KEY POINTS:
The Government surplus was 28 per cent lower than forecast in the five months to November, because of a sharp reversal in the New Zealand Superannuation fund, the Treasury said yesterday.
The Super Fund has been hit by turmoil in world financial markets.
However, the Government's underlying accounts continued to perform better than forecast in last May's Budget and even than in the December update.
The operating financial surplus for the five months was $1.284 billion, $506 million below forecast.
The NZ Super Fund lost $143 million, instead of a $395 million forecast surplus.
Treasury noted the decline was driven by the slowing in US economic activity and uncertainty generated by the fallout in the US sub-prime lending market.
The Government's operating balance, excluding gains and losses, was $2.161 billion, $240 million, or 12.5 per cent, higher than forecast as operating expenses ran below expectation.
Net government debt stood at $2.547 billion, which was $171 million lower than forecast, equating to 1.5 per cent of GDP.
The Government's net cash position, the difference between all income and spending - operational and capital - was a surplus of $774 million compared with a forecast surplus of $566 million.
This was mainly because of tax receipts being $90 million ahead of forecast and core capital spending being $138 million below forecast.
In December, Treasury forecast an operating surplus of $7.388 billion for the fiscal year to this June 30.
- NZPA
