Will the true debt figure please stand up.


In the weekend I received this message from an agitated Taxpayers Union: “We don’t normally email our supporters on a Sunday, but today is a little different.”

I was instructed to head to  the New Zealand Government Debt Clock  that is ominously ticking away. Making it sound like it has Treasury authenticity they say: “The model is clocking up the debt in real time using the official Government statistics and six-monthly updates put out by the Treasury.”

To really terrify us, the Taxpayers Union (TU) says government debt is about to hit $90,000 per household and that interest costs on the nearly $180b of existing debt, are $4,400 per household. It claims this is three times as much as spent on police and even more scary, soon the interest costs will exceed the amounts spent on the entire school and early childhood education systems. Gulp!

The TU want me to donate to help them fight this monster ‘before it is too late’ and “to avoid my household’s debt bill getting to $100,000, $150,000 or even $200,000”. Gulp again, a doubling of the debt is around the corner?

But gross Government debt is NOT a good indicator of the health of the government books because it ignores assets on the other side of Government’s ledger. It is like a household with a very valuable house and stacks of money in the bank but are judged by only the size of the mortgage.

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When government borrows it is not only for budget deficits.  Much of the debt has been used to purchase a range of assets such as held in the NZ Super Fund that can be liquidised if needed. The June 2023 Treasury summary of the actual net debt measure defines net debt to be Gross debt less core Crown financial assets. 

Net debt ended the year at 18.0 per cent of GDP, in line with the Budget 2023 forecast. This level of debt is well below the Government’s debt ceiling and means the government in well placed to respond to any future shocks. On a comparable measure of debt produced by the International Monetary Fund (IMF), our debt position as a percentage of GDP continues to be much lower than Australia, the United Kingdom and the United States”. (Financial Statements of the Government of New Zealand June 2023.

Thus while Gross debt was $135.8 billion for June year 2023 net debt was just $71.4 Billion or 18% of GDP. 

So why the panic?
Of course, we don’t have yet the full annual accounts for 2024 but we know (thanks to the clock) that gross borrowing will have increased to around $180 billion. But over the year Government has also invested in income-producing assets, lent to students to create a Crown asset, and borrowed to put about $2 billion into the NZ Super Fund.  Net worth measured as the difference between assets and liabilities) is likely to show a healthy increase as it has in past years.  

But inexplicitly, the National government has decided to report net debt without taking account the assets in the NZ Super Fund. Despite the IMF always including sovereign welfare funds in its net debt comparisons, reported government net debt for domestic purposes will now look as if it is over 40% of GDP and so much worse than the 18% reported in the 2023 accounts. 

Let’s remember that much of government debt is held by institutions such as managed funds and KiwiSaver on behalf of New Zealanders as investors. We owe this part of the debt to ourselves so where is the bogey man? Domestic owners of debt, including many retired people are rewarded with currently high interest payments either directly, or by holding term deposits with their bank who holds government debt.  So, while the interest on government debt is a large expense item when interest rates rate are high, a large number of New Zealanders benefit and pay tax on this income.

Yes, there are massive problems in New Zealand. The looming ageing of the population, poverty and inequality, housing deficits, climate change, collapse of the public health services as we know it, plus an intensifying recession.  Fiscal caution is needed but the sky is not falling. Focussing on reducing government gross debt might cause untold unnecessary damage to an economy already in recession.


  1. I guess it would be remiss to call them lying bastards on this particular issue. Misrepresenting the real situation to create fear is what they do best. Of course it makes their plan, to give tax cuts, completely irresponsible if you have more than two brain cells to rub together. That being said the average number of brains cells per 1ZB listener is currently at 1 and a half so we have a problem.

    • Well said Wheel.
      Lying bastards is mild compared to what they could be called.
      I imagine that if this lot were running a business they would be putting the emphasis on the 18% not the 40%.
      Goes to show what bullshitting incompetent people they are. Especially as they claim they are running a business.

      • UTC you are now in joint first place with Wheel displaying your complete ignorance of anything financial.
        I venture even back benchers hold more commercial qualifications than you and Wheel combined mind you zero plus zero equals zero.

