"Treasury is forecasting a $15.6 billion cash deficit for the current financial year which will add to New Zealand's already large stock of overseas debt.
"Therefore, we need to continue managing the Government's finances responsibly on behalf of taxpayers, reducing the rate of new spending and getting back into budget surplus as soon as possible."
The Government was taking steps on the operating side of its finances to get back to a "meaningful surplus" by 2014-15 - a year earlier than forecast, he said.
It was also considering options - such as extending the mixed-ownership for four state-owned enterprises - for reducing borrowing to pay for substantial increases in Government assets in the next few years.
New Zealand as a whole needed to save more, spend less and reduce its heavy reliance on foreign debt and the Government was a crucial part of that.
"By playing its part in lifting national savings, this Government will keep interest rates low and build faster, ongoing economic growth," Mr English said as Treasury released the Government's financial statements for the five months ended November.
The accounts put Crown revenue at $22.4 billion in the five months, $278 million below the December forecasts, and core crown expenses at $27.5 billion, $272 million below the forecast figure.
The operating balance before gains and losses (obegal) was $5.8 billion, down 1.8% on the forecast, and the operating balance was $2.5 billion, nearly 48% below the forecast, thanks to higher-than-expected investment returns from the New Zealand Superannuation Fund.
The core Crown residual cash deficit was $9.14 billion, $181 million lower than forecast.
Finance costs increased to $1.17 billion in the five months, 28.5% higher than in the previous corresponding period, due to increased debt levels.
Social security and welfare spending continued to dominate the Government accounts, rising 3.5% on the previous corresponding period to $8.9 billion.
Health spending increased by 5% to $5.7 billion in the period and education spending increased 3.5% to $4.9 billion.
Higher welfare spending was driven by the indexation of welfare benefits and the higher number of beneficiaries, health spending was increased to maintain and improve existing service levels and education spending rose through higher demand-driven expenses from roll growth and from funding in last year's Budget.
Mr English said that while there were some unders and overs in the revenue side of the accounts, the results were in line with forecasts.
