Dr Peter Bushnell
Deputy Secretary to the Treasury
The Financial Statements of the Government of New Zealand for the eight months ended 28 February 2007 were released by the Treasury today.
The 28 February 2007 monthly financial statements are compared against updated monthly forecast tracks based on the 2006 Half Year Economic and Fiscal Update.
$ million | February 2007 Actual YTD |
February 2007 Forecast YTD |
Variance $m |
HYEFU June 2007 Forecast |
June 2006 Actual |
---|---|---|---|---|---|
Residual cash | 1,239 | (162) | 1,401 | 107 | 2,985 |
Operating balance | 6,514 | 5,090 | 1,424 | 6,260 | 11,473 |
OBERAC | 5,597 | 5,090 | 507 | 6,656 | 8,648 |
Gross sovereign-issued debt | 36,599 | 37,463 | (864) | 37,867 | 35,461 |
% of GDP | 23.2 | 23.7 | (0.5) | 23.7 | 22.6 |
Net core Crown debt | 5,417 | 7,064 | (1,647) | 6,382 | 7,745 |
% of GDP | 3.4 | 4.5 | (1.1) | 4.0 | 4.9 |
Net core Crown debt with NZS Fund assets | (6,463) | (4,547) | (1,916) | (6,271) | (2,116) |
% of GDP | (4.1) | (2.9) | (1.2) | (3.9) | (1.3) |
Net worth | 88,292 | 76,548 | 11,744 | 77,718 | 71,403 |
The following table outlines the key variances for the year to 28 February 2007 and their likely impact on the year end result:
Item/indicator | Variance | Key drivers | Impact on revised forecast for year end |
---|---|---|---|
Tax Revenue | nil | Broadly in line with forecast | |
Net investment income (major contributor to the Operating Balance variance) | +$1.0 billion |
|
Net investment returns are looking positive. However, in the short term they can be volatile It is policy that investment returns by NZSF, ACC, GSF are retained by these entities and are not available for redistribution |
Core Crown expenditure | - $0.4 billion |
|
Departments expect that around half of the delays in spending will be permanent at year end |
OBERAC | + $0.5 billion | Mainly due to delays in departmental spending above | The depreciation on the revalued rail network (see Net Worth below) will reduce the operating balance by around $140 million per annum |
GSID | - $0.9 billion |
|
Settlement cash levels have decreased from last month by $0.4 billion. Uncertainty remains over long term levels and volatility |
Net Worth | + $11.7 billion |
|
|
Residual cash | + $1.4 billion | Delays in departmental spending on operating ($0.6 billion in cash terms), capital ($0.4 billion) and extra tax receipts from Crown reporting entities ($0.4 billion) | Unlikely the delays in departmental spending will impact on the year end position |
ENDS
Officer for Enquiries
Kamlesh Patel | Macroeconomic GroupTel: +64 4 471 5094
Fax: +64 4 471 5956
Email: [email protected]