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EUROPEAN COMMISSION DG Employment, Social Affairs and Equal Opportunities

EUROPEAN COMMISSION DG Employment, Social Affairs and Equal Opportunities Hugh Frazer, Policy Co-ordinator, Social inclusion policies. Seminar on Developing Local and Regional Plans for Social Inclusion Prague, 9 th February 2006 “Statistics on Income and Living Conditions” (SILC). 1.

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EUROPEAN COMMISSION DG Employment, Social Affairs and Equal Opportunities

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  1. EUROPEAN COMMISSION DG Employment, Social Affairs and Equal Opportunities Hugh Frazer, Policy Co-ordinator, Social inclusion policies Seminar on Developing Local and Regional Plans for Social InclusionPrague, 9th February 2006“Statistics on Income and Living Conditions” (SILC) 1

  2. Importance of Indicators • Analysis • Targets • Comparison • Monitoring • Exchange of learning

  3. Past experience • Statistics on income and living conditions and indicators on poverty and social exclusion have been requested at high political level. • For the 1994-2001 period, the European Community Household Panel (ECHP) survey was used to fulfil these political needs.

  4. Why to launch a new survey? (I) • The ECHP offered a unique information source (large range of topics, standardised methodology and centralised procedures, panel design) • However, the ECHP always suffered from several operational problems: • data timeliness, • initial response/attrition rates, • the non-participation of all countries in the project • and the non-integration the survey some of the national statistical systems.

  5. Why to launch a new survey? (II) • Due to the need of updating the content of the survey according to the freshest political demands - particularly after the Lisbon, Nice, Stockholm, and Laeken summits where strong support was given to the eradication of poverty and to a better understanding of social exclusion • and to the request for operational improvement, mainly the timeliness of the produced data, after 2002 it was decided to replace the ECHP survey by a new instrument 'EU-SILC‘ (Statistics on income and Living Conditions).

  6. EUSILC • The reference source from 2005 of comparative statistics on “Income distribution” and “Social exclusion” • A legal basis • Regulation of the European Parliament and the Council • supplemented by Commission Regulations for the implementation of EU-SILC • Three priorities • Quality: accuracy, coherence, comparability(target population, definitions) • Timely:data of year N available end N+1; data up to year N available in March year N+2 • Stability: integration of NSS Flexibility (some compromise were necessary: sample design, compilation of data, questionnaires)

  7. INCOME ACTIVITY ANDWORK SOCIALEXCLUSION HOUSING DEMOGRAPHY,EDUCATION ANDHEALTH EU-SILC Areas Areas covered in EU-SILC are divided insevenprimary domainsannually collected … … andsecondary areasto be collected every four year or less frequently

  8. Main indicators • The Laeken European Council endorsed a set of 18 common indicators for social inclusion that would allow monitoring in a comparable way of MSs’ progress towards agreed EU objectives regarding poverty and social exclusion. • Fields covered: income poverty, employment, health and education.

  9. Main indicators • At-risk-of-poverty rate • Share of the poor persons, that is, the persons with a personal income below the poverty threshold • Broken down by the following variables: • Age and gender • Household type • Work intensity of the household • Accomodation tenure status • Most frequent activity status

  10. Main indicators • At-risk-of-poverty threshold • 60% of the personal income median • Personal equivalised income = total disposable household income / equivalised household size • The equivalised household size used is the modified OECD scale (weight of 1 to the first adult of the household, 0.5 to each subsequent adult – aged 14+ – and 0.3 to each child aged less than 14).

  11. Main indicators • Relative at-risk-of-poverty gap It indicates the degree of proximity to the poverty threshold of the poor persons’ income distribution • Income quintile share ratio S80/S20 S80/S20 indicates the absolute degree of inequality of the income distribution. • Gini The Gini index indicates the relative degree of inequality of the income distribution.

  12. Main indicators • Persistent risk-of-poverty rate (longitudinal) Share of persons with an income below the poverty threshold in the current wave of the survey and in at least two of the preceding three waves

  13. At-risk-of-poverty rate, total population, 2003 Transitional data

  14. Illustrative value of the at-risk-of-poverty threshold for a 2-adult, 2-child household, 2003

  15. At-risk-of-poverty rate before any social transfers (top), after pensions (middle), and after all social transfers (bottom)

  16. Impact of social transfers other than pensions on the at-risk-of-poverty rate, total population, 2003

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