Figures supplied by the Treasury yesterday showed the Government's core tax revenue for the nine months ended March was 1.3%, or $535 million, ahead of forecast at $41.9 billion.
However, the figure was 5.3% ahead of the March 2012 figure of $39.7 billion.
The Government's operating balance excluding gains and losses (obegal) for the nine months under review was $5 billion, $273 million lower than forecast. The operating balance, which included $1.7 billion of investment gains by the New Zealand Superannuation Fund and $700 million gains by ACC, was $2.5 billion compared with a deficit of nearly $2 billion in the half-year forecast.
At the same time last year, the obegal was a deficit of $6.13 billion and the operating balance was a deficit of nearly $9 billion.
Finance Minister Bill English said the Government's finances continued to improve with higher-than-forecast tax revenue.
''The financial statements show that continued spending restraint is important as we remain on track to surplus in 2014-15, as the Budget next week will confirm.
''Ongoing spending control will allow the Government to build up sufficient surpluses to provide choices around repaying debt and investing more in priority public services,'' he said.
The accounts showed that ''other individuals'' tax revenue in March 2013 was 14.8% ahead of forecast at $406 million. While higher investment returns played a part in the increased tax take, tighter collection and enforcement by the Inland Revenue Department is also likely to have played a part.
Source deductions were $187 million, or 1.1%, above forecast due to a higher effective tax rate.
Corporate tax was $161 million below forecast.
Chief financial officer of the Treasury, Kamlesh Patel, said recent economic data suggested that aggregate labour incomes had been consistent with forecast but the composition of the labour force had changed through a decrease in the proportion of low-income workers.
''This change increased the revenue collected because of the progressive nature of the income tax scale,'' he said.
Crown core expenses were close to forecast at $52.2 billion.
While underspending related to delays in Treaty of Waitangi settlements and New Zealand's aid programmes was recorded, it was largely offset by higher-than-expected costs associated with an earthquake-related provision for wastewater, stormwater and freshwater in Canterbury, Mr Patel said.
The accounts show that core government services spending increased $958 million in March 2013 compared to the same period last year. Almost all of the increased spending was due to the provision for water infrastructure in Canterbury.
Social security and welfare spending was up $273 million in the year, mainly due to the indexation of welfare benefits and increased recipient numbers, particularly New Zealand superannuitants.
Environment spending fell $255 million in the year after few New Zealand Emissions Trading Scheme units were issued, at lower prices.
The lower issuance was related to the forestry industry, as it had received a one-off allocation of units in previous years.
Lower worldwide demand for carbon credits and the global financial crisis had seen the price per unit fall from about $NZ10 at March 31, 2012 to 9c at March 2013.
Pre-Budget spending
Spending already announced
• An additional $21.3 million over next four years allocated to help lower rate of rheumatic fever among children.
• Aged care and dementia services will receive extra $70 million over next four years.
• The Government announced the final 10 selected National Science Challenges and $73.5 million extra to fund them over next four years. Projects include ageing well, a better start, healthier lives, high value nutrition, land and water and life in a changing ocean.
• Department of Conservation allocated extra $20 million for additional frontline roles and upgrading recreational facilities.
• Forty-six service providers working with young New Zealanders will continue to receive $4.5 million of funding.
• Extra $158 million to tourism to accelerate the work already being done in attracting high-value tourists and supporting and increasing emerging and existing markets.
