In 2019, Iceland developed a well-being indicators framework to track its progress towards a well-being economy. The indicators are monitored and updated by Statistics Iceland and have been used to inform the identification of priorities in the national five-year fiscal strategy.
Iceland’s Well‑being Indicators Framework
Abstract
In 2018, Iceland’s Prime Minister appointed a Committee on Indicators for Measuring Well-being with the goal of identifying a comprehensive set of indicators to provide a more complete view of inclusive and sustainable well-being in the country. The Committee included experts from Parliament, ministries, academia, and Statistics Iceland. A public survey was also commissioned by the Committee to identify what well-being factors mattered most to the general public, and to provide additional inputs for the development of the indicator framework.
Iceland’s well-being indicator framework spans economic, environmental, and social factors of well-being and allow to situate Iceland’s performance internationally, as well as to identify areas of action. The indicator set initially included 39 indicators, expanded to 40 since 2022. These indicators are divided into three categories and 13 sub-categories. The Society category covers health, education, social capital, security, and work-life balance. The Economy category spans economic conditions, employment, housing and income. And the Energy category includes air quality, land use, energy, and waste and recycling. The indicators are available online and are regularly updated by Statistics Iceland based on official statistics.
At the end of 2019, the Ministerial Council on Fiscal Affairs conducted a prioritisation exercise on the basis of the well-being indicator framework to inform the government’s five-year fiscal strategy and annual budget. It ranked the (then) 39 indicators by taking into account a number of considerations including the results of a survey on Icelandic people’s priorities, the extent to which government policy could influence outcomes within the timeframe, and the impact on established government goals such as gender equity and rural development. As a result, it identified six well-being priorities for the 2021-2025 Fiscal Strategy: mental health, secure housing, better work-life balance, zero carbon emissions, innovation growth, and better communication with the public.
Iceland’s Well-being indicators framework is part of Iceland’s data-driven approach to becoming a well-being economy and seeks to inform policy decisions and priorities. The integration of the six well-being priorities into the five-year Fiscal Strategy Plan shifted national resource allocation towards the achievement of these goals, and by 2021 these priorities steered 30 of the government’s 35 policy areas. The indicators framework has also encouraged the Icelandic government to propose other initiatives to achieve the well-being priorities, such as the Act on the Integration of Services in the Interest of Children’s Prosperity (“Prosperity Act”), which seeks to enhance child well-being by ensuring the provision of comprehensive services to children and families early in the policy process.
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