Crown accounts reflect strong economy amid pandemic

  • Hon Grant Robertson

The Government’s financial accounts continue to reflect an economy that has performed better than expected, despite the latest Delta COVID-19 outbreak.

The Crown accounts for the four months to the end of October factors in the improved starting position for the new financial year. Core Crown tax revenue was $2.5 billion above the Budget 2021 forecast, coming in at $31.8 billion. This was largely driven by better-than-expected corporate profits and more people in work.

The operating balance before gains and losses (OBEGAL) was a deficit of $7.8 billion, $1.8 billion higher than forecast, as restrictions to contain the pandemic triggered the payment of government financial support.

As a result, core Crown expenses at $41.9 billion were $4.9 billion above forecast due to the payment of wage subsidies and COVID-19 resurgence support payments to protect jobs and livelihoods.

Net core Crown debt stood at 34.2 percent of GDP, below the 36.7 percent forecast.

“This better than expected result shows the resilience of the economy as it operates under Alert Level restrictions,” Grant Robertson said.

“We have been taking a balanced approach as we protect New Zealand from the global COVID-19 pandemic. This approach has been reflected in these results.

“As the country transitions to the new COVID-19 Protection Framework and the fewer restrictions that go with it, the prospects are strong for the economy to support the recovery and deal with long standing challenges such as climate change, housing and child wellbeing,” Grant Robertson said.

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