Technical report: update to measures using material deprivation for households below average income FYE 2024
Published 27 March 2025
Executive Summary
This report is designed to help users of the Households Below Average Income (HBAI) statistics understand and interpret estimates based on the updated measures of material deprivation from Financial Year Ending (FYE) 2024 and how to assess them against estimates based on the old measures. It also aims to support users of the underlying Family Resources Survey (FRS) data used for these measures.
Material Deprivation is a direct measure of poverty derived from the lack of items deemed to be necessary for a minimum acceptable standard of living. Estimates are published annually by DWP alongside other poverty measures in the HBAI publication.
Following a recommendation from the Office for Statistics Regulation (OSR) Review of Income-based Poverty Statistics, DWP and the London School of Economics and Political Science (LSE) conducted a review of the UK Material Deprivation measures and the associated FRS questions.
The decisions underpinning the methodology for the updated Material Deprivation measures were informed by recommendations from the LSE Review, evidence from analysis of HBAI FYE 2024 and back-series data, as well as broader conceptual perspectives.
Updated questions were included from FYE 2024 in the FRS:
- Children: 11 child-based and 11 household-based questions.
- Working-age adults: 10 working-age adult-based and 11 household-based questions.
- Pensioners: 8 pensioner-based and 11 household-based questions.
- The same household-based questions are asked across all groups.
- Standardised question routing is applied for all groups to optimise accurate responses by asking all questions first and then follow-up questions after.
The last changes to Material Deprivation items in the FRS were in FYE 2010 for pensioners and FYE 2011 for children and working-age adults. Previously, there were 21 child questions, 9 working-age adult questions and 15 pensioner questions.
A simple count approach is used across all updated Material Deprivation measures for children, working-age adults, and pensioners. It was chosen for its lower complexity and greater transparency, compared to the previous prevalence-weighted score approach.
Analysis indicated very similar trends in percentages in material deprivation using a prevalence-weighted score approach and simple count over time based on the old questions and old methodology.
A financial constrained lack definition is used to identify whether an item is lacked across most of the updated questions. Previously, a financial constrained lack definition was used for most of the old child and working-age adult questions, whereas a wider constrained lack definition was used for old pensioner questions.
Analysis indicated marginal difference in using a wider constrained lack definition in the FYE 2024 data for the pensioner questions. Other factors taken into consideration were that the financial constrained lack definition better aligns with the financial aspect of Material Deprivation and improvements to the question routing in the survey more accurately capturing financial reasons for lacking an item. This approach is now consistent across all age groups.
A simple absence definition is used for three items, in addition to some defined in the LSE Review, where conceptually there was no reason not to want these items other than due to financial constraint. A simple absence definition was used for a small number of old questions.
The updated material deprivation thresholds using the simple count approach are:
- Child questions: 4 or more items lacked.
- Working-age adult questions: 5 or more items lacked.
- Pensioner questions: 4 or more items lacked.
Previously a child would be in material deprivation if the prevalence-weighted score was 25 or more. The same threshold score of 25 or more was used for working-age adults. For pensioners, the threshold was a prevalence-weighted score of 20 or more. The thresholds for the updated measures were based on statistical analysis using a Composite Measure of Living Standards developed following the recommendation in the LSE Review, analysis of FYE 2024 data, and wider contextual and academic evidence.
For FYE 2024, material deprivation estimates based on the updated measures are:
- Children: 28%
- Working-age adults: 23%
- Pensioners: 11%
The material deprivation estimates for FYE 2023 were 21% for children, 22% for working-age adults and 8% for pensioners. Estimates between FYE 2024 and FYE 2023 are not comparable as FYE 2024 estimates are based on the updated questions and updated methodology, whereas the FYE 2023 estimates are based on the old questions and old methodology.
The updated methodology aims to provide measures of material deprivation that use updated questions that are more relevant to society today, an improved data collection methodology, as well as apply a transparent, simple count approach to counting the number of items lacked and a consistent definition of lacking an item across groups.
The Department has a statutory obligation to publish an annual estimate for Combined Low Income and Material Deprivation for Children under section 4 of the Welfare Reform and Work Act 2016. The FYE 2024 estimate will be based on the updated measure.
