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1380.0.55.006 - Perspectives on Regional Australia: Variations in Wage and Salary Income between Local Government Areas (LGAs), 2003-04 to 2008-09  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 18/07/2012  First Issue
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Introduction
Regional Variations in Wage and Salary Income, 2008-09
Growth of Average Annual Wage and Salary Income, 2003-04 to 2008-09
Local Government Areas by Average Annual Wage and Salary Income and Income Growth Rate


INTRODUCTION

For most people, household income is the most important determinant of their economic well-being and their ability to support a minimum material standard of living. Household income also contributes to the economic well-being of the communities and regions in which people live. Although people may receive income from a number of sources, over 80% of all income earned by Australian taxpayers is derived from wages and salaries.

Analysing geographical variations in average Wage and salary income can provide valuable information about the relative advantage or disadvantage of different regions. This article will examine Wage and salary income variations across Local Government Areas (LGAs) using data from 'Wage and Salary Earner Statistics for Small Areas, Time Series, 2003-04 to 2008-09'. The data presented in this article can be used to explore questions such as:

  • Which LGAs had higher average Wage and salary income compared to others?
  • Which LGAs experienced higher growth in Wage and salary income compared to others?
  • Which LGAs with high average Wage and salary income experienced either above or below average income growth?
  • Which LGAs with low average Wage and salary income experienced either above or below average income growth?

This article follows a previous ABS release that presented Wage and salary income variations across Statistical Local Areas (SLAs); Wage and Salary Earner Statistics for Small Areas, Time Series, 2003-04 to 2008-09. Further analysis at the LGA level will support local governments, policy makers and researchers who use LGA boundaries for planning and policy decisions. The data was produced by the ABS using Personal Income Tax (PIT) information provided by the Australian Taxation Office (ATO).

ABOUT THE DATA: COVERAGE ISSUES AND DATA CONSIDERATIONS

Wage and salary earners are defined as persons aged 15 years and over who have submitted an individual income tax return before October 31 in a given financial year and have received Wage and salary income in that financial year.

There are considerations that users should be aware of when analysing the data, such as:
  • Differences in the extent of part-time work may account for some differences in the number of Wage and salary earners and average Wage and salary income across regions;
  • A one-off tax bonus was available to some individuals who lodged a tax return for the 2007-08 financial year, which contributed to a 7.1% increase in individual tax lodgements for this year. This may affect some year to year comparisons of total and average Wage and salary income between LGAs;
  • To uphold the confidentiality of individual taxpayers, cells with small values have been randomly adjusted, including altering some cells to zero. Due to this, LGAs with fewer than 100 Wage and salary earners have been excluded from detailed analyses; and
  • PIT data may be affected by changes in taxation policy, which can influence who needs to lodge a tax return and what they need to report.

For more information about these data considerations and how they affect data analysis, please refer to the Explanatory Notes in 'Wage and Salary Earner Statistics for Small Areas, Time Series, 2003-04 to 2008-09'.


ANALYSING LOCAL GOVERNMENT AREAS (LGAs)

When analysing LGAs, it is important to keep in mind that they vary considerably in population size and population growth, which may account for some of the variation in average Wage and salary income and income growth between LGAs.

Table 1 shows the number of LGAs in each state by the size of their Estimated Resident Population (ERP) as at 30 June 2009. The ERP and land area of LGAs varies significantly between and within each state and territory. For example, Murchison (S), a rural LGA in Western Australia, had an ERP of only 114 people in 2009 and a land area of 44 909.7km2. Yet Stirling (C), an LGA encompassing suburban areas of Perth, had a 2009 ERP of 198 803 people and a land area of 104.8km2.

