Governments urged to focus spending on wellbeing and mental health

12 Dec 16

Governments should focus spending on mental health and wellbeing, researchers have argued, after a study found these are more closely linked to happiness than financial problems or poverty.


Mental health

The study found that tackling mental health issues like depression and anxiety could have four times the impact on happiness than eliminating poverty would, with no net cost to the public purse


The landmark study, led by Lord Richard Layard, wellbeing programme director at the London School of Economics Centre for Economic Performance, found that eliminating depression and anxiety could have four times more impact on happiness than eliminating poverty would.

Layard argued that this demands a “new role for the state – not ‘wealth creation’ but ‘wellbeing creation’”.

“The evidence shows that the things that matter most for our happiness and for our misery are our social relationships and our mental and physical health,” he explained.

“In the past, the state has successively taken on poverty, unemployment, education and physical health. But equally important now are domestic violence, alcoholism, depression and anxiety conditions, alienated youth, exam-mania and much else. These should become centre stage.”

The study found failed relationships and physical and mental health to be far more central to human happiness.

Eliminating anxiety and depression would reduce unhappiness by 20%, it found, while eliminating poverty would reduce it by just 5%.

Reducing mental illness would also have no net cost to the public purse, it added. Any investments would be repaid in the returns from higher employment, increased tax receipts and a reduction in hospital costs

Education has a very small impact on life satisfaction compared with having a partner, it continued, while the strongest factor in predicting a happy adult life is not the qualifications one achieves, but one’s emotional health.

Income inequality also explains just 1% of the variation in happiness within a community, while mental health differences explain over 4%, according to the study.

Overall increases in income or education appear to have little impact on the overall happiness of a population because of the way people weigh these up, the report also concluded.

“When people evaluate their income or education, they generally measure it against the locally prevailing norm. If my relative income rises, someone else’s must fall, and the average is unchanged,” the report said.

“This helps to explain why in Australia, Britain, Germany and the US, average happiness has failed to rise since records began, despite massive increases in living standards.”

Nancy Hey, director of What Works Centre for Wellbeing, said most people would agree that wellbeing is important, but understanding what governments, businesses and communities can do about it is “trickier”.

“This research helps us to understand what really supports people to lead better lives. These findings can be used to inform policy and spending decisions, and I hope will lead to trials that continue to build the global evidence base of what works to improve wellbeing,” she stated. 

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