8 May 2018

Govt finances $900m better than forecast

2:08 pm on 8 May 2018

The government's finances are in better shape than expected because of a stronger tax take.

Grant Robertson.

Finance Minister Grant Robertson said he would set out the government's spending plans in next Thursday's Budget. Photo: RNZ / Richard Tindiller

Excluding investment gains and losses, the operating surplus stood at $3.3 billion for the nine months to March, $910 million more than had been forecast.

The surplus was $1.8bn higher than at the same time last year.

Finance Minister Grant Robertson said the reports showed how well the government managed costs and that it stuck closely to the requirements in the Budget Responsibility Rules.

"The financial statements reflect the Coalition Government's prudent fiscal management, and show we are keeping to the Budget Responsibility Rules requiring us to run sustainable surpluses, cut net debt to 20 percent of GDP within five years and for us to spend responsibly in line with previous governments," Mr Robertson said.

Tax revenue was $57.5bn, some $1.1bn more than forecast due to a stronger economy which pushed up business profits, while more people employed boosted personal and sales tax.

Expenses came in close to forecast, at $59.1bn.

The Treasury expected the tax take at the end of the year to stay ahead of forecast.

Net debt stood at $60.8bn, $2.2bn less than expected. That represented 21.4 percent of GDP.

Mr Robertson said he would set out the government's spending plans in next Thursday's Budget.

"We are committed to responsibly managing the government's finances so that we can make the investments required to ensure people have access to doctors and modern hospitals when they need to, that our children receive the best education in the world that and every New Zealander has a warm, dry place to call home," he said.

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