Government surplus strengthens

By Phil Boeyen, ShareChat Business News Editor

Friday 5th April 2002

Higher tax income helped the government to increase its budget surplus for the eight months ended February and the trend is expected to continue.

Figures for the period show the government had a surplus of $1.696 billion for the eight months, which was $560 million higher than forecast in December's economic and fiscal update.

Treasury reports that total revenue beat forecasts by $289 million and included a higher than expected tax take of $205 million.

"It is expected that the current strength experienced in tax revenue will remain for the rest of the financial year, which will be reflected in the Budget 2002 estimated actual forecast."

Lower than forecast expenses of $132 million also pushed up the surplus for the period.

Health expenses were lower than forecast by $66 million, social security and welfare expenses were lower by $54 million and law and order expenses by $30 million.

These were partially offset by higher than forecast net foreign exchange losses of $45 million. Education expenses were also over budget by $38 million.

Net Crown debt was $543 million lower than forecast at $20.7 billion, equivalent to an estimated 17.6% of GDP compared to a forecast of 18%.

Treasury says this was mainly due to higher than forecast net cash flows from operations of $379 million and additional issues of circulating currency of $140 million, which as a matter of policy are not forecast.

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