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6527.0 - Household Expenditure Survey, Australia: User Guide, 1998-99  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 15/11/2001   
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Contents >> Chapter 5. Data analysis

Summary of comparability with previous HES surveys
Comparability between the 1998-99 HES and the 1993-94 HES
Income quintiles

SUMMARY OF COMPARABILITY WITH PREVIOUS HES SURVEYS

Comparability in the concepts, classifications and methodology employed in the HES has been maintained where possible between the 1998-99 survey and the previous surveys which were conducted in 1974-75, 1975-76, 1984, 1988-89 and 1993-94. Within some limitations, the results of the surveys can be viewed as a time series and changes in income and expenditure patterns over this period can be analysed.

Some of the differences between the surveys which need to be taken into account when performing time series analyses are given in table 3.

3 DIFFERENCES BETWEEN THE 1998-99 HES AND PREVIOUS SURVEYS


1998-99
1993-94
1988-89
1984
1975-76
1974-75

Complete households
  • capital city
  • other urban
  • rural
  • total
4,795
1.534
564
6,893
6,107
1,712
570
8,389
5,263
1,630
512
7,405
6,896
2,027
648
9.571
2,813
2,225
831
5,869
9,095
-
-
9,095
Household characteristics
See table 6
below for details.
See table 6
below for details.
Some differences
in classifications
and coding across household and demographic
items.
Some differences
in classifications
and coding across household and demographic
items.
Some differences
in classifications
and coding across household and demographic
items.
Some differences
in classifications
and coding across
household and
demographic
items.
Expenditure classification
Household Expenditure Classification
(HEC)
Household
Expenditure
Commodity Code
List (HESCCL)
Household
Expenditure
Commodity Code
List (HESCCL)
Household
Expenditure
Commodity Code
List (HESCCL)
Some differences
in coding (a)
Some differences
in coding (a)
Income in-kind (diary-collected)
The value of employer provided items was
included in total income estimates.
As for 1998-89
HES
As for 1998-89
HES
As for 1998-89
HES
As for 1998-89
HES
As for 1998-89
HES
Income in-kind (collected in individual questionnaire)
The value of employer provided rent for housing, telephone services and use of car
was not included
in total income estimates.
The value of
employer provided
rent for housing,
telephone
services,
electricity and use
of car was not
included in total
income estimates.
As for 1993-94 HES
As for 1993-94 HES
The value of
employer provided
items was
included in total estimates.
As for 1975-76
HES
Expenditure in-kind (diary-collected)
The value of employer provided items was
included in expenditure.
As for 1998-99
HES
As for 1998-99
HES
As for 1998-99
HES
As for 1998-99
HES
As for 1998-99
HES
Expenditure in-kind (collected in individual questionnaire)
The value of employer provided rent for housing, telephone services and use of car
was not included
in expenditure estimates
The value of
employer provided
rent for housing,
telephone
services,
electricity and use
of car was not
included in
expenditure
estimates.
As for 1993-94
HES
As for 1993-94
HES
The value of
employer provided
items was
included in
expenditure
estimates.
As for 1975-76
HES
Negative income
Negative incomes were left as negative.
As for 1998-99
HES
As for 1998-99
HES
Negative incomes
were set to zero.
As for 1984 HES
As for 1984 HES
Income tax
Entirely imputed.
As for 1998-99
HES
As reported with non-response
imputed.
As for 1988-89
HES
As for 1988-89
HES
As for 1988-89
HES

(a) Fine level codes in earlier surveys were less detailed and arranged in different categories. In most cases, it is possible to re-create the 1974-75 and 1975-76 codes for information collected in later surveys.


COMPARABILITY BETWEEN THE 1998-99 HES AND THE 1993-94 HES

This section provides a more detailed comparison of differences between the 1998-99 and 1993-94 surveys

Benchmarks

In 1993-94, the two household benchmarks comprised state/territory and twelve categories of household composition. There was a single person benchmark in 1993-94 which comprised six age categories. The household benchmarks in 1998-99 were expanded to include a distinction between capital city and the balance of the state or territory. The person benchmarks in 1998-99 were expanded to include extra benchmarks for state/territory and capital city/balance of state or territory, additional age categories, sex and labour force status.

