Media statement

Financial Statements of the Government of New Zealand for the ten months ended 30 April 2017

Paul Helm, Chief Government Accountant

The Financial Statements of the Government of New Zealand for the ten months ended 30 April 2017 were released by the Treasury today.  The statements are compared against forecasts based on the 2017 Budget Economic and Fiscal Update (BEFU) published on 25 May 2017.

Core Crown tax revenue was $0.8 billion (1.4%) higher than forecast for the ten months ended 30 April 2017 and $4.7 billion (8.2%) higher compared to the same period last year.  Corporate tax was the largest driver of increased tax revenue against forecast, being $0.7 billion above forecast.  The corporate tax forecast was based on an assumption that the annual peak in provisional tax assessments and estimates processing would occur in May.  However this year, the peak occurred in April. Therefore, most of this variance is short term and expected to reverse in May.

Core Crown expenses at $62.7 billion were $391 million (0.6%) lower than forecast, with impairment of tax receivables less than forecast, and lower than forecast year to date payments to Crown Entities.

The OBEGAL was a surplus of $2.2 billion for the ten months to 30 April 2017, compared to a forecast surplus of $1.0 billion.  This favourable variance of $1.2 billion was largely due to the higher than forecast core Crown tax revenue and lower than forecast core Crown expenses discussed above.

Net gains at $9.1 billion, were $599 million higher than forecast.  This result primarily related to higher than forecast investment returns on the Crown’s investment portfolios, partially off-set by lower than expected actuarial gains (mostly reflecting a lower discount rate used to convert future cash into present day dollars).  Net gains, combined with the OBEGAL surplus, resulted in an operating balance surplus of $11.5 billion ($1.8 billion higher than forecast). 

Net worth attributable to the Crown was $102.2 billion, $1.9 billion ahead of forecast for the ten months ended 30 April 2017.  This is primarily attributable to the operating balance result.

Core Crown residual cash was $670 million higher than forecast with core Crown tax receipts ahead of forecast and timing of capital spending. 

Directly impacted by the residual cash results, and an increase in circulated currency issued, core Crown net debt at $62.8 billion (24.0% of GDP) was $1.2 billion lower than forecast. 

Gross debt was $1.2 billion higher than forecast, largely as a result of unsettled trades at month end and an increase in the value of derivative liabilities.  The unsettled trades were settled in early May and it is expected that the gross debt variance will largely reverse in the coming month. 

$ million Year to date Full Year
April 2017
April 2017
to BEFU 17
to BEFU 17
June 2017
Core Crown          
Core Crown tax revenue 61,363 60,528 835 1.4 74,598
Core Crown revenue 66,643 65,819 824 1.3 80,771
Core Crown expenses 62,739 63,130 391 0.6 77,464
Core Crown residual cash (850) (1,520) 670 44.1 71
Gross debt3 88,706 87,546 (1,160) (1.3) 88,645
as a percentage of GDP 34.0% 33.5%     33.0%
Net debt4 62,754 63,941 1,187 1.9 62,277
as a percentage of GDP 24.0% 24.5%     23.2%
Total Crown          
Operating balance before gains and losses 2,181 981 1,200 122.3 1,621
Operating balance 11,507 9,717 1,790 18.4 9,438
Net worth attributable to the Crown 102,202 100,325 1,877 1.9 100,044
  1. Using the most recently published GDP (for the year ended 31 December 2016) of $261,169 million (Source: Statistics New Zealand).
  2. Using forecast GDP for the year ending 30 June 2017 of $268,877 million (Source: Treasury).
  3. Gross sovereign-issued debt excluding settlement cash and Reserve Bank bills.
  4. 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 Enquiries

Jayne Winfield | Office of the Government Accountant
Tel: +64 4 890 7205
Email: [email protected]