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Media StatementFinancial Statements of the Government of New Zealand for the Seven Months Ended 31 January 2008

6 March 2008

Dr Peter Bushnell
Deputy Secretary to the Treasury

The Financial Statements of the Government of New Zealand for the seven months ended 31 January 2008 were released by the Treasury today.

The 31 January 2008 monthly financial statements are compared against monthly forecast tracks based on the 2007 Half Year Budget Economic and Fiscal Update.

January results

  • The operating balance was in deficit by $0.4 billion, or $4.2 billion lower than forecast.  The three main contributors to this lower than expected result were:
    • $2.5 billion lower than forecast returns on the financial asset portfolios of the NZS Fund ($1.5 billion lower than forecast), ACC ($0.7 billion lower than forecast) and EQC ($0.3 billion lower than forecast)
    • $1.0 billion more than forecast loss on the revaluation of the ACC claims liability, and
    • $0.7 billion lower than forecast tax revenue.

  • Adjusting for the non-cash valuation changes, the OBEGAL was $0.6 billion lower than forecast at a surplus of $3.1 billion, primarily due to the lower than forecast tax revenue of $0.7 billion.
  • Core Crown tax revenue variances were in other persons tax ($0.4 billion lower than forecast), corporate tax ($0.2 billion lower than forecast), GST ($0.2 billion lower than forecast) and source deductions including deductions from salary and wages ($0.1 billion higher than forecast).
  • Residual cash and consequently the debt indicators were largely on target.

  Year to date Full Year
January
2008
Actual
January
2008
Forecast
Variance
$m
Variance
%
HYEFU
June 2008
Forecast
$ million  
Core Crown  
Core Crown revenue (excl. NZS Fund) [1] 34,045 35,143 (1,098) (3.1) 62,130
Core Crown expenses 32,126 32,525 399 1.2 57,137
NZS Fund operating balance (911) 539 (1,450) (269.0) 917
Core Crown residual cash 478 588 (110) (18.7) 759
GSID (excl. settlement cash) 31,605 31,595 (10) (0.0) 33,303
   as a percentage of GDP [2] 18.5% 18.5% 18.7%
Net Core Crown debt 2,647 2,634 (13) (0.5) 1,983
   as a percentage of GDP [2] 1.5% 1.5% 1.1%
Net Core Crown debt (incl. NZS Fund) (9,257) (10,708) (1,451) 13.6 (13,102)
   as a percentage of GDP [2] (5.4)% (6.3)% (7.4)%
Total Crown          
OBEGAL 3,057 3,690 (633) (17.2) 6,574
Net gains / (losses) (3,536) 15 (3,551) 636
Operating Balance (394) 3,793 (4,187) (110.4) 7,388

1  For the purposes of this indicator the NZS Fund is treated as a third party (i.e. its revenue is not included but the tax it pays is)

2  GDP for the year ended 30 September 2007 (Source: Statistics New Zealand).

ENDS

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