Source: New Zealand Treasury
The Interim Financial Statements of the Government of New Zealand for the four months ended 31 October 2025 were released by the Treasury today. The October results are reported against forecasts based on the Budget Economic and Fiscal Update 2025 (BEFU 2025), published on 22 May 2025, and the results for the same period for the previous year.
The key fiscal indicators for the four months ended 31 October 2025 were mixed compared to forecast, continuing the trends from the previous month’s results. The Government’s main operating indicator, the operating balance before gains and losses excluding ACC (OBEGALx), showed a deficit of $4.9 billion. This deficit was $0.7 billion larger than forecast. Whereas net core Crown debt was lower than forecast by $4.5 billion at $186.5 billion, or 42.8% of GDP.
Core Crown tax revenue, at $39.5 billion, was $0.6 billion (1.5%) lower than forecast. The largest variances related to corporate tax and other individuals’ tax at $0.3 billion (7.1%) and $0.2 billion (7.0%) lower than forecast respectively.
Core Crown expenses, at $48.5 billion, were relatively close to forecast.
The operating balance before gains and losses excluding ACC (OBEGALx) was a deficit of $4.9 billion, $0.7 billion more than the forecast deficit. When including the revenue and expenses of ACC, the OBEGAL deficit was $5.2 billion, $0.4 billion higher than the forecast deficit.
The operating balance was a surplus of $0.9 billion compared to a forecast deficit of $2.8 billion. The unfavourable variance in OBEGAL mentioned above was more than offset by favourable valuation movements, particularly on financial instruments. Net gains on financial instruments were $6.5 billion stronger than forecast, although this was partially offset by net losses on non-financial instruments of $2.3 billion.
The core Crown residual cash deficit of $3.7 billion was $0.8 billion smaller than forecast. While personnel and operating payments were larger than forecast, this was more than offset by net capital cashflows which were lower than forecast largely owing to timing factors affecting advances and investments with other government entities.
Net core Crown debt at $186.5 billion (42.8% of GDP) was $4.5 billion lower than forecast. The variance was driven by the combination of the favourable variance in net core Crown debt at 30 June 2025 which resulted in a better starting position for the current year, along with the lower than forecast residual cash deficit during the year, as mentioned above.
Gross debt at $215.9 billion (49.5% of GDP) was $11.7 billion lower than forecast, similarly with net core Crown debt, the majority of this variance comes from a more favourable starting position. The remaining variance predominately relates to lower than forecast issuances of Euro Commercial Paper and Treasury bills.
Net worth at $190.0 billion (43.6% of GDP) was $9.8 billion higher than forecast. In addition to the favourable operating balance variance discussed above, the better net worth starting position from the 30 June 2025 year results also contributed.
