David Cameron launched his "happiness index" yesterday as he announced that the Government would measure people's quality of life as well as economic growth. From April, the Office for National Statistics will seek to establish the key areas that matter most to people's wellbeing – such as health, levels of education, inequalities in income and the environment.

Mr Cameron denied his plan was "airy-fairy and impractical". He said: "If I thought this was woolly and insubstantial, I wouldn't be bothering with it. To those who say this sounds like a distraction from the serious business of government, I say finding out what will improve lives and acting on it is the serious business of government.

"We'll continue to measure gross domestic product. But it is high time we admitted that, taken on its own, GDP is an incomplete way of measuring a country's progress."

He cited marketing aimed at children and the influence of patients over where they were treated as examples of what might arise in a debate on how to measure quality of life. "I think this debate will help us think more carefully about how we are affecting the quality of people's lives," he said.