Table 1. LOCAL GOVERNMENT AREAS BY STATE AND ESTIMATED RESIDENT POPULATION (ERP), As at 30 June 20091

ERP
< 1 000
No. of LGAs
ERP
1 000-4 999
No. of LGAs
ERP
5 000-9 999
No. of LGAs
ERP
10 000-49 999
No. of LGAs
ERP
50 000-99 999
No. of LGAs
ERP
100 000-200 000
No. of LGAs
ERP
> 200 000
No. of LGAs
Total No.
of LGAs

New South Wales
0
26
27
51
26
20
3
153
Victoria
1
2
8
32
13
22
2
80
Queensland
16
23
0
20
3
7
5
74
South Australia
2
25
10
25
4
5
0
71
Western Australia
36
48
13
29
6
7
0
139
Tasmania
1
4
8
14
2
0
0
29
Northern Territory
2
3
7
4
1
0
0
17
Total
58
131
73
175
55
61
10
563

1 ERP Preliminary Estimates, excluding Unincorporated ACT and Unincorporated Other Territories
Source: 3218.0 - Regional Population Growth, Australia, 2008-09


It is important to note that the capital city of Brisbane and its inner suburbs are classified together as one LGA - Brisbane (C) - and the entire ACT is classified as one LGA - Unincorporated ACT (LGA). The variations of average Wage and salary income that exist within these densely populated LGAs have not been analysed in detail in this article. Please refer to the previous ABS release 'Wage and Salary Earner Statistics for Small Areas, Time Series, 2003-04 to 2008-09', for an analysis of the Wage and salary income variations between Statistical Local Areas (SLAs) within these LGAs.


REGIONAL VARIATIONS IN WAGE AND SALARY INCOME, 2008-09

In Australia, the average income from wages and salaries was $46,599 in 2008-09. This amount has increased from $36,889 in 2003-04, at an average annual rate of 4.8%. Map 1 shows regional variations in average annual Wage and salary income in 2008-09 by Local Government Area (LGA). The LGAs with the highest average income from wages and salaries were the inner metropolitan areas of Australia's capital cities or mining areas, such as Roebourne (S) in Western Australia and Roxby Downs (M) in South Australia. However, the majority of LGAs recorded average Wage and salary incomes below the Australian average, and these were generally located outside of major cities.

Map 1. AVERAGE ANNUAL WAGE AND SALARY INCOME - By Local Government Area, 2008-09
Map: Average Annual Wage and Salary Income by Local Government Areas, 2008-09



Table 2 shows the LGAs with the 10 highest and the 10 lowest average annual Wage and salary incomes in Australia in 2008-09. The 5 LGAs with the highest average annual income from wages and salaries were all in the Sydney metropolitan area, such as Mosman (A), Woollahra (A) and Hunters Hill (A). The remaining LGAs in the top 10 were either rural mining areas, such as Roebourne (S) and Ashburton (S) in Western Australia, or LGAs in the Perth metropolitan area, such as Peppermint Grove (S) and Cottesloe (T). The 10 LGAs with the lowest average annual Wage and salary incomes were all rural areas, commonly reliant upon the agricultural industry, such as Elliston (DC) and Karoonda East Murray (DC) in South Australia and Wickepin (S) in Western Australia.

Table 2. AVERAGE ANNUAL WAGE AND SALARY INCOME, Top Ten and Bottom Ten LGAs - 2008-09

RankLGA (a)
State
Wage & Salary
Earners
Average Wage &
Salary Income
no.
$

1Mosman (A)
NSW
13 270
105 954
2Woollahra (A)
NSW
25 595
84 217
3Hunters Hill (A)
NSW
5 493
79 920
4Ku-ring-gai (A)
NSW
47 252
78 066
5North Sydney (A)
NSW
35 702
77 972
6Roebourne (S)
WA
10 066
77 692
7Roxby Downs (M)
SA
2 551
76 204
8Ashburton (S)
WA
3 180
76 172
9Peppermint Grove (S)
WA
715
75 772
10Cottesloe (T)
WA
3 534
75 347

556Woorabinda (S)
QLD
203
30 333
557Tasman (M)
TAS
837
30 302
558Mount Marshall (S)
WA
192
30 271
559Kondinin (S)
WA
368
30 220
560Yarriambiack (S)
VIC
2 582
30 035
561Tiwi Islands (S)
NT
505
29 645
562Narembeen (S)
WA
304
29 365
563Elliston (DC)
SA
468
28 861
564Karoonda East Murray (DC)
SA
303
28 796
565Wickepin (S)
WA
323
27 586

(a) LGAs with fewer than 100 Wage and salary income earners have been excluded


GROWTH OF AVERAGE ANNUAL WAGE AND SALARY INCOME, 2003-04 TO 2008-09

All LGAs in Australia experienced growth in average annual Wage and salary income between 2003-04 and 2008-09. Map 2 shows that the majority of LGAs with high average annual growth rates of Wage and salary income were located in rural agricultural or mining areas. Many LGAs in the Perth metropolitan area also experienced relatively high growth in average Wage and salary income, with average annual growth rates above 6%. Many of the metropolitan areas of Australia's other capital cities experienced average annual growth rates of Wage and salary income that were very close to or only slightly below the Australian average growth rate of 4.8%.