Note that single year estimates are not published in the UK HBAI Statistics by region and ethnicity due to volatility in sample sizes and coverage. Historically, a three-year average has been applied (with a change to three-year averages based on two data points to exclude 2020/21 in more recent years). As FYE 2024 is the first year of estimates based on the updated measures, estimates are not published in the HBAI FYE 2024 release. Further information on material deprivation-based estimates published by country following the update can be found in the publications for Wales, Scotland and Northern Ireland.
Acknowledgements
DWP would like to thank the researchers at the London School of Economics and Political Science (LSE) for their advice and support in developing the updated Material Deprivation measures, following the LSE review.
We are also grateful to the FRS Expert Advisory Group who provided their expertise in discussions of the evidence and analysis for the key decisions that underpinned the methodology for the updated Material Deprivation measures.
Glossary
Material Deprivation
Material Deprivation is a direct measure of poverty derived from the lack of items deemed to be necessary for a minimum acceptable standard of living.
Lacked item
A lacked item is where the family does not have an item and this may be due to a particular constraint, such as financial or disability, or through choice.
Simple absence
Lacking an item or activity included in a material deprivation measure for any reason.
Constrained lack
Lacking an item or activity included in a material deprivation measure due to a constraint, such as a financial constraint or a disability.
Financial constrained lack
Lacking an item or activity included in a material deprivation measure due to a financial constraint only e.g. want but cannot afford.
Wider constrained lack
Lacking an item or activity included in a material deprivation measure due to a constraint, including financial constraint and some but not all reasons e.g. health/disability preventing them, too much trouble/too tiring, no one to do this with etc.
Adaptive preference
Where the respondent has adapted to managing on a lower standard of living. As a result, their preferences change and they lower their expectations. They may respond to no longer wanting or needing an item, or it is not relevant to them, as they see it as being out of their reach. These individuals should be captured as lacking the item but would not be under a financial constrained lack or wider constrained lack definition.
Personal choice
Where the respondent genuinely does not want or need the item, or it is not relevant to them. These individuals should not be captured as lacking the item.
Income gradient
When an outcome increases or decreases with income.
Prevalence-weighted score approach
A prevalence-weighted score approach gives greater weight to lacking those items that are more commonly held or where ownership is more widespread.
Simple count approach
A simple count approach gives each item an equal weight.
Child
A dependent child is defined as an individual aged under 16. A person will also be defined as a child if they are 16 to 19-years old and they are:
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not married nor in a civil partnership nor living with a partner; and
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living with parents/a responsible adult; and
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in full-time non-advanced education or in unwaged government training
Working-age adult
Working-age adults are defined as all adults below State Pension age.
Pensioner
Pensioners are defined as all adults at or above State Pension age.
Benefit unit (family)
A single adult or a married or cohabiting couple and any dependent children. Since January 2006 same-sex partners (civil partners and cohabitees) have been included in the same benefit unit.
Household
One person living alone or a group of people (not necessarily related) living at the same address who share cooking facilities and share a living room or sitting room or dining area. A household will consist of one or more benefit units.
Household Reference Person
The household reference person (HRP) is usually the highest Income householder. Note:
- In a single-adult household, the HRP is simply the sole householder (i.e. the person in whose name the accommodation is owned or rented).
- If there are two or more householders, the HRP is the householder with the highest personal income, taking all sources of income into account.
- If there are two or more householders who have the same income, the HRP is the elder.
The Head of benefit unit will not necessarily be the HRP.
Head of benefit unit
The head of the first benefit unit will be the same as the household reference person. For second and subsequent benefit units, the head will be the first adult to be interviewed.
Further terms can be found in the Glossary of the HBAI FYE 2024 Quality and Methodology Information Report.
Introduction
This report is designed to help users of the Households Below Average Income (HBAI) statistics understand and interpret estimates based on the updated measures of material deprivation from Financial Year Ending (FYE) 2024 and how to assess them against estimates based on the old measures. It also aims to support users of the underlying Family Resources Survey (FRS) data used for these measures.
Material Deprivation is a direct measure of poverty derived from the lack of items deemed to be necessary for a minimum acceptable standard of living. Estimates are published annually by DWP alongside other poverty measures in the HBAI publication.
