Appendix I: Data sources and notes
This paper draws upon a number of data sources. As a result, not all figures and definitions are consistent across tables and charts, nor is all data for the same time period. The main sources and comments upon these figures, definitions and data sources are identified below.
Administrative data
This background paper draws extensively upon a number of administrative data collections within FaHCSIA, as well as input from the DEEWR and DVA.
These collections include both 'official' statistics, including those published in the department's annual reports and in statistical publications, and internal analytical and research data collections. Results from these sources may differ for a range of reasons, including differences in timing and the extent to which point in time data is revised to take account of retrospective changes (for example late provision of data on income or a reversal of a suspension of a payment). These differences are rarely material but will result in some apparent inconsistencies.
While many tables include data on persons in receipt of the DVA Service Pension many do not. This is a consequence of payments being made through a different system. One result of this is that where one member of a couple is paid through FaHCSIA and another through DVA the records are not integrated.
Administrative data collections only contain data collected for administering payments. This may introduce some limitations, including:
- Information on incomes and assets reflect the specific rules of payments with regard to assessable and non assessable items, and as such do not necessarily reflect the total resources available to individuals. In other cases, such as Parenting Payment Partnered, where people are assessed on the basis of individual income only information on partner earnings is not available.
- Changes in program structures may result in changes in eligible populations.
- Very limited data are available on the characteristics and circumstances of income support recipients other than those needed for payment purposes.
Some data has been derived from the Longitudinal Data Set. This special data set, developed for research and related purposes, enables the experience of income support recipients over time to be analysed. In contrast to normal administrative data that focuses on individuals currently in receipt of assistance and their duration on their current payment, longitudinal data looks across payments.
This enabled duration of income support payment receipt over time to be considered in this analysis. This duration need not be continuous but rather based on the cumulative period a person has been on income support during the time in question. The time periods considered in the analysis are the experience over the past 5 years—which actually varies between 5 years and 5 years and 6 months—and a 10-year period that varies between 10 years and 10 years and 6 months.
As the LDS used in this analysis is only a sample it is subject to sampling variability. Estimates may not match as they would have had all records been counted.
Payment data
Data on payment rates are taken from Centrelink's publication A guide to Australian Government Payments, available at <http://www.centrelink.gov.au/internet/internet.nsf/publications/co029.htm> Historical rates data is available from The guide to social security law, available at <http://www.fahcsia.gov.au/guides_acts/ssg/ssg-rn.html>
Internal models have also been used to calculate the interaction of the tax transfer system and private income.
Survey data
It is important to note that survey data complements the administrative data—it is usually much broader in content and covers all households. When used for examining income support and income, however, it has some limitations, including:
- reliance on self-reporting. Many recipients do not accurately know the details of the payment they are in receipt of, or will refer to it by a common or former name. This is a particular problem for supplementary payments such as Rent Assistance, or when payment names are similar (such as Carer Payment and Carer Allowance). Others prefer not to tell interviewers they are receiving income support.
- household income is not always reported accurately. This is especially problematic at the top and the bottom of the income distribution. In analysis such as that of 'relative income poverty' this can pose particular problems as other analysis indicates that many apparently low-income households have levels of consumption and other characteristics suggesting they are much better off than their reported income.
The definitions used in surveys also often differ from those used for program purposes.
Most analyses presented in this paper have been derived from "Confidentialised Unit Record Files" which allow access to relatively detailed information at the household level and the extraction of specific tables. However to maintain confidentiality the data items are often amalgamated to ensure no person can be identified. This is especially the case with some smaller income support payments.
The main surveys used in this paper are:
The ABS's Survey of Income and Housing. This survey, currently conducted every two years, collects extensive information on the characteristics and income (and in the latest survey, wealth) of households.
The ABS's Household Expenditure Survey. This survey is similar to the Survey of Income and Housing although it is only conducted every six years. In addition to the items in the income survey it collects data on household expenditure and the ABS makes use of this, along with other survey details and their own internal modelling to obtain estimates of the value of non-cash transfers to households (including health and community services). Details are available in the ABS publication Government Benefits, Taxes and Household Income, Australia, 2003–04, available at <http://www.abs.gov.au/AUSSTATS/abs@.nsf/productsbyCatalogue/B9B3916F5652BF79CA256AA80081F81F?OpenDocument>
The ABS's Survey of Disability, Ageing and Carers. This survey was conducted in 2003 and provides a detailed data set on the experience of disability and caring. As has been noted in this background paper the definitions of caring and disability used in the survey do not equate to the criteria used for payment eligibility. For this reason—while the survey provides a very useful insight into the comparative caring and disability experience across the community as a whole, and is used here for comparing the experience across payments—it should not be used to draw more specific conclusions about the circumstances of persons on particular payments.
