Any minister who wants more money to spend in their portfolio will have to prove it will improve intergenerational wellbeing.

That was the message Prime Minister Jacinda Ardern delivered to her Cabinet from Davos last night (NZ Time.)

Speaking on a panel discussing the role of GDP as a measure of wellbeing at the World Economic Forum, Ardern challenged her ministers to put wellbeing at the heart of their budget bids.

"If you're a minister and you want to spend money, you have to prove that you're going to improve intergenerational wellbeing."


Ardern spent much of her time explaining why her Government was introducing a wellbeing budget this year – a world first.

She made it clear that any minister from her Cabinet would need to keep the Government's new approach top of mind and ministers would need to work with each other to ensure this was the case.

"So the Minister of Health might want to work with the Minister of Child Poverty and start delivering interventions that make a difference 30 years down the track."

Ardern is the Minister of Child Poverty Reduction.

May's budget will measure and report a broader set of indicators, such as child poverty and housing quality, to show a "more rounded version of success", alongside expected GDP growth.

GDP is the way a country measures its economic growth; it focuses on how much a country produces.

Although the panel, including Ardern, agreed GDP was still a good way of measuring economic growth, they agreed there were many elements of a country's wellbeing it did not capture.

But Ardern said the Government's new approach to wellbeing does not mean GDP would become irrelevant.


"I don't think it's the end of GDP, I think it's the beginning of doing things differently. We distil it down, in New Zealand, to say that for us, it's about bringing kindness and empathy to governance."

In terms of New Zealand's economy, she said the country is doing well – low unemployment, solid GDP growth and a healthy Government surplus.

"But we have homelessness at staggering rates, one of the highest rates of youth suicide in the OECD and our mental health and wellbeing is not where it should be."

She stressed these are the sorts things the wellbeing budget would measure and her, and successive Governments, could work to address.

Also on the panel with Ardern was United Arab Emirates Minister of State Happiness Ohood Bint Khalfan.

Khalfan, who was in New Zealand late last year to discuss the Government's wellbeing approach to GDP, praised Ardern's leadership in this area.


"I would like to commend Prime Minister Jacinda [Ardern] for her bold vision and for the groundbreaking work that New Zealand is leading when it comes to wellbeing."