Doubt lingers over small surplus in New Zealand government books

The New Zealand government's accounts returned to a small but unexpected operating surplus in the seven months to the end of January, prompting claims it was massaging the books to meet its target of a surplus this financial year.

Financial statements from the Treasury Wednesday showed an operating surplus of 77 million NZ dollars (55.76 million U.S. dollars), which was 712 million NZ dollars (515.64 million U.S. dollars) above forecast in December last year and the first part- year surplus since 2009.

The surplus was a result of tax revenue being 1.2 percent above forecast and government expenses being under forecast, said a statement from the Treasury.

However, it added that the government's operating balance fluctuated from month to month due to the seasonal nature of tax revenue and expense trends.

Net debt at 61.8 billion NZ dollars (44.71 billion U.S. dollars) , or 26.1 percent of gross domestic product (GDP), was 1.2 billion NZ dollars (868.55 million U.S. dollars) lower than forecast.

Finance Minister Bill English warned it was still too early to say whether the government would have a surplus for the full 2014- 2015 fiscal year.

"We won't know until the final accounts are published in October whether we will achieve a surplus for the whole year. The variance of both tax and expenditure from forecasts reinforces that message," English said in a statement.

The opposition Green Party said the Treasury figures showed the government was failing to meet its self-imposed surplus target and would instead see a deficit of 572 million NZ dollars (414.01 million U.S. dollars) this financial year.

"We're now seeing evidence that the government is massaging the books in an attempt to return to surplus," Green Party co-leader Russel Norman said in a statement.

He said the government was keeping state-run accident insurance levies artificially high, delaying settlements and slowing spending in order to show a surplus. Endi