Session 2 of the virtual event series on Implementing a well-being approach to policy and international partnerships in Latin America, 28-30 June 2022, More information at: https://www.oecd.org/wise/lac-well-being-metrics.htm

1. MEASURING AND INVESTING IN WHAT MATTERS:
Integrating Quality of Life measurements into government decision-making and
budgeting
Presentation to OECD Virtual Event:
Implementing a well-being approach to policy and cooperation in Latin America

2. Outline
• Context
International ‘Beyond GDP’ momentum
• Developing the Framework
Understanding the evidence-base, consultation with experts, understanding what matters to Canadians,
Indigenous engagement, interdepartmental collaboration
• The Architecture of the Quality of Life Framework
Domains based on evidence about the determinants of Quality of Life, indicators to monitor progress on
these domains, and two cross-cutting lenses to look at Fairness and Inclusion based on gender-based
analysis plus (GBA+) and Sustainability and Resilience.
• Using the Framework
Integration into the budget cycle and decision-making; from setting priorities, to getting the right mix of
investments, to communicating with Canadians, and monitoring how government spending is making a
difference in their lives.
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3. International ‘beyond GDP’ momentum
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2009
Report by the Commission on the
Measurement of Economic
Performance and Social Progress
(Stiglitz, Sen & Fitoussi)
2010
UK Government
initiates its Measuring
National Well-being
Program
2011 and 2012
Launch of the OECD’s
Better Life Initiative;
UN releases its
inaugural World
Happiness Report
2013
UK Government
launches the What
Works Centre for Well-
being
2017
Launch of the Well-
being Economies
Alliance
2019
New Zealand releases its
‘Well-being Budget’;
Government of Canada
mandate letter commitment
to quality of life
measurement
• A growing recognition that GDP is a necessary but insufficient measure of societal progress.
• While incomes are positively related to measures of well-being, they are known to carry diminishing marginal returns.
• In wealthy nations like Canada, non-economic determinants of well-being like mental health rival incomes in their relative importance.
• Over half of OECD countries have developed monitoring frameworks that track a wider set of indicators important for their citizens’
well-being; the UN 2030 Agenda sets 17 Sustainable Development Goals (SDGs). Common themes are:
1. Well-being – holistic measurement, including income and wealth but also non-economic factors like health, housing,
environment;
2. Equality – the distribution of outcomes across sub-groups; and,
3. Sustainability – whether today’s prosperity undermines future living standards.
• Government of Canada committed to introduce quality of life budgeting in 2019 and reiterated this commitment in 2021

4. An evidence-based approach
Traditional Economists &
Business Experts
Labour/Socially-minded
Economists / Experts
Experts on the Environment
Well-being Measurement
Experts
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• Literature on the determinants of well-being suggests income, health, social connections, freedom, and lack of
corruption explain about three-quarters of differences in perceived quality of life around the world but
significant variations across countries.
• There is broad support and enthusiasm for a made-in-Canada framework among the expert community.
• Consultations with experts aimed to ensure a solid evidence-based foundation based on the determinants of
well-being.
Strong support for moving
“beyond GDP”. Tended to
support a framework that
complements growth without
replacing it
Valued the framework’s
potential for taking a longer
term view, ensuring that
decisions made today do not
come at the expense of future
generations
Saw value in a framework that
balanced objective and
subjective indicators, and
which served as a catalyst for
filling long-standing data
gaps
Saw the framework’s potential
to bring greater focus to the
distribution of outcomes in
society rather than population
averages, and were keen to
ensure its design was
practical and useful

5. What We Heard From Canadians
Public opinion research (POR), commissioned by
Finance Canada in August 2020 showed that
COVID-19 was causing Canadians to re-evaluate
their priorities.
Basic things are fundamental to a good quality of life in Canada.
Respondents were mostly likely to rank the following among the
top three determinants of quality of life:
• physical health,
• financial security,
• mental health; and
• personal safety.
Note: Figure shows proportion of respondents that ranked an item as one of their top three quality of life priorities.
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6%
6%
7%
11%
16%
17%
18%
21%
24%
27%
38%
42%
56%
0% 10% 20% 30% 40% 50% 60%
Ranking Aspects of Quality of Life
Access to good education
A sense of identity/belonging
Equality of opportunity
Job opportunities
Housing
Democratic system of governance
Work-life balance
Healthy environment
Personal relationships
Personal safety and security
Mental health
Financial security
Physical health
Broad support for moving “beyond GDP”:
• 86 per cent of respondents believed it was
either very important (71 per cent) or
somewhat important (15 per cent) for the
federal government to move beyond solely
traditional economic measurements.

