Northern Ireland
Numbers in low income
Key points
- The most commonly used threshold of low income is a household income that is 60% or less of the average (median) household income in that year. For a discussion of why this is the most commonly used threshold, see the page on choices of low income thresholds. The latest year for which data is available is 2005/06. In that year, the 60% threshold was worth £108 per week for single adult with no dependent children; £186 per week for a couple with no dependent children; £182 per week for a single adult with two children under the age of 14; and £260 per week for a couple with two children under the age of 14. These sums of money are measured after income tax, council tax and housing costs have been deducted, where housing costs include rents, mortgage interest (but not the repayment of principal), buildings insurance and water charges. They therefore represent what the household has available to spend on everything else it needs, from food and heating to travel and entertainment.
- Over the period 2003/04 to 2005/06, 21% of the population of Northern Ireland were living in low income households using this threshold. This is equivalent to around 350,000 people.
- Northern Ireland's 21% rate is similar to the GB average. Although just four GB regions have lower rates, Northern Ireland's rate places it in a group made up of most of the English regions (outside the south), as well as Wales and Scotland.
- Over the same period, 21% of the population of Northern Ireland were also living in low income households measured on a before-deducting-housing-costs basis.
- This rate is higher than that for all GB regions apart from Wales. Unlike most GB regions, therefore, Northern Ireland's ranking when poverty is measured before deducting housing costs is very different from its ranking when it is measured after deducting housing costs.
- Over the period 2003/04 to 2005/06, housing costs in Northern Ireland for households with below average incomes were £28 a week gross and £18 a week net (of Housing Benefit).
- On both measures, housing costs in Northern Ireland are lower than in any GB region, by about £5 a week compared with Wales (the lowest GB region) and about £15 a week compared with the average for GB as a whole. It is for this reason that the two measures of low income (before and after deducting housing costs) rank Northern Ireland so differently when compared with the GB regions.
- The proportion of people who are in low income households is higher for Catholics than for Protestants: 25% compared with 18%.
Graph 1: Compared to GB
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Graph 2: Compared to GB (before deducting housing costs)
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Graph 3: Housing costs
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Graph 4: By religion
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Definitions and data sources
By convention, the low income threshold is defined as 60% of the income of the average household ('median income'). Except where stated otherwise, this is the average UK household. The justification for defining low income relative to the average is that anyone whose income is so far below that average is unlikely to be able to live normally by the standards of that society.
The amount of money that this 60% low income threshold represents varies according to the number of adults and children the household contains. In 2005/06, the latest year for which data is available, the threshold was worth: £108 per week for single adult with no dependent children; £186 per week for a couple with no dependent children; £223 per week for a single adult with two dependent children; and £301 per week for a couple with two dependent children.
These sums of money are measured after income tax, rates, and housing costs have been deducted, where housing costs include rents, mortgage interest (but not repayment of the principal), buildings insurance and water charges. The sum of money left over is therefore what is available to pay for food, clothing, travel, heating, lighting and so on.
The first two graphs compares the proportion of people in low income households in Northern Ireland with that for each of the regions in Great Britain. In the first graph, the calculations are done using incomes after deducting housing costs whilst, in the second, they are done using incomes before deducting housing costs.
A household is deemed to be in low income if its income is less than 60% of the contemporary British median household income. This threshold is the most widely accepted threshold of low income and is, for example, that currently used in the UK Government's child poverty targets.
The third graph shows how housing costs in Northern Ireland compare to the regions of Great Britain, with the data shown separately depending on whether rents paid for by Housing Benefit are considered to be a housing cost or not. Housing costs are calculated as 'income before deducting housing costs' less 'income after deducting housing costs' and are scaled to be for couples with no children.
The fourth graph compares the proportion of people in low income households (after deducting housing costs) by religious denomination. Note that the religious denomination of the household is defined in terms of the religious denomination of the Household Reference Person.
The data source for all the graphs is Households Below Average Income, based on the Family Resources Survey (FRS). Income is disposable household income after deducting housing costs. All data is equivalised (adjusted) to account for differences in household size and composition. The self-employed are included in the statistics. Note that in 2007 DWP made some technical changes to how it adjusted household income for household composition (including retrospective changes) and, as a result, the data is slightly different than previously published figures. The averaging over three-year periods has been done to improve statistical reliability.
Overall adequacy of the indicator: medium. The FRS is a well-established annual government survey designed to be representative of the population as a whole and the Northern Ireland sample has been boosted to improve sample sizes. However, the Northern Irish sample is a recent addition to the survey and is yet to be fully quality assured by the Department of Work and Pensions.