Looking forward to the 2006/07 HBAI publication: New analyses and improvements Peter Matejic (DWP) Households Below Average Income ESDS Government FRS User Meeting, 25 April 2008

2 Summary of presentation content What is covered by HBAI Contents of the 2006/07 publication Examples of analysis from 2005/06 data ­Relative and absolute low income Changes to the publication for 2006/07 ­Low-income and material deprivation measure ­Disability definition ­Restructuring and harmonising the publication

3 HBAI coverage Private households in United Kingdom Main source - DWP Family Resources Survey Measurement of living standards as determined by the net disposable household income Incomes equivalised and analysed Before and After Housing Costs (BHC and AHC) Data available at UK Data Archive

4 Contents of the 2006/07 publication Similar to previous years ­Detailed analysis of household incomes of all individuals, children, working age adults and pensioners for 2006/07 ­By quintile, composition of low-income groups and risk of being in a low-income group ­Time series of populations, composition of low-income groups and risk of being in a low-income group ­Summary statistics about the overall income distribution and persistent poverty

5 The income distribution in 2005/06 (BHC)

6 Average real income growth, 1998/ /06

7 Relative low-income indicator Relative incomes are assessed against the median of the year in question The indicator falls if the income of poorer households rises faster than population as a whole

8 Absolute low-income indicator Absolute incomes are assessed against the median in 1998/99 The indicator falls if poorer households are seeing their income rise in real terms

9 Change in 60 per cent relative median indicator Between 1998/99 and 2005/06: ­Whole population - 0.8m fall BHC (1.2m AHC) ­Children - 0.6m fall BHC (0.6m AHC) ­Working age adults - 0.4m rise BHC (0.5m AHC) ­Pensioners - 0.5m fall BHC (1.1m AHC)

10 More likely to be in low income households Workless working age families Lone parents Non-white ethnic groups Households containing someone with a disability not in receipt of disability benefits Local Authority / Housing Association tenants Groups with no savings or with bills in arrears Working age adults with no qualifications Pensioners without private pensions

11 Percentage of individuals in low-income by region/country: average over 2003/ /06

12 Percentage of individuals in low-income by region/country: average over 2003/ /06

13 Key changes for the 2006/07 publication Material deprivation and low income Disability definition Restructuring for greater clarity Greater harmonisation with other FRS-based publications

14 Measures of child poverty Three measures of child poverty outlined in SR2007 ­number of children in relative low-income households ­number of children in absolute low-income households ­number of children in relative low-income households and in material deprivation

15 Low-income and material deprivation concept Measure is combination of: ­Low-income threshold of 70 per cent below median income Before Housing Costs ­material deprivation measure Introduced in 2004/05 Aims to capture wider measure of families living standards

16 Low-income and material deprivation measure Material deprivation element based on affordability of 21 goods and services ­Material deprivation defined on basis of items that households say they cannot afford ­Prevalence weighting used, such that the higher the proportion that owns that item, the more the inability to afford it contributes to the measure. ­Overall score of 25 or more needed to be materially deprived 2.1 million children in low-income and material deprivation in 2005/06, down from 2.2 million in 2004/05

17 Disability definition We have extended the definition of disability used in the HBAI publication ­More in line with the Disability Discrimination Act Now includes individuals who: ­receive medication or treatment without which their impairment, illness or disability would substantially limit their ability to carry out normal day-to-day activities ­have ever had a long-term impairment, illness or disability that substantially limited their ability to carry out normal day-to-day activities Has the impact of increasing the number of individuals classified as having a disability

18 Restructuring and harmonising the publication We will bring the supplementary tables into the main section text ­All tables covering the same groups together ­Easier to navigate through the publication ­Dropped some tables in consultation with users We have sought to harmonise our definitions and classifications with other FRS-based publications ­FRS publication ­Income related benefits: Estimates of take-up

19 ANY QUESTIONS?