Mr. Speaker, I am pleased to speak to Motion No. 385 brought forward by the member for Leeds--Grenville today. It reads:
That, in the opinion of this House, the government should develop and report annually on a set of social, environmental and economic indicators of the health and well-being of people, communities and ecosystems in Canada.
As we heard in the previous discourse that this was a broad motion. However it has a relatively simple and straightforward purpose which is to replace gross domestic product as the major indicator of well-being. It would be replaced with something called the genuine progress indicator, otherwise known as GPI.
The proponent is quite wise not to get too detailed in his motion. There is a lot of work to get to where we have an index that will engender wide ranging support . To launch this index without the appropriate structural homework would be a mistake.
The current GDP is definitely a poor way to determine how well human beings are actually doing. Gross domestic product is solely a monetary measurement which does not take into account factors other than the output of a nation's economy.
This genuine progress indicator would take into account many factors, social factors, environmental factors and other indicators. The genuine progress indicator is a measurement which would introduce values other than money into our accounting system.
For example, if money were currently spent in British Columbia, Newfoundland or another jurisdiction for repairing environmental damage from an oil spill or some other environmental catastrophe, this would record as an increase in the gross domestic product. This ignores the environmental damage obviously and focuses only on money. Whereas the genuine progress indicator would also take the environmental damage into account. We could use other examples, social, environmental or other matters as well.
Therefore the genuine progress indicator has some very large positives. What we must recognize, however, is the genuine progress indicator can be, and I am not saying it will be, easily abused and manipulated if the indicators built into it are used to skew the results in a way that is designed not so much to bring a new form of transparency but to make the designers of the system look good.
This is always a concern when we leave this kind of initiative in the hands of government because government will unfailingly seek to create a form of measurement that is self-serving.
One example I could give is one could suggest that the number of factories located in a certain area would be built into the development of an indicator. This could be taken as an indicator, for example, of how much pollution is in the air, or it could indicate a higher number of jobs or it could be skewed to say a number of other things.
My point is the government or the bureaucracy could use the GPI to justify almost anything it wanted. Therefore that is probably the biggest hurdle and reason why GDP, gross domestic product, continues to be the main basis of comparison because of its predictability and the fact that it can be compared internationally despite its flaws.
We need a set of indicators for GPI to which everyone can agree so that we can get to a comparable and essentially truthful answer rather than a self-serving answer. The key is to develop a set of parameters and indicators that are objective.
A recognized objective measurement that many organizations and countries are beginning to utilize is neither the gross domestic product nor the genuine progress indicator, but something called the gross domestic product purchasing power parity. Rather than genuine GPI, some countries are tending to use GDP purchasing power parity as a more accurate measure of a nation's well-being because it takes into account the standard of living within that country.
This turned out to be a useful comparison this last month when I was in Thailand and India with the trade subcommittee because in a developing country normal measurements of GDP do not tell much about the state of the middle class or the state of how people in the workforce are actually doing.
Nearly all of the most respected international organizations now use GDP purchasing power parity to measure economic progress. This includes the World Bank, the International Monetary Fund and the United Nations economic reports. These groups are utilizing this new measurement. Nearly all reports must take into account the actual cost of living to express a nation's wealth and well-being. This new measurement tends to do that.
I am generally supportive of Motion No. 385. At this point in time it is not developed to the point where I believe it can be implemented usefully. Adoption of this motion, however, would signal our concern with continued reliance on and utilization of the GDP measurement.
Expansion to GDP purchasing power parity would be a positive move. Movement to the genuine progress indicator is also a positive move but needs an international push and international agreement on data input standards. Canadian support for this initiative would be a very positive step.
A fair and objective set of measurements is needed. This is something that needs to be recognized internationally and not something designed for government to make government look good. This past winter, the Canadian Alliance set up a sustainable development work group to look at this very issue. I would like to summarize their findings.
Indicators have been developed to measure progress in achieving sustainable development objectives, including Nova Scotia's genuine progress indicator and the World Bank's genuine savings sustainability indicator. However, quantification and measurement of values based on hundreds of sustainable development variables, such as soil degradation, pollution, forestry and fisheries completion, volunteer activity, natural resources values, et cetera, are extremely complex. We want to adopt sustainable development indicators.
The GPI, genuine progress indicator, is a work in progress and I support that initiative.