Crown's Half-Year Results Up on Expectation:Net Debt Now Below 30% of GDP

  • Bill Birch

The Crowns financial results for the first half of the 1996-97 year, in line with other recent fiscal out-turns, came in slightly ahead of expectation, Treasurer Winston Peters and Finance Minister Bill Birch announced today.

The Crown Financial Statements for the six months to 31 December 1996, which were tabled in Parliament this afternoon, show:

A net surplus of $1938 million, $323 million more than forecast, reflecting tax revenue and State owned enterprise and Crown entity surpluses which were both higher than forecast

A further improvement in Crown net worth to $5484 million, up $319 million on forecast. Net worth has risen continuously since becoming positive in December 1995.
These outcomes of a strong economy and prudent fiscal management, are permitting us to channel extra resources into priority areas such as health and education, the Ministers said.

Net public debt is now below 30% of GDP for the first time since 1982-83. That is a remarkable achievement, considering that net public debt peaked at 52.8% just five years ago, in 1991-92, they said.

Debt servicing costs, as a result of that reduction, have fallen for the six months from $2.1 billion in 1991-92 to $1.6 billion in 1996-97.

Net foreign currency debt, which was 45% of net public debt in December 1992, has now been eliminated. Net foreign currency debt has been reduced by about $16 billion in the last five years.

Results for the six months demonstrate the practical value of the economic principles at the heart of the Governments fiscal strategy, Mr Peters and Mr Birch said.

The Governments commitment to those principles ensures that New Zealanders can continue to look forward with confidence to the benefits that flow from a healthy economy and good stewardship of the Crown estate.