This is more so because there are some discrepancies between reported numbers on payment as reported in the SDAC and the number of people who receive payments. For this reason, a disjuncture between reported receipt of payments and reported caring or disability mean the data need to be interpreted with caution.
The Household, Income and Labour Dynamics in Australia (HILDA) Survey. HILDA is a longitudinal household survey conducted by the Melbourne Institute on behalf of FaHCSIA. Further information is available at <http://www.melbourneinstitute.com/hilda/>
The ABS survey of Employee Earnings and Hours is a survey conducted every two years by the ABS to collect data from employers on the distribution of earnings of their employees. The data used in this paper relates to the earnings of full-time non-managerial workers.
Data terms used
Equivalised income: Equivalisation is a technique used to adjust income to allow more meaningful comparisons of income for different households to take account of differences in size and composition and hence needs. It involves dividing household income by an equivalence scale based on the characteristics of the household. The equivalence scale used is the 'modified OECD' scale. This gives a weight of 1 to the first adult in a households, 0.5 to other adults and 0.3 for children aged under 15 years. For example a couple family with two young children would have an equivalence weight of 2.1. All results are shown in terms of the equivalent value of a single person. To gain the value for a particular household type the values shown should be multiplied by the weighting.
Real income (and expenditure): Real levels of income and expenditure seek to take account of price changes over time. They are derived by taking account of the effect of inflation as measured by the CPI to adjust historical rates and expenditure to the equivalent purchasing power of the dollar.
Median: The median is the middle point of a distribution. For example, median income is the income point at which half the population has a higher income and half has a lower income.
Decile, percentile et cetera: These are calculated in the same way as the median but refer to different points in the distribution. They involve ranking the population on the basis of the variable—that is, income—and then dividing the population into equal sized groups. Deciles, for example, involve creating 10 groups with the lower decile being the lowest ranked 10 percent of the population. Percentiles involve splitting the population into 100 categories.
Notes on tables
Table 1. Income support and other payment recipients, June 2007
Data is based on point-in-time administrative data at June 2007. The list is based on a selection of pensions, allowances and other payments/supplements.
Age Pension customer data includes Age Pension payments administered by the DVA.
Family Tax Benefit data is based on people who receive fortnightly instalments only as at June 2007. In addition around 10 per cent of eligible persons receive a lumpsum payment through the ATO.
(a) Recipients of the DVA Disability Pension and War Widows payments may also be in receipt of an income support payment.
Source: FaCSIA, DEST, DEWR, DVA and DAFF 2006-07 Annual Reports.
Table 2. Households unable to raise $2,000 in an emergency, 2003–04
This table uses an ABS classification of main source of household income and hence income support classifications may not match other groupings used in this paper. 'Parenting' includes both Parenting Payment Single and Parenting Payment Partnered.
Source: Derived by FaHCSIA from ABS 2003-04 Household Expenditure Survey Confidentialised Unit Record File.
Table 3. Payment recipients without a credit card, 2005–06
Age Pension & related = Age Pension, DVA Service and Widows Pension and Wife Pension; Austudy/Abstudy/YA = Austudy, Abstudy and Youth Allowance; DSP = DSP; Carer Payment = Carer Payment; Parenting Payment Single = Parenting Payment Single; Other Family = FTB, Maternity Payment, and Parenting Payment Partnered; NSA & working age = Other income support payments.
Source: Derived by FaHCSIA from ABS 2005-06 Survey of Income and Housing Confidentialised Unit Record File.
Table 4. Home and Community Care program
The table describes only a selection of the total services available through Home and Community Care (HACC) and, because clients may receive more than one type of assistance, the sum of the columns does not equal the number of clients.
