9:59:59.000,9:59:59.000
Just over a mile away from here

9:59:59.000,9:59:59.000
in Edinburgh's old town

9:59:59.000,9:59:59.000
is Panmure House.

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Panmure House

9:59:59.000,9:59:59.000
was the home of the world-renowned[br]Scottish economist Adam Smith.

9:59:59.000,9:59:59.000
In his important work[br]"The Wealth of Nations,"

9:59:59.000,9:59:59.000
Adam Smith argued,[br]amongst many other things,

9:59:59.000,9:59:59.000
that the measurement of a country's wealth

9:59:59.000,9:59:59.000
was not just its gold and silver reserves.

9:59:59.000,9:59:59.000
It was the totality of the country's[br]production and commerce.

9:59:59.000,9:59:59.000
I guess it was one of the earliest[br]descriptions of what we now know today

9:59:59.000,9:59:59.000
as Gross Domestic Product, GDP.

9:59:59.000,9:59:59.000
Now, in the years since, of course,

9:59:59.000,9:59:59.000
that measurement[br]of production and commerce,

9:59:59.000,9:59:59.000
GDP, has become ever more important,

9:59:59.000,9:59:59.000
to the point that today,

9:59:59.000,9:59:59.000
and I don't believe that this[br]is what Adam Smith would have intended,

9:59:59.000,9:59:59.000
that it is often seen as[br]the most important measurement

9:59:59.000,9:59:59.000
of a country's overall success.

9:59:59.000,9:59:59.000
And my argument today

9:59:59.000,9:59:59.000
is that it is time for that to change.

9:59:59.000,9:59:59.000
You know, what we choose to measure[br]as a country matters.

9:59:59.000,9:59:59.000
It really matters, because[br]it drives political focus,

9:59:59.000,9:59:59.000
it drives at public activity,

9:59:59.000,9:59:59.000
and against that context,

9:59:59.000,9:59:59.000
I think the limitations of GDP[br]as a measurement of a country's success

9:59:59.000,9:59:59.000
is all too obvious.

9:59:59.000,9:59:59.000
You know, GDP measures[br]the output of all of our work,

9:59:59.000,9:59:59.000
but it says nothing about[br]the nature of that work,

9:59:59.000,9:59:59.000
about whether that work[br]is worthwhile or fulfilling.

9:59:59.000,9:59:59.000
It puts a value, for example,

9:59:59.000,9:59:59.000
on illegal drug consumption,

9:59:59.000,9:59:59.000
but not on unpaid care.

9:59:59.000,9:59:59.000
It values activity in the short term[br]that boosts the economy

9:59:59.000,9:59:59.000
even if that activity is hugely damaging

9:59:59.000,9:59:59.000
to the sustainability of our planet

9:59:59.000,9:59:59.000
in the longer term.

9:59:59.000,9:59:59.000
And when we reflect on the past decade[br]of political and economic upheaval,

9:59:59.000,9:59:59.000
of growing inequalities,

9:59:59.000,9:59:59.000
and when we look ahead to the challenges[br]of the climate emergency,

9:59:59.000,9:59:59.000
increasing automation,

9:59:59.000,9:59:59.000
an aging population,

9:59:59.000,9:59:59.000
then I think the argument for the case[br]for a much broader definition

9:59:59.000,9:59:59.000
of what it means to be successful[br]as a country, as a society,

9:59:59.000,9:59:59.000
is compelling, and increasingly so.

9:59:59.000,9:59:59.000
And that is why Scotland in 2018

9:59:59.000,9:59:59.000
took the lead, took the initiative[br]in establishing a new network

9:59:59.000,9:59:59.000
called the Wellbeing Economy[br]Governments group,

9:59:59.000,9:59:59.000
bringing together as founding members

9:59:59.000,9:59:59.000
the countries of Scotland, Iceland,[br]and New Zealand for obvious reasons.

9:59:59.000,9:59:59.000
We're sometimes called the SIN countries,

9:59:59.000,9:59:59.000
although our focus is very much[br]on the common good.

9:59:59.000,9:59:59.000
And the purpose of this group[br]is to challenge that focus

9:59:59.000,9:59:59.000
on the narrow measurement of GDP,

9:59:59.000,9:59:59.000
to say that, yes, economic growth matters.

