Relative Poverty after Housing Costs
Description:
The proportion of individuals living in private households with an equivalised income of less than 60% of the UK median after housing costs.
Source of Data:
The data source is the Family Resources Survey (Households Below Average Income dataset). The unit of measurement is the individual.
Households Below Average Income is a National Statistics dataset owned by Department for Work and Pensions.
The indicator is published as part of the annual publication: Poverty and Income Inequality in Scotland.
The Family Resources Survey is a sample survey including approximately 2,700 households in Scotland. The responses of these households are weighted and grossed up to be representative of all private households in Scotland.
The equivalised household income of each individual is compared to 60% of the UK median, and the person is considered to be in relative poverty if their income is below that threshold. The weighted and grossed number of people below the threshold is then divided by the estimated number of individuals in private households in Scotland to provide this indicator.
Incomes are adjusted for household size (or 'equivalised') using the modified OECD equivalence scale.
The measure represents a three-year rolling average.
Definitions:
The income measure used is equivalised net disposable household income after housing costs. This is income from all sources (including earnings, benefits, tax credits, pensions, and investments) after deductions for income tax, national insurance contributions, council tax, pension contributions and maintenance payments and also after deductions for housing costs such as rent and/or mortgage interest payments.
Equivalisation sums the income of all householders, adjusts it to reflect the composition of the household, and applies the resulting income to all householders.
Private Scottish households refers to all households that are not communal establishments such as hostels, prisons or hospitals, for example.
The median is the middle value when the household income of all individuals in the UK are ranked in order. Sixty percent of the median is an internationally recognised poverty threshold.
Criteria for Change:
- Performance is improving if the indicator decreases for three periods in a row by at least 1 percentage point each period.
- Performance is worsening if the indicator increases for three periods in a row by at least 1 percentage point each period.
- Otherwise, performance is maintaining.