The Government’s books were again better than expected as the economy continued to recover post COVID lockdown, the Finance Minister Grant Robertson says.
The Crown Accounts for the four months to the end of October were far more favourable than what was forecast in the Pre-election Economic and Fiscal Update (PREFU).
The Operating Balance before Gains and Losses (OBEGAL) deficit at $3.8 billion was $4.8 billion better than the deficit forecast in PREFU.
“This was primarily due to higher than forecast tax revenue coming in $2.9 billion above the PREFU forecast. GST revenue was $1.6 billion above forecast because of stronger domestic spending as kiwis show confidence in the economy.
“Core Crown expenses were also $1.6 billion below forecast mainly owing to less than expected demand the Wage Subsidy Scheme which had underspend against forecast of $1.4 billion.
“Net core crown debt was 31.5% of GDP, this was $3.1 billion less than forecast. This compares to the current advanced economies average of more than 90%. Debt servicing costs remain low and are forecast to stay that way,” Grant Robertson said.
“Overall, the Government accounts are holding up well, which is a result of the Government’s action to support the New Zealand economy through a once-in-a-lifetime economic shock.”
This will be the last set of Financial Statements of the Government compared against PREFU. The November results will be compared against the Half-Year Economic and Fiscal Update.