Oops - $2 billion mistake in budget appropriations
We’ve spent most of this week immersed in the budget documents and making notes of potentially questionable spending or unusually large increases.
To our great surprise yesterday we noticed that one of the primary growth partnerships (PGPs) that the Government is funding appeared to have undergone a massive growth in spending. We’ve expressed much concern in the past about PGPs and consider them inappropriate corporate welfare and the Government picking favourites.
According to the budget estimates distributed on Budget Day, the New Zealand Sheep Industry Transformation Project (NZSTX) is to receive 644 times more than in 2013/14. As you can see from the scan below, the budget documents show an increase in spending from $3.3 million to just under $2.4 billion dollars.
For comparison, $2.4 billion is roughly the same amount of appropriations for corrections, courts and customs combined!
We've previously made noise that the hundreds of millions committed to PGP funding is wasteful spending.. So you can imagine our shock when we saw that the Sheep Industry would be receiving close to $2.4 billion of hard earned taxpayer money.
We emailed the Minister of Finance’s office and have been told, to our relief, that the figure is mistakenly 1,000 times more than intended.
We are delighted that the Sheep Industry haven’t had a bank error in their favour of over $500 from every New Zealander. Like anyone else they might want all their Christmases to come at once, but thankfully the New Zealand Merino Company, who runs the programme, won’t get to run off into the sunset with designer sheep bedecked in glittering jewels.
The mistake reminds us of the Westpac couple who went on the run after $10 million was mistakenly deposited in their bank account. Luckily this one is more easily rectified as the money is not yet spent!
***Correction*** In much the same way Treasury made a mistake, an earlier version of this post referred to 2.4billion equalling roughly the same as the total amount spent on Education in Budget 2014. That was incorrect. The $2.4 billion only relates to output expenses in Vote Education.