COST OF LIVING INDICATORS FOR TASMANIA: Final Report
JUNE 2011
PREPARED BY Yogi Vidyattama, Matthew Taylor and Robert Tanton,
PREPARED FOR Tasmanian Department of Premier and Cabinet
COST OF LIVING INDICATORS FOR TASMANIA: Final Report
ABOUT NATSEM
The National Centre for Social and Economic Modelling was established on 1 January 1993, and supports its activities through research grants, commissioned research and longer term contracts for model maintenance and development.
NATSEM aims to be a key contributor to social and economic policy debate and analysis by developing models of the highest quality, undertaking independent and impartial research, and supplying valued consultancy services.
Policy changes often have to be made without sufficient information about either the current environment or the consequences of change. NATSEM specialises in analysing data and producing models so that decision makers have the best possible quantitative information on which to base their decisions.
NATSEM has an international reputation as a centre of excellence for analysing microdata and constructing microsimulation models. Such data and models commence with the records of real (but unidentifiable) Australians. Analysis typically begins by looking at either the characteristics or the impact of a policy change on an individual household, building up to the bigger picture by looking at many individual cases through the use of large datasets.
It must be emphasised that NATSEM does not have views on policy. All opinions are the authors’ own and are not necessarily shared by NATSEM.
© NATSEM, University of Canberra 2011 All rights reserved. Apart from fair dealing for the purposes of research or private study, or criticism or review, as permitted under the Copyright Act 1968, no part of this publication may be reproduced, stored or transmitted in any form or by any means without the prior permission in writing of the publisher.
National Centre for Social and Economic Modelling University Drive South, University of Canberra, ACT 2617
Phone + 61 2 6201 2780 Fax + 61 2 6201 2751 Email [email protected] Website www.natsem.canberra.edu.au
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CONTENTS
About NATSEM 2 Author note 4 General caveat 4 1 Introduction 5 2 Methodology 6 2.1 STINMOD 7 3 Assessment of Tasmanian incomes and the effect of the current transfer system 7 4 Output 15 5 Conclusions 16 References 17
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AUTHOR NOTE
Yogi Vidyattama and Matthew Taylor are Research Fellows in the SISAM team, and Robert Tanton is Research Director of the Social Inclusion and Small Area Modelling (SISAM) Team at NATSEM.
GENERAL CAVEAT
NATSEM research findings are generally based on estimated characteristics of the population. Such estimates are usually derived from the application of microsimulation models or other economic modelling techniques to microdata based on sample surveys.
These estimates may be different from the actual characteristics of the population because of sampling and nonsampling errors in the microdata and because of the assumptions underlying the modelling techniques.
The microdata do not contain any information that enables identification of the individuals or families to which they refer.
4 COST OF LIVING INDICATORS FOR TASMANIA: Final Report
1 INTRODUCTION
The National Centre for Social and Economic Modelling (NATSEM) has prepared this final report for the Department of Premier and Cabinet’s Social Inclusion Unit (SIU) who are responsible for research and analysis on social inclusion, policy advice and support for the Social Inclusion Commissioner, Premier and Cabinet and administration of funding for programs that reduce social exclusion. This report is produced to provide data for the SIU’s Cost of Living Strategy research. In the research, the SIU is analysing policy levers outside the control of the Tasmanian Government, in particular the role of the Commonwealth Government in setting payment levels for pensions and allowances as well as marginal/effective taxation rates.
The data provided by NATSEM for the SIU are as follows:
1) The composition (using equivalised disposable incomes), range and distribution (household types, household income and age of the household reference person) of Tasmanian household incomes, as well as a comparison with all other states and territories of Australia (using ABS base datasets from 2005-06 and 2007-08 Survey of Income and Housing).