6. Developing the Framework
Provincial and Territorial Perspectives:
• Canada’s federation is highly decentralized.
• Many provinces and territories have experience with developing well-being or quality of life strategies to guide policy.
• Provinces and territories saw the Quality of Life initiative, with corresponding Budget 2021 investments in data as an opportunity to
address data limitations; particularly a lack of sub-regional breakdowns.
• The Quality of Life Framework is a monitoring tool, and is not limited to indicators that the federal government, or even any level of
government can control.
Indigenous Perspectives:
• Advancing self-determination and closing socio-economic gaps are critical to Canada’s ongoing process of reconciliation with Indigenous
peoples.
• Key takeaways from early discussions with Indigenous partners included the importance of being able to convey significant gaps in
quality of life outcomes, and the significant data gaps that need to be addressed in a way that respects Indigenous data sovereignty and
builds Indigenous data collection and analysis capacity as an enabler for transferring programs and services for Indigenous peoples.
• Co-developed work already underway on quality of life outcomes (e.g. the First Nations National Outcomes-based Framework; Inuit social
determinants of health report) is an important starting point for collaboration.
Horizontal collaboration across the federal government:
• The Framework aims to advance a whole-of-government approach to holistic policy development by providing a ‘North star’ for policy
development.
• Extensive interdepartmental collaboration helped to shape the framework so it reflects key outcome areas across government, and is
aligned with other commitments (e.g., Sustainable Development Goals, Gender-Based Analysis Plus approach).
• The Framework will continue to be evergreen to ensure it stays relevant over time.
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7. 7
Department of Finance - July 2017
Quality of Life Framework
Headline Indicators
Household incomes
Employment
Youth not in education, employment
or training (NEET)
Acceptable Housing
Poverty
Health-adjusted life expectancy
Self-rated mental health
Sense of belonging to local
community
Someone to count on
Time use
Victimization rate
Confidence in public institutions
Discrimination and unfair treatment
Air quality
Clean drinking water
Conservation areas
Greenhouse gas emissions
Climate change adaptation
Life satisfaction
Sense of meaning and purpose
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8. 8
Department of Finance - July 2017
Using the Framework to Assess Value
• The Quality of Life Framework provides a
standardized approach for assessing the attributes of
policy (or budget) proposals across multiple
domains.
• This helps to assign value/give greater visibility to:
• The secondary, tertiary or ancillary benefits of proposals
• Negative impacts, or trade-offs between domains
• This is intended to elevate social and environmental
returns vis-à-vis economic returns, and create
incentives to expand from a ‘fiscal impact’ to a
‘prevention’ and ‘long term investment’ mindset.
• A holistic accounting (even if only back-of-the-
envelope/qualitative) of the full range of expected
value creation/destruction of proposals may shift how
some policies get considered in decision-making.
Examples:
• Proposals that have minor or moderate primary
expected impacts, but additional positive secondary
impacts.
• e.g., sugar tax
• Proposals that have substantial positive primary
impacts, but accumulate negative secondary impacts.
• e.g., logging in old growth forests
• Proposals that are costly in the near term, but
accumulate positive impacts in multiple domains over
time.
• e.g., early learning and childcare
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9. Budget 2021 Investments in Quality of Life Data
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• The Framework’s indicator set is evergreen, and not restricted to what is already being measured.
• Past experience with Gender-based Analysis Plus has highlighted the need for better data availability,
particularly for understanding the experiences of rural and remote populations, Indigenous
communities, and other vulnerable populations.
• Work is underway to address gaps, including through these Budget 2021 investments:
• $13.8 million over 5 years and $2.2 million ongoing for Statistics Canada to fill key gaps in quality of life measurement.
• $172 million over 5 years and $36.3 million ongoing for Statistics Canada to implement a Disaggregated Data Action Plan that will
fill data and knowledge gaps.
• $81.5 million over 3 years to Indigenous Services Canada to support the development of distinctions-based First Nations, Inuit and
Métis data strategies.
• $27.3 million over 5 years and $6 million ongoing to Environment and Climate Change Canada and Statistics Canada for the
development of a Census of the Environment.
• $6.7 million over 5 years and $1.4 million ongoing to Justice Canada and Statistics Canada to develop justice data indicators and
enhance data analytics.
• $34.7 million over 5 years to Environment and Climate Change Canada to implement a new Climate Lens.
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10. Assessing Budget Proposals
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For Budget 2022, departments were asked to:
• Tag proposals by quality of life domain
impacted (up to four indicators per domain);
• Rate the scale of any expected impacts in both
the near and long term (either positive or
negative);
• Describe the populations expected to
experience the impacts.
This information is used to encourage proposals
that carry the high potential returns to quality of
life.

