What may be confusing is that in this case we're talking about the change in the rate of growth over time.
For instance, if you take a look at the operating budgets of the federal government, which had been frozen, they're not declining in that sense; however, inflation still eats away at their value and the amount of services they can deliver, one thing that Kevin Page has highlighted.
For those speaking about austerity, particularly when we look at it from the perspective of economic growth, the question is how much governments are contributing to or withdrawing from economic growth over time. Are they continuing to push economic growth, or are they becoming a drag on economic growth?
Certainly in the past year they were a much less important portion of economic growth than they were, say, in 2009 and 2010—following the stimulus years, when they were a much more important component of economic growth.