Point of Order: Buzz from the Beehive - 9/11/23

Increase in govt’s net debt is among the niggling numbers for Nicola Willis to tackle

No longer can your Point of Order monitors of ministerial communiques count on Grant Robertson seizing on the latest bit of economic news to proclaim his magnificence as a Minister of Finance.

The great economic news dried up at the end of September, a month in which Robertson announced:

There is no recession in NZ, economy grows nearly 1 percent in June quarter

Strong export boost as NZ economy turns corner

PREFU shows no recession, growing economy, more jobs and wages ahead of inflation

New Zealand gets AAA credit rating from S&P

The announcement about GDP growth – on 21 September – was the last from Robertson to be posted on the government’s official website before the general election on 14 October.

The election gave voters their opportunity to express their feelings about how well they are faring and what they were thinking of Labour’s economic management.

It seems they didn’t think too fondly about it, because Robertson and his Hipkins government colleagues are now sitting on the Opposition benches.

His only statements since then have related to his duties as Minister of Sport and Recreation:

All Blacks finish runners up at Rugby World Cup 2023

Sport Minister to represent Govt at RWC final

Robertson is Caretaker Minister of Finance, of course, but he had nothing to say today – or rather, no statement to post on the government’s official website – when the Treasury published the first set of government financial statements for the 2023/24 financial year.

These were for the three months ended 30 September and outline the operating results of the total Government. This includes the revenue and expenses of all departments plus the Reserve Bank, NZ Superannuation Fund, state-owned enterprises – including Air New Zealand – and Crown entities.

The September results are reported against forecasts based on the Pre-election Economic and Fiscal Update 2023 (PREFU 2023), published on 12 September 2023 and the results against the same period for the previous year.

Comparison against forecast

• Core Crown tax revenue amounted to $28.5 billion, which was $0.3 billion (1.1%) above forecast.
• Core Crown expenses were $33.4 billion, which was $0.1 billion (0.3%) below the forecast. Without The Treasury’s
• The operating balance before gains and losses (OBEGAL) deficit of $2.5 billion was $0.2 billion less than the forecast deficit.
• The operating balance was in a deficit of $3.9 billion, $0.4 billion more than the forecast deficit of $3.5 billion.
• Net debt at $81.4 billion (20.6% of GDP), was higher than forecast by $5.7 billion.
• Gross debt at $149.8 billion (37.8% of GDP), was $2.4 billion higher than forecast.

The next Finance Minister – presumably Nicola Willis – is likely to be well briefed on these figures and their implications.

Among the niggling numbers, net debt at $81.4 billion was $10.3 billion higher than for the same period last year. As a share of the economy, net debt increased to 20.6% of GDP from 19.5% of GDP a year earlier.

Point of Order is a blog focused on politics and the economy run by veteran newspaper reporters Bob Edlin and Ian Templeton