§ Mr. WillettsTo ask the Chancellor of the Exchequer if he will set out the distribution of original income, by quintile, in each of the past 10 years. [171582]
§ Ruth KellyThe information requested falls within the responsibility of the National Statistician, who has been asked to reply.
Letter from Len cook to Mr. David Willetts, dated 11 May 2004:
As National Statistician, I have been asked to reply to your recent Parliamentary Question asking for the distribution of original income, by quintile, in each of the past ten years. (171582)
Estimates in the following table are produced from the Office for National Statistics' analysis "The effects of taxes and benefits on household income" published on the National Statistics website on 6 May 2004 at: http://www.statistics.gov.uk/taxesbenefits.
The analysis includes measures of income inequality for the United Kingdom as a whole based on data from the Expenditure and Food Survey. There have been some changes in the underlying surveys and improvements in the methodology so caution is required when making direct comparisons between years.
The table shows, for the UK, for 1993 to 2002/03, average original income received by all households and for each income quintile group where households are ranked by equivalised disposable income. For example, the 1st quintile boundary is the income level below which one fifth of households are estimated to lie. Equivalisation is a standard methodology that takes into account the size and composition of households and adjusts their incomes to recognise differing demands on resources.
Original income is defined as income before government intervention i.e. from sources such as earnings, occupational pensions and investments. It does not include cash benefits such as the State Retirement Pension, Incapacity benefit, Working Families Tax Credit, child benefit or housing benefit.
271W
1996–97 1997–98 Quintile Income boundary2 Original Income Income boundary2 Original Income Bottom 2,310 2,520 8,032 8,507 2nd 6,450 6,760 11,344 11,922 3rd 14,710 15,530 15,521 16,342 4th 24,220 25,980 21,972 23,457 Top 44,780 47,610 Average for all households 18,490 19,680
1998–99 1999–2000 2000–01 Quintile Income boundary2 Original Income Income boundary2 Original Income Income boundary2 Original Income Bottom 2,940 2,840 3,090 8,785 9,171 9,790 2nd 7,260 7,680 8,820 12,504 13,173 13,808 3rd 16,570 17,170 18,570 17,193 18,212 19,029 4th 26,700 27,920 29,950 24,259 26,118 27,109 Top 51,220 54,400 55,740 Average for all households 20,940 22,000 23,230
2001–02 2002–03 Quintile Income boundary2 Original Income Income boundary Original Income Bottom 3,410 4,030 10,356 11,196 2nd 9,140 9,610 14,670 15,516 3rd 19,240 19,320 19,910 20,860 4th 32,000 33,080 28,469 29,575 Top 62,080 60,310 Average for all households 25,180 25,270 11993 calendar year, 1994–95 to 2002–03 are financial years. 2 Boundary point between equivalised disposable income quintiles. Source: Office for National Statistics, based on the analysis 'The effects of taxes and benefits on household income', published on the ONS website and in Economic Trends.