2) Disaggregation to the following categories where the data allows:
a) Income source of household, Government pensions and allowances – Age/disability pension
b) Income source of household, Government pensions and allowances – Unemployment, education and sickness allowances
c) Income source of household, Government pensions and allowances – Other government pensions and allowances
d) Income source of household – Wage and salary
e) Income source of household – Own unincorporated business income
f) Income source of household – Other income (superannuation or other private income)
g) Income level of household – National quintiles of household equivalised disposable income (Lowest, Second, Third, Fourth, Highest) and the second and third deciles
h) Composition of household – Lone person household
i) Composition of household – One parent, one family households with one dependent child only
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j) Composition of household – One parent, one family households with two or more dependent children
k) Composition of household – Couple only
l) Composition of household – Couple with one dependent child only
m) Composition of household – Couple with two dependent children only
n) Composition of household – Couple with three or more dependent children only
o) Composition of household – All households (being a total of all households for the geography)
3) Modelling of the effect of the current tax/transfer system on Tasmanian incomes and by:
a) Decomposing Gross Income into Gross Private Income, Transfers, Taxes and Disposable income
b) EMTR
4) Estimates of financial stress
5) Estimates of house price for households (to determine the level of asset ownership of primary place of residence)
6) Estimates of labour force participation
Besides the databases above, NATSEM has also provided this short written report that includes analysis and commentary on Tasmanian incomes, equivalised incomes, and comparisons within categories for Tasmania and other jurisdictions, using Gini coefficients and income poverty measures as well as an assessment of the effect of the current tax/transfer system on Tasmanian incomes, by comparing Gross Private Income and Disposable Incomes across the household groups.
2 METHODOLOGY
The model used for this project is NATSEM’s in-house static microsimulation model of Australia's income tax and transfer system, STINMOD. The model is mostly used to analyse the distributional and individual impacts of income tax and income support policies and to estimate the fiscal and distributional impacts of policy reform. STINMOD has been used to analyse a wide range of policies including the major changes to the tax and transfer system introduced in Australia in July 2000, changes in effective tax rates over the last decade, and changes to single age pensions.
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2.1 STINMOD
STINMOD is a model that has been used to calculate the simulated impact of major Australian federal government cash transfers, income tax and the Medicare levy. The model estimates the aggregate fiscal impact of a change in tax and/or transfer policy on revenue and government expenditure. The model also estimates the distributional impacts of policy change at the household level, for groups of people and individuals – that is, who wins, who loses and by how much.
STINMOD works by applying the current and possible alternative settings of the tax and transfer system, which have been coded and regularly updated to reflect major changes in tax/transfer policies every year, to a sample population (basefile) which is constructed from the latest ABS Surveys of Income and Housing Costs. For this work, we have used the latest version of STINMOD, STINMOD/10, which has a basefile using combined data from the 2005/06 and 2007/08 ABS Surveys of Income and Housing. In addition, various demographic and administrative benchmarks are used to increase the accuracy of the modelling, and economic indicators are used to inflate the earnings and other monetary values reported by those Australians captured in the ABS surveys to current values (as the surveys are always some years out of date). The rates and payments settings of the tax and transfer system (parameters), which are also regularly updated, are used to determine and calculate different tax and income variables for each of the individuals and families in the sampled population.
STINMOD is updated each year, to take into account the latest Government policies, inflate financial data, and bring in any new survey information. The version used for this work is STINMOD/10, which uses the 2005-06 and 2007-08 Surveys of Income and Housing. This latest model includes a range of improvements over past models following a thorough review undertaken by NATSEM and the Australian Government. For example, the latest STINMOD includes detailed information on housing costs including rents and mortgages. Housing costs are taken from the ABS survey data and updated to 2011 values using appropriate inflators. Rents are inflated using capital city ABS rent inflation figures and mortgages are updated using ABS housing finance data for each state. Changes in interest rates are incorporated into the mortgage costs of households using the RBA’s measure of standard variable interest rate.