While Brisbane (C) as a whole LGA experienced an above average growth rate of Wage and salary income (5.6%), there are significant variations of income growth between the Statistical Local Areas (SLAs) within this LGA. For example, the inner suburban SLAs of Balmoral, Bulimba and Hawthorne all experienced high growth rates of 7.4%, yet the outer suburban SLAs of Sunnybank, MacGregor and Robertson all had below average growth rates of 3.5%.

Map 2. GROWTH OF AVERAGE ANNUAL WAGE AND SALARY INCOME - By Local Government Area, 2003-04 to 2008-09
Map: Growth of Average Annual Wage and Salary Income by Local Government Areas, 2003-04 to 2008-09



Table 3 shows the LGAs with the 10 highest and 10 lowest average annual growth rates of average Wage and salary income from 2003-04 to 2008-09. The majority of LGAs with the highest growth rates were located in Western Australia. These included semi-rural areas relatively close to Perth such as Pingelly (S), Wandering (S) and Boddington (S), agricultural areas in the wheat belt region such as Tammin (S), Koorda (S), Wickepin (S) and Dandaragan (S), as well as the remote mining area of Ravensthorpe (S) in the state's south. Only one LGA with a growth rate above 8.0% was not located in Western Australia. This was the Shire of Barcoo in South West Queensland, where the discovery of oil and gas reserves has led to considerable development in that industry (Barcoo Shire Council Website).

Table 3. AVERAGE ANNUAL GROWTH OF WAGE AND SALARY INCOME, Top Ten and Bottom Ten LGAs - 2003-04 to 2008-09

RankLGA (a)
State
Wage and Salary Earners
2008-09
Average Wage & Salary Income 2003-04
Average Wage & Salary Income 2008-09
Growth Rate
no.
$
$
%

1Ravensthorpe (S)
WA
617
25 599
46 653
12.8
2Tammin (S)
WA
139
18 327
32 198
11.9
3Pingelly (S)
WA
421
22 617
37 830
10.8
4Wandering (S)
WA
140
22 676
37 698
10.7
5Boddington (S)
WA
665
37 709
60 369
9.9
6Barcoo (S)
QLD
133
27 067
43 291
9.8
7Wickepin (S)
WA
323
17 588
27 586
9.4
8Dandaragan (S)
WA
1 115
26 821
41 326
9.0
9Kent (S)
WA
166
21 500
32 921
8.9
10Koorda (S)
WA
151
24 396
37 094
8.7

556Strathfield (A)
NSW
16 242
37 920
44 480
3.2
557Gtr. Dandenong (C)
VIC
56 761
31 983
37 389
3.2
558Guyra (A)
NSW
1 601
26 549
30 911
3.1
559Barunga West (DC)
SA
748
26 360
30 533
3.0
560Leeton (A)
NSW
4 555
32 267
37 336
3.0
561Mount Magnet (S)
WA
149
38 667
44 173
2.7
562Adelaide (C)
SA
9 069
41 653
47 582
2.7
563Dorset (M)
TAS
2 864
28 335
32 224
2.6
564Jerilderie (A)
NSW
532
28 002
30 954
2.0
565Trayning (S)
WA
128
28 105
30 372
1.6

(a) LGAs with fewer than 100 Wage and salary income earners have been excluded



LOCAL GOVERNMENT AREAS BY AVERAGE ANNUAL WAGE AND SALARY INCOME AND INCOME GROWTH RATE

Comparison of Tables 1 and 2 shows that LGAs with high income growth rates do not necessarily have high average incomes. For example, Tammin (S), an agricultural area in Western Australia, experienced the second highest average annual growth of Wage and salary income of all LGAs in Australia (11.9% from 2003-04 to 2008-09), yet the average Wage and salary income in the region was $32,198 in 2008-09 (well below the Australian average of $46,599). Similarly, LGAs with high incomes do not always experience high income growth. The LGA of Stonnington (C), a metropolitan area in Melbourne's inner south-east, had an average Wage and salary income of $63,775 in 2008-09 (well above the Australian average of $46,599), however the average annual growth rate of Wage and salary income in this region was only 3.8% (below the Australian average of 4.8%).

