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Media statement

Interim Financial Statements of the Government of New Zealand for the eleven months ended 31 May 2022

Issue date: 
Tuesday, 5 July 2022
Corporate author: 

The interim Financial Statements of the Government of New Zealand for the eleven months ended 31 May 2022 (the financial statements) were released by the Treasury today.

The May results are reported against forecasts based on the Budget Economic and Fiscal Update 2022 (BEFU 2022), published on 19 May 2022.

  Year to date Full Year
BEFU 2022
BEFU 2022
BEFU 2022
BEFU 2022
Core Crown tax revenue 98,861 95,979 2,882 3.0 103,796
Core Crown revenue 107,124 104,150 2,974 2.9 112,910
Core Crown expenses 113,185 114,549 1,364 1.2 128,444
Core Crown residual cash (24,902) (25,122) 220 0.9 (31,780)
Net debt4 59,073 54,781 (4,292) (7.8) 61,163
as a percentage of GDP 16.6% 15.4%     16.9%
Gross debt 117,772 114,780 (2,992) (2.6) 115,139
as a percentage of GDP 33.1% 32.2%     31.8%
Operating balance before gains and losses (7,553) (13,032) 5,479 42.0 (18,978)
Operating balance (excluding minority interests) (11,244) (21,354) 10,110 47.3 (27,880)
Total borrowings 202,617 193,979 (8,638) (4.5) 200,518
Net worth attributable to the Crown 141,033 130,657 10,376 7.9 123,853
as a percentage of GDP 39.6% 36.7%     34.2%
  1. Using the most recently published GDP (for the year ended 31 March 2022) of $355,916 million (Source: Stats NZ).
  2. Favourable variances against forecast have a positive sign and unfavourable variances against forecast have a negative sign.
  3. Using BEFU 2022 forecast GDP for the year ending 30 June 2022 of $362,367 million (Source: The Treasury).
  4. The net debt indicator includes core Crown advances, Crown entity borrowings and the financial assets and borrowings of the New Zealand Super Fund (NZS Fund). Net core Crown debt (the previous headline net debt indicator) was $126.7 billion (35.6% of GDP) at 31 May 2022 with a forecast of $126.8 billion (35.6% of GDP). A reconciliation between net debt and net core Crown debt can be found on page 5 of the financial statements.

Core Crown tax revenue for the eleven months ended 31 May 2022 was $2.9 billion (3.0%) above forecast, at $98.9 billion. The key drivers were positive variances in corporate tax ($1.6 billion), net other individuals’ tax ($0.7 billion) and source deductions ($0.6 billion). 

Similar to the trend reported in previous months, core Crown tax receipts of $0.6 billion (0.6%) is less than the variance in core Crown tax revenue and there remains a risk that some payments from the stronger core Crown tax revenue outturn may fall into the 2022/23 fiscal year, when terminal tax is due.

Core Crown expenses were $113.2 billion, $1.4 billion (1.2%) below forecast below forecast mainly reflecting timing delays in spending from Government departments.

The operating balance before gains and losses (OBEGAL) deficit of $7.6 billion was $5.5 billion better than forecast, mainly reflecting the core Crown results discussed above. The results of Crown entities and State-owned Enterprises were also stronger than expected.

When total gains and losses are added to the OBEGAL result, the operating balance was $11.2 billion, $10.1 billion better than the deficit forecast.

The key driver of the net gains and losses variance were changes in discount rates, resulting in actuarial gains on the ACC outstanding claims liability that were $9.0 billion higher than the actuarial loss forecast. This was partially offset by weaker market conditions resulting in losses on the Crown’s investment portfolios (New Zealand Superannuation Fund and ACC).

The core Crown residual cash deficit of $24.9 billion, was $0.2 billion lower than the deficit forecast. While tax receipts were $0.6 billion above forecast and operating expense payments where close to forecast, net core Crown capital cash outflows were $0.6 billion higher than forecast, which was the result of number of factors.

As at 31 May 2022, nominal net debt was $59.0 billion (16.6% of GDP), $4.3 billion higher than forecast. Most of this variance is driven by unfavourable market conditions resulting in net losses being higher than forecast by $2.4 billion.

Gross debt at $117.8 billion (33.1% of GDP), was $3.0 billion higher than forecast. This is owing to the issuance of $1.4 billion in euro-commercial paper, derivative liabilities being greater than forecast by $0.9 billion and treasury bills being $0.4 billion higher than forecast.

Total borrowings were $202.6 billion, $8.6 billion higher than forecast. The increase is largely owing to the variance in gross debt mentioned above, an increase in the value of derivatives in loss held outside of the core Crown ($2.5 billion), Kāinga Ora borrowing being $1.0 billion greater than forecast and the higher level of settlement deposits held with the Reserve Bank ($2.8 billion).

The next release of the Financial Statements of Government will be 30 June 2022 Financial Statements of Government. It is anticipated that these will be released in early October 2022.



Treasury Communications Team
Email: [email protected]
Last updated: 
Tuesday, 5 July 2022