Long-term Fiscal Model
Page updated 22 Sep 2012
The Long-Term Fiscal Model (LTFM) is an Excel spreadsheet-based model, created by the New Zealand Treasury. Its primary purpose is to produce the 40-year projections of economic and fiscal variables, such as nominal GDP and core Crown net debt, used in the Long-Term Fiscal Statements.
The latest version of the LTFM is the model produced for the 2009 Long-term Fiscal Statement, Challenges and Choices: New Zealand's Long-term Fiscal Statement.
The main inputs it uses are:
- 2009 Budget Economic & Fiscal Update (BEFU) fiscal forecasts, covering the June-end years 2009/10 to 2012/13
- 2009 BEFU macroeconomic forecasts, 2009/10 to 2012/13, and
- 2008-base June-end year demographic projections from Statistics New Zealand, to 2049/50.
The modelling approach and assumptions used in Challenges and Choices are outlined in the Treasury Working Paper 01/10, Challenges and Choices: Modelling New Zealand’s Long-Term Fiscal Position.
The published model covers the two main scenarios of Challenges and Choices, namely historic trends and sustainable debt. There are considerably more scenarios than just these two in the 2009 Statement. However, in general, these other scenarios are variations on one of these two main options, often with just a single, or a small number, of fiscal, economic and/or demographic parameters altered.
The one key difference in how the historic trends and sustainable debt scenarios are modelled is in the assumed annual growth rates of non-demographic demand for each major expense type ie, real per capita demand drivers.
The way to model different scenarios is by changing the assumptions for post-forecast, projected year (2013/14 and beyond) variables in the Scenarios worksheet.
Download the Model
|28 Jan 2010||Long-term Fiscal Model for the Long-term Fiscal Statement 2009||ltfm-ltfs09.xls (2,705 KB)|
- Long-term Fiscal Model for the Long-term Fiscal Position 2006 ltfm-ltfp06-v2.xls(10.7 MB)