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Media statement

Financial Statements of the Government of New Zealand for the Nine Months Ended 31 March 2007

Issue date: 
Thursday, 10 May 2007
Status: 
Current
Corporate author: 
View point: 

Dr Peter Bushnell
Deputy Secretary to the Treasury

The Financial Statements of the Government of New Zealand for the nine months ended 31 March 2007 were released by the Treasury today.

The 31 March 2007 monthly financial statements are compared against updated monthly forecast tracks based on the 2006 Half Year Economic and Fiscal Update.

$ million March 2007
Actual
YTD
March 2007
Forecast
YTD
Variance
$m
HYEFU June
2007
Forecast
June
2006
Actual
Residual cash 2,024 (342) 1,682 107 2,985
Operating balance 6,012 5,270 742 6,260 11,473
OBERAC 5,011 5,270 (259) 6,656 8,648
Gross sovereign-issued debt 36,335 37,168 (833) 37,867 35,461
% of GDP 23.0 23.6 (0.5) 23.7 22.6
Net core Crown debt 4,489 6,292 (1,803) 6,382 7,745
% of GDP 2.8 4.0 (1.2) 4.0 4.9
Net core Crown debt with NZS Fund assets (7,659) (5,528) (2,131) (6,271) (2,116)
% of GDP (4.9) (3.5) (1.4) (3.9) (1.3)
Net worth 87,790 76,728 11,062 77,718 71,403

 

The following table outlines the key variances for the year to 31 March 2007:

 

Item/indicator Variance Key drivers
Tax Revenue nil  
Net investment income (major contributor to the Operating Balance variance) +$1.2 billion
  • Largely unrealised gains on investments held by the:
    • NZSF ($0.6 billion)
    • GSF ($0.1 billion), and
    • ACC ($0.1 billion)
  • Higher than forecast foreign exchange gains ($0.4 billion)
Core Crown expenditure +$0.4 billion
  • Write-down of tax and fines receivables ($1.1 billion); offset by
  • Delays in departmental spending ($0.7 billion)
OBERAC -$0.3 billion Mainly due to delays in departmental spending, offset by write-down of tax and fines receivables above
GSID -$0.8 billion
  • Reductions in DMO foreign currency borrowings ($0.5 billion) and the Reserve Bank’s other lending facilities ($0.7 billion), offset by settlement cash levels being higher than forecast by $0.4 billion
Net Worth +$11.1 billion
  • Revaluation of the rail network ($10.3 billion), and
  • Operating balance impact of the higher than expected net investment returns, write-down of receivables and delays in departmental spending ($0.7 billion)
Residual cash +$1.6 billion Delays in departmental spending on operating ($0.6 billion in cash terms), capital ($0.4 billion) and some one-off unforecast tax receipts ($0.5 billion)

 

Where appropriate, the March results have been factored into the revised annual forecast, to be released as part of the Budget Economic and Fiscal Update. In summary, the main impacts are:

  • an increased level of investment income, which will be retained by the entities, and

  • delays in departmental spending will impact on the operating balance and residual cash.

ENDS

Officer for Enquiries

Kamlesh Patel | Macroeconomic Group
Tel: +64 4 471 5094
Fax: +64 4 471 5956
Email: kamlesh.patel@treasury.govt.nz
Last updated: 
Tuesday, 30 October 2007