Central government agencies are expected to spend approximately $3.55 billion on the environment in the 2024/25 fiscal year, according to the latest estimate of environmental expenditure from the Parliamentary Commissioner for the Environment.

This total is similar to the forecast for the previous fiscal year ($3.60 billion), and in line with 2022/23 ($3.54 billion), but the composition of that expenditure has changed considerably. There has been a significant increase in expenditure relating to extreme weather events caused by climate change and drops in expenditure in other areas.

Since 2023/24, budgeted climate adaptation spending has increased by $666 million as government agencies budget for recovery efforts following recent extreme weather events, such as Cyclone Gabrielle and the Auckland Anniversary Weekend floods. By contrast, spending on emissions reduction activities decreased by $370 million, spending on the environmental management system decreased by $139 million, and spending on pollution and waste decreased by $25 million.

“As climate change exacerbates the magnitude and frequency of extreme events, we can expect greater spending on adaptation,” explains the Commissioner, Simon Upton.

“Whether we are talking about extreme weather, degraded water or other pollution, the environment is starting to send us invoices for damage that is only likely to increase. This poses a significant risk to the Crown. There is an urgent need to get a better handle on what the future holds.”

This estimate, the fourth released by the Commissioner, outlines spending from 22 central government agencies against six high level environmental outcomes. It is intended to give MPs a big picture view of how public funds are being spent on the environment and enable them to understand the trade-offs those spending decisions represent.

“Traditional spending information has been presented to MPs by agency, rather than outcomes. By focusing on outcomes, the estimate helps MPs to see how spending relates to achieving environmental goals at the whole-of-government level. Armed with this information, Parliament can ask better questions about the spending decisions Ministers have taken and ask chief executives to demonstrate what outcomes that spending will secure.”

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