Poverty in Scotland: methodology

Details on how poverty in Scotland is measured.

This document is part of 2 collections

Data sources and suitability

This page lists and describes some of the main data sources available to statistical users interested in income and poverty in Scotland.

In addition, the Office for National Statistics provide a detailed guide to sources of data on earnings and income, including the main uses, strengths and limitations:

This guide includes the Family Resources Survey, Households Below Average Incomes series, the Annual Survey of Hours and Earnings, the Labour Force Survey, the Living Cost and Food Survey, the Effects of Taxes and Benefits series, the EU Statistics on Income and Living Conditions, the Survey of Personal Incomes, the Wealth and Assets Survey, and National and Regional Accounts.

Family Resources Survey and Households Below Average Income dataset

The Family Resources Survey (FRS) is the official source of UK and Scottish Government information about income and poverty. It is a face-to-face survey interviewing approximately 2,800 households in Scotland and 30,000 households across the UK as a whole. The FRS is run by the Department for Work and Pensions (DWP) and aims to collect detailed information about respondents' incomes from employment and other sources. The Households Below Average Income dataset (HBAI) is derived from the FRS and is the source of UK and Scottish Government official income and poverty estimates. The HBAI is used for the "Poverty and income inequality in Scotland" publication.

Household responses are weighted and grossed up to be representative of all private households in Scotland. Incomes are equivalised (to take into account household composition) using the OECD modified equivalence scale. Once equivalised, weighted and grossed, the total income of every individual is summed to arrive at the total income figure.

The FRS is one of the best sources for understanding changes to the distribution of income over time and the risk of poverty for various groups in society. At Scottish and UK level, HBAI income and poverty figures are considered to be among the most robust available from any source. These estimates however, are not available at Local Authority level or smaller geographies.

Local income and poverty data

Local data is available here: Local poverty statistics

Scottish Household Survey

The Scottish Household Survey (SHS) is designed to provide accurate, up-to-date information about the characteristics, attitudes and behaviour of Scottish households and individuals on a range of issues. This includes information on household income.

There are some definitional differences in the income questions asked in the SHS and FRS. Also, as the SHS asks questions about a variety of topics it inevitably asks less detailed income questions than the solely income-focussed FRS.

Detailed analysis undertaken in 2020 concluded that the SHS measures household income accurately enough to produce income deciles and identify households who are in relative poverty before housing costs, with some caveats concerning benefit recipients including pensioners:

Previous research looking at the differences between the two sources can be found here:

A feasibility study into the possibility of improving the quality of income estimates from the SHS by combining SHS and FRS data:

Scottish Index of Multiple Deprivation

The Scottish Index of Multiple Deprivation (SIMD) is a relative measure of deprivation across 6,976 small areas (called data zones). If an area is identified as ‘deprived’, this can relate to people having a low income but it can also mean fewer resources or opportunities. SIMD looks at the extent to which an area is deprived across seven domains: income, employment, education, health, access to services, crime and housing.

The SIMD income domain counts people who receive certain income-related benefits and tax credits. While there is some overlap with people in poverty, not all SIMD income-deprived people are necessarily in poverty, and not all people in poverty are considered income-deprived in SIMD.



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