Quarterly Financial Statement for December 2014

The Quarterly Financial Statement for December 2014 is now available. 

For the December Quarter the net operating balance of the General Government Sector as at 31 December 2014 was a surplus of $8.5 million, made up of:

  • Operating revenue of $65.9 million; and
  • Operating expenditure of $57.4 million. 

The overall fiscal balance which excludes theeffectsof depreciation which are contained in operating expenditure, but includes capital expenditure was a surplus of $6 million.

Total revenue collections for the quarter ending December 2014/15 were slightly higher than the Budget estimate and were mainly attributable to higher than estimated tax and fishingrevenues.

Total operating expenses for the quarter ending December 2014/15 were lower than the Budget estimate and were mainly attributable to lower levels of spending by Agencies, the underwrite of the long haul Sydney (cost to December $1.42 million) and Los Angeles (Cost to December $3.05 million) routes and the TOA Apex Guarantee.  Welfare payments were also below budget by 9 per cent, however, timing issues with the increase in the rate of the pension for those aged 70 and over of $15 a month will see this expenditure come back towards the budget estimate.

Whilst pleased with the positive state of the accounts Minister for Finance, the Honourable Mark Brown pointed out that there were some considerable expenditures to go through. 

“It is positive to see these surpluses coming through, however I am confident that we will be in surplus for the 2014/15 year but not at these sorts of amounts that we have seen for December.  We have expenditure associated with a number of infrastructure activities coming through, such as Project City and also the increase we gave to pensioners will also bring that number down.”

Minister Brown noted in particular that the performance of the underwrite to date was positive. “The underwrite is improving, with the oil prices beginning to factor into the equation, and we are hopeful that trend will continue on, additionally spending on the Toa guarantee were lower as well.”

Gross borrowings of the Crown were $94.179 million, net borrowings of the General Government Sector (excluding loan reserves and borrowings by SOEs) were $51.358 million.  The net cash reserve which is essentially unencumbered increased by $0.26 million since last quarter to a total of $16.218 million.

As at 31 December 2014 the Crown held $52.4 million in cash which was held in various term deposits, against this amount were $36.2 million of commitments, leaving a balance of $16.2 million.

Table 1 Overall Budget Balance

2013/14Actual('000)   2014/15Budget('000) 2014/15Actual('000)              Variance ('000)                %
59,530 Operating Revenue 65,078 65,934 856 1
54,762 Operating Expenditure 62,460 57,409 (5,051) (8)
4,768 Net Operating Balance 2,618 8,525 (5,907) (226)
547 Add CrownDepreciation 1,460 1,460 - -
862 Add Ministry Depreciation 1,298 1,054 (244) (19)
436 Add Pa Enua Depreciation 497 439 (58) (12)
2,375 Less Capital Expenditure - CI Govt Funded 10,917 5,479 (5,438) (50)
4,238 Fiscal Balance (5,044) 5,999 (11,043) 219

 Table 2 Total Gross Borrowings

   Total Gross Borrowings 94,403
      Loan Reserve 16,866
   Net Borrowing by the Crown 77,537
      Avatiu Port Development 24,122
      Airport Authority 2,057
  Total Net Borrowings by the Crown 51,358