To deliver a more sustainable economy we need to make better use of resources, promote stability and competition, develop skills and reward work, and supply goods and services which meet consumers’ needs whilst minimising their impact on the environment. Business needs a strong, stable economy as the basis for innovation and investment, on which future jobs depend.
The traditional measure of the economic performance is the gross domestic product or GDP, which represents the total value of all goods and services produced by a nation during a given year. It is effectively a measure of traditional economic strength. A nations economics has a significant effect on environmental issues. Energy consumption, pollution and waste are just a few of the impacts of the economy in our society. If we are to sustain economic growth and if the UK is to maintain its economic strength then the practices causing these environmental problems must continue. However, these practices can become less damaging to the environment. This is possible because our economy makes enough money to finance new initiatives and technologies that will reduce some of the negative impacts.
Total GDP and GDP per capita are good indicators of the relative strengths of the worlds nations. The economically stronger nations should perhaps take the lead in tackling environmental issues.
Other indicators may include:
- Investment in public, business and private assets (headline);
- Social investment;
- Rate of inflation;
- Government borrowing and debt;
However, it is increasingly being recognised these traditional economic indicators alone do not provide an adequate measure of an economy’s sustainability. To improve upon these indicators, we need to know how resource efficient our economy is, both in terms of the natural resources that it consumes (and wastes) and its utilisation of labour capital. Some indicators that have been proposed by the Government in this respect include:
- Waste production, and energy and water consumption;
- Transport indicators;
- Education and employment;
- Consumer expenditure;
- Environmental management and reporting.