ieep patrick ten brink presentation on beyond gdp indicators at the eeb sds seminar 16 nov 07

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Is there a suitable overall indicator for Sustainable Development – to supplement GDP? What are the possible candidates? EEB Seminar Reviewing the EU SDS Brussels Friday 16th November 2007 ` Patrick ten Brink Head of Brussels Office IEEP (Part of Beyond GDP team, but this presentation does not represent an official position)

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IEEP Patrick ten Brink Presentation on Beyond GDP Indicators at the EEB SDS Seminar 16 Nov 07.

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Page 1: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

Is there a suitable overall indicator for

Sustainable Development

– to supplement GDP?

What are the possible candidates?

EEB Seminar

Reviewing the EU SDS

Brussels

Friday 16th November 2007

`

Patrick ten Brink

Head of Brussels Office

IEEP(Part of Beyond GDP team, but this presentation

does not represent an official position)

Page 2: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

Presentation Structure

� Background: Some interesting Facts & the Beyond GDP context for this

presentation (see www.beyond-gdp.eu)

� Indicators to measure progress, true wealth & wellbeing – what is out there?

� From candidates to ideas for ways forward - some ideas to add to the debate

This contribution to the debate does not represent any formal position from Beyond GDP

The Beyond GDP conference an initiative of Commissioner Dimas, and a partnership

between the European Commission, European Parliament, Club of Rome, OECD, & WWF.

Supported by team: Ecologic, MNP, IEEP & media partners.

See www.beyond-gdp.eu

Page 3: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

● ● ● Interesting Facts – Did you know that:

On GDP - different roles, different views

“Without measures of economic aggregates like GDP, policymakers would be adrift in

a sea of unorganized data. The GDP and related data are like beacons that help

policymakers steer the economy toward the key economic objectives”. Paul Samuelson,

in Samuelson and Nordhaus (1995)

Yet

Simon Kuznets - GDP's creator – already in 1934 said that “The welfare of a nation

can scarcely be inferred from a measurement of national income”.

& after almost 30 years further thought, added

“Distinctions must be kept in mind between quantity and quality of growth, between its

costs and return, and between the short and the long term. Goals for more growth

should specify more growth of what and for what.”

Page 4: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

On GDP and natural resources

A country could cut down all its forests and deplete its natural resources and this

would show only as a positive gain to GDP despite of the loss of capital.

Source: Millenium Ecosystem Assessment (MA) 2005 see

http://www.millenniumassessment.org

On GDP and social equity“Progress measured by a single measuring rod, the GNP, has contributed significantly

to exacerbate the inequalities of income distribution”

Robert McNamara, President of the World bank, 1973

On GDP and learning from business

“No one would look just at a firm’s revenues to assess how well it was doing. Far more

relevant is the balance sheet, which shows assets and liability. That is also true for a

country.”

Joseph Stiglitz, 2005 in Foreign Affairs,

see http://www.foreignaffairs.org/.html

GDP is not enough; we need to go beyond GDP

Page 5: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

Beyond GDP: What Questions will the

Conference address?

� What can economic measures such as GDP do best and where are other

measures of progress, true wealth and wellbeing needed?

� What are our societies’ health and wellbeing based on and how can nature be

taken into account ? What are our nations wealth based on?

� What measures are viable, useful complements to GDP – eg ecological

footprints, human development index, poverty index, happy planet index or

genuine savings approach?

� Where can we usefully use the complementary measures and hence improve the

measurement and reporting of the true wealth and wellbeing of nations?

� What needs to be done to support the process of moving beyond GDP?

Effectively same set of questions as the EEB seminar.

Page 6: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

● ● ● What are the candidates for going

beyond GDP?

Figure 1: Growth in number of composite indices (UNDP Office of Development Studies, 2006). The indices cover a

diverse set of issues including competitiveness, governance, social aspects, human rights, the environment, security

and globalization.

Source: from MNP (2007)

More and more people are searching for better indicators

Page 7: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

What indicators are out there?

