WW got a report card through the door the other day for one of the ‘currently being formally educated’ members of our household.

It arrived unceremoniously; its owner - informed of its existence, then sombre-faced retired to their bedroom to allow the report to be digested, and await the inevitable ‘conversation’.

The conversation we were able to have was great, because the measurements used within the report gave us a really accurate picture of how things are: academically, behaviourally, in terms of effort and engagement, and provided a really clear steer about what the next steps and choices might be, moving forward.

What we measure, matters.

One of the measurements within the ‘report card’ for the UK is our Gross Domestic Product (GDP). GDP measures the total value of goods made, and services provided, over a period of time. The amounts paid for finished goods and services are added together to get a GDP figure. We started using GDP soon after World War II, as a means of determining the health of the economy, and that is still the purpose of its use today.

The UK treasury states that GDP matters because: “Rising GDP means the economy is growing, and the resources available to people in the country – goods and services, wages and profits – are increasing.”

Living in an economic system that is based on stimulating growth has notable, well documented benefits: higher incomes, increased life-expectancy, better education, reduced poverty.

So, why aren’t these our reality?

Here’s the limitation of GDP as a prominent measure of economic health. Imagine the dreadful scenario where everyone in the country decided to get divorced this year. Our lawyers would make a mint; the housing market would grow because of the need for more places to live; children would have a Xbox in each house…

We might all be heartbroken and miserable, and our society and communities deeply damaged, but the economy would look swell! Our GDP would soar because of the production and activity around all these goods and services I’ve mentioned. But that’s as far from the kind of country that I want to live in as I can imagine. Maybe what we measure needs to change?

There has been a considerable emphasis to develop better indicators of national progress, prosperity, well-being, and happiness. This has arisen from the growing recognition that GDP can’t measure these goals, and for too many people is a measure within a system that isn’t delivering on the incomes, life expectancy and lack of poverty noted above. And Scotland is leading the way on this work.

In 2018 we, along with Iceland and New Zealand established the network of Wellbeing Economy Governments to challenge the acceptance of GDP as the ultimate measure of a country's success. If we truly are judged by the company we keep, then I think we should be proud to be part of that particular friendship group.

This week I hosted an event where Kate Forbes, Scotland’s cabinet secretary for finance and the economy, spoke to people from Inverclyde, and some visitors from across Scotland, about the development of a wellbeing economy.

A wellbeing economy is not about growth as king. It balances measures of economic progress and prosperity with measures of inclusion – where we ensure that the economy truly does benefit all, and isn’t merely feeding one large economic centre.

It balances progress with sustainability – ensuring we can have a just transition to a net zero economy without damaging communities or leaving old industries behind without a viable future for their people.

Wellbeing economics is rooted in building resilience. The focus on growth up to now, means that London has been the priority. Here in Inverclyde, our industries have successively come and gone without just transition ever being a consideration. Inverclyde’s resilience has often been in spite of, not because of, the actions of government upon us.

The cabinet secretary outlined a plan for wellbeing economics. Putting this into practice – locally as well as nationally – is now the task at hand. Delivering a new economic system that cares about people not just growth is one of the greatest, but most exciting, responsibilities I hold as an elected member