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Year end financial statements

The 2015 Snapshot [of the Financial Statements of the Government]

The 2015 Snapshot [of the Financial Statements of the Government]

The key facts and figures of the Financial Statements of the Government for the year ended 30 June 2015.

The snapshot is a high level presentation of key facts and figures of the financial year, intended to make the financial statements more user friendly and accessible.

While the information in this snapshot of the financial statements is drawn from and is consistent with information presented in the full Financial Statements of the Government of New Zealand for the Year Ended 30 June 2015, it is not intended to be read as a full picture of the New Zealand Government's financial performance or position.

The 2015 Snapshot [of the Financial Statements of the Government] (Part 1)

The economy

Real gross domestic product growth annual average rate was 3.0% mainly due to robust growth in construction, household consumption and tourism.

In current dollar terms, the value of output increased 2.8% in the June 2015 year, down from 8.1% growth in the previous June year.

Annual average % change in GDP
Annual average % change in GDP.

Facts and figures – June year (compared to 2014)

  • $240.6 billion nominal GDP (up 2.8%)
  • $217.5 billion real GDP (up 3.0%)
  • $67.6 billion export receipts (up 0.8%)
  • 1,443,700 average full time employees (44,600 more)
  • $28.79 average hourly rate (up 2.4%)
  • 5.7% average unemployment (0.3% lower)
  • 0.6% annual average inflation (0.9% lower)

Where does the Government's money come from?

Total revenue: $95.0b (39.5% of GDP)
Total revenue: $95.0b (39.5% of GDP).
  • 70% of revenue was from collection of tax ($5.1 billion more than last year)
  • 84% of sales of goods and services were from SOEs (eg, NZ Post and listed companies)
  • 13% of total revenue was from other sources (eg, ACC, EQC, and fire service levies)
  • $5.8 billion increase from last year
  • Represents 39.5% of GDP
  • Core Crown tax revenue was $66.6 billion
Who pays income tax, and how much?
Who pays income tax, and how much?.
  • Next March tax year 3.6 million New Zealanders are expected to pay tax of $29.3 billion – an average of $8,138 each

How was the money spent?

Total expenses: $94.3b (39.2% of GDP)
Total expenses: $94.3b (39.2% of GDP).
  • $72.4 billion core Crown Expenses increased by $1.2 billion since last year
  • 23% of all spending was by SOEs and Crown Entities

$51.5 billion was spent on welfare, health and education

Social welfare

$11.6 billion to provide 665,000 super annuitants with income support and $4.4 billion to 302,000 people receiving Jobseeker Support and Emergency Benefit, Sole Parent Support and Supported Living Payment.

Health

$11.4 billion of funding to District Health Boards, which contributed to a range of hospital and community-based services, including around 167,000 elective surgeries and 92.9% of eight-month-olds being immunised.

Education

$12.9 billion helped to fund 96.1% participation in early childhood education, 81.2% of 18 year olds to achieve NCEA Level 2 or equivalent.

OBEGAL returns to surplus

Operating balance before gains and losses (OBEGAL)
Operating balance before gains and losses (OBEGAL).
  • $0.4 billion surplus
  • Growth in tax revenue has outpaced growth in expenditure
  • First surplus since 2008
  • Core Crown tax revenue was $5.1 billion more than last year
  • Core Crown expenses increased $1.2 billion from last year
Reconciliation to Budget 2015 $b
Forecast OBEGAL deficit (0.7)
Higher core Crown taxes 0.6
Lower core Crown expenses 0.5
Actual surplus 0.4
  • Core Crown tax revenue was 0.8% higher than forecast
  • Core Crown expenses were 0.7% less than forecast
  • While core Crown tax and core Crown expenses were close to forecast (within 1%), combined they had a significant impact on OBEGAL

The 2015 Snapshot [of the Financial Statements of the Government] (Part 2)

Capital spending increases core Crown net debt

 .
  • OBEGAL surplus contributed to core Crown operating cash surplus of $1.6 billion
  • $4 billion of capital spending (offset by $0.6 billion from the second Meridian instalment)
  • Overall cash deficit of $1.8 billion
Core Crown net debt
Core Crown net debt.

$60.6 billion core Crown net debt

  • $0.7 billion increase from last year due to continuing cash deficits
  • Relatively flat as a percentage of GDP (0.4% decrease on last year)

Operating receipts → Operating spending → Capital spending → Cash deficit → Net debt

The Crown balance sheet

.
  • The Crown balance sheet grew over the year with total assets reaching $279 billion
  • Total liabilities were $186 billion
  • Financial assets and liabilities are particularly sensitive to changes in market rates such as share prices

Balance sheet sensitivities

Impact on operating balance of change in key market rates
Impact on operating balance of change in key market rates.

Balance sheet composition

.
  • Social sector net worth $121.7 billion
    $138.8 billion of social sector assets (eg, schools, hospitals and social housing) have increased by $5.6 billion from last year.
    Social sector liabilities were similar to last year at $17.1 billion, a $0.1 billion increase.
  • Financial sector net worth -$49.9 billion
    $87.4 billion of financial sector assets with a $12.8 billion increase from last year.
    $137.3 billion of financial sector liabilities, an increase of $7.7 billion from last year.
  • Commercial sector net worth $20.4 billion
    $52.5 billion of commercial sector assets (mainly SOEs) with a $3.5 billion increase from last year.
    $32.1 billion of commercial sector liabilities (including Kiwibank), an increase of $2.6 billion from last year.