April accounts highlight monthly volatility

A smaller-than-expected $297 million operating balance before gains and losses (OBEGAL) surplus for the ten months to 30 April highlights the monthly volatility in the Government’s accounts, Finance Minister Bill English says.

The surplus was $941 million smaller than forecast in Budget 2016, largely as a result of core Crown tax revenue coming in $1.1 billion lower than forecast.

“Tax revenue can fluctuate significantly from month to month,” Mr English says.

“What is important is the overall trend, which shows the Government growing surpluses and getting on top of debt.”

The lower-than-expected tax revenue was largely driven by corporate tax being $1.4 billion below forecast. Treasury consider that most - if not all - of this variance will reverse out by 30 June.

Core Crown expenses were in line with Treasury’s Budget forecasts, and remain on track to stay below 30 per cent of GDP in 2015/16 – down from 34 per cent in 2008/09.

“The Government measures success by the results we achieve for New Zealanders, not by spending more in an attempt to show that we care.”