The Crown operating balance excluding gains and losses (obegal) deficit grew in the four months ending October to $1 billion from the Budget 2014 forecast of a deficit of $740 million.
The operating balance, which includes gains on Crown investments in various sharemarkets, was a deficit of $988 million, a turnaround of nearly $1.2 billion on the expected surplus of $188 million.
Mr English and Prime Minister John Key campaigned during this year's election on providing a ''wafer thin'' surplus in the current financial year, which ends in June 2015.
Mr English is now a list MP and could be expected to leave Parliament after 26 years in 2016, as part of Mr Key's ongoing renewal project.
With ongoing problems in the euro zone and Fonterra's downgraded forecast knocking 2.7% off economic growth next year, Mr English will struggle to get the books into black.
After the release of the accounts yesterday, Mr English said government revenue continued to grow more slowly than forecast in the Budget, again highlighting the challenge of returning to surplus next year.
Although core Crown tax revenue was $1.5 billion (7.9%) higher than at the same time last year, it was $97 million lower than forecast in the Budget.
''This emphasises the unusual conditions the New Zealand economy is experiencing.
''We have stable growth, growing employment and low interest rates, which are helping New Zealanders to get ahead.
But at the same time, falling dairy prices and low inflation are impacting on the nominal economy and government revenue.''
All that was making it more challenging for the Government to achieve its fiscal targets as quickly as it would like, he said.
The accounts for the four months showed GST revenue was $200 million (3.5%) below the Budget forecast and source deductions were $75 million (0.9%) below forecast.
The shortfalls were partially offset by corporate tax revenue being $129 million (4.6%) above forecast and other individuals' tax being $70 million (5.3%) higher than forecast.
The Treasury said the tax trends had been taken into account in the Half-Year Economic and Fiscal Update forecasts due to be released next week.
Core Crown expenses for the four months were $118 million higher than forecasts, due largely to the one-off indemnity cost associated with Solid Energy.
Excluding that cost, core Crown expenses of $24 billion were $15 million above budget.
Mr English said the expenses data showed the Government was ''generally'' doing a good job of controlling its own spending.
The challenge was coming from revenue over which the Government had less control.
The Treasury said due to sharply lower dairy prices and ongoing low inflation, the current rate of revenue growth was unlikely to continue over the rest of the financial year, he said.
The fiscal update next week would provide a fresh set of forecasts on the fiscal situation, on New Zealand's economic growth and job growth as well as wages and unemployment.
The accounts showed they were boosted by $2 billion of gains on financial investments but the gain was offset by the actuarial losses on the ACC and Government Superannuation Fund liabilities of $1.6 billion and $400 million respectively.
Annually, the Crown accounts provide a mixed result for Mr English to ponder.
The obegal deficit of $1 billion in October is $746 million below the $1.75 billion deficit in October last year.
But the operating deficit of $998 million is $2.8 billion more than the expected surplus of $1.83 billion.dene.mackenzie@odt.co.nz