The current model has also been linked to NATSEM spatial microsimulation model, SpatialMSM, to derive small area estimates, and this is the model used in Part 2 of this work
3 ASSESSMENT OF TASMANIAN INCOMES AND THE EFFECT OF THE CURRENT TRANSFER SYSTEM
This section provides an assessment of the median equivalised household income (especially disposable household income) of Tasmanian households compared to households in other States of Australia. The use of household rather than individual
7 COST OF LIVING INDICATORS FOR TASMANIA: Final Report
income assumes income-sharing within households. The modified OECD equivalence scale (first proposed by Buhmann et al (1988) and widely recognised internationally) is used to adjust these household incomes for household size and composition. In this study, this scale has been used to give a value of 1 to the first adult in the household, 0.5 to any second and subsequent adults, and 0.3 to dependent children. This is a standard equivalence scale used in Australia as further discussed in Greenwell et al (2001), Saunders (2005) and Saunders et al (2008). Dependent children are defined, in common with other recent Australian studies, as children aged 0 to 14 years (see, for example, Saunders et al 2008). Due to the distribution of household incomes, we have used the median income. We have also removed zero and negative incomes due to ABS concerns about the reliability of households in their surveys reporting zero and negative incomes (Saunders et al, 2008)
Table 1 shows that the median gross and disposable income of Tasmanian households is lower than other states in Australia. We cannot include values for the two Territories separately as the ABS has combined the ACT and the NT as ACT/NT to protect the confidentiality of respondents, and this is the way we have presented the data in Table 1.
The median equivalised gross household income of Tasmanian households is estimated to be only 78% of the median Australian household income, while the disposable income is slightly better at nearly 85% of the median Australian equivalised disposable household income. The difference between the equivalised disposable income of Tasmania and South Australia, which has the second lowest income, is estimated to be around $80/week.
Tasmania also has the highest poverty rate of all States. The poverty rate is calculated using the half of median equivalised disposable income as the poverty line (see more discussion in Harding et al 2001; Harding and Szukalska 2000; Saunders et al 2008). As can be seen in Table 1, the national median equivalised disposable household income using this model is $740 per week, which means the poverty line is estimated to be $370 per week.
The overall poverty estimate from this model is lower than the estimate from the ABS Survey of Income and Housing, as well as previous STINMOD models. The reason for this is that in September 2009 the Australian government increased the rate of pension paid to single age pensioners, and this has moved many pensioners above the poverty line (Tanton et al, 2009). This would not be reflected in the base survey data, and highlights the importance of using STINMOD to bring in the new tax/transfer systems. In addition, in STINMOD, we assume full take up of government benefits while it was estimated that there are benefits unclaimed for more than 168,000 Australians (Baker, 2010). This would have a minor impact on our calculations, as many of these will only claim some of their benefits.
The difference in median income in the Balance of State for Tasmania compared to the capital city Hobart is estimated to be nearly $200 per week. Interestingly, the poverty rate estimated for Hobart is higher than the Tasmanian Balance of State area. This may be because there are lower levels of inequality in the Balance of State area, as shown by the gini coefficient. This, along with a higher median income in Hobart, means there is more likely to be more people below the half median poverty line in Hobart.
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Table 1 Incomes, Poverty Rates and Gini coefficients for all Australian States and Territories, 2011 Equivalised Equivalised Gross Disposable Household Household Income Income Inequality Measure Ratio to Ratio to National National Median Median Median Median Poverty Gini ($) (%) ($) (%) Rate (%) coefficient
New South Wales 825.00 98 730.00 99 6.70 0.283
Victoria 856.00 101 749.00 101 7.38 0.263
Queensland 843.00 100 741.00 100 6.71 0.265
South Australia 786.00 93 698.00 94 8.38 0.259
Western Australia 916.00 109 774.00 105 5.62 0.270
Tasmania 662.00 78 614.00 83 10.50 0.238
- Hobart 817.00 97 713.00 96 11.60 0.239
- Tasmania balance of state 612.00 73 567.00 77 9.67 0.221
ACT/NT 1,134.00 134 936.00 126 4.36 0.253
Australia 844.00 100 740.00 100 6.92 0.262 Source: STINMOD/10 Note: The State of usual residence for the ACT and the NT have been combined by the ABS as ACT/NT in the basic CURF to protect the confidentiality of respondents
Table 2 gives a clearer picture of why incomes in Tasmania are relatively low compared to the other States. First, the median salary and income from wages, salaries and businesses in Tasmania is lower then the other States and Territories. Second, there are around 23% of households relying on the Age Pension and the Disability Support Pension as their principal source of income, while the total proportion of households relying on Government pensions and allowances (income support) is just below 31%, the highest of any State. South Australia is the only other jurisdiction that has anything close to this number at 22%. The national proportion of households that rely on Government income support as their principal source of income is around 29%.
