Paul Helm, Chief Government Accountant
The Financial Statements of the Government of New Zealand for the ten months ended 30 April 2016 were released by the Treasury today. The statements are compared against forecasts based on the 2016 Budget Year Economic and Fiscal Update (BEFU) published on 26 May 2016.
While for the most part results were consistent with the BEFU forecasts, there were some timing-related variances (eg, corporate tax revenue and cash payments) that we expect to reverse by 30 June.
Core Crown tax revenue at $56.7 billion, was 1.9% or $1.1 billion lower than forecast largely due to corporate tax being $1.4 billion below forecast. The majority of the variance was timing-related, where a number of large income tax assessments that were expected to be filed in April (based on historical patterns) had not yet been filed. Instead we now expect these large taxpayers to file in May and June. Other tax types were broadly in line with forecast.
Core Crown expenses at $60.8 billion, were close to forecast.
The operating balance before gains and losses (OBEGAL) was a surplus of $297 million for the ten months to 30 April, $941 million lower than forecast, mainly reflecting lower than forecast core Crown tax revenue.
When these gains and losses are combined with the OBEGAL result, the operating balance was a deficit of $3.4 billion ($1.1 billion larger than forecast).
The core Crown residual cash position, at a deficit of $4.1 billion, was $594 million smaller than expected, primarily reflecting higher than expected tax receipts and lower cash payments.
Net debt at $64.6 billion (26.3% of GDP) was $274 million lower than forecast, largely reflecting the residual cash result, partly offset by lower than forecast gains on borrowings and marketable securities.
At 30 April 2016, total Crown assets were valued at $281.4 billion and liabilities were $193.1 billion while the Crown’s share of net worth stood at $82.6 billion.
The current OBEGAL surplus of $297 million compares to a surplus of $448 million at the same time last year. Core Crown tax revenue has increased by 3.0%, while core Crown expenses have grown by 2.2% over that time.
|$ million||Year to date||Full Year|
|Core Crown tax revenue||56,701||57,823||(1,122)||(1.9)||69,682|
|Core Crown revenue||61,374||62,444||(1,070)||(1.7)||75,329|
|Core Crown expenses||60,822||60,886||64||0.1||74,382|
|Core Crown residual cash||(4,063)||(4,657)||594||12.8||(2,115)|
|as a percentage of GDP||35.2%||35.0%||34.7%|
|as a percentage of GDP||26.3%||26.4%||24.9%|
|Operating balance before gains and losses||297||1,238||(941)||(76.0)||668|
|Net worth attributable to the Crown||82,561||83,804||(1,243)||(1.5)||83,547|
- Using the most recently published GDP (for the year ended 31 December 2015) of $246,080 million (Source: Statistics New Zealand).
- Using forecast GDP for the year ending 30 June 2016 of $250,126 million (Source: Treasury).
- Gross sovereign-issued debt excluding settlement cash and Reserve Bank bills.
- Net core Crown debt excluding student loans and other advances. Net debt may fluctuate during the year largely reflecting the timing of tax receipts.
Officer for EnquiriesKamlesh Patel | Office of the Government Accountant
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