CHAPTER 6 - CONCLUSION
The distribution by household groups of the national accounts household income, consumption and wealth estimates presented in this publication provides a bridge between the macro-economic aggregate household estimates produced within the Australian System of National Accounts (ASNA) and the ABS household economic resource surveys distributional analysis of household income, consumption and wealth. The household distributional results presented in this paper complement the aggregate estimates for household income, consumption and wealth for 2003-04 to 2014-15 published in the household sectoral accounts in the Australian System of National Accounts, 2014-15 (cat. no. 5204.0).
Due to user demand for timely household distributional data, the ABS has included in this release extrapolated estimates of household distributional data for income, consumption and wealth for 2014-15, five months after the end of the reference year. A feasibility study to test the robustness of the modelled 2014-15 distributed income and wealth estimates, found the modelled estimates of the total shares of national accounts aggregates and components by household groups to be quite accurate. The study found the actual levels of distributed estimates at the aggregate level to be more accurate than the components, but overall less accurate than the shares. Overall, the ABS considers that the 2014-15 estimates will provide a timely initial assessment of the financial health of household groups.
The distributional results for 2014-15 show income inequalities (calculated as ratios of the shares of the highest to lowest quintile) across households classified according to income and net worth quintiles for income components such as compensation of employees, property income and superannuation benefits received. However, the results show a reversal of the inequality when the impact of the distributional policies of government through transfer payments in cash and in kind (i.e. social assistance benefits and health social transfers in kind), and income tax are analysed on the income quintiles, this impact is illustrated to a lesser extent on the net worth quintiles. The value of the ratios for total gross disposable income and household final consumption, indicate income inequalities are higher than consumption inequalities, with further evidence provided by the inequality across households income quintiles for gross saving. Inequalities in wealth are illustrated by income and net worth quintile distribution of ownership of residential dwelling and land and superannuation and insurance reserves, with the net worth quintiles indicating these inequalities more markedly.
The ABS are among only a few national statistical offices (NSOs) that have produced time series of the household distributional data set. The distributional analysis of the time series in this release may be employed to address policy questions not otherwise possible with aggregate time series estimates of the household sector from the ASNA. The questions that can be answered may be broadly categorised to those related to a household group's (i) contribution to growth in income (consumption, net saving and net worth) and (ii) material living standards, such questions as:
- which household group benefitted from the increase in gross disposable income, and its components such as interest and dividend receivable during the period 2003-04 to 2014-15;
- what was the saving behaviour of household groups before, during and after the global financial crisis (GFC);
- which household groups are investing in superannuation (insurance technical reserves), and over time which household groups are benefitting from growth in superannuation technical reserves;
- for a household group, what is the contribution of social transfer kind in education to the overall growth in actual individual consumption per household;
- for household groups, what is the contribution of residential dwelling and land to growth overtime in net worth per household; and
- what is the impact on gross disposable income per household for household groups with a change in taxation policy.