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Government's books remain in the black

NZ NewswireNZ Newswire 10/05/2016

The government's books remain in surplus as higher than expected tax revenue allowed it to beat Treasury forecasts.

It posted an operating balance before gains and losses of $167 million for the nine months to the end of March - $334m more than forecast at December's half-year economic and fiscal update.

Finance Minister Bill English says the accounts are in good order ahead of his eighth budget on May 26.

"In Budget 2016 our focus is shifting more to repaying debt," he said.

He indicated he would continue to exercise fiscal restraint in the budget with further investment in a growing economy and public services.

"We measure success by results, rather than the level of spending."

In the latest accounts core Crown revenue was $206m higher than predicted while its expenses were $134m lower than forecast.

The current operating surplus compares to a deficit of $358m at the same time last year and core tax revenue has grown by 4.3 per cent over that time.

Net losses were $3.8 billion higher than forecast due to greater than expected actuarial losses on the ACC claims liability and when gains were combined the operating balance was a $3.6b deficit - $3.5b weaker than expected.

The Treasury will also update its forecasts on budget day. In the December Budget Policy Statement, the Treasury projected an deficit of $400m in the year ending June 30, having previously forecast a surplus of $200m.

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