Even though Hawaii’s government is short on cash, it’s budgeted spending is still rising.

That’s largely because demand for government services has jumped as a result of the down economy.

Medicaid costs represent the largest expense, along with scheduled increases debt service payments and public workers’ health and retirement benefits.

Overall state government spending is expected to increase to $11 billion next fiscal year, a 7 percent increase over this fiscal year’s $10.2 billion budget.

General fund spending, the part of the budget over which lawmakers have the most control, would rise to $5.4 billion, an 8.5 percent increase from this fiscal year’s $4.9 billion budget.

Legislators said they cut about $600 million from Gov. Neil Abercrombie’s requested spending.