Media statement

Interim Financial Statements of the Government of New Zealand for the nine months ended 31 March 2023

The interim Financial Statements of the Government of New Zealand for the nine months ended 31 March 2023 were released by the Treasury today.

The March 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 for the same period for the previous year.

  Year to date Full Year
HYEFU 2022
HYEFU 2022
HYEFU 2022
HYEFU 2022
Core Crown tax revenue 83,615 85,950 (2,335) (2.7) 118,061
Core Crown revenue 91,737 94,611 (2,874) (3.0) 130,193
Core Crown expenses 92,520 93,243 723 0.8 129,331
Core Crown residual cash (22,756) (21,871) (885) (4.0) (25,364)
Net debt4 72,801 77,584 4,783 6.2 78,655
          as a percentage of GDP 19.1% 20.4%     19.9%
Gross debt 143,351 140,339 (3,012) (2.1) 138,989
          as a percentage of GDP 37.7% 36.9%     35.2%
Operating balance before gains and losses (3,388) (913) (2,475) (271.1) (3,631)
Operating balance (excluding minority interests) 4,470 733 3,737 (725)
Total borrowings 225,242 232,663 7,421 3.2 229,918
Net worth attributable to the Crown 172,218 167,971 4,247 2.5 166,246
          as a percentage of GDP 45.3% 44.2%     42.1%
  1. Using the most recently published GDP (for the year ended 31 December 2022) of $380,326 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 Capital) and the financial assets and borrowings of the New Zealand Super Fund (NZS Fund).

Core Crown tax revenue at $83.6 billion, was $2.3 billion below forecast. This is due to lower corporate and other individuals’ taxes which were lower than forecast by $0.9 billion and $0.6 billion respectively and a result of revenue from terminal tax returns being lower than forecast. GST revenue ($0.8 billion) was also below forecast which indicates that the economy is tracking weaker than forecast.

Core Crown revenue at $91.7 billion was $2.9 billion lower than forecast, largely due to core Crown tax revenue and the lower than forecast Emissions Trading Scheme (ETS) revenue ($1.2 billion) as the price of New Zealand Units (NZUs) continues to be below forecast. Higher than forecast interest revenue due to a higher-than-expected OCR $0.4 billion offsets this by $0.4 billion.

Core Crown expenses at $92.5 billion, were $0.7 billion lower than forecast, driven by underspends across a number of government agencies. The largest underspends were in social security services, which was $0.6 billion lower than forecast due several factors which include delays relating to service delivery and business transformation, and lower than expected costs for the income related rent subsidy scheme due to lower than expected rental costs. In addition, environmental protection services was $0.5 billion lower than forecast as a result of NZU price movements. These underspends were offset by finance costs which were $0.6 billion above forecast as a result of higher-than-expected interest rates. 

The operating balance before gains and losses (OBEGAL) deficit of $3.4 billion was $2.5 billion greater than the forecast deficit of $0.9 billion. This was largely because of the core Crown variances noted above and additional expenditure outside of the core Crown relating to the North Island weather events.

The operating balance was $4.5 billion in surplus, $3.7 billion better than the forecast. The improvement in the operating balance was largely driven by gains on the valuation of financial and non-financial assets and liabilities.

The core Crown residual cash deficit of $22.8 billion was $0.9 billion higher than forecast. The higher than forecast deficit was primarily driven by net operating cash outflows as tax receipts were lower than forecast and the timing of operating payments were different to expectations.

Net debt at $72.8 billion (19.1% of GDP), was lower than forecast by $4.8 billion. $4.0 billion of this is due to favourable movements in the fair value of financial assets and liabilities (which includes the New Zealand Super Fund) and $1.1 billion was due to lower than forecast Crown Entity borrowings. This was partially offset by a higher than forecast residual cash deficit.

Gross debt at $143.4 billion (37.7% of GDP), was $3.0 billion higher than forecast due to several factors including foreign currency borrowings, unsettled trades and government bonds. These factors were partly offset by lower core Crown derivative liabilities, Reserve Bank liability balances and International Monetary Fund liabilities.

Net worth attributable to the Crown was $172.2 billion which was $4.2 billion higher than forecast, largely as a result of a favourable operating balance and asset revaluations.



Treasury Communications Team
Email: [email protected]