5 December 2008
Embargoed until 10:00am, Friday 5 December 2008
Dr Peter Bushnell
Deputy Secretary to the Treasury
Financial Statements Of The Government Of New Zealand For The Four Months Ended 31 October 2008
The Financial Statements of the Government of New Zealand for the four months ended 31 October 2008 were released by the
The monthly financial statements are compared against the monthly forecast tracks based on the 2008 Pre-Election
Economic and Fiscal Update released on 6 October.
Results for the four months ended 31 October 2008 • Tax revenue, core Crown expenses and the operating balance before gains and losses (OBEGAL) were broadly in line with
• The operating balance deficit of $3.5b was $5.0b lower than the forecast surplus.
The two main contributors to this lower-than-expected result were: o The NZ Superannuation Fund (NZS Fund), ACC and EQC
all suffered losses on their investment portfolios that were larger than expected ($3.5b, $0.6b and $0.2b respectively)
as a result of continuing turmoil in global financial markets.
o GSF and ACC also recorded losses as a result of recent revaluations of their long term liabilities of $1.0b and $0.4b
• The core Crown residual cash deficit was $0.9b lower than forecast at $3.7b.
This was mainly due to delays in transferring $0.7b to the NZ Fast Forward Fund and higher-than-expected petroleum
mining royalties received due to high oil prices earlier in the year.
• Gross sovereign-issued debt (GSID) was $3.1b higher than forecast at $33.6b (18.8% of GDP). This was due to
stronger-than-expected demand for government-issued assets, depreciation of the NZ dollar impacting on foreign currency
liabilities, and an increase in the volume of derivatives in loss compared to forecast. These factors all have a broadly
corresponding impact on the Crown’s financial asset portfolio and so have minimal impact on net core Crown debt.
• Net core Crown debt was $1.9b lower than forecast at $2.2b mainly due to the lower than-expected residual cash deficit
(noted above), $0.3b higher-thanforecast circulating currency, and $0.6b due to an increase in derivative holdings.