The proportion of households relying on the Age Pension and Disability Support Pension in Tasmania is also considerably higher outside the capital city of Hobart with 27% of households relying on these payments. Given the recent increase in the single Age pension that will have moved many people above the poverty rate, this could explain why the poverty rate is lower in the Balance of State area even when it has a lower median income. Given the high proportion of pension recipients in Tasmania Balance of State, this area is also vulnerable to changes in Government policies affecting transfer payments.
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Table 2 Income by income source by State, 2011 NSA, YA and Sickness Wages and Salary Business Age Pension, DSP Other income support Other income Benefit
Equivalised Proportion Equivalised Proportion Equivalised Proportion Equivalised Proportion Equivalised Proportion Equivalised Proportion Disposable of Disposable of Disposable of Disposable of Disposable of Disposable of income households income households income households income households income households income households (Median, $) (%) (Median, $) (%) (Median, $) (%) (Median, $) (%) (Median, $) (%) (Median, $) (%)
New South Wales 926.00 60.29 598.00 6.11 411.00 17.67 382.00 2.27 454.00 3.58 642.00 10.08 Victoria 916.00 61.18 607.00 5.84 419.00 16.50 334.00 2.73 438.00 4.14 695.00 9.60
Queensland 894.00 62.08 678.00 7.74 423.00 17.28 369.00 2.47 455.00 3.32 669.00 7.11 South Australia 903.00 54.86 718.00 7.34 414.00 21.60 328.00 3.60 437.00 4.26 663.00 8.33 Western Australia 931.00 63.70 637.00 7.84 423.00 15.54 319.00 2.18 465.00 2.79 637.00 7.95 Tasmania 815.00 54.05 590.00 7.02 418.00 23.06 319.00 3.92 442.00 3.99 697.00 7.97 - Hobart 862.00 60.76 787.00 5.69 413.00 18.31 261.00 3.56 413.00 2.10 713.00 9.58
- Tasmania balance of state 762.00 48.81 556.00 8.06 418.00 26.77 337.00 4.19 444.00 5.46 646.00 6.71 ACT/NT 1,021.00 73.11 690.00 4.51 381.00 6.12 295.00 2.72 439.00 2.12 922.00 11.42 Australia 916.00 60.95 637.00 6.63 417.00 17.24 361.00 2.57 451.00 3.61 669.00 9.00 Source: STINMOD/10 Notes: All proportions should sum to 100% across the rows. The State of usual residence of the ACT and the NT have been combined by the ABS as ACT/NT in the basic CURF to protect the confidentiality of respondents
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Table 3 confirms that Tasmanian households are vulnerable to Government income transfer policy changes. We estimate that in 2011, 16% of the total gross income in Tasmania will come from Government income support. Tasmania has not only the highest proportion of income support compared to all other Australian States and Territories, but it is also the only State in which the proportion of total income support paid is higher than the ratio of the total tax paid to gross income. This occurs mainly in the Tasmanian Balance of State area, where the total income support is around 20% of gross income, almost twice as much as the tax paid by households in the area.
Table 3 also presents the Effective Marginal Tax Rate (EMTR). This calculates the average proportion of income lost from an additional dollar generated by an income unit (family) due to the tax paid and the loss of income support. So looking at Table 3, in New South Wales, if a family earns $1 more, on average, they will be worse off by 28.42 cents through paying more in tax and losing benefits. A lower EMTR suggests greater benefits in earning more private income, with less benefits lost and less tax paid. An EMTR below 50, especially around 30, is usually considered as a rate that shows that people, on average, are not depending too much on income support, as well as not being restricted by high income taxes (Whiteford et al 1989).