The Code of Practice for Statistics requires periodic reviews of Accredited Official Statistics. The last changes to Material Deprivation items in the Family Resources Survey (FRS) were in FYE 2010 for pensioners and FYE 2011 for children and working-age adults. Throughout this report, ‘old’ relates to these questions and measures. Note that the old measure for pensioner material deprivation was for adults aged 65 and over. This meant that before FYE 2019, female pensioners aged under 65 were not included. Since the equalisation of State Pension Age from FYE 2019, all pensioners were included in the measure.
It is recognised as best practice to review the relevance of the items used to measure Material Deprivation to reflect changes in what is considered a necessity. For example, reliable access to the internet would have previously been perceived to be a luxury but now would be deemed a necessity.
Starting in December 2021, DWP, in partnership with researchers at the London School of Economics and Political Science (LSE), conducted a review of the Material Deprivation measures and the associated FRS questions. This followed a recommendation from the Office for Statistics Regulation (OSR) Review of Income-based Poverty Statistics to review the current set of questions that underpin UK material deprivation, and to determine a way to compare material deprivation across groups. Test questions were included in the FYE 2023 FRS. Recommendations for updates to the items and activities to be included in the Material Deprivation measures were approved by the DWP Chief Statistician and updated questions were included in the FYE 2024 FRS. The LSE Review along with a summary were published in March 2024.
Although breaks in series make it difficult to analyse trends, the Covid-19 pandemic had already disrupted the Material Deprivation series in recent years and the LSE Review concluded that the benefits of revising the measures outweighed the disadvantages.
The main advantages are:
- updating the necessities to items and activities which are perceived to be necessary for a minimum acceptable standard of living in the UK today.
- standardisation in data collection methodology.
- a core set of household-level items reduces the survey burden relative to collecting this information from multiple adults living in the same household, increases comparability between age groups and, potentially, aids the development of a whole population measure.
For FYE 2024 FRS, the survey was designed to ask 75% of households the updated questions and 25% of households the old questions to assess the break in the series. From April 2024, only the updated questions have been included in the FRS.
Four key decisions underpin the methodology for the updated Material Deprivation measures:
a. Approach to counting the number of items lacked.
b. Approach to defining a lacked item.
c. Setting the threshold at which an individual is defined as in Material Deprivation.
d. Presentation of estimates in the HBAI FYE 2024 release.
These decisions were informed by recommendations from the LSE Review, evidence from analysis of HBAI FYE 2024 and back-series data, as well as broader conceptual perspectives. Discussions of the evidence and analysis were carried out with our FRS Expert Advisory Group which consists of academics and users from third sector organisations, including the lead researcher from the LSE Review. The decisions have been assessed using an analytical framework created by DWP which evaluates validity, continuity, sensitivity, consistency alongside the need for transparency and resource implications.
The Department has a statutory obligation to publish an annual estimate for Combined Low Income and Material Deprivation for Children under section 4 of the Welfare Reform and Work Act 2016. The FYE 2024 estimate will be based on the updated measure.
Note that single year estimates are not published in the UK HBAI Statistics by region and ethnicity due to volatility in sample sizes and coverage. Historically, a three-year average has been applied (with a change to three-year averages based on two data points to exclude 2020/21 in more recent years). As FYE 2024 is the first year of estimates based on the updated measures, estimates are not published in the HBAI FYE 2024 release. Further information on material deprivation-based estimates published by country following the update can be found in the publications for Wales, Scotland and Northern Ireland.
Summary of the Updated Material Deprivation Measures
The following section summarises the key aspects of the updated Material Deprivation measures.
The updated methodology aims to provide measures of material deprivation that use updated questions that are more relevant to society today, an improved data collection methodology, as well as apply a transparent, simple count approach to counting the number of items lacked and a consistent definition of lacking an item across groups.
Further detailed information and analysis underpinning each decision made is set out later in this report.
Updated Material Deprivation questions
There are 29 updated Material Deprivation questions included in the Family Resources Survey (FRS) from FYE 2024, based on recommendations from the LSE Review.
The updated material deprivation questions consist of three groups of questions:
- Child questions: 11 child items and 11 household items
- Working-age adult questions: 10 working-age adult items and 11 household items
- Pensioner questions: 8 pensioner items and 11 household items
with the same household items captured across all groups.
