty-two Components Time Use: Value of Civic and Voluntary Work Value of Unpaid Housework & Childcare Work Time and Underemployment Value of Leisure Time Marilyn Waring’s pioneering work paved way

33 Nova Scotia Genuine Progress Index: Twenty-two Components Social Capital/Socioeconomic Health Educational Attainment Income Distribution, Debts and Assets Livelihood Security Costs of Crime Freedom / Civic engagement

34 The Capital Approach Conceptual strengths – (1) capacity to measure sustainability – capital stocks; (2) links domains via natural, human, social, cultural, produced capital Strategic strength – from indicators to accounting framework = challenges dominance of GDP-based measures Tactical strength – language of economics and business: wealth, investment, depreciation

35 Valuing Natural Resource Health For example, a healthy forest effectively: Prevents soil erosion/sediment control Protects watersheds Regulates climate regulation/sequesters carbon Provides habitat for wildlife / biodiversity Supports recreation, tourism, aesthetic quality Provides timber

36 E.g. % Forest Area by Age Class, NS 1958-99

37 CONCLUSION: Clearcut harvesting and loss of natural age and species diversity have resulted in loss of:  valuable species  wide diameter and clear lumber that fetch premium market prices  resilience and resistance to insect infestation  wildlife habitat, & decreasing populations of birds  forest recreation values - impact nature tourism

38 This represents a substantial depreciation of a valuable natural capital asset  a decline in forested watershed protection and a 50% drop in shade- dependent brook trout  soil degradation and the leaching of nutrients that can affect future timber productivity  a substantial decline in carbon storage capacity and an increase in biomass carbon loss a decline in other essential forest ecosystem services.

39 The Good News: Volume 2: Best Forestry Practices in N. S. Selection harvesting increases forest value and provides more jobs Shift to value-added creates more jobs Restoration forestry is a good investment What incentives can encourage restoration

40 Full Cost Accounting Basic Principles and challenges: Expanded definition of capital: Natural, human, social, cultural, produced capital, but no common metric for measurement External -> internal benefits and costs Price non-market benefits and costs Fixed -> variable costs Strengths: Enhances market efficiency, reduces needs for govt. regulation, provides more accurate, comprehensive information

41 Benefits Total benefits of 2000-01 system range from $79 million to $221 million =$84-$236 pp, incl: –$3.3 - $84.3 million in GHG emission reductions; –$9 - $67 million in air pollutant reductions –$18.8 million in extended landfill life –$28.6 million in energy savings from recycling –$6.5 - $8.9 million in employment benefits –$1.2 - $1.9 million in avoided liability costs –$1.1 - $1.7 million in export revenue of goods and services –$187,000 in additional tourism

42 Energy savings per tonne of waste recycled MaterialEnergy savings Paper8.5 million Btu Plastic20.1 million Btu Glass2.4 million Btu Steel Cans18.4 million Btu Aluminium Cans166.9 million Btu

43 Costs Total costs of 2000-01 solid waste-resource system were $96.6-102.7 million: –$72.4 m. in operating and amortized capital costs –$14.3 m. for beverage container recycling prog. –$2.7 million for used tire management program –$1.6 million in RRFB operating and admin costs –$5 - $9.5 million to increase participation –$220,000 - $1.8 million in nuisance costs

44 Results Implementation of the Solid Waste-Resource Strategy led to an increase in operating and amortized costs from $48.6 million ($53/capita) in the 1996-97 fiscal year to $72.5 million ($77/capita) in the 2000-01 fiscal year. –An increased cost of $24 million ($25/capita) for implementing the changes

45 Results The new NS solid waste-resource system in 2000-01 produced net savings of at least $31.2 million, when compared to the old 1996-97 solid waste-resource system This translates into savings of $33 for each Nova Scotian, versus a cost of $25 as suggested when comparing strictly the operating and amortized capital costs of the two systems

46 From Indicator Perspective = Genuine Progress – Access to curbside recycling in Nova Scotia jumped from less than 5% in 1989 to 99% today – 76% of residents now have access to curbside organics pickup – Both are by far the highest rates in the country

47 Access to curbside recycling, NS 1987-2001

48 Comparisons On a per capita basis, Nova Scotia disposes of 39% less waste than Canadian average HRM has the highest waste diversion rate of any municipality in Canada – twice the average. Nova Scotia’s overall waste diversion rate of 46% is also higher than any industrialised country. Nova Scotia's high diversion rate is due in large part to its composting system.

49 Goal: Changing Behaviour E.g. % Waste Diversion in Nova Scotia

50 Examples of GPI Results: e.g. Valuing Voluntary Work Canadians contribute 3.4 billion hours of voluntary work per year; equivalent of 1.8 million FTE jobs (economic add-on) Services worth $53.2 billion / year, invisible in our conventional measures of progress 1990s: voluntary work down 12.3% - time stress Canadians lose $6 billion in volunteer services

51 Valuing a Healthy Population: Health as Human Capital GPI Population Health Reports include: Cost of Chronic Illness in Canada (focus on preventable portion) Women’s Health in Atlantic Canada Income, Health and Disease in Canada; Equity and Disease in Atlantic Canada Costs of Tobacco, Obesity, Physical Inactivity Cost of HIV/AIDS in Canada Economic Impact of Smoke-Free Workplaces Value of Care-giving

52 Costs of 7 Types Non-Infectious Chronic Disease, NS, 1998 60% medical costs = $1.2 billion / year 76% disability costs = $900 million 78% premature death costs = $900 mill. 70% total burden of illness = $3 billion = $3,200 per person per yr = 13% GDP

53 Cost of Chronic Illness in Nova Scotia 1998 (2001$ million)

54 Why are we interested? = What Portion is Preventable? Requires Determinants (sci. literature) Excess Risk Factors Account for: 40% chronic disease incidence 50% chronic disease premature mortality Small number of risk factors account for 25% medical care costs = $500 mill./yr 38% total burden of disease preventable = $1.8 bill. (includes direct and indirect costs)

55 Costs of Key Risk Factors, Nova Scotia (2001 $ millions)

56 Valuing Equity: GDP tells us how much income, not how income shared


58 Health Costs of Socioeconomic Inequality in Nova Scotia Use of physician services (Kephart): –No high school = +49% than degree –High school diploma = +12% more –Lower income = +43% than higher –Lower middle income = +33% more

59 Excess Physician Use (= small fraction total costs) Educational inequality = $42.2 million = 17.4% of total Income inequality = $27.5 million = 11.3% = costs avoided if all Nova Scotians were as healthy as higher income / university

60 CIW Action on 3 fronts: Research, communication and policy. E.g.: NWG Ottawa Nov 8-9: Research has begun. Announcement in Feb-Mar; next NWG meeting in May to assess progress Reality Check – 3-year pilot now expanded -> high profile seminars International dimension: NZ, Bhutan + Conference June 20-23 2005 on global best practices. Need cooperation sooner rather than later – before systems entrenched

61 CIW: Measuring what we value to leave a better world for our children

62 Genuine Progress Index for Atlantic Canada Indice de progrès véritable - Atlantique

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