We can’t keep going on like this

Baseline Budget spending increased three times more than inflation and economic growth in the last four years.

Finance Minister Bill English said:

“Baseline Budget spending has jumped 45 per cent since 2005 – at a time when inflation and the economy only grew by about 15 per cent.

“More than a third of all Budget vote areas received funding increases of over 50 per cent in the past five years and over two thirds received increases of more than 30 per cent.

“This kind of rampant spending growth is unsustainable and cannot continue.”

The table shows the increase in spending:


 These are unsustainable figures – and they exclude some expenses, such as benefits and Working for Families payments, the purchase of KiwiRail and loan write-offs.

This is Labour’s legacy but reversing it is National’s responsibility.

We can’t keep going on like this. The  government is borrowing an average $250 million a week, every week, over the next four years to continue providing public services and maintain welfare payments.

That is a hand break on economic growth and if it’s not checked we’ll be handicapping future generations too.

One Response to We can’t keep going on like this

  1. Matt Nolan says:

    One thing to keep in mind is that nominal GDP rose by about 28% during this period. So any spending increases of less than 28% saw spending as a % of economic activity fall.

    As a result, it appears that governments share of spending did climb a bit – but not as sharply as these figures suggest at first blush.


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