Each question asks if the individual or household has an item, with response options of ‘Yes’ or ‘No’. Once all questions have been asked, follow-up questions to determine the reasons for responding ‘No’ - they are lacking the item - are asked for some questions. For the question, ‘Do you regularly have money worries at the end of the month?’, if the response is ‘Yes’ – to having regular money worries – then the individual is lacking the item.
Differences to the old measures are:
- While some updated questions ask about similar items lacked, other items from the old questions have been replaced and more questions are asked overall. Previously, there were:
- 21 child questions
- 9 working-age adult questions
- 15 pensioner questions
- For the old child and working-age adult questions, a single question was asked, with the response options ‘Yes’ and ‘No’ responses which identified the reason for lacking (Want but can’t afford, don’t want/need, does not apply) for most items
- For the old pensioner questions, as well as the initial question with ‘Yes’ or ‘No’ response options, a follow-up question to determine reasons for responding ‘No’ was asked for most items
The old and updated FRS questions are set out in Annex 1, along with links to the methodologies that the old Material Deprivation measures were based on. The wording of the updated questions has been shortened in this report for simplicity. The full question wording can be found in the LSE Review.
For FRS FYE 2024, the survey was designed to ask 25% of households the old questions and 75% were asked the updated questions. From FYE 2025, only the updated questions will be asked in the questionnaire. Further information can be found in the Data collection and imputation section in this report.
Approach to counting the number of items lacked
A simple count approach is used - if the item is lacked, the item is given a value of 1. Values for all items are added together to provide a count of items lacked. If the number of items lacked is above the threshold, the individual is defined to be in material deprivation (see the summary section for Setting the threshold at which an individual is defined as in Material Deprivation below).
This change is a result of a recommendation in the LSE Review to apply a simpler approach and replaces the previous, more complex prevalence-weighted score approach.
Analysis of HBAI back-series data indicated that this change made a negligible impact on estimates and mirrored conclusions in research papers that the complex prevalence-weighted score approach provided little added value to measuring material deprivation compared to the more transparent, simple count approach.
Further information is provided in the section Approach to counting the number of items lacked in this report.
Approach to defining a lacked item
A simple absence definition is used for a small number of questions - the item is defined as lacked if the response is ‘No’ to having the item (or ‘Yes’ for ‘Regular money worries at the end of the month’ question):
- Enough clothes that they feel comfortable to wear (MDCH5)*
- Enough bedrooms for children 10+ years (MDCH9)*
- Regular money worries at the end of the month (MDWA1 and MDPEN1)
- Able to pay bills without cutting back on essentials (MDHH1)
- Able to put money aside for unexpected expenses (MDHH2)
- Home adequately warm in cold weather (MDHH5)
- Home damp-free (MDHH6)
- Heating/electrics/plumbing in good working order (MDHH10)*
A simple absence definition is used for three items (marked with an asterisk above), in addition to some defined in the LSE Review, where conceptually there was no reason not to want these items other than due to financial constraint.
For remaining questions, a financial constrained lack definition is used - an item is defined as lacked if the response is ‘No’ to having the item and the follow-up reasons for not having the item is ‘We/I do not have the money for this’ or ‘This is not a priority on my/our current income’.
This is a change for the Pensioner Material Deprivation measure which previously used a wider constrained lack definition that also included some additional follow-up reasons such as restrictions due to health or disability, too much trouble or too tiring, no one to do the activity with or to help or other reasons.
Analysis indicated marginal difference of using a wider constrained lack definition in the FYE 2024 data. Other factors taken into consideration were that the financial constrained lack definition better aligns with the financial aspect of Material Deprivation and improvements to the question routing in the survey more accurately capturing financial reasons for lacking an item.
Further information can be found in the Approach to defining some items lacked using simple absence section in this report.
Setting the threshold at which an individual is defined as in Material Deprivation.
An individual is defined to be in material deprivation if the number of items lacked are:
- Child questions: 4 or more items
- Working-age adult questions: 5 or more items
- Pensioner questions: 4 or more items
For FYE 2024, estimates based on the updated measures give the following percentages of individuals in material deprivation:
- Children: 28%
- Working-age adults: 23%
- Pensioners: 11%
The thresholds for the updated measures were based on statistical analysis using a Composite Measure of Living Standards developed following a recommendation in the LSE review, analysis of FYE 2024 data, and wider contextual and academic evidence.
