The Crown accounts for the eight months to 28 February posted a $1.4 billion operating surplus before gains and losses, $912 million better than expected at the half yearly update, Finance Minister Steven Joyce says.
“Higher tax revenues and lower than forecast expenditure mean the OBEGAL surplus is better than expected,” Mr Joyce says.
Tax revenues from the last year are 3.8 per cent ahead of Budget 2016 expectations and 7.7 per cent ahead of the same period last year, with all categories of tax growing.
“The Government has collected $3.5 billion more in tax in the first eight months of this year compared to last year,” Mr Joyce says. “That’s one of the dividends the country obtains from a consistently growing economy that is responding to a strong economic plan.”
Core Crown expenses were $395 million below forecast.
The $1.4 billion OBEGAL surplus compares to Treasury’s Budget 2016 forecast of a $568 million surplus for the eight months to February at the start of the fiscal year.
“While, the expenses outturn will continue to move around a little, it is good to see the trend of growing tax revenues continue as we head into Budget 2017, Mr Joyce says.
“It’s also good to see us making progress on our debt target, with net debt currently at 23.5 per cent of GDP,” Mr Joyce says. “Reducing net debt to around 20 per cent of GDP by 2020/21 will improve the resilience of the New Zealand economy to future shocks.”