1. This publication contains estimates of the characteristics of wage and salary earners, including age, sex and income, for the five major regions that form the Remoteness Structure within the Australian Standard Geographical Classification (ASGC).
2. These data have been compiled from the Australian Taxation Office's (ATO) Individual Income Tax Return Database, based on individual tax returns lodged for the financial year ended 30 June.
3. The ABS wishes to acknowledge the support of the Australian Taxation Office in compiling these statistics and in assisting the ABS to increase output and dissemination of aggregated regional data relevant to users of regional statistics.
4. All individual income tax statistics provided to the ABS by the ATO have been in aggregated form only, at the Statistical Local Area (SLA) level. Information relating to individual tax payers has not been released to the ABS. Data for the five remoteness areas have been derived from the aggregated SLA data.
5. Prior to being released to the ABS, ATO data have been subjected to a confidentiality process that randomly adjusts cells in tables with small values, including altering some small cells to zero. Under these circumstances caution should be exercised and, in general, no reliance should be placed on cells with small values in tables. The application of this process prevents the risk of inadvertently releasing information that may identify an individual, without general detriment to the overall information value of the statistics.
SCOPE AND COVERAGE
6. The ATO database covers all individuals who submit an individual tax return and includes persons with income from one or more of a range of sources such as wages and salary, own business, superannuation, investments and government pensions, benefits and allowances. The scope of the ATO statistics presented in this electronic release relate only to persons with wage and salary income.
7. As the ATO's income tax return is designed to obtain a person's total income from various sources over a financial year, and not the employment status of a person at a particular point in time, wage and salary earners have been defined as:
persons aged 15 years and over who have submitted an individual income tax return and for whom wage and salary income was the principal (or main) source of income for the financial year.
8. Wage and salary income, as reported on the income tax return, includes gross income as shown on the 'PAYG payment summary- individual non-business' as well as allowances, commissions, bonuses, tips, gratuities, consultation fees, honoraria and other payments for services. The data to define and compile counts of wage and salary earners have been sourced from questions 1 and 2 on the 2002-03 individual income tax return. (Note: PAYG (Pay as You Go) payment summaries were previously known as Group Certificates).
9. A diagram summarising the ABS categorisation of persons reporting wage and salary incomes on individual tax returns can be found in the Explanatory Notes of the previous ABS release Characteristics of Wage and Salary Earners in Regions of Australia, 2000-01 (cat. no. 6261.0.55.001).
10. 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 to understanding and interpreting the geographical context of statistics published, by not only the ABS but also state and other commonwealth agencies.
11. This publication presents data based on the Remoteness Structure outlined within the Australian Standard Geographical Classification (ASGC), Volume 1, 2001 (cat. no. 1216.0). As the Remoteness Structure is defined only in Census years, commencing with the census year 2001, 2002-03 SLA data was concorded to the 2001 remoteness areas.
12. The remoteness structure is based upon the Accessibility/Remoteness Index of Australia (ARIA) which was developed for the Department of Health and Aging (formally known as the Commonwealth Department of Health and Aged Care) by the National Centre for Social Applications of Geographical Information Systems (GISCA). ARIA measures the remoteness of a point based on road distances to the nearest ABS defined Urban Centres (classified to five population sizes). The basic premise of ARIA is that remoteness is a factor of the relative distance one must travel to access a full range of services.
13. The Remoteness Structure contains the following categories:
For further clarification the Glossary provides examples of what is contained within each remoteness area.
14. As the Remoteness Structure is based on the grouping of spatial units of Census Collection Districts (CDs), the Migratory classification (areas composed of off-shore, shipping and migratory CD's) has been added to make the structure inclusive of all CD's in Australia. However, Migratory areas have been excluded from the statistics presented within this publication as people do not record these areas as their residential address when completing administrative forms such as the income tax return.
15. The ABS uses geographic concordances to enable the conversion of data from one type of geographic region to another. Geographic concordances are expressed as conversion factors based on population.
16. 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 ATO aggregated postcode data estimates for statistical local area. The wage and salary 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 2002-03 were calculated for boundaries effective at 1 July 2003 as defined in the detailed main structure of the Australian Standard Geographical Classification (ASGC), 2003 (cat. no. 1216.0).
17. Concording data for small geographic areas such as postcodes to larger geographic areas such as SLAs and remoteness areas:
- Major Cities of Australia
- Inner Regional Australia
- Outer Regional Australia
- Remote Australia
- Very remote Australia
18. When analysing the statistics the following limitations of the concordance methodology need to be noted;
- minimises confidentiality restrictions as data are not output for postcodes with small populations;
- enables the data to be output for other standard ABS geographic areas including Statistical Division (SDs), Statistical Sub-divisions (SSDs), Local Government Areas (LGAs), and Remoteness Structure Classes.