11. 11
Department of Finance - July 2017
Budget Impacts Report
• For Budgets 2021 and 2022, budget proposals
were analyzed against the Quality of Life
Framework to identify expected quality of life
impacts based on the framework domains and
indicators tag high level outcomes.
• This analysis was summarized and reported in
the Budget’s ‘Impacts Report’.
• In the future, we are aiming to enhance this
process to better support internal decision-
making and identify proposals that carry high
well-being returns across all domains of the
framework.
• For example, will are looking at approaches to
better assess the scale of impacts, trade-offs and
synergies, and how impacts play out over time.
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Budget 2021
quality of life
content
Differential
impacts

12. ANNE
X

13. 13
Department of Finance - July 2017 13
Quality of Life indicators

14. Department of Finance Canada
Commitments
Minister of Middle Class Prosperity and
Associate Minister of Finance
Mandate Letter Commitment (2019)
• Lead work within the Department of Finance,
with the support of the Minister of Families,
Children and Social Development and the
Minister of Innovation, Science and Industry as
the Minister responsible for Statistics Canada,
to better incorporate quality of life
measurements into government decision-
making and budgeting, drawing on lessons
from other jurisdictions such as New Zealand
and Scotland.
All Ministerial Mandate Letters (2021)
• Across our work, we remain committed to ensuring
that public policies are informed and developed
through an intersectional lens, including applying
frameworks such as Gender-based Analysis Plus
(GBA Plus) and the quality of life indicators in
decision-making
President of the Treasury Board
Mandate Letter Commitment (2021)
• Ensure government policy continues to be
developed through an intersectional lens, is
reflective of the needs and aspirations of Canadians
and supports our path to net-zero through:
• Continuing to refine and strengthen the quality
of life framework to ensure that we achieve
long-term outcomes that benefit people, and
that progress towards those aims is rigorously
reported
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15. Using the framework to shape policy
Quality of Life Domains
Fairness and Inclusion
Lens
Sustainability and
Resilience Lens
Top-down
policy
shaping
Monitoring
and Reporting
• National performance,
international comparisons
where appropriate
• Performance and disparities
between groups
• Performance over time,
sustainability, in some cases
forecasts / projections
Priority Setting
• Identifying emerging challenges
• Selecting the best opportunities
to improve the quality of life of
Canadians
• Identifying gaps, vulnerable
groups to develop targeted
responses, and areas where
investments could carry the
highest impact
• Identifying sustainability
challenges and opportunities to
make progress (e.g. net zero
commitment, fiscal
sustainability)
• Identifying vulnerabilities to
shocks
Bottom-
up policy
setting
Assessment of
Policy
Proposals
• Holistically assessing of how
proposals may advance quality
of life domains
• Promoting horizontal policy
coherence
• Assessment of expected
impacts of proposals on people
• Includes regional, income
distributional and
intergenerational equity issues
• Green Lens
• Strategic Environmental
Assessment
• Long-term cost benefit analysis
• Modelling expected outcome
trajectories
Other
Potential
Applications
Monitoring actual performance against expected, Public reporting, Audit and evaluation, Departmental
reporting, Parliamentary accountability, Small-scale experimentation in areas of low performance.
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