Media StatementFinancial Statements of the Government of New Zealand for the Ten Months Ended 30 April 2008

11 Jun 2008

Dr Peter Bushnell
Deputy Secretary to the Treasury

The Financial Statements of the Government of New Zealand for the ten months ended 30 April 2008 were released by the Treasury today.

The monthly financial statements are compared against monthly forecast tracks based on the 2008 Budget Economic and Fiscal Update.

Results for the ten months ended 30 April 2008

• The operating balance including gains and losses was $0.6 billion higher than forecast. The three main contributors to this higher than expected outturn were:
• Investment returns were $0.8 billion higher than forecast due to positive investment performances in April;
• Corporate tax revenue was $0.3 billion higher than forecast. Higher than expected assessments were lodged in April. This is expected to impact positively on the year end result; and
• GST revenue was $0.6 billion lower than forecast mainly due to a change in GST due dates. The GST due date for April was recently moved from 28 April to 7 May, so there was no GST due date in the month of April itself. Consequently, GST payable to the Crown on some large transactions had not yet been processed, as taxpayers had no incentive to file earlier than 7 May. Refund assessments however, tend to be processed earlier as taxpayers have an incentive to claim as soon as possible. Refunds processed in April were also impacted by strong export growth and some large, one-off transactions.
• The OBEGAL was $0.6 billion higher than forecast. This variance was mainly due to ACC actuarial losses being incorrectly classified in ACC’s forecast as insurance expense rather than gains and losses. This reclassification has no impact on the operating balance.
• Core Crown residual cash was largely on track with forecast.

	Year to date				Full Year
	April 2008 Actual[2]	April 2008 Forecast[2]	Variance $m	Variance %	BEFU June 2008 Forecast[3]
$ million
Core Crown
Core Crown revenue (excl. NZS Fund) [1]	50,912	51,336	(424)	(0.8)	61,814
Core Crown expenses	46,099	46,513	414	0.9	57,364
NZS Fund operating balance	(608)	(766)	158	20.6	(615)
Core Crown residual cash	738	561	177	31.6	908
GSID (excl. settlement cash)	31,395	31,367	(28)	(0.1)	31,763
as a percentage of GDP	18.0%	18.0%			17.6%
Net Core Crown debt	1,672	2,082	410	19.7	1,846
as a percentage of GDP	1.0%	1.2%			1.0%
Net Core Crown debt (incl. NZS Fund)	(11,391)	(10,554)	837	7.9	(11,254)
as a percentage of GDP	(6.5)%	(6.0)%			(6.2)%
Total Crown
OBEGAL	6,034	5,423	611	11.3	5,227
Net gains / (losses)	(2,930)	(2,945)	15	(0.5)	(2,668)
Operating Balance	3,104	2,478	626	25.3	2,559

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

2  Using GDP for the year ended 31 December 2007 of $174,647 million (Source: Statistics New Zealand).

3  Using forecast GDP for the year ended 30 June 2008 of $180,137 million (Source: Treasury).

ENDS

Officer for Enquiries

Kamlesh Patel | Macroeconomic Group
Tel: +64 4 917 6094
Fax: +64 4 471 5956
Email: kamlesh.patel@treasury.govt.nz