Economic resilience shown in Crown accounts

  • Hon Grant Robertson

The Government’s books show that the New Zealand economy is continuing to display resilience in the face of the ongoing impact of COVID-19.

The Crown accounts for the eleven months to the end of May 2021 show the operating balance before gains and losses (OBEGAL) was a deficit of $3.6 billion, $5.8 billion better than forecast by the Treasury in Budget 2021 in May.

Tax revenue was $89 billion, $4.1 billion above forecast due to higher than expected corporate and income tax, and GST revenue.

Net core Crown debt was 31.2 percent of GDP, $6 billion less than forecast.

“This is a positive result, with the economy’s resilience and New Zealanders’ confidence in the recovery confirming that the Government’s ongoing response to the pandemic is the right one,” Grant Robertson said.

“The outlook, however, remains uncertain. The recent case of an Australian traveller in Wellington with COVID-19, Australia’s growing outbreak and the pandemic more globally shows the economic environment remains volatile. The recovery remains uneven among some sectors and regions in New Zealand, while supply chain issues still affect the economy.

“We are still facing elevated levels of debt and OBEGAL deficits for some years to come as a result of the borrowing needed to support New Zealanders through COVID 19.

“The balanced approach we took in Budget 2021 is appropriate as we work through the uncertainty. This Government will continue to keep a lid on debt while targeting support to where it is needed most to accelerate the recovery and tackle long-standing issues around climate change, housing and child wellbeing,” Grant Robertson said.

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