Each year the budget automatically increases based on CPI, resulting in 'budget cuts' actually being cuts to the automatic increases. Change the budgeting process to have a zero-baseline and to force agencies to each justify their automatic budget increases. Freezing the budget (aside from mandated automatic increases) would solve the deficit problem within a few years, instead of dozens of years.
Automation, economies of scale, and increases in efficiency should generally compensate for increased demand/load on each agency. In rare cases when it doesn't, then let each agency explain/justify their need for budget increases.