Is New Zealand a model for ''reinventing'' government and cutting spending? The government of Alberta, Canada, consciously replicated significant elements of the New Zealand model to attain fiscal balance and public sector reorganization, including the core element of restructuring institutions to change individual behavior. Despite broad similarities in policy content and outcome, differences in the specific content of policy and the politics of policy implementation led to differences in the sustainability of reform and the location of budget cuts. Alberta's Progressive Conservative party emphasized expenditure cuts where both the New Zealand Labour and National parties emphasized government reorganization and the introduction of market mechanisms. Contrasting these efforts to balance budgets and reinvent government suggests that there is considerable variation in the ''model,'' and that left governments in general are probably more likely to pursue and succeed at the reinvention of government, while stinting fiscal balance. Right governments, on the other hand, are more likely to achieve short-run fiscal balance at the expense of successful reinvention. In turn this suggests that while the partisan orientation of the reforming party matters, neither has an ideal policy mix for long-term fiscal stability. Alternation of governments may provide the best policy mix.
And let me speak candidly to those who have their eyes on the [budget] surplus. Forget it. The only time we will make decisions about spending money is right now-at the beginning of the year when the budget is set. At the end of the year, when we know the size of the surplus, there is no choice. No one can choose to spend the surplus-it must go to pay down Alberta's debt. That's the law in Alberta. (Jim Dinning, Provincial Treasurer, Budget Speech,