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PERSONS LODGING INDIVIDUAL INCOME TAX RETURNS, Australia, 2000-01
(a) Persons reporting wage and salary income may also have other sources of income.
12 From the ATO database, and using data for 2000-01 as an example, the proportion of persons with wage and salary income as their principal source of income represents around 72% of all persons who lodged an income tax return with the ATO. Of those persons who reported any wage and salary income, the proportion for whom wage and salary income was the principal source was around 93%. The wage and salary income of these wage and salary earners represents over 99% of all wage and salary income reported and around 87% of the total income of all individuals reporting any wage and salary income. Similar proportions are also evident for other years.
REVISIONS TO PREVIOUS DATA
13 As part of the ongoing process of improving the overall accuracy and quality of the statistics compiled from an administrative data source, there has been a slight change in the way the definition of wage and salary earners has been specified from records on the ATO database for the years 1999-00 and 2000-01 in comparison to how it was specified for 1995-96 to 1998-99.
14 In broad terms, for 1999-00 onwards, lump sum and/or other non-regular payments have been excluded from the definition of principal source of income. These payments include eligible termination payments (ETPs), net capital gains and equalisation deposits and withdrawals, etc. This change aligns the definition more closely to international standards that define income as of a regular and recurring nature, received at annual or more frequent intervals.
15 Consequently, data for those tables which include the total number of wage and salary earners and total wage and salary income paid, for the four years 1995-96 to 1998-99, have been revised, providing a comparable time series for the whole period 1995-96 to 2000-01. The effect of this change is that the estimates of the number of wage and salary earners for the years 1995-96 to 1998-99 are slightly higher than those previously published in Experimental Estimates, Regional Wage and Salary Earner Statistics, Australia, 1995-96 to 1998-99 (cat. no. 5673.0). For example, persons receiving an ETP (i.e. question 4 on the individual income tax return in 2000-01) with a monetary value higher than that shown for wage and salary income (i.e. questions 1 and 2) would have been previously excluded from the data (i.e not a wage and salary earner). However, with this refinement, these persons may now be defined as wage and salary earners (when their wage and salary income is their main source of income over other sources). That is, the value of the lump sum and/or other non-regular payment does not override the main employment status of the individual for the financial year as defined for the purposes of these statistics.
16 The statistics compiled from the ATO database are based on individual income tax returns lodged for the financial year ended 30 June, regardless of the year in which they were processed. At the time of compiling the statistics for 2000-01 it is estimated that around 99.0% of returns had been processed.
17 The Australian Standard Geographical Classification (ASGC) is used by the ABS for the collection and dissemination of geographically classified statistics and its use enables comparability across datasets. The ASGC is an essential reference for understanding and interpreting the geographical context of statistics published, not only by the ABS but also by other organisations.
18 This publication presents data in accordance with the Remoteness Structure contained within the Australian Standard Geographical Classification (ASGC), Volume 1, 2001 (cat. no. 1216.0).This edition of the ASGC was the first to include a geographical structure describing Australia in terms of a measurement of remoteness or distance from services. The Remoteness Structure is designed to provide for statistics which compare, on the one hand the Major Cities of Australia, to, at the other extreme, Very Remote areas. Such statistics should allow regional analysts, decision makers and service providers to quantify the differences and/or similarities across the remoteness areas of Australia.
19 The Remoteness Structure is based upon the Accessibility/Remoteness Index of Australia (ARIA) which was developed for the former Commonwealth Department of Health and Aged Care (now Department of Health and Ageing) by the National Key Centre for Social Applications of Geographical Information Systems (GISCA). ARIA measures the remoteness of a point based on the road distances to the nearest ABS defined Urban Centres (which are classified to five population class sizes). The basic premises of ARIA are that there are more services available in larger towns than small towns and that remoteness is a factor of the relative distance one must travel to access a full range of services.
20 The Remoteness Structure contains the following categories:
21 As the Remoteness Structure is based on groupings of Census Collection Districts (CDs), the Migratory classification (areas composed of off-shore, shipping and migratory CDs) has been added to make the structure inclusive of all CDs in Australia. However, Migratory has been excluded from the statistics presented in this publication as people do not record these areas as their residential address when completing administrative forms such as the income tax return.
22 The Remoteness Area names used throughout this electronic publication are generally abbreviated, with 'Australia' omitted from the full title name.
