The Treasury Department of New Zealand has announced that the economic downturn is worse than expected, which is putting more pressure on tax revenues. This is making it difficult for the government to address its budget deficit.

The Chief Economic Adviser, Dominick Stephens, has indicated that the latest data suggests that the Treasury's economic and fiscal forecasts will be downgraded. The updated projections will be released on December 17 in the half-year economic and fiscal update.

The ongoing economic challenges will have significant implications for the government's financial planning and fiscal strategy going forward.