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Forecast Statement of Borrowings for the years ending 30 June

Forecast Statement of Borrowings for the years ending 30 June
  2007 2008 2008 2009 2010 2011 2012
  Actual Previous
Budget 		Forecast Forecast Forecast Forecast Forecast
  $m $m $m $m $m $m $m
Borrowings              
Government stock 15,778 17,732 18,240 17,737 16,004 18,379 16,765
Treasury bills 2,098 2,786 2,776 2,578 2,578 2,578 2,578
Government retail stock 364 358 379 377 377 377 377
Settlement Cash with Reserve Bank 7,507 7,523 7,894 7,894 7,894 7,894 7,894
Derivatives in loss[1] 1,126 300 422 311 341 368 397
Finance lease liabilities 954 958 959 950 942 938 933
Other borrowings 14,087 16,707 15,693 18,109 21,215 22,572 23,490
Total Borrowings[2] 41,914 46,364 46,363 47,956 49,351 53,106 52,434
Total Sovereign-Guaranteed Debt[3] 31,174 33,167 33,682 32,881 31,145 33,409 31,534
Total Non-Sovereign Debt 10,740 13,197 12,681 15,075 18,206 19,697 20,900
Total Borrowings[2] 41,914 46,364 46,363 47,956 49,351 53,106 52,434
Gross and Net Debt analysis:              
Total Borrowings[2] 41,914 46,364 46,363 47,956 49,351 53,106 52,434
Core Crown borrowings 35,885 38,876 38,845 38,435 37,020 39,611 38,053
Add back NZS Fund holdings of sovereign-issued debt and NZS Fund borrowings 912 1,524 752 893 1,053 1,249 1,413
Gross sovereign-issued debt[4] 36,797 40,400 39,597 39,328 38,073 40,860 39,466
Less Reserve Bank Settlement Cash (7,507) (7,523) (7,894) (7,894) (7,894) (7,894) (7,894)
Add back changes to DMO borrowing due to settlement cash[5] 1,600 1,600 1,600 1,600 1,600 1,600 1,600
Gross sovereign-issued debt excluding Reserve Bank Settlement Cash 30,890 34,477 33,303 33,034 31,779 34,566 33,172
Less core Crown financial assets[6] 44,909 51,184 52,699 55,552 57,618 63,850 65,880
Net Core Crown debt (incl. NZS Fund)[7] (8,112) (10,784) (13,102) (16,224) (19,545) (22,990) (26,414)
Add back NZS Fund financial assets 12,523 15,439 15,085 17,980 21,250 24,782 28,519
Net Core Crown Debt (excl. NZS Fund)[8] 4,411 4,655 1,983 1,756 1,705 1,792 2,105

Notes on Borrowings

  • [1] Derivatives are included in either borrowings or marketable securities, deposits and equity investments depending on their value at balance date. This treatment leads to fluctuations in individual items within the Statement of Borrowings, primarily due to exchange rate movements.
  • [2] Total Borrowings (Gross Debt) is the total borrowings (both sovereign-guaranteed and non-sovereign guaranteed) of the total Crown. This equates to the amount in the total Crown balance sheet and represents the complete picture of whole-of-Crown debt obligations to external parties.
  • [3] Total Borrowings (Gross Debt) can be split into sovereign-guaranteed and non-sovereign-guaranteed debt. This split reflects the fact that borrowings by SOEs and Crown entities is not explicitly guaranteed by the Crown. No debt of SOEs and Crown entities is currently guaranteed by the Crown.
  • [4] Gross sovereign-issued debt is debt issued by the sovereign (i.e., core Crown) and includes Government stock held by the NZS Fund, ACC or EQC for example. In other words, the total sovereign-issued debt does not eliminate any internal cross-holdings held by these entities.
  • [5] The Reserve Bank has used $1.6b of settlement cash to purchase reserves that were to have been funded by DMO borrowing. Therefore the impact of Settlement Cash on GSID is adjusted by this amount.
  • [6] Core Crown financial assets exclude receivables.
  • [7] Net core Crown debt is the Government Sovereign issued debt less financial assets. This can provide information about the sustainability of the Government's accounts, and is used by some international agencies when determining the credit-worthiness of a country. However, as some financial assets are not easily converted into cash, and some are restricted, it is important to view net debt alongside gross sovereign-issued debt.
  • [8] Adding back the NZ Superannuation Fund Assets provides the financial liabilities less financial assets of the Core Crown, excluding those assets set aside to meet part of the future cost of New Zealand superannuation.

The accompanying Notes and Accounting policies are an integral part of these Statements.

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