Expenses
|
Year ended 30 June $ million |
Actual 2003 |
Actual 2004 |
Actual 2005 |
Actual 2006 |
Actual 2007 |
Forecast Original Budget |
Forecast Est Actuals |
Actual 2008 |
|---|---|---|---|---|---|---|---|---|
| Social security and welfare | 13,907 | 14,252 | 14,682 | 15,598 | 16,768 | 17,698 | 18,071 | 17,877 |
| Health | 7,501 | 8,111 | 8,813 | 9,547 | 10,355 | 11,613 | 11,343 | 11,297 |
| Education | 7,016 | 7,585 | 7,930 | 9,914 | 9,269 | 9,719 | 10,046 | 9,551 |
| Core government services | 2,130 | 2,091 | 2,567 | 2,507 | 4,817 | 2,479 | 3,222 | 3,371 |
| Other core Crown expenses | 9,343 | 9,843 | 10,903 | 11,754 | 12,795 | 14,587 | 14,682 | 14,901 |
| Core Crown expenses | 39,897 | 41,882 | 44,895 | 49,320 | 54,004 | 56,096 | 57,364 | 56,997 |
| Crown entities, SOE and eliminations | 12,347 | 11,816 | 13,397 | 15,015 | 14,725 | 15,818 | 17,222 | 18,845 |
| Total Crown expenses | 52,245 | 53,698 | 58,292 | 64,334 | 68,729 | 71,914 | 74,586 | 75,842 |
- Figure 4 - Core Crown expenses
- Source: The Treasury
- Figure 5 - Core Crown expenses by sector
- Source: The Treasury
Core Crown expenses represent the day-to-day operating spending of the Government (ie, it does not include purchases of physical assets or capital spending).
Core Crown expenses were $367 million (0.6%) lower than forecast at $56,997 million. The main variances were:
- social security and welfare expenses were $194 million (1.1%) lower than forecast mainly relating to lower than forecast family assistance expenditure
- education expenses were $495 million (4.9%) lower than forecast as the impairment of student loans was $491 million lower than expected
- core government expenses were $149 million (4.6%) higher then forecast. Impairment of tax receivables was $265 million higher than expected reflecting an increase in the underlying overdue debt. This variance was partially offset by underspends across a number of departments (none of which was individually significant), and
- other core Crown expenses were $219 million (1.5%) higher than forecast due in the main to treaty settlements being earlier than forecast.
In comparison to the previous year, Core Crown expenses were $2,993 million (5.5%) higher. Significant expenditure increases were:
- annual indexation of welfare benefits
- expense initiatives introduced in the 2007 Budget (including the introduction of KiwiSaver), and
- higher demand-driven education expenses.
This increase was partially offset by a decrease in sovereign receivable impairment expenses resulting from a large one-off tax receivable impairment in the year ended 30 June 2007.
Core Crown expenses have increased as a percentage of GDP by 1.6% since 2003 (30.1% in 2003 to 31.7% in 2008) with the introduction of major Government policies such as Working for Families and KiwiSaver.
