Using administrative data to produce official social statistics New Zealand’s experience

Outline Background Key drivers Benefits and challenges Four case studies Future directions

Context New Zealand Statistics Act - Mandate to use data from government administrative systems for statistical purposes Established statistical series using administrative data - Births, deaths, marriages and external migration - Health, education, crime, incomes and welfare benefits Recent initiatives involve integration of administrative data - Enhance value of administrative data sources - Produce new statistical outputs Other uses of administrative data - Survey frames - Replace survey data

Key drivers Concerns about compliance burden on households Need for more efficient use of available data sources Recognition of potential of administrative data to meet information needs Technology an enabler facilitating the transfer, processing and storage of large volumes of data

Benefits of administrative data Universal coverage of program participants Detailed and accurate data for key aspects of program Allows the production of statistics for - Small areas and populations sub-groups - Rare events or phenomena with small incidence Unique identifiers allow linking of records over time Not affected by respondent recall and sample attrition

Challenges of using administrative data Coverage – data may not represent the population of statistical interest Quality – data often do not meet official statistics standards in terms of relevance, timeliness, accuracy, accessibility, interpretability and coherence Explanatory/classificatory variables - limited in administrative datasets Unit of measurement – data is often event or case based making the generation of statistics on units of policy interest problematic Continuity – data subject to changes from administrative decisions Privacy – tensions between individuals rights to privacy and the need for good information to improve strategic decision-making

Case study 1: Injury Information Manager Demand for information on nature, extent and impact of injuries in NZ Injury statistics dispersed and lack coherence Statistics NZ appointed Injury Information Manager in 2003 Initial objective to create an integrated unit record dataset abandoned Focus shifted to improving quality and building the volume of statistical output Achievements - Established regular outputs on work-related injuries - Improved access through web-based table tool Long-term aim is to develop a injury database through linking data at the micro-level

Case study 2: NZ Census Mortality Study Collaborative study between Statistics NZ, Ministry of Health and Otago University Response to researcher concern about the limited socio-economic variables on death records Objective to measure socio-economic correlates of mortality through linking death records and census records Probabilistic linkage using date of birth, sex, country of birth and area of usual residence Death records linked to census for 3 years following each census Linked database used to address a wide range of research questions - What is the relationship between socio-economic factors and mortality? - Is unemployment associated with suicide? - What is the contribution of smoking to mortality? A subsequent study has linked cancer register and census records

Case study 3: Linked Employer-Employee Database (LEED) Catalyst for LEED was user requirement for data on labour dynamics LEED was created by linking a longitudinal employer series from Statistics NZs Business Frame to a longitudinal series of payroll data from the taxation system Linking was done using employer tax number Integrated database follows an employer-employee link over time and covers all individuals receiving income taxed at source plus individuals receiving an income-replacing benefit LEED provides a rich source of data on the operation of the labour market and has been used to study: - Work to retirement transitions of NZers in their 60s - Labour market outcomes of people who move from social assistance to work - Impact of firm closure on workers’ future employment and earnings Data available for population sub-groups and small areas Success of LEED has led to initiatives to expand database by adding: - Benefit type - Tertiary enrolments

Case study 4: Tertiary Students Loans and Allowances Student Loan Scheme introduced in 1992 to overcome financial barriers to study Student Loans and Allowances linked database established in response to need for information to evaluate the costs of the scheme and the return on education Integrated database links together data from 3 agencies - Ministry of Social Development (amount borrowed) - Ministry of Education (field of study and level of educational attainment) - Inland Revenue Department (outstanding loan balance, post-study income) Integration 2-staged process - Ministry of Social Development and Inland Revenue data linked using tax number - Ministry of Education records added using probabilistic matching Complete coverage of all student loan recipients from 1992 Longitudinal data allows analysis of outcomes for same sets of students over time and has been used to study: - Factors affecting post-study earnings of tertiary students - Progress in repayment of student loan debts by demographic and educational outcomes - Extent to which student loan borrowers are moving overseas according to size of student loan balance & educational outcomes

Future directions Integration of administrative data has been a response to specific user needs Intend to adopt a more strategic approach in the future First step will be the development of a social statistics architecture An important principle will be use of administrative records where possible Nature and extent of integration will be an important architectural design issue Privacy issues and public acceptability will determine how far we can push the boundaries