Disagree because that loss of funding basically started the gutting of NZDF and meant that there were cuts all around.
I was in at the time and we lost capability and people. Morale hit rock bottom and people started voting with their feet, especially when the base closures started. I saw the ANZAC FFG plans in 1991 and on them there was kit that said Australia only and that reduced the NZ capability. Was not good for RNZN morale and we regarded it as absolute govt shite. The Andovers weren't replaced because of funding cuts - more capability lost. Skyhawks should have been replaced earlier in the 1990s but weren't because of funding cuts - looked what happened. Then there was the shite about the M113 APCs deploying to Balkans without proper kit because we didn't have the gear. Had to borrow add on armour from the ADF. And the APCs were stuffed completely and the only thing keeping them together was the rust holding hands.
You are arguing about funding - there is a difference between policy orientation and the difference in funding that policy orientation. The first did not change during the 1990's but the second did. I have no argument about that they did not fund the policy posture from the DWP's of the 1990's.
Here is the rub - and you will not like it. The NZDF did need to change in the 1990's. It did need to be be moulded into greater efficiency. Some of those bases that closed like Te Rapa, Sylvia Park, Hobsonville, Shelly Bay and Hopahopa were well passed their relevancy. Wigram or Woodburn? They only needed a single base in the South. Nostalgia is not a compelling rationale for saving both. (The reality is that base rationalisation plans first came about in the 1980's following the policy work of Derek Quigley and his Strategos Consulting Group which went to the Lange cabinet in 1988).
The issue in the 1990's, was a weak DefMin in Cooper, Razor Ruth and a PM in Bolger who was basically disinterested. Allow me to have a judgement on some of the personalities I knew and spoke to then and after. This wont change your own personal biases but Shipley was when she became PM in 1997 was interested and more so as she developed in the job, Bill 'Mogadon' Birch did manage to hold the line even when the Asia Crisis hit in 97-98 when budgets across all GOTD departments were being hit and Max Bradford tried bloody hard to get us the F-16's and the 3rd Frigate. Happy to discredit the first three but the last 3 mentioned should be distinguished from the 3 in the early-mid 1990's - Ships, Brad and the Mog were not as useless as you try to paint them and took their roles seriously even when up against immense fiscal and political challenges. It was not their fault Winston grandstanded in Cabinet over the 3rd Anzac and that they only had 18 months to attempt to turn around damage done before Clark & Co came in.
So yes that started the rot and any claims that we had a balanced force in the 1990s was absolute bull crap. Yep balanced against what? The 1939 NZ Defence TOE (Table Of Equipment)? It was and is all political spin and has been ever since, no matter what side of the house the pollie(s) spouting it was / is sitting on, and based on some airy fairy ideology learnt from a book, that doesn't at all relate to the real world and does nothing for the sailor, soldier airman, airwoman, who always have to sort the mess out that pollies always make when they stuff up the diplomacy.
The NZDF was a small balanced force from the 1960's onwards. The policy orientation and ability to provide a deployable air combat squadron, air surveillance capability, four frigates, an all arms battalion group and special forces capability with air transport and rotary transport support has been in that context - a small balanced force. In essence a combat capability for deployment generated from each of the 3 services to be a component within a larger unified command. That was the agreed policy context of a small balanced force for a nation that was mostly around 3-4 million in population at the time since the days when Gen Thornton and VADM Phipps as CDS's advised the Holyoake government and continued by subsequent governments but for the exception of the Clark era onward. It was that Bolger & Co did not fund it. The Shipley lot really wanted to - and did indeed recognise the thawing relationship with the US in the later Clinton era and unlike the Nats in recent years did get that FTA's and Defence were symbiotic - especially with the US.
You can be miffed that it was not funded adequately - I am too - but that fundamental policy posture existed until the late 1990's. Note that I not once reverted to mentioning bovine effluent in my analysis.