        • So Bob please tell us why National would be excluding the assets?

          Is it because they will borrow to fund tax cuts? I guess that’s an example of taking on debt with no corresponding asset to consider.

          You know damn well why they are doing it. It fits well with their narrative. Just like not mentioning any housing stock when talking about KO debt.

  2. More Labour Government legacy with more to follow.
    To use someone else’s saying “they couldn’t run a meat raffle in a Pub.”

    • They saved 20,000 lives, and a lot of small businesses from going bankrupt with that money. So you’d be happy to see 20,000 people dead and a lot of small business people out of work? People I might say who very rarely vote labour. Now that’s governing for all the people, not just their mates.

      • I take your point gs but the 20,000 was plucked from thin air.
        My assertion regarding the “meat raffle” stands.

  3. Wheel you obviously listen to 1ZB otherwise you would be unable to comment.
    On issues financial,economics in general you have revealed yourself time and time again to have no idea what you are talking about.
    Please stick to what you know.

      • Plagiarism again Mr.NSC using my terminology which is flattery in the extreme and not surprising given your limited vocabulary.
        Please may I ask yet again is English your first language.

        • Reading a previous post of yours, I understand you are grammatically challenged and your dyslexia is noted Bob thick fuck.
          I must say TDB is very tolerant of your many inaccuracies and if it wasn’t for freedom of speech you would have been shut down long ago. However as you continue to post and make a complete fool of yourself feel free to continue your grammatical, political and financial incompetence.

          • Are you the Editor of the TDB Mr.Squeaky?
            I have done extremely well when it comes my personal financial position and as mentioned before I am a man of letters.

        • Your egotism(the fact of being excessively conceited or absorbed in oneself) is noted Bob the thick.

        • Bob the first…

          “Richard you can’t vote for people like Chloe Swarbrick they don’t have any policy.What for example is their economic policy?Regardless of being right or left wing a country cannot function without a sound economic policy.
          I fear our elections can be likened to voting for a class captain.’

          Given your limited vocabulary please may I ask yet again is English your first language?

          What does the sentence.. “What for example is their economic policy?” mean?

          You are embarrassing.

          • I am a man of letters as mentioned previously including English,commerce and science so I find your attempts to denigrate me highly amusing.
            Keep it up please it makes my day.

            • Your ego is so huge , everyone gets to laugh at you. Haha. Keep it up you make everyone’s day.

          • Wonderful to see what I penned repeated by NSC gosh I’m erudite.
            Thanks Squeaky old bean.

    • Given the absolute rubbish you talk Bob, I won’t be taking your feedback on board. You clearly have no clue.

      • When you refer to Bob in your comments make sure you put right pseudo, bob1st as there is another ‘Bob’. Which is a nuisance and I early on mentioned the confusion. There are about 273,000 headwords; 171,476 of them being in current use, 47,156 being obsolete words = many headwords in the dictionary so what about another one? And throw in some obsolete words, some of us may actually remember them!

    • Given the absolute rubbish you talk Bob, I won’t be taking your feedback on board. You clearly have no clue.

  4. When can we see a TWG Tag Match, Susan St John, Rob Cambell v Jordan Williams and Nicola Willis? Call out the challenge.