4 COMPARISON OF BENCHMARKS USED IN THE 1993-94 AND 1998-99 HES
1998-99 HES1993-94 HES

Household benchmarksState / territory by capital city / balance of state or territoryState / territory
Capital city / balance of state or territory by number of adults (1, 2, 3 and over) by number of children (0, 1, 2 and over)Number of adults (1, 2, 3 and over) by number of children (0, 1, 2, 3 and over)
Person benchmarksState/territory by age groups (0-4, 5-9, 10-14, 15-19,
20-24, 25-44, 45-64, 65 and over)
Age groups (0-4, 5-14, 15-19, 20-24, 25-54, 55-64, 65 and over)
Labour force status (employed / unemployed / not in
the labour force) by sex by capital city / balance of state or
territory by age groups (0-14, 15-24, 25-44, 45-64, 65 and over)


Expenditure classification

Since 1984 the expenditure classification has been relatively unchanged. For the 1998-99 HES it was considered time to update the classification to include new items of expenditure such as payments to internet providers and mobile phone accounts. In the process of updating the classification, it was converted to a hierarchy using two digits for each level of the classification. This structural change allows for the addition and deletion of categories over time and for the logical display of levels, including the creation of totals and subtotals.

Some of the new categories include prepared meat products, land tax, mobile phone accounts, catholic school fees, other non-government school fees, sunscreens, road tolls, donations to charity, home entertainment systems, digital video discs, internet fees, satellite dishes, and pay television. For a complete list of items and the concordance with the 1993-94 HESCCL see appendix 3.

Despite all the changes, 78% of categories at the published level are unchanged from 1993-94, and there are only minor changes to the major group level of the classification.

5 DIFFERENCES IN NUMBER OF EXPENDITURE CATEGORIES, 1993-94 - 1998-99
Published level categoriesBase level categories

1998-998 digit codes46310 digit codes609
1993-943 digit codes4254 digit codes500
Number of new categories 38109



Other classifications and standards

Some of the classifications and standards used in presenting information on household characteristics have changed since 1993-94. Table 6 provides an indication of the variables affected by such changes.
6 DIFFERENCES IN CLASSIFICATION AND CODING OF HOUSEHOLD CHARACTERISTICS
1998-991993-94

OccupationAustralian Standard Classification of Occupations - Second Edition, 1997 (Cat. no. 1220.0)Australian Standard Classification of Occupations - First Edition, 1986 (Cat. no. 1220.0)
Country of birthStandard Australian Classification of Countries, 1998 (Cat. no. 1269.0)Standard Australian Classification of Countries for Social jStatistics, 1990, (Cat. no. 1269.0)
GeographyAustralian Standard Geographical Classification, 1996 (Cat. no. 1216.0)Modified Australian Standard Geographical Classification based on interviewing requirements
Household compositionStandards for Statistics on the Family, 1995 (Cat. no. 1286.0). In particular the definition of dependent children aged 15 and over has changed to include full-time students aged 15-24 who have a parent in the household (but no partner or child of their own).In 1993-94 and previous surveys, the definition of dependent children aged 15 and over included full-time students aged 15-20 who had a parent or other relative in the household (but no partner or child of their own).
Tenure typeABS standard for Tenure Type, 1995Nature of occupancy
Landlord typeABS standard for Landlord Type, 1995Nature of occupancy
Industry of employmentAustralian and New Zealand Standard Industrial Classification, 1993 (Cat. no. 1292.0)Industry was not coded in 1993-94


Improvements and changes in data content

Some of the differences between the 1998-99 and 1993-94 surveys which led to changes or expected improvements in output are given below:
  • mobile phones - collected in the household questionnaire instead of the diary;
  • taxes and fees on financial institution accounts - collected in the household questionnaire instead of the diary;
  • child care - collected in the household questionnaire instead of the diary and some changes made to classification;
  • education - questions included distinction between catholic and other non-government schools;
  • disability - questions moved from the household questionnaire to the individual questionnaire and some changes made to screening questions for disability;
  • loans - changed method for collection;
  • gambling - improved instructions in the diary;
  • income in-kind - improved instructions in the diary;
  • more detailed questions on income in-kind collected in the individual questionnaire; and
  • electricity payments dropped from types of income-in-kind in the individual questionnaire, and housing in-kind limited to employer provided rent.
    Changes to child care, education and loans were particularly significant.