+ frameworks/approach

National accounts satellites

Happy and Health life years

Structural indicators

EU-SDS indicators

Footprints (ecological, carbon)

Factor efficiency

Happy planet index

Human Poverty Index (HPI)

Human Development Index (HDI)

Genuine savings index

ISEW/GPI

GDP

Is there a best?

or simply

Horses for courses ?

Question of ‘fit for purpose’?

What purpose ?

&

Does it do the job?

Can it be developed to do the job?

Recall: The welfare of a nation can

scarcely be inferred from a

measurement of national income”.

see www.beyond-gdp.eu for descriptions and links

Page 8: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

What indicators are out there? Competing?

HDI GSI

GPI

EF

Living Planet Report 2004, http://www.panda.org/news_facts/publications/key_publications/living_planet_report/index.cfm

Redefining Progress (2006) http://www.rprogress.org/projects/gpi/

2005 Human Development Report, UNDP

The World Bank (2005a) Where is the Wealth of Nations? Measuring Capital for the XXI Century.

Page 9: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

Categorisation of Indicators and SD Pillars

Economic

Environmental Social

GDP

Foot-

print

Genuine

savings

Greening

GDP

EU-SDS

indicators

HDIHappy

Planet

Index

EU-Env.

indicators

ISEW/

GPI

HPISocial

indicators

‘All-in-one’ approaches

Source: IEEP

SEEA

NCI

‘All-together’

approaches

Page 10: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

Indicators – Some very specific coverage

and uses; others combine issues

Economic

Environmental

Social

Source: IEEP

GDP

Foot-

print

Genuine

savings

Greening

GDPEU-SDS

indicators

HDI

Happy

Planet

Index

EU-Env.

indicators

ISEW/

GPI

HPI

Social

indicators

NNP

SEEA

NCI

Page 11: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

Where are which used ?Should we judge them all in the same way?

Measurement

Robust data on economy, society & environment

+

Evaluation of policies

Source: IEEP

Reporting to scientists / analysts &

policy makers

Communicating the facts – still

robust data, just the right robust

data in the right form.

Analysis

Policy making

Reporting to the outside world Public discussion

Tools: IA, CBA, MCA

Foot-

printGDP HDI

Foot-

print

SEEA

EU-Env.

indicators

Social

indicators

A: Don’t judge indicators for public by same criteria as that for analysts

Headline indicators

HDI

Decision making

Goal setting

Press

Page 12: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

From candidates to ideas for ways forward - some

ideas to add to the debate

Measurement Eg We need to understand the state of our natural capital, ecosystem functions, services.

Reporting

Goal setting Eg Scope for greater use of ecological and carbon footprints

Eg Scope for greater use of factor efficiency targets

AnalysisEg need to understand ecosystem functions, services and

contributions to true wealth and wellbeing society better

Eg do a climate risk assessment

Public discussion

Eg scope for footprints, happiness and also impacts of natural hazards on livelihoods; national risk

Eg Countries should be encouraged to do and public more environmental accounts – stock accounts and flow.

Press

Eg scope for footprints, happiness, healthy life years, HDI

Reporting Eg National climate risk index and national ratings

Decision making Eg Revise way structural funds are allocated/dispersed

Personal contribution to debate - does not represent Beyond GDP

Page 13: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

Conclusions

• Not one ‘best’, but a range of purposes and range of indicators

• Range of ways forward – some on measurement, some on analysis, some policy setting etc

• Developments in parallel - some make more robust and fit for purpose, some create new.

• Need to ensure that what is used is right for what it is used for.

• Need to broaden what is measured, understood, used, and debated.

• We need measures that build on robust data, useful for policy and understandable by the public.

• Many right answers. Need for many actors to take forward

What can and will be done ?

– debate here, debate on Monday and Tuesday at the Parliament, and after - -

commitment across parties for way forward already started.

Page 14: IEEP Patrick ten Brink Presentation on Beyond Gdp Indicators at the EEB  SDS Seminar 16 Nov 07

IEEP is an independent not for profit institute dedicated to advancing an

environmentally sustainable Europe through policy analysis, development

and dissemination.

Thank you

EEB Seminar

Reviewing the EU SDS

Brussels

Friday 16th November 2007

`

Patrick ten Brink

Head of Brussels Office

IEEP

www.ieep.eu