New Zealand Economy – Interim Financial Statements of the Government of New Zealand for the five months ended 30 November 2023

	Year to date				Full Year
	November 2023 Actual1 $m	November 2023 HYEFU 2023 Forecast1 $m	Variance2 HYEFU 2023 $m	Variance HYEFU 2023 %	June 2024 HYEFU 2023 Forecast3 $m
Core Crown tax revenue	49,149	48,605	544	1.1	122,025
Core Crown revenue	54,933	54,191	742	1.4	135,740
Core Crown expenses	56,779	57,118	339	0.6	140,286
Core Crown residual cash	(13,785)	(13,463)	(322)	(2.4)	(25,831)
Net debt4	83,853	85,624	1,771	2.1	97,414
as a percentage of GDP	20.9%	21.4%			23.2%
Gross debt	155,510	153,042	(2,468)	(1.6)	166,640
as a percentage of GDP	38.8%	38.2%			39.7%
Operating balance before gains and losses	(2,797)	(3,944)	1,147	29.1	(9,319)
Operating balance (excluding minority interests)	(4,621)	(4,768)	147	3.1	(6,873)
Net worth attributable to the Crown	179,413	179,280	133	0.1	177,160
as a percentage of GDP	44.8%	44.7%			42.2%

Using the most recently published GDP (for the year ended 30 September 2023) of $400,818 million (Source: Stats NZ).
Favourable variances against forecast have a positive sign and unfavourable variances against forecast have a negative sign.
Using HYEFU 2023 forecast GDP for the year ending 30 June 2024 of $419,982 million (Source: The Treasury).
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 $49.1 billion, was $0.5 billion (1.1%) above forecast, with the variance spread across a number of tax types. Net other individuals tax revenue was $0.2 billion above forecast, mainly owing to provisional tax revenue. Source deduction revenue and Customs and excise duties were $0.1 billion above forecast respectively.

Core Crown revenue at $54.9 billion was $0.7 billion (1.4%) above forecast. In addition to the stronger core Crown tax revenue result, interest revenue was higher than forecast by $0.1 billion, largely reflecting higher-than-expected interest-bearing deposit balances held by the Reserve Bank of New Zealand (RBNZ).

Core Crown expenses at $56.8 billion were $0.3 billion (0.6%) below the forecast. The lower‑than-expected spending was spread across a number of spending areas (mainly core government services, housing and community development and social security and welfare). Most of this variance is timing in nature and is expected to unwind in the future months.

The operating balance before gains and losses (OBEGAL) was a deficit of $2.8 billion, $1.1 billion smaller than the forecast deficit. The variance to forecast was largely owing to the core Crown results discussed above.

The operating balance was a deficit of $4.6 billion, broadly consistent with the expected deficit. While the OBEGAL deficit was smaller than forecast, this was largely offset by unfavourable valuation movements.

The unfavourable valuation movements predominately reflected the net losses on non‑financial instruments from the valuation of the ACC outstanding claims liability and New Zealand Emissions Trading Scheme liability, which in total were $3.3 billion weaker than the forecast gain. This was partially offset by net gains on financial instruments, which were $2.3 billion stronger than the forecast loss and mainly driven by the New Zealand Superannuation Fund (NZS Fund) portfolio reflecting the global financial markets.

The core Crown residual cash deficit of $13.8 billion, was $0.3 billion (2.4%) higher than the forecast deficit. The cash deficit was the result of net operating cash outflows which were higher than forecast by $0.4 billion, slightly offset by net capital cash outflows which were $0.1 billion lower than forecast.

Net debt at $83.9 billion (20.9% of GDP), was $1.8 billion (2.1%) lower than forecast. This was largely driven by the net gains on financial assets ($2.5 billion) mainly due to market volatility affecting the NZS Fund portfolio. The weaker core Crown residual cash (excluding contributions to the NZS Fund and core Crown advances, $0.4 billion) result and higher Crown entity borrowings ($0.3 billion) have partially offset the stronger investment returns.

Gross debt at $155.5 billion (38.8% of GDP), was $2.5 billion (1.6%) higher than forecast. This was largely due to additional borrowing which included Euro Commercial Paper ($3.7 billion) to manage short term liquidity requirements. This was partially offset by RBNZ derivative values being more favourable than forecast.

Net worth attributable to the Crown at $179.4 billion (44.8% of GDP), was $0.1 billion (0.1%) higher than forecast. This was largely driven by the variance in the operating balance result.