Media statement

Interim Financial Statements of the Government of New Zealand for the five months ended 30 November 2022

The interim Financial Statements of the Government of New Zealand for the five months ended 30 November 2022 were released by the Treasury today.

The November results are reported against forecasts based on the Half Year Economic and Fiscal Update 2022 (HYEFU 2022), published on 14 December 2022 and the results against the same period for the previous year.

The significant variances to key indicators reported in the November Financial Statements are either timing in nature or reflect market changes (eg, equity markets, interest rates) which can be volatile. Stronger investment market conditions were a key factor in both the operating balance and net debt position being better than expected in November. While timing issues have contributed to the variances reported in core Crown expenses and residual cash.

  Year to date Full Year
HYEFU 2022
HYEFU 2022
HYEFU 2022
HYEFU 2022
Core Crown tax revenue 45,428 45,350 78 0.2 118,061
Core Crown revenue 49,954 49,768 186 0.4 130,193
Core Crown expenses 51,727 50,985 (742) (1.5) 129,331
Core Crown residual cash (19,591) (17,620) (1,971) (11.2) (25,364)
Net debt4 71,797 75,626 3,829 5.1 78,655
          as a percentage of GDP 19.2% 20.3%     19.9%
Gross debt 135,015 133,403 (1,612) (1.2) 138,989
          as a percentage of GDP 36.2% 35.7%     35.2%
Operating balance before gains and losses (2,438) (2,499) 61 2.4 (3,631)
Operating balance (excluding minority interests) 176 (2,941) 3,117 106.0 (725)
Total borrowings 224,362 224,534 172 0.1 229,918
Net worth attributable to the Crown 167,570 164,417 3,153 1.9 166,246
          as a percentage of GDP 44.9% 44.0%     42.1%
  1. Using the most recently published GDP (for the year ended 30 September 2022) of $373,329 million (Source: Stats NZ).
  2. Favourable variances against forecast have a positive sign and unfavourable variances against forecast have a negative sign.
  3. Using HYEFU 2022 forecast GDP for the year ending 30 June 2023 of $394,778 million (Source: The Treasury).
  4. The net debt indicator includes core Crown advances, Crown entity borrowings (excluding Kiwi Group) and the financial assets and borrowings of the New Zealand Super Fund (NZS Fund).

Core Crown tax revenue for the five months ended 30 November 2022 was close to forecast at $45.4 billion.

Core Crown expenses at $51.7 billion were $0.7 billion higher-than-forecast. This was largely driven by higher finance costs due to changes in interest rates, and health expenses due to timing of funding provided.  

The operating balance before gains and losses (OBEGAL) deficit of $2.4 billion was close to forecast. When total gains and losses are added to the OBEGAL result, the operating balance surplus was $0.2 billion, $3.1 billion stronger than expected, largely reflecting valuations driven by market conditions.

The core Crown residual cash deficit of $19.6 billion was $2.0 billion more than the deficit forecast. Similar to core Crown expenses, the cash outflows from operating activities were higher than forecast. In addition, net core Crown capital cash flows are higher than expected largely owing to the Funding for Lending Programme (FLP), with issuances of loans happening earlier than anticipated. Both items are timing in nature and are expected to unwind by year end.

As at 30 November 2022, net debt was $71.8 billion (19.2% of GDP), $3.8 billion lower than expected. The variance is primarily a result of market movements impacting financial instruments (eg, NZS Fund investment portfolio) since the completion of the HYEFU 2022 forecasts.

Gross debt at $135.0 billion (36.2% of GDP), was $1.6 billion higher than forecast due to multiple factors, including foreign currency borrowing (through the issuance of Euro Commercial Papers), borrowings by the Reserve Bank for operational purposes and short‑term Treasury Bill borrowings.

Total borrowings were close to forecast at $224.4 billion, with lower borrowings by State‑owned Enterprises and lower derivatives in losses (mainly NZS Fund) offsetting the variance in gross debt.

Net worth attributable to the Crown at $167.6 billion was $3.2 billion higher than forecast largely reflecting the operating balance variance mentioned above.



Treasury Communications Team
Email: [email protected]