To examine LGAs based on both average Wage and salary income and average annual income growth, each LGA was grouped into one of the following five categories:
  • high income and above average income growth;
  • high income and below average income growth;
  • low income and above average income growth;
  • low income and below average income growth; or
  • all other regions.

LGAs were classified as high or low income if their average Wage and salary income for 2008-09 fell in the top 10% or bottom 10% of all LGAs in Australia (i.e. was above $53,601 or below $32,378). LGAs were classified as above or below average growth if their average annual growth rate of Wage and salary income between 2003-04 and 2008-09 was above or below the Australian average of 4.8%.

Map 3 shows the geographical location of the LGAs that fall into each of these categories.

Map 3. AVERAGE ANNUAL WAGE AND SALARY INCOME AND INCOME GROWTH RATE - By Local Government Area, 2003-04 to 2008-09
Map: Average Annual Wage and Salary Income and Income Growth Rate by Local Government Areas, 2003-04 to 2008-09

HIGH INCOME AND ABOVE AVERAGE INCOME GROWTH LGAs

A total of 36 LGAs fell into this category; the majority (21 LGAs) were located in Western Australia, seven each were in New South Wales and Queensland, and one was in South Australia (see Map 4). The LGAs in this category can be generally classified into two groups:
  • mining regions, such as Roebourne (S), East Pilbara (S), Port Hedland (T) and Boddington (S) in Western Australia, Isaac (R) and Mount Isa (C) in Queensland, as well as Roxby Downs (M) in South Australia;
  • suburban areas of Perth and Sydney, such as Cambridge (T), Peppermint Grove (S), South Perth (C), Mosman Park (T) and Cottesloe (T) in Perth and Manly (A), Waverley (A) and Randwick (C) in Sydney.

Map 4. HIGH INCOME AND ABOVE AVERAGE INCOME GROWTH LGAs - By Average Annual Wage and Salary Income and Income Growth Rate, 2003-04 to 2008-09
Map: High Income and Above Average Income Growth Local Government Areas



Of the Western Australian LGAs in this category, Roebourne (S) recorded the highest average Wage and salary income in 2008-09 ($77,692) and one of the highest average annual growth rates in Wage and salary income (8.1%). The Shire of Roebourne is located in the state's Pilbara region and contains the mining centres of Karratha, Dampier and Roebourne. According to the 2006 Census of Population and Housing (conducted at the midpoint of the period under review), the largest industry of employment in Roebourne (S) was Metal Ore Mining, which employed 13.2% of employed persons aged 15 years and over in the region.

The characteristics of Wage and salary earners in Roebourne (S) were typical of the mining regions in this category, in that:
  • A higher proportion were male (57.0%) compared to Australia (51.8%);
  • A higher percentage were employed as Technicians and Trades Workers (21.3%) and Machinery Operators and Drivers (10.1%) compared to Australia (11.5% and 6% respectively);
  • A lower percentage were employed as Managers (9.1%) and Professionals (13.7%) compared to Australia (11.4% and 19.7% respectively);
  • A higher percentage were aged between 25 and 54 years (91%) and a lower percentage were aged above 55 years (9.0%) compared to Australia (84.9% and 15.1% respectively); and
  • A higher percentage were earning above $83,200 per year (39.8%) compared to Australia (11.4%).

The Estimated Resident Population (ERP) of Roebourne at 30 June 2009 was 18 828 people. Between 2004 and 2009, Roebourne's ERP had grown at an average annual rate of 2.8%, which was slightly above the population growth rate for Australia over the same time period (1.8%). While many of the mining regions in this category experienced above average population growth between 2004 and 2009, such as East Pilbara (S) in Western Australia and Isaac (R) in Queensland (with average annual population growth rates of 5.0% and 2.6% respectively), some regions experienced below average population growth or even population decline, such as Coolgardie (S) and Leonora (S) in Western Australia (with average annual population growth rates of -0.5% and -0.7% respectively).