23 Detailed information about the Remoteness Structure can be referenced in Information Paper: ABS Views on Remoteness, 2001 (cat. no. 1244.0) and Information Paper: Outcomes of ABS Views on Remoteness Consultation, Australia, 2001 (cat. no. 1244.0.00.001). A brief description and map is also included in the Appendix.
24 The ABS uses geographic concordances to enable the conversion of data from one type of geographic region to another. These geographic concordances are generally used to convert data for 'non-standard areas' to data for standard areas used by the ABS. Geographic concordances (or conversions) are expressed as conversion factors based on population.
25 The geographic identifier available on the ATO database is the postcode of the current home address of the individual. Consequently, postcode to SLA conversion factors have been used to concord, or convert, ATO aggregated postcode data to estimates for statistical local areas. The wage and salary earner data for SLAs was then concorded to the Remoteness Structure. The concordances are based on the estimated resident population for each particular year. Data for 2000-01 were calculated on boundaries effective at 1 July 2001 as defined in the Detailed Main Structure of the Australian Standard Geographical Classification (ASGC), Volume 1, 2001 (cat. no. 1216.0).
26 An alternative method of concording ATO wage and salary earner data would have been to concord ATO aggregated postcode data directly to the Remoteness Structure. However, the difference between applying the two methods is not significant.
27 Concording data for small geographic areas such as postcodes to larger geographic areas such as SLAs and Remoteness Areas:
28 When analysing the statistics the following limitations of the concordance methodology need to be taken into account:
29 Further information concerning statistical geography is contained in Australian Standard Geographical Classification (ASGC), Volume 1, 2001 (cat. no. 1216.0). A map showing the remoteness areas is available in the Appendix.
CHARACTERISTICS OF WAGE AND SALARY EARNERS
30 The characteristics of wage and salary earners covered in this publication include age, sex, occupation and wage and salary income. Wage and salary income has been presented as a median as well as in income ranges. Various cross-tabulations (e.g. age by sex, occupation by age, etc.) are also referenced throughout the publication, however detailed tables, including data for each state and territory by Remoteness Area can be accessed through the data cubes. These tables are in the form of Excel spreadsheets. A complete list of the data definitions and classifications are included in the Glossary.
COMPARABILITY OF RESULTS WITH ABS COLLECTIONS
31 The following diagram summarises the basic components of the employed population in Australia, as defined in ABS collections. Wage and salary earners, or employees, comprise around 86% of all employed persons and as such make a major contribution to the labour market. The shaded area shows the component that the wage and salary earner estimates from ATO data attempt to represent.
ABS CATEGORIES OF EMPLOYED PERSONS(a), Australia, May quarter 2001
(a) Persons aged 15 years and over.
Source: ABS Labour Force Survey
32 Where possible the wage and salary earner estimates compiled from the ATO database have been compared with other ABS data sources such as the Census of Population and Housing, the Labour Force Survey and the Survey of Employment and Earnings. These comparisons provide a means for establishing whether counts are of an ‘expected’ magnitude and whether distributions across variables or regions are similar. Despite differences in purpose, concepts, definitions and reference periods, the statistics compiled from the ATO database have been found to be generally consistent in broad magnitude when compared with these other data sources. A summary of some of these comparisons are included in the previously published Information Paper: Use of Individual Income Tax Data for Regional Statistics, Experimental Estimates for Small Areas, 1995-96 and 1996-97 (cat. no. 5673.0) and in the accompanying appendix to Regional Wage and Salary Earner Statistics, Australia, 2000-01, Electronic Publication (cat. no. 5673.0.55.001).
INDIGENOUS COMMUNITY DEVELOPMENT EMPLOYMENT PROJECTS
33 The statistics presented in this electronic publication relate primarily to the year 2000-01. Although data are available on a similar basis for 1995-96 to 1999-2000, changes to the treatment of persons reporting Community Development Employment Project (CDEP) income in individual income tax returns have possibly produced variations in the levels of some data items, particularly for Remote and Very Remote areas. CDEP enables Indigenous persons to exchange unemployment benefits for opportunities to undertake work and training in their communities.
34 From 1998-99 onwards, specific instructions were included in the ATO TaxPack regarding the treatment of CDEP payments. These instructions indicated that amounts paid from CDEP should be included under the category 'Commonwealth of Australia Government Allowances or Payments'. Prior to 1998-99 such an instruction was not included in TaxPack and, as CDEP income was generally shown on group certificates as 'CDEP Salary or Wages', it is probable that CDEP income was included under the wages and salaries category for previous years.
