The state of the books

StatsNZ has put up its year-end accounts for the government, split out across functional areas. 

Their data goes back to 2009 in the main table; I'm sure earlier data's available somewhere in Infoshare.

But sticking with the Excel sheet they've provided, we can lob in June-year population statistics and June quarter consumer price index values to get per capita real measures on operating expenditures net of finance cost and on spend in different functional areas. 

Here's per capita real central government operating expenditure net of interest expenses. Netting out interest expenditures is helpful if you want a handle on core government operating expenditure. Government can decide to take on less debt; it cannot decide to stop making its interest payments. 

You may have heard a lot of stories about austerity. Consider that both the government and the opposition may want to convey the impression that it has happened, despite it very much not having happened. 

Throughout the 2010s (barring #eqnz), per capita real operating expenditure net of interest expenses ranged from $17,143 to $18,653 - with 2019's jump to $18,653 being well out of line with the prior track. Labour substantially increased spending under its wellbeing focus - as was its prerogative. 

Per capita real operating expenditure net of finance cost has been above $21,000 since then; the provisional figure for 2025 is $21,648.

Here's the breakdown by functional categories. Let's start with the bigger-ticket items. 

The largest-spend category here by far is social protection: benefits and superannuation. 

Spending on those has risen over the period and is now close to the peak that they hit during the GFC and Christchurch Earthquake. There was always going to be a slow rise in these with an aging population in the absence of reform to NZ Superannuation. 

Health is next. It peaked during Covid. Vaccines cost money. Again, an aging population will get you an increasing track on this one - but we were averaging about $3700 per capita before Covid and we're now around $4600. 

Education had a large Covid spike, then retrenchment to a new level a bit above the old per capita level. 

But remember that this is per capita, not per capita under the age of 25. And the proportion of under-25s has been dropping at the same time as the proportion of over-65s has been increasing. 

Any giant shedding of government staff will show up in General Public Services.

The austerity really stands out in this picture. Can't you see it too? 

'Economic affairs' spiked with the wage subsidy scheme but has maintained a substantial ratchet. 

The category's spend, pre-Covid, peaked in 2019 at just over $1,200 per capita. Now it's just over $1,700 per capita. 

Public order and safety has plateaued just over $1,200 per capita. The increase began under the Ardern government. National has maintained their increase in resourcing to police. 

Housing and Community Amenities jumped from close to nil to just over $400 per capita under the prior Labour government, and has stayed there under National.

Defence has been more frugal - but remember that this is just operating expenditures, not capital expenditures. That's around $400 per capita throughout. Minor decline in real per capita operational expenditures since 2009. 

Recreation, culture, and religion rose and has retrenched somewhat. I wonder what the heck is in the 'religion' category. But the apparently arts and culture hating National-led coalition is spending more in this category, in per capita real dollars, than Ardern ever did pre-Covid. 

Environmental protection has been maintained at a slightly higher level than pre-Covid. Under the Key government environmental protection was around $160 per capita; pre-Covid Ardern had it around $175. Just look at that slash and burn from the environment-haters. It's right there. Can't you see it? That little downward tick in 2025?

We continue to be in substantial structural deficit. 

Increasing revenue to match spending is always an option, but one that would entrench the increased spending in just about every category since Covid - and still leave a demographic problem to be dealt with as superannuation entitlements keep rising along with health spending. 

And I've not included the costs of financing an increasing government debt.