As can be seen from Table 3, EMTR’s across Australian States and Territories are similar, and all around the 25 – 30 mark. Even though it is one of the lowest, Tasmania as a State does not have the lowest EMTR (South Australia does), although Tasmania - Balance of State does have the lowest EMTR. Tasmania - Balance of State also has one of the lowest median incomes (see Table 1) and is the area where households are most reliant on income support (see Table 2).
The main driver of the low EMTR in Tasmania – Balance of State is the low median income, which means additional taxes paid for an additional dollar earned are not high due to the marginal tax rate scale in Australia. The high reliance on benefits could actually increase the EMTR as each additional dollar earned would lose more in benefits. However, in Tasmania we found that there are many household with pension as their principal source of income that will not lose a substantial amount of benefits if they earn an additional dollar in private income, so this would have little effect on the EMTR in Tasmania, and certainly wouldn’t push it higher. Our testing using STINMOD has shown that taking out this type of household in Tasmania would increase Tasmania’s EMTR to be not only above South Australia but also above Victoria.
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Table 3 Proportion of Gross Income to Disposable Income, Private Income, Income Support, Tax Paid and EMTR, 2011 Proportion of Gross income from disposable private Income EMTR tax paid income income support (%) (%) (d) (%) (a) (%) (b) (%) (c) (e)
New South Wales 82.08 90.14 9.86 17.92 28.42
Victoria 83.46 89.77 10.23 16.54 27.01
Queensland 82.63 90.02 9.98 17.37 27.69
South Australia 84.06 87.54 12.46 15.94 26.68
Western Australia 81.79 92.14 7.86 18.21 29.18
Tasmania 87.14 84.26 15.74 12.86 26.73
- Hobart 85.71 88.36 11.64 14.29 27.86
- Tasmania balance of 88.61 80.02 19.98 11.39 25.85 state
ACT/NT 80.87 95.73 4.27 19.13 30.12
Australia 82.69 90.12 9.88 17.31 27.87 Source: STINMOD/10 Notes: gross income = private income + income support (i.e., (b) + (c) = 1) and disposable income = gross income – tax paid (i.e., (a) = 1 - (d) ), The State of usual residence of the ACT and the NT have been combined by the ABS as ACT/NT in the basic CURF to protect the confidentiality of respondents
Looking at financial stress in Table 4, we have defined financial stress as the proportion requiring help from a family or friend to pay registration and insurance on time due to a shortage of money. The estimation of financial stress uses the probabilities of different financial stress indicators from the ABS Household Expenditure Survey 2003/2004. These probabilities are based on the proportions of households who are experiencing a particular financial stress indicator based on the age of the household reference person, the sex of the household reference person, the equivalised disposable household income quintile and the State they are living in. These probabilities are then used to impute the financial stress indicators onto STINMOD/10 Essentially this means proportions of households in financial stress for these different characteristics have been calculated from the 2003/04 survey and have been applied to STINMOD/10.
The results show Tasmania is one of the two states with the highest proportion of households suffering financial stress in most of categories. Tasmania experiences the highest ranking for financial stress on 2 of the 7 indicators, and the second highest on 4 of the 7 indicators. This indicates that Tasmania has one of the highest levels of financial stress of all States in Australia.
