Budget 2026: the fall and confused rise of New Zealand aid

The strange case of the $162 million that didn't bark in the night.

It was a glum afternoon, a sea fog had drifted in over Kilbirnie, my coffee was cold, my cat asleep by the heater, and somewhere in the background Bryan Adams was singing sadly to himself on a CD player.[i]

Still, my usual irritation at having to spend so much time bullying spreadsheets and imploring PDFs to find out how much aid New Zealand gives had been replaced by something else.[ii]

That something was an unusual question: how on Earth do you misplace 162 million dollars?[iii]

In May last year, New Zealand thought it had spent $1.2 billion dollars on aid in the financial year just ended (the 2024/25 financial year). But it turns out that, according to the numbers in this year’s budget, we only spent $1.04 billion. Aid isn’t easy: projects get delayed, wars break out, politicians are capricious… But $162 million dollars? That’s an awful lot of money to have thought you had spent only to discover it’s still in your wallet.

To the government’s credit, it hasn’t repossessed the money, or disappeared it. Rather, it has rolled it forward, which means that – assuming the cash doesn’t get lost again – New Zealand’s aid spend will increase considerably this year. Also, to the government’s credit, is has increased the triennial aid budget for the current triennium. (Nominally, New Zealand budgets its aid in three year triennia. In practice, annual and triennial spends often change within triennia, but the triennial budgets are important guides nonetheless.)

The result of all this is that, after falling with a thud in the 2024/25 financial year – as you can see in the chart below – New Zealand’s aid spending is on the up. This is true both in nominal and inflation-adjusted terms. (Although, caveat lector, my inflation adjusted numbers are based on Treasury’s projection of the CPI only going up by 1.6% this year, which seems optimistic.)

Even our Aid/GNI ratio is projected to tremble upwards.

This – misplaced millions and spreadsheet irritations aside – is a happier tale than I thought I would be telling today. The government deserves credit for that.

On the other hand, with inflation taken into account, our overall aid spend it still set to be considerably less than it was in the last triennium.

Given that we’re living in a time of fuel shortages in the Pacific, a catastrophic civil war in Sudan, Gaza permanently poised on the edge of famine, and where natural disasters, as well as all the other development challenges, aren’t going anywhere, it would be nice if New Zealand could find it within itself to do more.

For now though, let’s at least be grateful that they found the misplaced $162 million.

---

[i] If you spot any errors, want to see my data, or have any questions, please get in touch. I’m very happy to make corrections and send them out. If you want to complain about any errors, please send your complaints to MFAT. It’s crazy that, rather than the government proactively proving useful aid data on budget day, it falls to an academic with a laptop.

[ii] I say “aid” not “ODA” because New Zealand gives some aid to the Cook Islands, which is no longer eligible for Official Development Assistance (ODA) in the eyes of the OECD. Annoyingly the government doesn’t tell us in advance how much it’s giving to the Cooks, so my numbers all pertain to aid not ODA, though the difference won’t be huge, I hope.

[iii] All numbers in his article are in NZD.