HIGH INCOME AND BELOW AVERAGE INCOME GROWTH LGAs

A total of 17 LGAs fell into this category; the majority (11 LGAs) were located in New South Wales, five were in Victoria, and one was in Western Australia (see Map 5). Many of these LGAs recorded average annual growth rates in Wage and salary income that were only slightly under the national average of 4.8%. All but one - Stonnington (C) in Melbourne's inner south-east - recorded average annual growth rates above 4.0%. With the exception of Dundas (S) in Western Australia, the LGAs in this category were all suburban areas of Sydney or Melbourne. These included Boroondara (C), Port Phillip (C), Bayside (C) and Yarra (C) in Melbourne, as well as Lane Cove (A), Willoughby (C), North Sydney (A) and Hornsby (A) in Sydney.

Map 5. HIGH INCOME AND BELOW AVERAGE INCOME GROWTH LGAs - By Average Annual Wage and Salary Income and Income Growth Rate, 2003-04 to 2008-09
Map: High Income and Below Average Income Growth Local Government Areas



The Victorian LGA of Stonnington (C) recorded an average Wage and salary income of $63,775 in 2008-09 (the second highest in Victoria) but an average annual growth rate of just 3.8%. Stonnington (C) is in Melbourne's inner south-east and includes the suburbs of Toorak, South Yarra, Windsor and Armadale. According to 2006 Census data, Stonnington's (C) largest industries of employment were Legal and Accounting Services and Cafes, Restaurants and Takeaway Food Services, which employed 4.9% and 4.3% of employed persons aged 15 years and over in the region respectively.

The characteristics of Wage and salary earners in Stonnington (C) were typical of the metropolitan regions in this category, in that:
  • A slightly lower proportion were male (50.4%) compared to Australia (51.8%);
  • A higher percentage were employed as Managers (17.7%) and Professionals (32.9%) compared to Australia (11.4% and 19.7% respectively);
  • A lower percentage were employed as Technicians and Trades Workers (5.4%), Machinery Operators and Drivers (1.0%) and Labourers (3.4%) compared to Australia (11.5%, 6.0% and 10.7% respectively); and
  • A higher percentage were earning above $83,200 per year (19.5%) compared to Australia (11.4%).

The ERP of Stonnington (C) at 30 June 2009 was 99 110 people. Over the period 2004 to 2009, Stonnington's ERP had grown at an average annual rate of 1.2%, which was slightly below the average population growth rate for Australia (1.8%). Most of the metropolitan LGAs in this category also experienced population growth from 2004 to 2009 that was slightly below the Australian average, such as Hunters Hill (A), North Sydney (A), Pittwater (A) and Warringah (A) in Sydney (all with population growth rates of 1.0%).


LOW INCOME AND ABOVE AVERAGE GROWTH LGAs

A total of 32 LGAs fell into this category; the majority were in Queensland (13 LGAs) and Western Australia (9 LGAs), with some also in South Australia (4 LGAs) and the Northern Territory (3 LGAs) and one each in Tasmania, New South Wales and Victoria (see Map 6). The LGAs in this category were mostly rural agricultural regions such as Streaky Bay (DC) and Karoonda East Murray (DC) in South Australia, Buloke (S) in Victoria and Weddin (A) in New South Wales, as well as LGAs in the wheat belt region of Western Australia such as Tammin (S), Wickepin (S), Dumbleyung (S) and Kulin (S). The far northern Queensland and Northern Territory LGAs in this category, such as the Northern Peninsula Area (R), Wujal Wujal (S), Hope Vale (S) and Tiwi Islands (S), encompass many Indigenous communities and high proportions of their Wage and salary earners were employed as Community and Personal Service Workers.

Map 6. LOW INCOME AND ABOVE AVERAGE INCOME GROWTH LGAs - By Average Annual Wage and Salary Income and Income Growth Rate, 2003-04 to 2008-09
Map: Low Income and Above Average Income Growth Local Government Areas



Wickepin (S), in Western Australia, had the lowest average Wage and salary income ($27,586) of all LGAs in Australia, yet had one of the highest income growth rates (9.4%). The Shire of Wickepin is in Western Australia's wheat belt region and encompasses the small towns of Yealering, Harrismith and Tincurrin. According to 2006 Census data, the largest industry of employment in Wickepin was Sheep, Beef Cattle and Grain Farming, which employed 51.6%of employed persons aged 15 years and over in the region.

