NZ Government Finances Show Signs of Improvement Amid Ageing Population Risks

The New Zealand government's finances are showing signs of improvement, but experts warn that an ageing population poses long-term risks to the country's financial stability.

According to Treasury forecasts, the government is expected to post a $2.1 billion surplus in 2028/29, a year earlier than previously forecasted, and a $4 billion surplus using the new ObegalX measure which includes the impact of the Accident Compensation Corporation (ACC).

The improvement is attributed to inflation pushing tax revenue higher than expected, as well as lower-than-expected spending.

Treasury Secretary Iain Rennie warned that if left unchecked, New Zealand's ageing population would make the country's financial position 'unsustainable' in the long term, citing the cost of New Zealand Superannuation as a major concern.