Paul Helm, Chief Government Accountant
The Financial Statements of the Government of New Zealand for the seven months ended 31 January 2015 were released by the Treasury today. These statements are compared against forecasts based on the 2014 Half Year Economic and Fiscal Update (HYEFU) released on 16 December 2014.
The total Crown's operating balance before gains and losses (OBEGAL) was a surplus of $77 million in the seven-month period until January. This was $712 million above forecast, reflecting higher tax revenue and lower core Crown expenses. OBEGAL fluctuates month to month due to the seasonal nature of tax revenue and some expense trends.
Core Crown tax revenue at $37.8 billion was 1.2% ($456 million) above forecast. This variance was mainly due to higher than expected corporate tax ($158 million), other individuals tax ($158 million) and source deductions ($146 million). Partially offsetting these, GST was $95 million lower than forecast primarily due to higher than forecast refunds to insurers.
Core Crown expenses, at $41.4 billion, were $249 million lower than forecast. This variance is spread over a number of departments.
Net gains and losses on non-financial instruments were $4.6 billion lower than forecast, mainly due to a higher than expected actuarial loss on the ACC liability. This variance reflected weaker interest rates and a weaker inflation outlook. As a result, the operating balance was below forecast by $3.0 billion.
The core Crown residual cash deficit (at $2.4 billion) was $763 million lower than forecast, mainly due to tax receipts being $665 million more than forecast.
Net debt at $61.8 billion, (26.1% of GDP) was $1.2 billion lower than forecast, largely reflecting the residual cash result and more currency in circulation from the holiday period.
Gross debt at $87.2 billion (36.8% of GDP) was $3.6 billion higher than forecast but was matched by an increase in financial assets with no flow on impact to net debt.
At 31 January, total Crown assets were valued at $263.1 billion and liabilities were $184.6 billion while the Crown’s share of net worth stood at $73.3 billion.
The Treasury’s next updated economic and fiscal forecasts will be published on 21 May 2015.
|Year to date||Full Year|
|Core Crown tax revenue||37,779||37,323||456||1.2||65,626|
|Core Crown revenue||40,971||40,494||477||1.2||71,466|
|Core Crown expenses||41,427||41,676||249||0.6||73,018|
|Core Crown residual cash||(2,398)||(3,161)||763||24.1||(4,009)|
|as a percentage of GDP||36.8%||35.3%||33.6%|
|as a percentage of GDP||26.1%||26.6%||26.5%|
|Operating balance before gains and losses||77||(635)||712||112.1||(572)|
|Net worth attributable to the Crown||73,275||76,240||(2,965)||(3.9)||77,376|
- Using GDP for the year ended 30 September 2014 of $236,757 million (Source: Statistics New Zealand).
- Using forecast GDP for the year ended 30 June 2015 of $239,188 million (Source: The Treasury).
- Gross sovereign-issued debt excluding settlement cash and Reserve Bank bills.
- Net core Crown debt excluding student loans and other advances. Net debt may fluctuate during the year largely reflecting the timing of tax receipts.
Officer for EnquiriesKamlesh Patel | Office of the Government Accountant
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