The interim Financial Statements of the Government of New Zealand for the five months ended 30 November 2019 (the financial statements) were released by the Treasury today. The financial statements are compared against forecasts based on the 2019 Half Year Economic and Fiscal Update (HYEFU 2019) published on 11 December 2019.
The operating balance before gains and losses (OBEGAL) was a $0.1 billion surplus, $0.7 billion above the forecast deficit primarily due to the tax revenue and core Crown expenses being favourable against forecast.
Core Crown tax revenue of $35.7 billion was $0.3 billion (1.0%) above forecast. Around a third of this variance is likely to be timing relating to revenue from customs and excise duties. The remaining variance is spread across a number of tax types. As this is the first month following the release of HYEFU 2019, it is difficult to draw any conclusion about the nature of these variances.
Core Crown expenses of $37.9 billion were $0.2 billion (0.6%) below forecast. The majority of this variance is likely to be a result of timing.
When total gains and losses are added to the OBEGAL result, the operating balance was a $0.9 billion surplus $1.7 billion above the forecast deficit. This variance was primarily driven by favourable changes in market prices resulting in net investment gains being higher than forecast by $1.3 billion.
Core Crown residual cash was a deficit of $4.7 billion and in line with the forecast.
Net core Crown debt was $61.7 billion (20.1 % of GDP) at the end of November 2019, $0.1 billion (0.2%) higher than forecast owing mainly to the impact from the revaluation of financial instruments.
Gross debt at $89.4 billion (29.1% of GDP) was close to forecast.
Total borrowings at 30 November 2019 were $119.7 billion, $1.0 billion higher than forecast, primarily due to additional third party borrowings by Kāinga Ora.
Net worth attributable to the Crown was $140.0 billion, $1.8 billion higher than forecast. The majority of this variance relates to the higher than expected operating balance for the first five months of the year as discussed above. In addition, property, plant and equipment revaluations were $0.2 billion higher than expected.
|Year to date||Full Year|
|Core Crown tax revenue||35,695||35,355||340||1.0||88,692|
|Core Crown revenue||38,791||38,557||234||0.6||95,797|
|Core Crown expenses||37,901||38,137||236||0.6||93,776|
|Core Crown residual cash||(4,656)||(4,666)||10||0.2||(5,154)|
|Net core Crown debt4||61,716||61,591||(125)||(0.2)||62,526|
|as a percentage of GDP||20.1%||20.1%||19.6%|
|as a percentage of GDP||29.1%||29.2%||28.0%|
|Operating balance before gains and losses||129||(554)||683||123.3||(943)|
|Operating balance (excluding minority interests)||881||(843)||1,724||204.5||422|
|Net worth attributable to the Crown||139,965||138,214||1,751||1.3||139,620|
|as a percentage of GDP||45.6%||45.0%||43.7%|
- Using the most recently published GDP (for the year ended 30 September 2019) of $307,052 million (Source: Stats NZ).
- Favourable variances against forecast have a positive sign and unfavourable variances against forecast have a negative sign.
- Using HYEFU 2019 forecast GDP for the year ending 30 June 2020 of $319,804 million (Source: The Treasury).
- Net core Crown debt excluding student loans and other advances. Net debt may fluctuate during the year largely reflecting the timing of tax receipts.
- Gross sovereign-issued debt excluding settlement cash and Reserve Bank bills.
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