The Composite Measure of Living Standards was used to identify a range of potential thresholds by assessing results of statistical tests across four related indicators of material deprivation and poverty:
- Living in food insecure household
- Net household income after housing costs
- Savings in the family
- Priority debt in the family (where families could lose their home, have their energy supply cut off, lose essential goods or go to prison if not repaid)
Further information can be found in the Development of a Composite Measure of Living Standards to identify the Material Deprivation thresholds section in this report.
Presentation of estimates in the HBAI FYE 2024 release
Following the OSR and LSE recommendations and to support users of HBAI and FRS data, additional information has been published in the HBAI FYE 2024 release.
In the main HBAI report and publication tables, additional estimates are presented for:
- Child Material Deprivation measure
- Working-age Adult Material Deprivation measure
- Combined Low Income and Child Material Deprivation measures After Housing Costs
- Combined Low Income and Working-age Adult Material Deprivation measures After Housing Costs
Note, the Pensioner Material Deprivation estimates are already published as a standalone measure and combined low income and pensioner material deprivation estimates are not used in HBAI analysis, so no additional estimates have been published.
This separate technical report has been published:
- Setting out the analysis and decisions that underpin the updated methodology
- Providing a comparison of estimates based on the old and updated measures in FYE 2024 and with FYE 2023 for information only
Note that single year estimates are not published in the UK HBAI Statistics by region and ethnicity due to volatility in sample sizes and coverage. Historically, a three-year average has been applied (with a change to three-year averages based on two data points to exclude 2020/21 in more recent years). As FYE 2024 is the first year of estimates based on the updated measures, estimates are not published in the HBAI FYE 2024 release. Further information on material deprivation-based estimates published by country following the update can be found in the publications for Wales, Scotland and Northern Ireland.
Publication tables and charts as well as the Stat-Xplore dataset will only present the updated estimates for FYE 2024, with footnotes explaining the break in the series provided to aid user interpretation.
Additional HBAI variables will be made available on the case-level dataset available at the UK Data Service for further analysis by users. A suite of documentation and guidance is also published alongside the dataset. The underlying, original FRS variables will be published in the FRS Benunit dataset as part of the suite of FRS FYE 2024 datasets at the UK Data Service.
Further information can be found in the Presentation of estimates in the HBAI FYE 2024 release section in this report.
Analysis of FYE 2024 estimates based on old and updated measures
Analysis was carried out to assess a break in the series for estimates based on material deprivation measures for FYE 2024. Estimates based on the updated measures are not directly comparable against FYE 2023, as different questions and methodologies were applied – see the Executive Summary for more information.
This analysis focussed on comparing the HBAI FYE 2023 sample with 25,000 households and the HBAI FYE 2024 sample asked the old questions with 4,000 households (24% of the HBAI FYE 2024 households). Material deprivation estimates for these samples used the old questions and the old methodology. An assessment was made on how similar the compositions of these samples were. This was to be able to compare estimates of material deprivation between the two years had the old questions and old methodology been maintained.
Estimates based on the updated measures are presented in the main HBAI report and publication tables.
FYE 2024 estimates based on the old measures provided in this analysis should not be reported.
Overall, the sample composition of those in material deprivation for FYE 2024 asked the old questions closely aligned with the FYE 2023 sample composition for working-age adults and pensioners. Some differences were seen in the composition of children in material deprivation in the FYE 2024 sample asked the old questions, compared to the FYE 2023 sample. The changes seen in material deprivation estimates in the FYE 2024 sample asked the old questions compared to the FYE 2023 sample were not statistically significant.
A separate set of Trends tables with estimates for FYE 2023 and FYE 2024 where households were asked the old questions can be found in the accompanying ODS supported tables that can be downloaded via the HBAI homepage (see Directory of Tables link on this web page).
Further information can be found in the Analysis of FYE 2024 estimates based on old and updated measures section of this report.