  5. Yeah well, also….
    graeme hart liquidated our assets after he bought them at below capital value thus ta da! Multi-billionaire at 69 and one of the richest 200 in the world. You must be on quite the hourly rate graeme.
    And what about them four poor old now foreign owned banks stealing $180.00 a second net 24/7/365 to make them the second most profitable in the world next only to Canada?
    The Press.
    What about them 3118 multi-millionaires each with a base figure starting $50 million net.
    It’s a funny thing. I sit here in the lounge of my Port Town house and I see an alarming thing… No big boats.
    Industrial port traffic has had the arse fall out of it and only very recently too. Are we at war Susan St John? Serious question.
    And one more thing… British farmers are freaking out at the prospect of the beastly kiwi farmers inching back into the UK. My question to you is; What inched us out? What went on here back in the 1960’s and early ’70’s ? Boys? Yoo hoo, Boooooyyysssss ? Have you been naughty, naughty little boys. Naughty little billionaires, naughty little millionaires…. Have you been playing with farmers money?
    For educational purposes…
    Prime Video
    The Men Who Stole The World
    They’re bankers, traders, investment funds executives. They forgot all about morality to make money. The entire world had to suffer the consequences of their actions. They impoverished countries, drove millions of workers into unemployment, and contributed to the rise in extremism. So who are they? And, after the 2008 crisis, were the real culprits condemned? Could there be another?
    P.S. ” Government has also invested in income-producing assets, ” Such as? And what gubbimint?
    All I see are minions to neo-liberal greed now merely hoping they get away with their crimes against us.
    I have a simpler view of things.
    A few scumbags have sabotaged our AO/NZ for their wealth creation. They’ve convinced us that the social democracy we had was inefficient so they created a soft-cock fascist autocracy which very efficiently made the [them’s] multiples of billions and millions over night which is why it’s necessary, essential in fact, to have to walk past the wretched homeless populating the gutters between the casinos, the brothels and the Bentley’s.
    AO/NZ IS NOT a disaster that seemed like a good idea at the time. It’s a fucking crime scene! Aye Boys?

      • In less than 7 months Luxon, Peters and Seymour have destroyed NZ and it’s reputation.

  6. Yes Wheel 1.5 average brain cells for 1ZB I think that’s generous I would give them 0.5 there some really dumb fucks that call in and listen to all their garbage and divisive shit on that channel. In the meantime, free Willy English (who was well paid by the gnats) wrote a so-called independent report on Kainga Ora. Now we hear Salvation Army being mentioned again by the lying chris bullshop and it looks like more selling of state assets, state land and privatising of state homes yet another transfer of public assets to greedy private hands.
    These bastards must think we are all dumb yes some are the ones that voted for them.

    • They do think that we’re all dumb, and I’ve been thinking that this distortion of government debt might have Bill English’s slippery little fingers all over it. Remember the minister who got the figures wrong when putting the kibosh on Sue Moroney’s parental leave bill and then had to admit it next day? Starting to think that Bill’s Catholicism serves as a license to lie, pop along to Confession and the god of small things will wipe them off like a kiddies magic slate does.

  7. There is a good summary (dated 2012) by Alan Bollard called ‘Dealing with Debt’. Among other things, it points out that NZ gross public debt from the time of Vogel onwards was really eye-watering, as much as 200% of GDP after WW1, was then gradually paid down over the course of the first Labour Govt and post WW2 prosperity, and that even Muldoon did not add to it all that much by earlier standards, the Rogernomic beatup notwithstanding. Kind of puts the current panic in perspective. But of course, who reads financial history apart from complete policy wonks?

  8. The egit, who blaim, Kiwi you. This, your debt home, grocery bill, and all capitals exploit, is not our past govern fault, you fools, its capitalism, and again its adjustment to greeds control. See, John, boy, caught fiddling.

  9. Why the concern about government debt when the real debt problem in NZ is household debt at $540 billion .Imagine how much that is costing in interest alone ,remembering only half will be at 7% or lower the rest will be closer to 20% as they are personal loans .Governnent debt is around 20% of GDP while household debt is around 140% of GDP .Now can you see the real problem that NZ has .Even John Key could see the problem while he was resting up as PM and knew he could not fix the problem so spun his wheels and decided to plunder the property industry along with his pimp mates .

  10. Let’s remember that much of government debt is held by institutions such as managed funds and KiwiSaver on behalf of New Zealanders as investors. We owe this part of the debt to ourselves so where is the bogey man?

    From NZ Stats we find that at December 2023:
    – New Zealand households held $693 million in New Zealand Government Bonds
    – Non-residents held $73.869 billion.

  11. Well said Xenophon.
    It is a critical factor when making comparisons particularly with the USA.
    The New Zealand economy it too small to be dynamic.

  12. As usual, absolute nonsense. We could clear the whole public debt just by asking paper New Zealanders with no connection to New Zealand like Larry Page and young blood enthusiast Peter Thiel to fork over or f**k off.

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