KEY POINTS:
The New Zealand Government's operating surplus for the three months to September 30 was $1.864 billion, $407 million above forecast on the back of a higher tax take and gains from investments, the Treasury said on Friday.
The higher-than-expected surplus resulted from tax revenue being $400 million above forecast from higher income tax revenues because the economy was staying stronger than forecast.
Investment income was $300 million higher than forecast, but expenses were $300 million higher than expected because of the timing of payments, which was expected to reverse through the year.
Crown revenue totalled $14.23 billion, 3.7 per cent ahead of the same period last year, with expenses of $12.81 billion, down 10.3 per cent on a year ago.
The operating balance was down $803 million or 30.1 per cent on the same period last year.
The operating balance before revaluations and accounting changes (OBERAC), which strips out unrealised investment gains, was $1.812 billion, $355 million above forecast.
Net Government debt stood at $7.786 billion or 5 per cent of GDP, in line with forecasts.
New Zealand is effectively debt free when the assets of the Government's NZ Superannuation Fund are taken into account, with the balance being a surplus of $2.68 billion or 1.7 per cent of GDP.
The Treasury forecast an operating surplus of $5.77 billion for the fiscal year to June 30 2007 in the May budget.
The government's net worth, the difference between its total assets and liabilities, was $73.41 billion against a forecast at $72.93 billion.
National's finance spokesman, John Key, said the latest figures made a mockery of Finance Minister Michael Cullen's insistence that tax cuts were not affordable.
"An already cynical public will see tax cuts in 2008 for what they are -- a reluctant return of some of the cash that Labour's gouged from the pockets of hard-working Kiwis over the past seven years," he said.
- REUTERS / NZPA
