The optimal size of government is an important political and economic issue. However, because no long-term government expenditure series has official standing, New Zealand is often a missing case in comparative studies of government expenditure. Although government expenditure data is available from 1972 on Treasury’s website, the most widely used data before 1972 is a ‘consolidated’ long-term data series, on Statistics New Zealand’s website, which uses data from a number of sources and is published with strong disclaimers.
This article draws together alternative data, primarily from published official sources, to show that better quality data is often available from different printed sources. It discusses why the alternative data is more accurate and consistent, and considers what the data shows about changes in the role of the state in New Zealand.
The article first defines government expenditure, and considers other ways in which governments affect people’s behaviour and purchasing power. The best available expenditure series are then outlined, and changes in government expenditure over time examined. The low reporting of tax expenditures in New Zealand, compared to other countries, is discussed. Finally, the weaknesses of New Zealand’s most widely used expenditure data set are considered.