Debt and the interest bill
Other ways to measure debt, Treasury's forecasts, and the interest bill next to other spending.
How much does the government owe?
At 30 June 2026, net core Crown debt was $186.8 billion, or 40.9% of GDP.[1][3] A year earlier it was $182.2 billion (41.8% of GDP).[2][4] These are audited figures from the government's annual financial statements.[11][32] In plain words, net core Crown debt is what the core Crown has borrowed minus most of the financial assets it holds, such as cash and investments. It does not subtract advances (money the government has lent) or the NZ Super Fund's assets.
Treasury's pre-election update says: The Government’s headline debt indicator is net core Crown debt.
[50] Treasury also publishes other measures:
- Gross debt: $227.4 billion (49.8% of GDP), up from $203.7 billion a year earlier.[7][6][8][5]
- Net debt, a wider measure that adds Crown entity borrowing and also subtracts advances and the NZ Super Fund's financial assets, which net core Crown debt does not: $91.2 billion (20.0% of GDP).[29][30][27]
What do these measures include?
Net core Crown debt, in Treasury's words, is debt issued by the sovereign (the core Crown) less core Crown borrowings less core Crown financial assets, excluding advances and financial assets held by the NZS Fund
.[26]
Gross debt represents debt issued by the sovereign (core Crown) and includes Government stock held by the NZS Fund, ACC and NHC. Gross debt excludes NZS Fund borrowings, Reserve Bank’s holdings of settlement cash and Reserve Bank bills.
[25]
For net debt, Treasury's glossary says: Net debt represents core Crown and Crown entity borrowings (excluding Kiwi Group Capital Limited) less core Crown financial assets (including advances). It includes the financial assets and borrowings of the NZS Fund.
[27]
Core Crown covers Ministers, Departments, Offices of Parliament, the NZS Fund and the Reserve Bank, but not Crown entities and SOEs
(state-owned enterprises).[24]
Treasury's forecast path
Treasury's Pre-election Economic and Fiscal Update (PREFU), published on 29 September 2026, forecasts the following, at 30 June each year.[37][38][39][40] Earlier years are actuals from the annual financial statements.[33][34]
The chart starts in 2017, the first year in Treasury's time series table. Actual years use GDP as revised in the 2026 financial statements; forecast years use Treasury's September 2026 GDP forecasts.
| 30 June | Net core Crown debt $b | % of GDP | Gross debt $b | % of GDP |
|---|---|---|---|---|
| 2026 actual | 186.8 | 40.9% | 227.4 | 49.8% |
| 2027 | 209.6 | 43.7% | 243.4 | 50.7% |
| 2028 | 223.0 | 43.9% | 259.4 | 51.1% |
| 2029 | 230.5 | 43.3% | 269.8 | 50.7% |
| 2030 | 232.8 | 41.8% | 273.2 | 49.0% |
| 2031 | 229.8 | 39.5% | 269.0 | 46.2% |
2026 is the audited actual. 2027 to 2031 are Treasury forecasts based on policy settings and economic conditions when they were prepared. They are not targets. PREFU was finalised before the audited accounts: its unaudited 2026 figure was $186.7 billion (41.0% of GDP, on Treasury's September GDP estimate of $455.9 billion), against the audited $186.8 billion (40.9% of GDP, on revised GDP of $456.8 billion).[59][38][41][17]
The interest bill
In the year to 30 June 2026 (the 2025/26 year), core Crown finance costs were $9.06 billion, up from $8.86 billion the year before.[12][13] Treasury's update splits this into $8.70 billion of interest on financial liabilities (mostly borrowing) and $0.36 billion of "interest unwind" on provisions, an accounting charge on amounts set aside for future costs. The split is unaudited; the total matches the audited accounts.[43][44]
| 2025/26 finance costs | |
|---|---|
| Per year | $9.06 billion |
| Per day (365 days) | $24.8 million |
| Per person a year | $1,691 |
| Share of core Crown expenses | 6.2% |
| Share of GDP | 2.0% |
Per person uses Stats NZ's provisional estimate of 5,357,300 people living in New Zealand at 30 June 2026.[60] It is the total divided by the population, not an amount anyone is billed. Core Crown expenses were $146.3 billion.[16]
The core Crown also earns interest on the money it holds and lends. In 2025/26 its interest revenue was $3.52 billion.[35] Interest expense on financial liabilities ($8.70 billion) minus interest revenue was about $5.2 billion.[43] This is a rough comparison: the assets that earn interest are not the same as the debt. (Treasury's segment table shows total core Crown interest expenses of $9.06 billion, which includes the interest unwind.[36])
Compared with other spending
Treasury groups core Crown expenses by purpose (its "functional classification"). These groups are not the same as Votes in the Budget. Finance costs were the 4th-largest of the 15 groups in 2025/26, after health ($32.92 billion), education ($21.21 billion) and the largest group, social security and welfare ($50.39 billion).[23][16][15][14]
| Core Crown expenses, 2025/26 | $ billion | Share |
|---|---|---|
| Social security and welfare | 50.39 | 34.4% |
| Health | 32.92 | 22.5% |
| Education | 21.21 | 14.5% |
| Finance costs | 9.06 | 6.2% |
| Law and order | 7.08 | 4.8% |
| Transport and communications | 6.04 | 4.1% |
| Core government services | 5.92 | 4.0% |
| Defence | 3.53 | 2.4% |
| Economic and industrial services | 3.01 | 2.1% |
| Environmental protection | 2.51 | 1.7% |
| Housing and community development | 1.96 | 1.3% |
| Heritage, culture and recreation | 1.44 | 1.0% |
| Primary services | 1.03 | 0.7% |
| Other | 0.19 | 0.1% |
| GSF pension expenses | 0.06 | under 0.1% |
| Total (excluding losses) | 146.32 | 100% |
Treasury's forecast
Treasury says core Crown finance costs are expected to gradually increase from 2.0% of GDP in 2025/26 to 2.4% of GDP by 2029/30
, that this largely reflects the additional borrowings expected over the forecast period
, and that they stay flat as a share of GDP by 2030/31
. In nominal terms core Crown finance costs grow from $9.1 billion in 2025/26 to $13.7 billion by 2030/31.
[45][42] The interest rates page shows how much these forecasts depend on rates.
2022 is the first year in Treasury's finance costs table. Amounts are in dollars of each year, not adjusted for inflation; the table also shows each year as a share of GDP.
| Year to 30 June | Finance costs $b | Per day $m | % of GDP |
|---|---|---|---|
| 2021/22 actual | 2.88 | 7.9 | 0.8% |
| 2022/23 actual | 6.57 | 18.0 | 1.6% |
| 2023/24 actual | 8.94 | 24.4 | 2.1% |
| 2024/25 actual | 8.86 | 24.3 | 2.0% |
| 2025/26 actual | 9.06 | 24.8 | 2.0% |
| 2026/27 | 10.29 | 28.2 | 2.1% |
| 2027/28 | 11.40 | 31.1 | 2.2% |
| 2028/29 | 12.48 | 34.2 | 2.3% |
| 2029/30 | 13.50 | 37.0 | 2.4% |
| 2030/31 | 13.69 | 37.5 | 2.4% |
Per day divides by the days in each year (366 in years that include 29 February). % of GDP uses GDP as revised in the 2026 financial statements for actual years and Treasury's GDP forecasts for forecast years.[31][41] The forecasts used market interest rates at 30 June 2026, adjusted for rates on 21 August 2026.[47]