Resilient economy reflected in Govt accounts

The Crown’s accounts continue to reflect the resilience of the economy and the Government’s balanced financial management and puts the country in a strong position to respond to Omicron, Grant Robertson said.

The Crown Accounts for the seven months to the end of January were better than forecast in December’s Half Year Economic and Fiscal Update (HYEFU).

The Operating Balance before Gains and Losses (OBEGAL) deficit was $8.0 billion, $3.7 billion below that forecast in HYEFU.

Tax revenue was $1.4 billion above forecast at $59.7 billion, due to better-than-expected corporate profits and a strong jobs market. Core Crown expenses was $72.1 billion, $1.3 billion less than forecast.

Net core Crown debt stood at 35.3 percent of GDP, $1.6 billion less than forecast.

“This better-than-expected result shows the strength and resilience of the economy despite the volatility and uncertainty surrounding the ongoing pandemic. It shows our health-led response since the start of the pandemic to protect lives and livelihoods has been our best economic response,” Grant Robertson said.

“But the impacts of the Omicron outbreak are not covered in these accounts. We know this will be a challenging period for many New Zealanders.

“New Zealand is in a strong fiscal position, with lower than expected deficits and debt levels well below that of other countries we compare ourselves against. We will continue to take a balanced approach to respond to the ongoing pandemic and invest in long standing challenges such as climate change, housing and child wellbeing, while carefully managing our resources to ensure the long term sustainability of the economy.”