19. The occupation data in this publication is based on the Australian Standard Classification of Occupations, 2nd Edition (cat. no. 1220.0). Occupation data published in the previous edition of this publication, Characteristics of Wage and Salary Earners in Regions of Australia, 2000-01 (cat. no. 6261.0.55.001), were based on the 1st edition of this occupation classification.
COMPARABILITY OF RESULTS WITH ABS COLLECTIONS
20. The wage and salary earner estimates compiled from the ATO database have been compared with other ABS sources including the Census of Population and Housing and the Labour Force Survey. Despite differences in purpose, concepts, definitions and reference periods, the statistics compiled from the ATO database have been found to be generally consistent when compared to these other data sources. A summary of these comparisons can be found in the previously published Information Paper: Use of Individual Income Tax Data for Regional Statistics, Experimental Estimates for Small Areas, 1995-96 and 1997-97 (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).
21. A diagram summarising the basic components of the employed population, as defined in ABS collections, can be found in Characteristics of Wage and Salary Earners in Regions of Australia, 2000-01 (cat. no. 6261.0.55.001).
INDIGENOUS COMMUNITY DEVELOPMENT EMPLOYMENT PROJECTS
22. Community Development Employment Projects (CDEP) enables Indigenous persons to exchange unemployment benefits for opportunities to undertake work and training in their communities. Changes in the treatment of persons reporting CDEP income in individual income tax returns have possibly produced variations in the level of some data items, particularly for Remote and Very Remote areas. The number of Indigenous persons residing 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.
23. From 1998-99 onwards, specific instructions were included in the ATO TaxPack regarding treatment of CDEP payments. These instructions indicated 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 likely that CDEP income was included under the wages and salaries category for previous years.
24. The exclusion of CDEP income from 1998-99 onwards is more than likely responsible for the observable decrease in the number of wage and salary earners and conversely the upward movement in the median annual wage and salary income for Remote and 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, part-time work. ATSIC Annual Reviews in 1997-98 and 1998-99 reported that 96% of CDEP recipients were located in regional Australia with 65% being located in remote areas (which would 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 in wage and salary earners combined with low wages and salaries paid had consequently had the effect of lowering the overall average and median incomes for Very Remote areas.
25. 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 1996-97 and 2002-03 in particular need to be treated with caution.
26. Some other limitations need to be taken into account when analysing the data. For example,
- in applying the concordances it is assumed that the particular characteristics of any data item are uniformly distributed across a postcode and therefore concorded data may not truly reflect the distribution of the characteristics of a population.
- some official postcodes (e.g. PO boxes, etc.) do not correspond to residential areas but have still been reported under the current home address field. Data for these and other 'invalid' postcodes have been included in an 'unknown' category for each state and territory and for Australia where the state or territory was not known.
- Data that could not be directly classified to one of the Remoteness Structure classes have been excluded from most tables. The effect of this is minimal as the population in the unknown category is less than 0.6%.
- a number of low income earners, including wage and salary earners, are not required to submit a tax return and therefore may not be included in the statistics. For example, where income is below the annual tax free threshold and tax was not withheld, a return is not required to be submitted.
- the data do not take into account whether wage and salary earners worked full-time or part-time, had multiple job holdings or overtime earnings. Consequently, these factors may account for some of the differences when comparing average or median wage and salary incomes or other characteristics of wage and salary earners across regions.
27. The points outlined above are considered to be relatively minor limitations which do not impede the general use of the data for the broad purposes intended.
28. Due to the application of both the postcode concordance and the randomisation process, totals for each 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 randomisation of small cells had only been applied to the SLA level and for most purposes the value of the data has not been impaired.
SYMBOLS AND OTHER USAGES
- generally, around 95% of individual income tax returns for any income tax year have been processed within one year and around 99% within two years of the end of the income tax year. It may be possible that a very small proportion of returns had not been processed at the time these statistics were compiled and therefore would not be included in the estimates presented.
|ABS||Australian Bureau of Statistics|
|ASGC||Australian Standard Geographical Classification|
|ATO||Australian Taxation Office|
|CDEP||Community Development Employment Project|
|ETP||eligible termination payment|
|LGA||local government area|
|PAYG||pay as you go|
|SLA||statistical local area|
|$m||million dollars |
|-||not applicable or figure not calculated|