Jayne Winfield, Chief Government Accountant

The interim Financial Statements of the Government of New Zealand for the four months ended 31 October 2024 were released by the Treasury today.

The October results are reported against forecasts based on the Budget Economic and Fiscal Update 2024 (BEFU 2024), published on 30 May 2024, and the results for the same period for the previous year.

Core Crown tax revenue of $39.3 billion was close to forecast with GST being $0.6 billion (6.1%) below forecast, partly offset by resident withholding tax on interest and other individuals tax which were $0.3 billion (26.8%) and $0.2 billion (8.3%) above forecast, respectively.

Core Crown expenses of $46.4 billion were also relatively close to forecast.

The operating balance before gains and losses (OBEGAL) deficit of $4.6 billion was $0.9 billion more than forecast. Overall, the core Crown results contributed almost $0.5 billion to the variance with the rest mainly coming from the results of Health New Zealand.

The operating balance deficit of $2.6 billion was $0.8 billion more than the deficit forecast. This is largely owing to the variance in OBEGAL mentioned above. While there were valuation changes this month these largely offset.

The core Crown residual cash deficit of $2.4 billion compared to a forecast surplus of $0.6 billion. This $3.0 billion unfavourable variance was largely due to lower core Crown tax receipts from the impact of the Matariki holiday, with a greater amount of receipts being received in the 2023/24 year, rather than in the 2024/25 year as assumed in our forecasts. In addition, personnel and operating payments were higher than forecast while net capital outflows were lower than forecast largely owing to timing factors affecting advances and investments with other government entities.

Net core Crown debt at $178.5 billion (43.2% of GDP), was higher than forecast by $0.7 billion. The favourable variance in net core Crown debt at 30 June 2024 resulted in a better starting position for the current year which has been more than offset by the weaker residual cash result in the current year.

Gross debt at $192.7 billion (46.6% of GDP) was $6.4 billion higher than forecast largely owing to higher than forecast issuance of government stock due to the timing of debt issuance.

Net worth attributable to the Crown was $179.2 billion (43.4% of GDP), $0.2 billion higher than forecast. The better net worth starting position for the year more than offset the unfavourable operating balance variance discussed above.

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