The proportion of HACC funded agencies that submitted HACC Minimum Data Set data in 2006-07 differed across jurisdictions and ranged from 75 per cent to 100 per cent. Actual client numbers will be higher than those reported.
State/Territory refers to the location of service providers.
Refer to the Appendix 4 of the source document for definitions of assistance types.
Source: Home and Community Care Program Minimum Data Set, 2006-07 Annual Bulletin.
Table 5. CSTDA funded services 2006–07
This table is not a complete list but is a selection of services provided through the Commonwealth State Territory Disability Agreement in 2006-07.
Individuals may use more than one service so user numbers cannot be aggregated to give total client numbers.
Source: CSTDA National Minimum Data Set 2006-07.
Table 6. Income support recipients by duration on payment, 2007
This table uses longitudinal data to look at the duration of income support receipt over time and across payments. Persons are in scope if they were on one of the identified payments between January and June 2007. The duration need not be continuous. It is based on the cumulative period of time the person has been on income support over the period in question.
(a) The time period over which duration is counted actually varies between 5 years and 5 years 6 months, and 10 years and 10 years and 6 months.
(b) Total duration on payments is a combination of the total time the person had been on payments in the 11 years prior to 2007, and the time they have continuously been on their current payment type if this is greater.
The data excludes DVA payments.
Source: FaHCSIA Longitudinal Data Set.
Table 7. Housing tenure of recipients of transfer payments, September 2007
As at September 2007, excludes persons on DVA payments.
Source: FaHCSIA Housing data set.
Table 8. Couple combinations of income support payments, September 2007
Note this data excludes couples where one person is not in receipt of income support payments or receives their income support from DVA. It excludes all couples where both members are on DVA payments.
Source: FaHCSIA Housing data set.
Table 9. Income support recipients, partner status, September 2007
'Partner not on payment' includes cases both where the partner is not in receipt of income support payments and where they receive their income support from DVA.
Source: FaHCSIA Housing data set.
Table 10. Living arrangements of single income support recipients, 2005–06
Unlike the other tables on living arrangements this is derived from ABS survey data. This is because administrative data does not collect information on living arrangements except to the extent necessary for program administration. Compared with administrative data this survey data appears to under-report the number of single income support recipients.
Age Pension & related = Age Pension, DVA Service and Widows Pension and Wife Pension; Austudy/Abstudy/YA = Austudy, Abstudy and Youth Allowance; DSP = DSP; Carer Payment = Carer Payment; Parenting Payment Single = Parenting Payment Single; Other Family = FTB, Maternity Payment, and Parenting Payment Partnered; NSA & working age = Other income support payments.
Source: Derived by FaHCSIA from ABS 2005-06 Survey of Income and Housing Confidentialised Unit Record File.
Table 11. Incidence of caring and disability (ABS SDAC definitions), 2003
As with other tables derived from survey data estimates of numbers on income support payments may not match with administrative records due to self reporting and sampling errors.
Carers are classified as being primary carers spending more than 20 hours a week caring.
The 'Core disability' classification used by the ABS does not always coincide with the measurement of disability for the purposes of eligibility for DSP or other payments. It is likely to classify some people who would not be eligible for income support and exclude others who may be.
Source: Derived by FaHCSIA from ABS 2003 Survey of Disability Ageing and Caring Confidentialised Unit Record File.
Table 12. Reliance upon income support by household wealth decile
Source: Derived by FaHCSIA from ABS 2005-06 Survey of Income and Housing Confidentialised Unit Record File.
Notes on charts
Chart 1. Illustration of the operation of the income test
Rates are those that apply to a single person without child and are those that apply as at 1 July 2008.
The Maximum Basic Rate for Newstart Allowance is the lower single rate. The higher rate is paid to single people with children and to those aged 60 and over on income support for nine months or more.'
Source: A guide to Australian Government payments 1 July to 19 September 2008.
Chart 2. Income support packages for selected single recipients, as at June 2008
The packages are the maximum rates of income support (before the operation of the income and assets tests) plus the specified supplements. Other supplements may also be available (for example, Rent Assistance). All rates (excluding Bonus payments) are annualised rates for the period 20 March to 19 September 2008. The Bonus payments are those announced in the 2008-09 Budget and paid by 30 June 2008.
