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Media statement

Financial Statements of the Government of New Zealand for the Four Months Ended 31 October 2008

Issue date: 
Friday, 5 December 2008
Corporate author: 
View point: 

Dr Peter Bushnell,
Deputy Secretary to the Treasury

The Financial Statements of the Government of New Zealand for the four months ended 31 October 2008 were released by the Treasury today.

The monthly financial statements are compared against the monthly forecast tracks based on the 2008 Pre-Election Economic and Fiscal Update.

Results for the four months ended 31 October 2008

  • Tax revenue, core Crown expenses and the operating balance before gains and losses (OBEGAL) were broadly in line with forecast. 
  • The operating balance deficit of $3.5b was $5.0b lower than the forecast surplus.  The two main contributors to this lower-than-expected result were:
    • The NZ Superannuation Fund (NZS Fund), ACC and EQC all suffered losses on their investment portfolios that were larger than expected ($3.5b, $0.6b and $0.2b respectively) as a result of continuing turmoil in global financial markets.
    • GSF and ACC also recorded losses as a result of recent revaluations of their long term liabilities of $1.0b and $0.4b respectively.
  • The core Crown residual cash deficit was $0.9b lower than forecast at $3.7b.  This was mainly due to delays in transferring $0.7b to the NZ Fast Forward Fund and higher-than-expected petroleum mining royalties received due to high oil prices earlier in the year.
  • Gross sovereign-issued debt (GSID) was $3.1b higher than forecast at $33.6b (18.8% of GDP).  This was due to stronger-than-expected demand for government-issued assets, depreciation of the NZ dollar impacting on foreign currency liabilities, and an increase in the volume of derivatives in loss compared to forecast.  These factors all have a broadly corresponding impact on the Crown’s financial asset portfolio and so have minimal impact on net core Crown debt.
  • Net core Crown debt was $1.9b lower than forecast at $2.2b mainly due to the lower than-expected residual cash deficit (noted above), $0.3b higher-than-forecast circulating currency, and $0.6b due to an increase in derivative holdings.

Year to date

Full Year
June 2009
$ million          
Core Crown          
Core Crown revenue (excl. NZS Fund) [1] 20,680 20,487 193 0.9 61,102
Core Crown expenses 20,071 20,366 295 1.4 62,359
NZS Fund operating balance (2,315) 312 (2,627) (842.0) 986
Core Crown residual cash (3,692) (4,564) 872 19.1 (5,909)
GSID (excl. settlement cash) 33,632 30,554 (3,078) (10.1) 32,087
   as a percentage of GDP 18.8% 17.1%     17.4%
Net Core Crown debt 2,178 4,116 1,938 47.1 5,207
   as a percentage of GDP 1.2% 2.3%     2.8%
Net Core Crown debt (incl. NZS Fund) (10,268) (10,017) 251 2.5 (10,430)
   as a percentage of GDP (5.7)% (5.6)%     (5.7)%
Total Crown          
OBEGAL 898 781 117 15.0 (64)
Net gains / (losses) and other items (4,405) 689 (5,094)   1,973
Operating Balance (3,507) 1,470 (4,977) (338.6) 1,909


1  For the purposes of this indicator the NZS Fund is treated as a third party (ie, its revenue is not included but the tax it pays is).

2  Using GDP for the year ended 30 June 2008 of $179,048 million (Source: Statistics New Zealand).

3  Using forecast GDP for the year ended 30 June 2009 of $184,390 million (Source: Treasury).


Officer for Enquiries

Kamlesh Patel | Macroeconomic Group
Tel: +64 4 917 6094
Fax: +64 4 471 5956
    Last updated: 
    Friday, 5 December 2008