You asked
Please confirm that in the report https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhouseholdfinances/incomeandwealth/bulletins/householdincomeinequalityfinancial/yearending2018 calculations of the Gini Coefficient do not capture the value of the subsidy to housing costs that social housing provides?
Similarly, the wealth effect of the available, but untaken, discount available to those in social housing exercising the right to buy? Is there any ONS research pointing to the value of that subsidy to the poorest and its effect on the coefficient?
We said
Many thanks for your request for information.
The calculations you refer to in the Household income inequality, UK: Financial year ending 2018 bulletin are based on equivalised disposable income. Disposable income is defined as the amount of money that households have available for spending and saving after direct taxes (such as Income Tax, National Insurance and Council Tax) have been accounted for. It includes earnings from employment, private pensions and investments as well as cash benefits provided by the state. It does not include the value of the subsidy to housing costs that social housing provides. Similarly, the figures don’t take into account the untaken discount available to those in social housing exercising the right to buy.
Our Effects of taxes and benefits on UK household income: financial year ending 2017 release provides an estimates of the value of housing subsidies provided by social housing in its estimate of Final Income. In addition, the Department for Work and Pension’s Households Below Average Income series provide estimates of the Gini Coefficient after housing costs, taking into account the different housing arrangements that people have, which you may find useful.
If you have any further questions, please do get in touch at hie@ons.gov.uk