The Maximum Basic Rate for Newstart Allowance is the lower NSA rate. The higher rate is paid to single people with children and to those aged 60 and over on income support for nine months or more. Telephone Allowance is the higher annual rate (that is, the internet rate) for the period 20 March - 19 September 2008 with the exception of that paid to Newstart Allowance (partial capacity) who are not eligible for the higher rate.
Source: A guide to Australian Government payments, 1 July to 19 September 2008.
Chart 3. Comparisons of real rates of income growth over the past decade
Many of the household types in the chart are hypothetical and result from internal FaHCSIA modelling—for example, what happened for an Age Pension couple whose total income was equivalent to 100 per cent of the Average Weekly Ordinary Time Earnings. The chart also incorporates estimates from ABS survey data (some of which have been further modelled by FaHCSIA to derive disposable income).
Chart title
|
Detailed description
|
Single Allowee no income (c)
|
Single adult allowee with no private income
|
Single 10th pctl FT NMA earnings (b)
|
After tax income of a single adult with earnings equal to the 10th percentile of earnings of full-time non-managerial adult
employees
|
Single 25th pctl FT NMA earnings (b)
|
After tax income of a single adult with earnings equal to the 25th percentile of earnings of full-time non-managerial adult
employees
|
Single Median FT NMA earnings (b)
|
After tax income of a single adult with earnings equal to the 50th percentile (median) of earnings of full-time
non-managerial adult employees
|
Single Av FT NMA earnings (b)
|
After tax income of a single adult with earnings equal to the average earnings of full-time non-managerial adult employees
|
Couple 2 ch 100%/67% AWOTE (c)
|
After tax income of a couple with two children aged 4 and 8 years, one member earning 100 per cent of Adult Weekly Ordinary Time Earnings
(AWOTE) and the other 67 per cent of AWOTE
|
Pension Cple 2 Child'n no income (c)
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Pensioner (Disability Support Pension) and allowee (Parenting Payment Partnered) couple with two children aged 4 and 8 years, with no
private income
|
Age Pen Cple + 25% AWOTE (c)
|
After tax income of an Age Pensioner couple with one member earning 25 per cent of AWOTE from employment
|
Age Pension Couple no income(c)
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Age Pensioner couple with no private income
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Single Pensioner no income (c)
|
Single Age Pensioner with no private income
|
Couple 2 Child 100% AWOTE (c)
|
After tax income of a single breadwinner couple family with two children aged 4 and 8 years, with the employed person earning 100 per
cent of AWOTE
|
Single Parent 2 Chld'n no income (c)
|
Lone Parent on PPS with two children aged 4 and 8 years, with no private income
|
Low Inc H'hold Disp Income (a)
|
Equivalised household disposable income for low income households as identified in the ABS Survey of Income and Housing
|
Age Pen Cple + 50% AWOTE (c)
|
After tax income of an Age Pensioner couple with one member earning 50 per cent of AWOTE from employment
|
Av. Equiv. H'hold Disp Income (a)
|
Equivalised average household disposable income from ABS Survey of Income and Housing
|
Sources:
(a) Equivalised Household Disposable Income, period 1995–96 to 2005–06 ABS Survey of Income and Housing (Cat No 6523DO001).
(b) Estimate of disposable income of a person with earnings equal to that of a Full-time Adult Non-Managerial Employee at the 10th, 20th and 50th percentile point of the earnings distribution and the Average, ABS Survey of Employee Earnings and Hours (Cat No 6306.0). Period May 1996 and May 2006. FaHCSIA modelling to derive disposable income.
(c) FaHCSIA modelling, Q1 1998 to Q1 2008, data used are applicable payment rates and Average Weekly Ordinary Time Earnings from the ABS Average Weekly Earnings (Cat No 6302.0).
Chart 4. Replacement rates – single allowee
Pension rate includes telephone, pharmaceutical and utilities allowances and bonuses. The rate for households in private rental includes the value of rent assistance.
Where an income benchmark (for example, MTAWE) is in excess of the threshold for Medicare levy surcharge, the modelling assumes that the surcharge is levied.
Source: FaHCSIA modelling using sources as per chart 3.
Chart 5. Replacement rates – single pensioner
As per chart 4.
Chart 6. OECD – social assistance as a proportion of household income
The chart includes revised estimates for Australian couple only households to reflect outcomes of both members being in receipt of an allowance.