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Table 4 Proportion of households in financial stress, 2011 Whether Whether Assistance Sought Went could not could not sought from Pawned or financial help Unable to without pay gas/ pay welfare/ sold from heat home meals electricity/ registration/ community something friends/family due to due to telephone insurance organisatio due to due to a shortage of shortage bill on on time due ns due to shortage of shortage of money (%) of money time due to to shortage shortage of money (%) money (%) (%) shortage of of money money (%) money (%) (%) New South Wales 3.48 2.93 9.16 2.38 2.91 13.5 5.11
Victoria 2.57 2.37 10.2 1.78 2.85 14.5 4.99
Queensland 1.61 4 9.63 0.89 2.37 12.1 5.26 South Australia 2.49 4.82 8.61 4.28 2.52 16.6 5.8 Western Australia 3.07 4.12 9.59 2.63 2.61 14.8 5.47
Tasmania 3.33 2.98 10.5 3.09 3.31 16 7.53
ACT/NT 1.99 3.8 9.4 0.48 3.89 12.9 7.02
Australia 2.71 3.3 9.54 2.06 2.75 13.8 5.25 Source: STINMOD10A
Table 5 shows the proportion of gross income received through income support and tax paid as a proportion of gross income for different family types and different States to see whether there is any specific type of family that is more vulnerable to changes in the transfer system. Among couple families, it is the couples without children that are more vulnerable, shown by a high proportion of income support to total gross income. This is primarily because this type of family usually consists of a very young family or a very old family. Both these types of families rely on certain types of welfare, the Age pension for the very old family; and Newstart allowance for very young families just starting in the job market. Couple families with more than two children in Tasmania also received a relatively high proportion of their gross income from income support, especially those with three or more children, whose proportion of gross income received through income support is similar to those without children. This may reflect the Family Tax Benefit payment increasing with more children.
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Table 5 Proportion of gross income to income support received and tax paid for different family types, Couple families, 2011
Couple family with Couple family with at Couple family without Couple family with two dependent least three dependent children one dependent child children children
Gross Gross Gross Gross Tax paid Tax paid Tax paid Tax paid income income income income as a as a as a as a received received received received proportion proportion proportion proportion through through through through of gross of gross of gross of gross income income income income income income income income support support support support (%) (%) (%) (%) (%) (%) (%) (%) New South 13.01 13.11 3.13 20.66 3.94 22.78 5.50 23.72 Wales
Victoria 13.11 12.40 3.27 20.62 3.79 20.47 7.28 21.32
Queensland 12.39 14.49 3.04 20.12 3.78 20.70 6.68 22.25 South 15.77 11.96 6.36 16.98 3.80 21.15 6.60 22.92 Australia Western 8.92 14.15 2.45 20.84 3.79 22.85 6.47 21.30 Australia
Tasmania 16.30 10.85 4.16 17.32 8.46 14.91 12.53 16.54
- Hobart 12.49 10.89 2.70 18.76 6.98 17.19 4.79 20.31
- Tasmania 19.65 10.82 6.48 15.03 9.56 13.22 22.42 11.67 balance of state
ACT/NT 4.98 15.55 1.43 21.95 1.47 21.99 4.74 21.84
Australia 12.48 13.29 3.19 20.39 3.84 21.59 6.37 22.46 Source: STINMOD10A Note: The State of usual residence of the ACT and the NT have been combined by the ABS as ACT/NT in the basic CURF to protect the confidentiality of respondents
While Table 5 shows that among couple families, those with no dependent children in the household are the most vulnerable to changes in transfer payments, Table 6 shows that the vulnerability of those in sole parent households and lone person households is much higher than those in couple households with the sole parent household with one child receiving around 30% or more of their gross income from government benefits. The proportion goes up to around 50% when the single parent has two or more children in their care. The lone person household is less vulnerable than the sole parent household, but on average is still more vulnerable than couple households.
There is another category of families which consist of couples with non-dependent children only, other one family households, multiple family households and group households (shown as ‘Other’ in Table 6). On average, these types of families are estimated to have received about 10% of their gross income from income support. Tasmanians in these categories are estimated to have a higher proportion of around 15% of their gross income paid as benefits.
