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Budget 2005 Home Page Half-Year Economic & Fiscal Update 2005

Fiscal Indicators

There are a number of indicators that are important in understanding the state of the Government’s fiscal position. No single indicator provides an all-purpose measure of the financial performance of the Crown and its impact on the economy. For example:

  • the total Crown operating balance reflects the difference between current revenues (tax revenue, investment income etc) and current expenses (salaries, benefit payments etc). The operating balance shows whether the Government has generated enough revenue to cover expenses
  • the total Crown OBERAC reflects the difference between current revenues and current expenses adjusted for valuation movements and accounting policy changes. The OBERAC provides a measure of the Government’s underlying stewardship
  • the total Crown net worth reflects the difference between total assets and total liabilities. The change in net worth in any given forecast year is primarily driven by the operating balance
  • the cash available/(shortfall to be funded) reflects the net effect of the Government’s core Crown operating (cash equivalent of the OBERAC) and investing activities (such as contributions to the NZS Fund and purchases of physical assets). It shows whether the cash generated is sufficient to meet all government spending (both operating and investing)
  • gross sovereign-issued debt reflects the debt burden of the core Crown (excluding the activity of the NZS Fund and GSF). The movement over the forecast period is primarily driven by the cash available/(shortfall to be funded)
  • net core Crown debt reflects borrowings (financial liabilities) less cash and bank balances, marketable securities and deposits, and advances (financial assets). Net debt excludes the financial assets of the NZS Fund and GSF as these assets are restricted in nature.
Table 2.1 – Summary fiscal indicators[2]
  Year ended 30 June
  2005 2006 2007 2008 2009 2010
($ million) Actual Forecast Forecast Forecast Forecast Forecast
Total revenue 67,065 69,775 72,141 74,590 77,085 82,131
% of GDP 44.4 43.9 44.2 43.9 43.1 43.7
Total expenses 60,910 64,351 66,381 70,620 73,851 77,173
% of GDP 40.3 40.5 40.7 41.6 41.3 41.1
Operating balance 6,247 5,557 5,893 4,103 3,367 5,091
% of GDP 4.1 3.5 3.6 2.4 1.9 2.7
OBERAC 8,873 5,924 5,893 4,103 3,367 5,091
% of GDP 5.9 3.7 3.6 2.4 1.9 2.7
Net worth 49,983 55,555 61,448 65,551 68,918 74,009
% of GDP 33.1 35.0 37.7 38.6 38.5 39.4
Cash available/(shortfall to be funded) 3,104 492 (1,341) (2,687) (3,167) (1,366)
% of GDP 2.1 0.3 (0.8) (1.6) (1.8) (0.7)
Gross sovereign-issued debt 35,045 33,275 32,967 35,728 36,111 36,195
% of GDP 23.2 20.9 20.2 21.0 20.2 19.3
Net core Crown debt 10,771 10,597 10,434 11,854 14,240 14,998
% of GDP 7.1 6.7 6.4 7.0 8.0 8.0

Source: The Treasury

Notes

  • [2]Detailed tables of the key indicators for the Half Year Update and Pre-election Update are located on pages 48 and 49.
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