From an international perspective, New Zealand fares well in several aspects of current well-being, but faces challenges in housing affordability, household income and earnings, mental health, and child well-being. There are also large inequalities for health and educational outcomes, and a high share of economically vulnerable people. Social capital is a particular strength, but New Zealand’s natural assets are being depleted. The Treasury has developed its Living Standards Framework and associated Dashboard to integrate well-being evidence more systematically in its advice to the Government. The Dashboard is consistent with international measurement practice, but has some indicator gaps, particularly for natural capital. The New Zealand Government is applying a well-being approach to policy and budget decision-making, including legislating for well-being objective-setting and reporting. Continuing to develop the evidence base that supports the well-being approach is critical. Effective implementation requires further investment in methodological development, civil service capacity-building, and strong leadership across government.

New Zealand’s immigration system aims to enhance well-being by promoting economic development, reuniting families and meeting humanitarian objectives. Immigration is high and residence admissions are focused on the high skilled to enhance economic outcomes. Empirical evidence suggests that immigration has had small positive effects on per capita incomes and has not adversely affected the wage or employment outcomes of the average NZ-born worker. However, temporary migration has had small negative impacts on new hires of some groups of people, notably social welfare beneficiaries not in the (16) most urbanised areas. Immigrants have high well-being outcomes on average but suffer an initial shortfall in employment and wages relative to the comparable NZ-born. New Zealand has refined the migration system over the years to attract those who are more likely to ease labour shortages and, should they apply for residence, have better earnings prospects. It has also deployed settlement and integration programmes to improve labour market and other outcomes that affect well-being. This chapter looks at further adjustments to the system to enhance its well-being benefits for both the NZ-born and immigrants.

New Zealand’s housing supply has not kept pace with rising demand, including from net immigration. Affordability has worsened, particularly for low-income renters. Government action is underway to allow new housing through initiatives such as the Urban Growth Agenda, KiwiBuild and the Housing and Urban Development Authority, but further steps are needed to improve well-being. Clear overarching principles for sustainable urban development and rationalisation of strict regulatory containment policies would allow the planning system to better respond to demand for land. Incentives for local governments to accommodate growth could be increased by giving them access to additional revenue linked to local development. More user charging and targeted rates would also help to fund infrastructure required to service new housing. Government delivery of affordable housing through KiwiBuild should be re‑focused towards enabling the supply of land to developers, supporting development of affordable rental housing and further expanding social housing in areas facing shortages.