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Table 6 Proportion of gross income to income support received and tax paid for different family types, non-Couple families, 2011
Sole parent with at Sole parent with one Lone person least two dependent Other (a) dependent child household children
Gross Gross Gross Gross Tax paid Tax paid Tax paid Tax paid income income income income as a as a as a as a received received received received proportion proportion proportion proportion through through through through of gross of gross of gross of gross income income income income income income income income support support support support (%) (%) (%) (%) (%) (%) (%) (%) New South 35.18 11.42 51.77 7.35 22.94 11.97 10.26 15.13 Wales
Victoria 39.16 9.58 58.44 6.69 20.87 12.08 9.94 14.56
Queensland 33.42 15.78 48.21 8.86 17.25 14.22 11.08 14.62 South 28.94 11.56 57.42 4.88 25.52 11.12 9.26 15.21 Australia Western 54.10 7.20 27.42 16.43 17.55 13.98 4.77 17.01 Australia
Tasmania 41.26 6.36 67.53 3.60 28.08 9.66 15.19 12.25
- Hobart 29.17 7.95 80.26 1.82 25.46 11.14 12.50 12.14
- Tasmania 51.95 4.94 61.93 4.38 30.04 8.57 19.78 12.44 balance of state
ACT/NT 19.03 16.55 27.03 16.64 7.56 15.51 3.84 17.81
Australia 36.73 11.80 50.15 8.38 20.49 12.68 9.67 15.08 Source: STINMOD10A Notes: (a) couples with non-dependent children only, other one family households, multiple family households and group households. The State of usual residence of the ACT and the NT have been combined by the ABS as ACT/NT in the basic CURF to protect the confidentiality of respondents
4 OUTPUT
The output from this work is a number of workbooks.
1. INCOMES_BY_HH_STATELEVELVF.XLS contains the mean, median and the range of the equivalised disposable household income as well as information on how many households are represented and the number observations used to do the estimation.
2. GROSS_INCOME_DECOMPOSITIONVF.XLS contains information on Private Income, Income Support, Tax Paid and Disposable Income as a Proportion of Gross Income as well as information on how many households are represented and the number observations used to do the estimation.
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3. EMTRVF.XLS contains estimates of the average effective marginal tax rate in particular households as well as information on how many households are represented and the number observations used to do the estimation.
4. HOUSING_VALUE_MEANVF.XLS contains the mean, median and the range of house values for different households as well as information on how many households are represented and the number observations used to do the estimation.
5. LFPARTICIPATION_RATEVF.XLS contains the average labour force participation rate among people aged 15 and over as well as information on how many adults are represented and the number observations used to do the estimation.
Each of the tables contains five sheets:
- Household Composition. This sheet contains results for each of the family types specified in section 1.
- Principal Source. This sheet contains the results by different sources of household income. This is the principal source of household income, so where the majority of the Household’s income comes from.
- Quintiles. This sheet contains the results for each quintile of the equivalised disposable household income distribution.
- Deciles. This sheet contains the results for each decile of the equivalised disposable household income distribution, as well as the results for Deciles 2 and 3, as per Tasmanian SIU request.
- Age. This sheet contains the results by the age of the Household Reference Person.
6. POVERTY_GINIVF.XLS contains poverty rates and the overall gini coefficient. The poverty rates are the number of people living in households with incomes below the half median equivalised disposable household income. The five worksheets shown above are also available for poverty rates in this workbook, but the gini coefficient is only produced for each State.
7. FINANCIAL STRESSVF.XLS contains the estimated proportion of households in financial stress as described in the household expenditure survey 2003/04. This workbook only contains one sheet showing financial stress by State.
8. GROSS_INCOME.XLS contains the mean of the gross household income as requested by the Tasmanian SIU. It also contains five sheets as described in output number 1-5.
5 CONCLUSIONS
This research provides an estimate of income for different types of households in Tasmania, Hobart and balance of State; and all other States and Territories for comparison. In general, incomes in Tasmania are low compared to other states in Australia. This is not
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only because of lower wages and business income, but also because of a high proportion of households with the pension as their principal source of income, especially in Balance of State areas in Tasmania. This would make households in Tasmania, and especially those in the Balance of State area, more vulnerable to the impact of any changes in Government policy on income transfer payments. As in other States, sole parent households are particularly vulnerable to any changes in the transfer system, followed by lone person households. Couple households in Tasmania are also relatively vulnerable compared to the other States and Territories, especially for couple parent families without children and couple families with three or more children. For couple families without children, the high vulnerability is due to their low private income and this is possibly because most of them are either very young or very old.
REFERENCES
Baker, D., 2000, ‘Missing Out: Unclaimed Centrelink Payments and Concession Benefits’ Impact, Election 2010, 12-13. Availability:
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