Households Below Average Income
Households Below Average Income (HBAI) uses household disposable incomes, after adjusting for the household
size and composition, as a proxy for material living standards. More precisely, it is a proxy for the level of consumption of
goods and services that people could attain given the disposable income of the household in which they live. In order to allow
comparisons of the living standards of different types of households, income is adjusted to take into account variations in the
size and composition of the households in a process known as equivalisation. A key assumption made in HBAI is that all individuals
in the household benefit equally from the combined income of the household. This enables the total equivalised income of the
household to be used as a proxy for the standard of living of each household member.
The main source of data used in this
study is the Family Resources Survey, which is a continuous
cross-sectional survey. As the FRS does not track individuals over time, analysis
of incomes is supplemented by the use of longitudinal data from the British
Household Panel Survey.
The Department for Work and Pensions strongly recommends that anyone using this data to look at low income statistics request access to the Special Licence version of the Households Below Average Income dataset, which contains all households and unrounded income data. This will ensure analysis is consistent with that published in the National Statistics Households Below Average Income series. The End User Licence data should only be used for teaching purpose and basic analyses. Results derived from the End User Licence data will differ from those published officially.
Further information is available from the DWP HBAI
web page.
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