9:59:59.000,9:59:59.000
It is important.

9:59:59.000,9:59:59.000
But it is not all that is important.

9:59:59.000,9:59:59.000
And growth in GDP should not be pursued

9:59:59.000,9:59:59.000
at any or all cost.

9:59:59.000,9:59:59.000
In fact, the argument of that group

9:59:59.000,9:59:59.000
is that the goal, the objective[br]of economic policy

9:59:59.000,9:59:59.000
should be collective wellbeing:

9:59:59.000,9:59:59.000
how happy and healthy a population is,

9:59:59.000,9:59:59.000
not just how wealthy a population is.

9:59:59.000,9:59:59.000
And I will touch on the policy[br]implications of that in a moment,

9:59:59.000,9:59:59.000
but I think particularly[br]in the world we live in today

9:59:59.000,9:59:59.000
it has a deeper resonance.

9:59:59.000,9:59:59.000
You know, when we focus on wellbeing,

9:59:59.000,9:59:59.000
we start a conversation

9:59:59.000,9:59:59.000
that provokes profound[br]and fundamental questions.

9:59:59.000,9:59:59.000
What really matters to us in our lives?

9:59:59.000,9:59:59.000
What do we value in[br]the communities we live in?

9:59:59.000,9:59:59.000
What kind of country,[br]what kind of society,

9:59:59.000,9:59:59.000
do we really want to be?

9:59:59.000,9:59:59.000
And when we engage people[br]in those questions,

9:59:59.000,9:59:59.000
in finding the answers to those questions,

9:59:59.000,9:59:59.000
then I believe that we have[br]a much better chance

9:59:59.000,9:59:59.000
of addressing the alienation[br]and disaffection from politics

9:59:59.000,9:59:59.000
that is so prevalent in so many countries

9:59:59.000,9:59:59.000
across the developed world today.

9:59:59.000,9:59:59.000
In policy terms, this journey[br]for Scotland started back in 2007

9:59:59.000,9:59:59.000
when we published what we call[br]our National Performance Framework,

9:59:59.000,9:59:59.000
looking at the range of indicators[br]that we measure ourselves against.

9:59:59.000,9:59:59.000
And those indicators are as varied[br]as income inequality,

9:59:59.000,9:59:59.000
the happiness of children,[br]access to green spaces,

9:59:59.000,9:59:59.000
access to housing.

9:59:59.000,9:59:59.000
None of these are captured[br]in GDP statistics,

9:59:59.000,9:59:59.000
but they are all fundamental[br]to a healthy and a happy society.

9:59:59.000,9:59:59.000
(Applause)

9:59:59.000,9:59:59.000
And that broader approach is at the heart[br]of our economic strategy,

9:59:59.000,9:59:59.000
where we give equal importance[br]to tackling inequality

9:59:59.000,9:59:59.000
as we do to economic competitiveness.

9:59:59.000,9:59:59.000
It drives our commitment to fair work,[br]making sure that work is fulfilling

9:59:59.000,9:59:59.000
and well-paid.

9:59:59.000,9:59:59.000
It's behind our decision to establish[br]a just transition commission

9:59:59.000,9:59:59.000
to guide our path[br]to a carbon zero economy.

9:59:59.000,9:59:59.000
We know from economic[br]transformations of the past

9:59:59.000,9:59:59.000
that if we're not careful,[br]there are more losers than winners.

9:59:59.000,9:59:59.000
And as we face up to the challenges[br]of climate change and automation,

9:59:59.000,9:59:59.000
we must not make those mistakes again.

9:59:59.000,9:59:59.000
The work we're doing here in Scotland[br]is, I think, significant,

9:59:59.000,9:59:59.000
but we have much, much to learn[br]from other countries.

9:59:59.000,9:59:59.000
I mentioned a moment ago[br]our partners at nations

9:59:59.000,9:59:59.000
in the wellbeing network,

9:59:59.000,9:59:59.000
Iceland and New Zealand.

9:59:59.000,9:59:59.000
So I'm noting, and I will leave it to you[br]to decide whether this is relevant or not

9:59:59.000,9:59:59.000
that all three of these countries[br]are currently led by women.

9:59:59.000,9:59:59.000
(Applause)