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Adjusted disposable income account

Australian System of National Accounts: Concepts, Sources and Methods
Reference period
2020-21 financial year

Actual final consumption

13.94    The concept of actual final consumption is aimed at recording consumption in the sector in which the good or service is actually consumed rather than in the sector than incurs the expenditure.

13.95    Household actual final consumption includes:

  • the value of the households expenditures on consumption goods and services including expenditures on non-market goods or services sold at prices that are not economically significant;
  • government final consumption expenditures on education, health, social security and welfare, sport and recreation and culture, which are considered to be individual services; and
  • all services provided by non-profit institutions serving households as they are treated as individual services.

13.96    Government actual final consumption is equal to government final consumption expenditures on collective services. Whilst collective services benefit the community, or certain sections of the community, rather than government, the actual consumption of these services cannot be distributed among individual households, or groups of households. Therefore, the actual consumption of these collective services is attributed to the government units that incur the corresponding expenditures.

13.97    The final consumption expenditures of NPISHs are automatically included in household actual final consumption, with NPISHs being part of the household sector in the ASNA. However, the value of the actual final consumption of NPISHs is equal to the value of its total final consumption expenditure less its expenditure on individual goods or services provided as social transfers in kind to households. The value of the actual final consumption of NPISHs is thus equal to the value of the expenditures they incur on collective services.

13.98    The following table outlines the method used to calculate adjusted disposable income for both the general government and household sectors.

Table 13.26 Annual adjusted disposable income accounts - by sector
ItemComment
General government

 

 

The general government adjusted disposable income account is compiled using data which is used to compile gross disposable income for general government.

The following outlines the calculation of adjusted disposable income:

     Adjusted disposable income
     equals Gross disposable income
     less Social assistance benefits in kind
     less Transfers of individual non-market goods and services

Note that the sum of Social assistance in benefits kind and transfers of individual non-market goods and services is described in the ASNA as Total outlays in kind.

The use of adjusted disposable income is equal to actual collective consumption plus net saving, with net saving being the difference (i.e. the balancing item) between adjusted disposable income and the used of adjusted disposable income.

 Social assistance benefits in kind
  

Social assistance benefits in kind relate to benefits paid by general government on behalf of household sector. Data from the following items is used to estimate the most significant amounts to be attributed to households from general government:

  • Medicare rebates and discounts for concession card holders,
  • National Disability Insurance Scheme
  • Aged care subsidy,
  • Pharmaceutical Benefits Scheme, and
  • Childcare subsidy
  • These data are sourced from Government Finance Statistics.
 Transfers of individual non-market goods and services

 

 

Transfers of individual non-market goods and services includes expenditures on health and education services as well as any other individual good or services provided to households free, or at prices that are not economically significant.

Transfers of individual non-market goods and services are derived by subtracting the social assistance benefits in kind from the total outlays in kind where total outlays in kind is total government final consumption expenditure less actual collective consumption.

 Actual collective consumption

 

 

Government actual final consumption, also referred to as actual collective consumption, is compiled using government final consumption expenditure data obtained from Government Finance Statistics.

The government final consumption expenditure data is classified according to the Australian version of the Classification of the Functions of Government (COGOF-A), and data for COFOG-As relevant to government actual final consumption are summed to form the estimate for actual collective consumption. They are:

  • General public service;
  • Defence;
  • Social protection (part);
  • Public order and safety;
  • Environmental protection;
  • Housing and community amenities (part);
  • Recreation, culture and religion; and
  • Economic affairs.
Household (including NPISH)

 

 

The household adjusted disposable income account is compiled using data which is used to compile gross disposable income for households.

The following outlines the calculation of adjusted disposable income:

     Adjusted disposable income
     equals Gross disposable income
     plus Social assistance benefits in kind
     plus Transfers of individual non-market goods and services from general government

Note that the sum of Social assistance benefits in kind and transfers of individual non-market goods and services from general government is described in the ASNA as Social outlays in kind.

The use of adjusted disposable income is equal to actual individual consumption plus consumption of fixed capital, with the difference between adjusted disposable income and these uses being net saving (which is derived as a balancing item) between adjusted disposable income and the use of adjusted disposable income.

 Social assistance benefits in kind

 

 

Social assistance benefits in kind relate to benefits paid by general government to the household sector. Data for the following items is used to estimate the most significant amounts to be attributed to households from general government:

  • Medicare rebates and discounts for concession card holders,
  • National Disability Insurance Scheme
  • Aged care subsidy,
  • Pharmaceutical Benefits Scheme, and
  • Childcare subsidy.

These data are sourced from Government Finance Statistics.

 Transfers of individual non-market goods and services from general government

 

 

Transfers of individual non-market goods and services from general government includes, most significantly, the expenditures on health and education services as well as any other individual good or services provided to households free, or at prices that are not economically significant.

Transfers of individual non-market goods and services from general government are derived by subtracting the social assistance benefits in kind from social transfers in kind where social transfers in kind is total government final consumption expenditure less actual individual consumption.

 Actual individual consumption

 

 

Household actual final consumption, also referred to as actual individual consumption, is compiled using government final consumption expenditure data obtained from Government Finance Statistics.

The government final consumption expenditure data is classified according to the Australian version of the Classification of the Function of Government (COFOG-A), and data for COFOG-As relevant to household actual final consumption (i.e. individual consumption) are summed with household final consumption expenditure to form the estimate for actual individual consumption. The COFOG-As are:

  • Education;
  • Health;
  • Social protection (part);
  • Housing and community amenities (part); and
  • Transport.

Final consumption expenditure and actual final consumption: summary

13.99    Total final consumption in the economy may be viewed from two perspectives, being:

  • the expenditure side, as the total value of all expenditures on individual and collective consumption goods and services incurred by resident households, resident NPISHs and general government units; and
  • actual final consumption, as the value of all the individual goods and services acquired by resident households plus the value of the collective services provided by general government to the community., or large sections of the community.

13.100    The coverage of goods and services is the same in both cases. In order to ensure that the values of the two aggregates are the same, the goods and services acquired by resident households through transfers in kind must always be valued at the prices at which they are valued in the expenditure aggregates, and the time of recording the goods and services acquired by transfers in kind must be the same as the time of recording in the expenditure aggregates. It is also assumed that the flows to non-residents are balanced by flows from government (and NPISHs) of other economies.