35 While Indigenous persons reside and work in all regions of Australia, the number of Indigenous persons in Remote and Very Remote areas relative to the total population means that the impact of these changes to the definition of wage and salary earners adopted for these data is significant for these areas.
36 The exclusion of CDEP income from 1998-99 onwards is more than likely responsible for the observable large decrease in the number of wage and salary earners and conversely the upward movement in the average annual wage and salary income for Very Remote areas. The Independent Review of Aboriginal and Torres Strait Islander Commission's (ATSIC) CDEP Scheme, conducted in 1997, recognised that CDEP provided mostly low-paid and part-time work. ATSIC Annual Reviews in 1997-98 and 1998-99 reported that 96% of CDEP recipients were located in regional Australia (i.e. outside of metropolitan areas) with 65% being located in remote areas (which would mostly equate to Very Remote Australia in the Remoteness Structure). The annual reviews indicated that CDEP wages in remote areas were around $195 per week. The increased number of persons included as wage and salary earners combined with the low wages and salaries paid has consequently had the effect of lowering the overall average and median incomes for Very Remote areas.
37 The following graphs highlight the effect of these changes in reporting practices with the treatment of CDEP participants. It is expected that the statistics from 1998-99 onward provide a truer and more consistent reflection of the data in these regions. Any comparisons between 1997-98 and 1998-99 and 1995-96 and 2000-01 in particular need to be treated with caution.
Source: ATO Income Tax Data.
38 In addition to the methodological and definitional issues already mentioned (such as the number of wage and salary earners defined over a whole financial year rather than at a point in time, use of postcode concordances and the randomisation of small cells) some other limitations need to be taken into account when analysing the data. For example,
39 Overall, the limitations outlined above are considered to be relatively minor factors which do not limit the general use of the data for the broad purposes intended.
40 Due to the application of both the postcode concordance and the randomisation process, totals for each variable and geographic area may differ from table to table. Concorded figures have been rounded while column and row totals have been derived after the random adjustment process has been applied. The random adjustments have been made only to very small cells, however, the more detailed a table is, the greater the likelihood of small cells being present. The randomisation of small cells has only been applied at the SLA level and for most purposes the value of the data has not been impaired. Differences in totals between tables are not significant and can be ignored.
41 Furthermore, where figures have been rounded, discrepancies may occur between the sums of the component items and totals. Proportions and rates have been calculated on rounded figures and may differ slightly if calculated on the unrounded numbers.
42 Users may wish to refer to the following ABS and non-ABS products which contain statistics relating to wage and salary earners and/or other statistics compiled from Australian Taxation Office data.
Australian Bureau of Statistics, Information Paper, Use of Individual Income Tax Data for Regional Statistics - Experimental Estimates for Small Areas, 1995-96 and 1996-97, cat. no. 5673.0
Australian Bureau of Statistics, Experimental Estimates, Regional Wage and Salary Earner Statistics, Australia, 1995-96 to 1998-99, cat. no. 5673.0
Australian Bureau of Statistics, Regional Wage and Salary Earner Statistics, Australia, 2000-01, Electronic Publication, cat. no. 5673.0.55.001
Australian Bureau of Statistics, Information Paper, Use of Business Income Tax Data for Regional Statistics - Experimental Estimates, Selected Regions, Australia, 1995-96 to 1997-98, cat. no. 5675.0
Australian Bureau of Statistics, Experimental Estimates, Regional Small Business Statistics, Australia, 1995-96 to 2000-01, cat. no. 5675.0
Australian Bureau of Statistics, Labour Force, Australia, cat. no. 6203.0.
Australian Bureau of Statistics, Labour Force Survey, Australia, data cubes.
Australian Bureau of Statistics, Wage and Salary Earners, Australia, cat. no. 6248.0.
Australian Bureau of Statistics, 1996 and 2001 Census of Population and Housing.
Australian Bureau of Statistics, Australia in Profile, A Regional Analysis, 2001 Census of Population and Housing, cat. no. 2032.0.
Australian Taxation Office, Taxation Statistics, a summary of taxation and superannuation statistics, annual, ATO Canberra.
43 For further information about these statistics, contact the National Information Service on 1300 135 070, or Mark Nowosilskyj on: (08) 8237 7358 or email email@example.com
SYMBOLS AND OTHER USAGES
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