The characteristics of Wage and salary earners in Wickepin (S) were typical of the agricultural regions in this category, in that:
  • A slightly lower proportion were males (48.3%) compared to Australia (51.8%);
  • A higher percentage were employed as Labourers (22.3%) and a lower percentage were employed as Professionals (14.2%) compared to Australia (10.7% and 19.7% respectively);
  • A slightly higher percentage were above 55 years of age (16.7%) compared to Australia (15.1%); and
  • A higher percentage were earning below $20,800 per year (51.1%) compared to Australia (26.2%).

The ERP of Wickepin (S) at 30 June 2009 was 771 people. Between 2004 and 2009, Wickepin's ERP had grown at an average annual rate of 0.7% from 2004, which was below the average population growth rate for Australia over the same time period (1.8%). Many of the agricultural regions in this category also experienced below average population growth rates, such as Broomehill-Tambellup (S) in Western Australia and Break O'Day (M) in Tasmania (with average annual population growth rates of 1.1% and 1.4% respectively). Some of the agricultural regions in this category also experienced population decline, such as Orroroo/Carrieton (DC) in South Australia and Jerramungup (S) in Western Australia (with average annual population growth rates of -1.3% and -1.1% respectively).


LOW INCOME AND BELOW AVERAGE GROWTH LGAs

A total of 21 LGAs fell into this category; the majority were in South Australia (8 LGAs) and New South Wales (5 LGAs), three each were in Victoria and Tasmania, and there was one each in Western Australia and Queensland (see Map 7). LGAs in this category tended to be rural areas, such as Barunga West (DC), Cleve (DC) and Kingston (DC) in South Australia, Jerilderie (A), Guyra (A) and Glen Innes Severn (A) in New South Wales, Yarriambiack (S) and Hindmarsh (S) in Victoria, Dorset (M) in Tasmania and Woorabinda (S) in Queensland.

Trayning (S), in the wheat belt region of Western Australia, also fell into this category and had the lowest average annual growth rate of Wage and salary income of all LGAs in Australia (1.6% from 2003-04 to 2008-09). Trayning (S) had a very small number of Wage and salary earners in 2008-09 (128 earners) and its largest industry of employment in 2006 (according to the 2006 Census of Population and Housing) was Sheep, Beef Cattle and Grain Farming, which employed 49.4% of employed persons aged 15 years and over in the region.

Map 7. LOW INCOME AND BELOW AVERAGE INCOME GROWTH LGAs - By Average Annual Wage and Salary Income and Income Growth Rate, 2003-04 to 2008-09
Map: Low Income and Below Average Income Growth Local Government Areas



Dorset (M), an LGA in Tasmania, had the third lowest average annual income growth rate (2.6%) of all LGAs in Australia and had an average Wage and salary income of $32,224 in 2008-09, which was well below the Australian average of $46,599. Dorset (M) is in Tasmania's north-east and contains the regional centres of Scottsdale and Bridport. According to 2006 Census data, Dorset's largest industries of employment were Log Sawmilling and Timber Dressing, Sheep, Beef Cattle and Grain Farming and Dairy Cattle Farming, which employed 10.0%, 7% and 6.7% of employed persons aged 15 years and over in the region respectively.

The characteristics of Wage and salary earners in Dorset (M) were typical of the rural regions in this category, in that:
  • A higher percentage were employed as Labourers (27.7%) and a lower percentage were employed as Professionals (9.3%) compared to Australia (10.7% and 19.7% respectively);
  • A slightly higher percentage were above the age of 55 years (16.8%) compared to Australia (15.1%); and
  • A higher percentage were earning below $20,800 per year (36.8%) compared to Australia (26.2%).

The ERP of Dorset (M) at 30 June 2009 was 7 377 people. Between 2004 and 2009, Dorset's ERP had grown at an average annual rate of 0.4%, which was below the average population growth rate for Australia over the same time period (1.8%). The other regions in this category also experienced below average population growth rates and many experienced population decline, such as Jerilderie (A) and Wakool (A) in New South Wales (with average annual population growth rates of -1.2% and -1.0% respectively).


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