Higher spending on continuing programs is considered a “parameter variation”. The budget documents clearly say that new policy will lead to higher tax and higher spending. Check BP1, statements 4 (revenue) and 5 (expenses).

http://alsblog.wordpress.com/2008/05/15/thoughts-on-the-budget/

Change is the spice of life. I’ve changed most things in my life since birth… so I thought I’d extend that theme to my name.

In my original big government conservatism piece, I used a demographic measure, spending per person, on the grounds that this was closer to the underlying spending drivers than GDP.

Re 7. You have argued previously that you prefer to look at spending in real terms. However, in fact there are lots of reasons why this is not the appropriate benchmark. A large share of public spending on health, education etc is related to wage costs while age, disability, and service pensions are wage-linked as is parenting payment single, and unless they have changed the legislation so is Family Tax Payment Part A in an indirect way. Demographic change is also likely to put an upward pressure on real spending on health and pensions. Really, only unemployment payments could be expected to behave in the way you say - fall in real terms in good economic times - and isn’t unemployment predicted to increase?

So unless we expect falling real wages, we should also expect increasing real spending in a large part of the budget. Now you can argue that the Government should do more cutting, but you should also recognise that spending as a share of GDP is usually regarded a the appropriate benchmark for assessing the size of government.

Alastair - Of course I don’t know for sure what will be in future budgets, but I know what the incentives are - to make any decision that will upset people as long as possible before the next time they will get to vote, and to hand out the electoral bribes just before they will vote. And there is still plenty of pent-up demand for more spending from Labor’s constituencies.