This revision was undertaken by FaHCSIA using the OECD modelling spreadsheets
Source: "Benefits and Wages 2007—OECD Indicators", OECD Paris 2007.
Chart 7. OECD – retirement income systems net replacement rates for a worker on 50 per cent and 100 per cent of average earnings
Source: "Pensions at a Glance – Public Policies across OECD countries, 2007 edition", p. 35, OECD, Paris, 2007.
Chart 8. Age Pension as a percentage of budget standards
FaHCSIA has updated the SPRC budget standards using the detailed CPI component level price indices. In addition the estimation of rent for public housing tenants has been reset to reflect current charging policies (in NSW) for public rental including water charging. A new private rental standard has been developed using NSW median private rents in the local government areas of Blacktown, Fairfield, Gosford, Liverpool and Penrith. No changes were made to the components of the budgets beyond this.
The original budget standards were published as DSS Policy Research Paper Number 74 – "Development of indicative budget standards for Australia", Peter Saunders, Jenny Chalmers, Marilyn McHugh, Collette Murray, Michael Bitman and Bruce Bradbury, Budget Standards Unit, Social Policy Research Centre. March 1998.
Chart 9. Relative and real low income measures
The low income (poverty) line is set at 50 per cent median disposable income. The real measure uses relative low income line from 1995 adjusted by the ABS Consumer Price Index in subsequent years. The relative measure is rebased at each survey point.
Elderly = Aged 65 years and over; Children = Aged under 15 years. All rates are expressed as percentage of the specific sub population.
Income has been equivalised using the revised OECD scale.
Years shown are financial years ending on 30 June.
Source: Derived by FaHCSIA from 1994-95, 1995-96, 1996-97, 1997-98 1999-00, 2000-01 ABS Survey of Income and Housing Costs, and 2002-03, 2003-04 and 2005-06 Survey of Income and Housing Confidentialised Unit Record Files.
Chart 10. Transfer reliant households: incidence of financial stress, 2006
Persons aged over 15 years living in households with more than 50 per cent of income from transfers.
Hardship relates to the incidence of: missing a meal, going without heating, having to sell or pawn an item, or seeking help from a welfare organisation, because of a shortage of money. Financial stress includes these items as well as being unable to pay electricity, gas or phone bills on time, not being able to pay mortgage or rent on time or asking for financial help from family or friends. Multiple stress or hardship involves a person reporting two or more of these items over the previous 12 months.
Source: Derived by FaHCSIA from HILDA wave 6 unit record file (2006).
Chart 11. International comparison of single–couple relativities
Source: Social Security Programs Throughout the World is based on information available to the ISSA and SSA with regard to legislation in effect in January 2006, or the last date for which information has been received.
Chart 12. CPI and Age Pension analytical living cost index
Source: ABS, Consumer Price Index, Australia, (Cat No 6401.0 ); ABS, Analytical Living Cost Indexes for Selected Australian Household Types (Cat No 6463.0 ); ABS Australian Economic Indicators, Jan 2000 (Cat No 1350.0).
Chart 13. Highly reliant income support recipients: value of bank accounts, 2005–06
The figure is based on individuals living in households that report that more than 90 per cent of household income is derived from transfer payments.
Equivalised using revised OECD equivalence scales.
It should be noted that as earnings from investments, including bank account balances are treated as income, some household with higher bank balances will be excluded from this group of highly transfer reliant households.
Age Pension & related = Age Pension, DVA Service and Widows Pension and Wife Pension; Austudy/Abstudy/YA = Austudy, Abstudy and Youth Allowance; DSP = DSP; Carer Payment = Carer Payment; Parenting Payment Single = Parenting Payment Single; NSA & working age = Other income support payments.
Source: Derived by FaHCSIA from ABS 2005-06 Survey of Income and Housing Confidentialised Unit Record File.
Chart 14. Highly reliant households: components of final income, 2003–04
Highly reliant households are those that report that more than 90 per cent of household income is derived from transfer payments. Classification of income support as per table 2.
Descriptions of the composition and derivation of non-cash assistance are in ABS, Government Benefits, Taxes and Household Income, Australia, 2003-04 (Cat No 6537.0 ).
Equivalised using revised OECD equivalence scales.
