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Media statement

Financial Statements of the Government of New Zealand for the Seven Months Ended 31 January 2011

Issue date: 
Tuesday, 8 March 2011
Corporate author: 
View point: 

Struan Little
Deputy Secretary to the Treasury


The Financial Statements of the Government of New Zealand for the seven months ended 31 January 2011 were released by the Treasury today.

The monthly financial statements are compared against monthly forecast tracks based on the 2010 Half Year Economic and Fiscal Update published in December 2010.

For the seven months ended 31 January the majority of key indicators were tracking close to forecast.  The only notable variances were for gross debt and the operating balance deficit.  In line with recent months, the cause of these respective variances was largely due to two factors: debt issuance being ahead of schedule and investment returns being higher than expected. 

Core Crown tax revenue was slightly weaker than forecast (0.8% lower than expected at $29.9 billion) as underlying weakness in the economy resulted in shortfalls in GST ($285 million), corporate tax ($157 million) and other individuals’ tax ($120 million).

Partially offsetting the shortfall in tax revenue, source deductions (PAYE) were again 2.6% higher than forecast ($323 million).  This was potentially due to wage and employment growth although volatility in recent data provides uncertainty over the cause.  

Although core Crown revenue was weaker than expected, lower core Crown expenses (0.9% lower at $38.5 billion) and slightly higher profits from State Owned Enterprises and Crown Entities, saw the operating balance before gains and losses deficit remain largely in line with forecast at $6.2 billion. 

Both the residual cash deficit (at $10.1 billion) and net debt (at just under $37.0 billion or 19.4% of GDP) were also close to forecast, as the previous month’s residual cash variance reversed as expected.  

Gross debt stood at $63.0 billion (33.1% of GDP), which was $14.3 billion higher than the same time last year.  As a result of the higher debt position, finance costs for the seven months ended 31 January 2011 were $1.7 billion compared with $1.3 billion in the same period last year. 

The January results reflect the Crown’s position up until 31 January 2011, prior to the devastating Canterbury Earthquake of 22 February.  Costs to the Crown associated with the tragic earthquake will be recorded in future accounts as costs are quantified.




Year to date Full Year
$ million January
January 2011
June 2011
Core Crown          
Core Crown tax revenue 29,924 30,157 (233) (0.8) 52,527
Core Crown revenue 32,490 33,149 (659) (2.0) 58,446
Core Crown expenses 38,463 38,830 367 0.9 70,560
Core Crown residual cash (10,145) (10,065) (80) (0.8) (15,602)
Gross debt3 63,048 61,585 (1,463) (2.4) 67,400
as a percentage of GDP 33.1% 32.3%     33.3%
Net debt4 36,968 37,176 208 0.6 42,078
as a percentage of GDP 19.4% 19.5%     20.8%
Total Crown          
Operating balance before gains and losses (6,207) (6,090) (117) (1.9) (11,098)
Operating balance (998) (4,752) 3,754 79.0 (9,116)
Net Worth 93,916 90,156 3,760 4.2 85,809


1 Using GDP for the year ended 30 September 2010 of $190,740 million (Source: Statistics New Zealand)

2 Using forecast GDP for the year ended 30 June 2011 of $202,398 million (Source: Treasury)

3 Gross sovereign-issued debt excluding settlement cash and Reserve Bank bills

4 Net core Crown debt excluding student loans and other advances



Officer for Enquiries

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Tel: +64 4 917 6943
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    Last updated: 
    Monday, 7 March 2011