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New Zealand Budget Surplus Exceeds Expectations

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New Zealand's budget logged a bigger-than-estimated surplus in the year ended June as revenue growth exceeded forecast, the Treasury Department said in a statement on Thursday.

The operating balance before gains and expenses in 2016/17 reached NZ$4.1 billion, which was bigger than the NZ$3.71 billion projected in the pre-election update in August.

The surplus increased from NZ$1.83 billion posted in 2016.

"This better result should be seen as a one-off," Finance Minister Steven Joyce, said. "Treasury advises that much of this expenditure reduction reflects timing differences and is likely to reverse out in the years ahead."

He said the 2016/17 full year result should be interpreted with caution, and not seen as automatically flowing through into higher surpluses than forecast in the years ahead.

Core crown tax revenue was NZ$5.2 billion more than last year and was higher than the Budget 2017 forecast by NZ$1.0 billion.

At the same time, core crown expenses were NZ$2.4 billion higher than last year, but NZ$1.1 billion less than Budget 2017 forecast.

Net debt came in at 22.2 percent of gross domestic product, down from 24.4 percent of GDP in 2016. In August, the net debt was estimated to fall to 22.5 percent of GDP.

by RTT Staff Writer

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