    Child care and education

    In 1998-99 the collection of child care data was moved from the diary to the household questionnaire to improve the reliability of the data. There were also a number of classification changes, including the differentiation of child care into formal and informal child care, the inclusion of preschools in formal child care, and the movement of pre-year one education from child care (Household services) to education (Miscellaneous goods and services).

    For education data items, the independent schools expenditure categories were expanded to differentiate between catholic and other non-government schools. Data items on the number of children in the household were also expanded to make this distinction.

    Loans

    Methodological changes

    In both the 1988-89 and 1993-94 surveys the ABS requested each respondent’s authorisation to collect loans information from banks and other financial institutions. In 1993-94, 73% of loans were processed using information provided by banks or financial institutions. The details of the remaining loans were collected from respondents during the interview. This procedure had been used quite successfully in 1988-89. However, in 1993-94 there were problems with data quality and the form was expensive and time-consuming to process.

    In 1998-99, instead of using a loans authorisation form, all respondents were asked to provide loans details. To improve data quality, respondents were asked to refer to a bank statement.

    Definition

    In the 1998-99 survey the definition of loans was expanded to include revolving credit loans and lease arrangements. A revolving credit loan, also known as a line of credit or continuous credit, is an arrangement where the customer may make minimum monthly repayments and pay interest to leave the remainder outstanding. Since there is no fixed monthly repayments the loan can continue indefinitely (e.g. overdrafts). Credit card balances were not included in loans in either the 1993-94 or the 1998-99 survey. The interest paid on credit cards was collected in a separate part of the survey. Other aspects of the definition of loans remained the same in the 1998-99 and 1993-94 surveys (see Glossary for details).

    Data item changes

    In 1993-94 loans were classified by type of loan (mortgage, other housing, personal). This was replaced in 1998-99 with the purpose of the loan (buy or build this property, buy or build other property, alterations and additions to this property, alterations and additions to other property, motor vehicle, holiday, other).

    Calculation of interest and principal

    In 1993-94 it was assumed that financial institutions would accurately report the amount of interest and principal paid on the loan. Where this was not the case, or in cases where respondents provided loan details, the amount of interest and principal paid was calculated using the usual repayment (minus refunds), amount borrowed, term, and proportion of loan used for other purposes. This calculation suffers from the assumption that throughout the term of the loan, equal amounts of interest and principal are paid.

    In 1998-99 respondents were asked to provide the opening and closing balance of their loans, as reported on their statement, or the amount outstanding on their loan (if they had no statement). The closing balance, last repayment (minus refunds), current interest rate and proportion of the loan used for other purposes were then used to calculate interest and principal payments.

    New items

    Financial stress

    Based on living standards research over the past ten years including the Australian Living Standards Study conducted by the Australian Institute of Family Studies and the Deprivation Standards Research Project conducted by the Flinders University of South Australia, some new items providing a subjective measure of the household’s economic well-being were included in the 1998-99 HES.

    One person in the household was asked to provide assessments of the current household’s circumstances. This person was randomly chosen from the household reference person and the spouse.

    There were ten new questions which covered topics such as management of household income, present standard of living compared with two years ago, ability to raise emergency money ($2,000), main source of emergency money, and cash flow problems. Data items available from this survey are listed in appendix 2.

    Capital transfers

    In 1993-94 an extensive list of lump sum receipts was collected. In 1998-99 this picture was balanced by collecting some lump sum disbursements as well as receipts. The lump sum disbursements collected were irregular child support payments, irregular cash gifts, and cash matrimonial settlements.


    INCOME QUINTILES

    The 1998-99 HES publications contain tables of expenditure estimates for households classified according to gross income quintiles. Income quintiles are formed by ranking all households in terms of their gross income and then dividing the households into five groups each containing 20% of all households. The lowest quintile contains the 20% of households with the lowest incomes, the second lowest quintile contains the 20% of households with the next lowest incomes and so on up to the highest quintile which contains the 20% of households with the highest incomes.

    ABS publications show that estimated numbers of households in each quintile are not exactly the same and the proportion of households in each quintile is not exactly 20%. Some slight variation occurs because many households have the same income at the income quintile cut-off points. Instead of allocating households with the same incomes to different quintiles, as would be necessary to have equal numbers of households in each quintile, households with the same income values are allocated to the same quintile.

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