Higher investment returns have helped turn around the Government's books, with its deficit for the 11 months to the end of May just $2.1 billion.
It represents a drop of 70% on the same period a year earlier, when the deficit was more than $7 billion.
Once the investment gains are excluded, the deficit is closer to $5 billion, substantially higher than at the same time last financial year.
The cash deficit is also higher, but the figures still show public finances are rebounding after last year.
The cash deficit is also higher but the figures still show public finances are rebounding after last year.
However, the economy will have to improve further before the books return to surplus.
Tax income fell $3 billion from the same period the previous year.
Treasury is predicting the operating deficit - the difference between what the Government earns and what it spends - will be about $3 billion for the full year.
While the finances are looking better than last year, Mr English says the restraint in Government spending has only just begun.
He says the Government still faces a challenge to get its books back into surplus, and although Budget forecasts show that won't happen until 2015, he wants it to occur earlier.