Source: Derived by FaHCSIA from ABS 2003-04 Household Expenditure Survey Confidentialised Unit Record File.
Chart 15. White Card clients: average expenditure, 2007–08
Source: Department of Veterans' Affairs.
Chart 16. Proportion of the population aged 15 years and over on income support, 1901–2008
Retirement = Age Pension, Wife Pension(Age), DVA service and disability pensioners aged over 65 years; People with a disability = DSP and DVA disability pensioners aged under 65 years; Carers = Carer Payment and Wife Pension (DSP); Students = Youth Allowance (Student), Austudy and Abstudy; Other working age = Other income support payments.
Source: FaHCSIA.
Chart 17. Real rates of selected pensions and allowances, 1970–2008
Annualised rates of assistance applying as at 1 January, adjusted by the All Groups Consumer Price Index for previous December quarter.
Rates include telephone, pharmaceutical and utilities allowance and bonuses.
Source: FaHCSIA.
Chart 18. Australian Government expenditure on transfer payments, 1910 to 2008
Source: FaHCSIA.
Chart 19. Main income support payments by gender, June 2007
As for Table 1, note selected payments only.
Chart 20. Levels and rates of receipt of income support by age and gender, June 2008
Note this uses 2007 estimated resident population data by age.
Age Pension & related = Age Pension, DVA Service, Partner Service and ISS, Widow B and Wife (Age) Pension; Disability Support Pension = Disability Support Pension; Carer = Carer Payment, Wife Pension (DSP); Parenting Payment Single = Parenting Payment Single; Youth & students = Austudy, Abstudy, Youth Allowance; Other working age = Other income support payments.
Source: FaHCSIA and DVA.
Chart 21. Age specific rates of receipt to age 65, June 1997 and June 2007
Source: FaHCSIA and DVA.
Chart 22. Disability Support Pensioners by medical category
Source: FaHCSIA.
Chart 23. Medical condition of carees of Carer Allowance recipients
Source: FaHCSIA.
Chart 24. Employment of income support recipients, 2005–2006
Source: Derived by FaHCSIA from ABS 2003-04 Household Expenditure Survey Confidentialised Unit Record File.
Chart 25. Private weekly income by income support payment type, September 2007
This table excludes persons on DVA payments.
Age Pension & related = Age Pension, Wife Pension (Age), Widow B Pension, Crisis Payment – Pension; Disability Support Pension = Disability Support Pension; Carer = Carer Payment, Wife Pension (DSP); Parenting Payment Single = Parenting Payment Single; Youth & students = Austudy, Youth Allowance, Youth Allowance – Apprentice; Other working age = Other income support payments.
Weekly income includes: income from earnings, savings and investments, superannuation, compensation, DVA pensions and allowances, Defence Force Income Support Allowance, overseas pensions, Community Development Employment Projects, New Enterprise Incentive Scheme and other sources of income, excluding child support payments.
Source: Source: FaHCSIA Housing data set.
Chart 26. Cumulative private income by income support payment, September 2007
As per chart 25.
Chart 27. Total income of Age Pensioners as a proportion of pension, September 2007
All weekly income, excludes DVA pensioners.
Note the low incomes for initial percentiles of the distribution with a mix of both pension and non-pension income reflects the operation of the Assets test and other administrative issues.
Source: Source: FaHCSIA Housing data set.
Chart 28. Income support recipients by net household wealth, 2005–06
Net wealth is total household wealth less debt. Wealth includes balances in superannuation funds and value of family home, debt includes HECS liabilities, consumer debt and housing loans.
Data on the proportion of the population within each decile on income support is presented as a proportion of the population aged 15 years and over.
Age Pension = Age Pension, DVA service and widow pensions and Wife Pension; DSP = DSP; Carer Payment = Carer Payment; Parenting Payment Single = Parenting Payment Single; Youth = Austudy, Abstudy and Youth Allowance.; Other working age = Other income support payments.
Source: FaHCSIA derived from ABS 2005–06 Income and Housing Survey Confidentialised Unit Record File.
Chart 29. Transfer reliant households: distribution of net wealth, 2005–06
As for chart 28.
Chart 30. Transfer reliant households: composition of wealth, 2005–06
Households that rely upon transfer payments for more than 50 per cent of household income.
As for chart 28.
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