But that has not stopped Mr English from hinting at tax cuts before the next election.
Figures released by the Treasury yesterday showed an operating balance before gains and losses (obegal) of a deficit of $772 million in this financial year instead of the wafer-thin surplus promised during the election campaign.
The deficit is forecast to turn into a surplus of $565 million by 2015-16, rising to $4.1 billion in the following year - an election year.
However, given the downturn in the Australian economy, slowing growth in China - New Zealand's two largest trading partners - and the threat of recession in the euro zone - the surplus in 2016 is just as likely to turn into a deficit.
Mr English came in for much criticism from his political opponents but remained confident an obegal surplus was achievable this financial year - despite the Treasury forecasts.
''These forecasts emphasise the unusual conditions the New Zealand economy is experiencing. Treasury is predicting solid growth, growing employment and low interest rates, which help New Zealanders to get ahead.''
At the same time, falling dairy prices and low inflation were restricting growth in the nominal economy and government returns, he said, in a repeat of comments made last week at the release of the Crown accounts for the four months ended October.
Although the Treasury forecasts predicted a small deficit for the present year, Mr English said he believed the strong underlying economy and responsible fiscal management could deliver a surplus when the final Government accounts were published in October next year.
Previous forecasting rounds showed the outlook could change significantly between the half-year update and the final accounts being published, he said.
As recently as 2012-13, the final obegal deficit was $2.9 billion smaller than the previous half-year forecast.
The obegal deficit had shrunk significantly from a peak of 9% of GDP in 2010-11.
Net core Crown debt was expected to peak in the current fiscal year at 26.5% of GDP before reducing to 19.1% of GDP in 2021.
A residual cash surplus was expected in 2018, a year earlier than forecast previously, which was also when the Government intended to start repaying debt in dollar terms, Mr English said.
The Budget Policy Statement, also released yesterday, showed allowances for Budget 2015 and Budget 2016 had been reduced to $1 billion.
The allowance had been pre-phased over three years to provide a $2.5 billion allowance in Budget 2017.
''This will allow us to consider modest tax cuts and/or additional debt repayment in Budget 2017, as economic and fiscal conditions allow.''
Council of Trade Unions economist Bill Rosenberg said the horizon for workers looked gloomy following the release of the Budget Policy Statement.
Continuing cuts in Government funding of public services were inevitable. The policy statement ignored the social, environmental and economic pressures building in New Zealand.
''Maintaining a $1 billion allowance for new spending in the face of these pressures is like putting a cork in a boiling kettle. At some point, it will blow out.''
PwC economics director Chris Money said it did not matter if the surplus was missed in the current year.
''The market is more interested in the direction of travel than the absolute number, and that direction of travel is still good. We're more interested in the forecast surplus for the years beyond the current year.''
The reaction
Grant Robertson
Labour finance spokesman
The Government owes New Zealanders an apology for failing to deliver the surplus it spent four years and two election campaigns promising. Bill English's face is redder than the Crown accounts. This is the political test he set himself and he failed.
Winston Peters
New Zealand First leader
What we have got now is `ponzi-nomics'. Every man, woman and child in New Zealand is now $14,000 in debt before they even start dealing with what they owe. It has come at the expense of exporters. Farms, houses and businesses are being sold offshore to follow the banks we once owned.
Russel Norman
Green Party co-leader
National has repeatedly staked its economic credibility on achieving a budget surplus this year but even that narrow goal is looking unachievable. How can people say Bill English is a good economic manager when his decisions are leading to seven consecutive deficits?