Recommendations from the LSE Review
Recommendations from the LSE Review were evaluated by DWP and the following were taken forward in the development of the updated measures from the HBAI FYE 2024 release:
1. Type of Approach:
a. Given the lower complexity and greater transparency of simple count measures, we recommend additional research to establish whether such a measure would have led to substantially different estimates of material deprivation over the last decade. If not, we recommend moving to a simple count measure.
b. If prevalence weighting is continued, we recommend a number of items and activities should be given the maximum weight of one irrespective of prevalence rates. The degree of deprivation felt by lacking some items is very unlikely to be affected by prevalence. We recommend further exploratory work to assess the desirability of giving the maximum weight to a damp free home, keeping home adequately warm in cold weather, able to pay bills, three meals a day and daily fresh fruit and/or vegetables.
c. We also used simple absence to assess deprivation of ‘having enough bedrooms for children over 10 years not to have to share with a child of a different sex’ in the analysis of the FRS test question data but suggest that further analysis of this item is conducted using the larger sample size which will be available in FRS FYE 2024.
d. Evidence suggests that adaptive preferences mean that people underreport financially constrained lack of necessities. We recommend further research to understand income gradients in people reporting that they, or their children, lack items or activities due to not wanting or needing them. This research could lead to the use of simple absence rather than constrained lack to establish deprivation for a wider set of items or activities.
2. Setting the Threshold:
a. It was not within the remit of the LSE Review to recommend optimum thresholds for the revised measures; data collected in the FRS for the first year, rather than the smaller FRS test question dataset, is required for this. However, the LSE Review assessed different methodological approaches and recommended using a combination of statistical analysis and judgement to determine where the new thresholds are set. To provide full transparency to users, documentation detailing the decisions made, and why, should be published alongside the statistics.
b. For the statistical modelling, we recommend DWP does not rely on household income alone to test which thresholds are best at discriminating between deprived and non-deprived groups. We recommend the development of a composite standard of living measure which could include information on savings, debts and food security, and recognises differences in needs/costs faced by different household types. For example, single parent households or where any household member has a long-standing illness or disability.
3. HBAI FYE 2024 Publication:
a. To gain a clearer picture of poverty trends, we recommend that alongside the HBAI low-income series and the combined low income and material deprivation series (a legal requirement for the child poverty measure), DWP publishes new HBAI headline series on material deprivation alone. Currently DWP release this measure via their online dissemination tool, Stat-Xplore, including the standalone metric in the publication would also meet some users concerns about the combined measure conflating two concepts (low income and material deprivation).
b. We recommend DWP headline statistics for combined measures are based on After Housing Costs and not Before Housing Costs income. This is a more realistic measure of the resources available to spend on necessities and consistent with other HBAI headline series.
4. Recommendations not taken forward for the HBAI FYE 2024 release
The following recommendations were not taken forward for the HBAI FYE 2024 release:
- Recommendation in relation to simple absence versus constrained lack: Parents may be more likely than children to report child-related items are lacked because children don’t want or need them rather than not being able to afford them. We recommend further research to establish the feasibility of asking children (aged 11+) directly about whether they lack items or activities, and the reason(s) why they lack any
- Recommendations on developing a core set of questions for the whole population alongside measures aimed at specific family types. Please see the LSE summary for more information
As the FRS does not interview children, this survey could not be used to ask children directly about whether they lack items or activities and reasons why they lack them. Further research based on these recommendations may be considered in the future by DWP.
Decision Process
To develop the updated Material Deprivation measures and calculate the updated estimates, the following order of decision making was taken:
a. Imputation following FYE 2024 data collection.
b. Approach to counting the number of items lacked.
c. Approach to defining some items as lacked using simple absence.
d. Development of a composite measure of living standard to identify the range of thresholds for financial constrained lack definition and wider constrained lack definition of Material Deprivation.
e. Approach to defining a lacked item not already defined using simple absence: and setting the Material Deprivation thresholds.
f. Presentation of estimates in the HBAI FYE 2024 release.
Using the LSE recommendations as a starting point, analysis was carried out using HBAI back-series and FYE 2024 data. As well as evaluating trends seen in overall material deprivation estimates for children, working-age adults and pensioners, further analysis was also produced by groups associated with material deprivation:
- In a food insecure household
- In a low-income household (below 60% of FYE 2011 median income After Housing Costs)
- With disability in the family
- Living in rented accommodation
- With no savings in the family
Discussions of the evidence and analysis were carried out with our FRS Expert Advisory Group which consists of academics and users from third sector organisations, including the lead researcher from the LSE Review.
The decisions were assessed using an analytical framework created by DWP which evaluates validity, continuity, sensitivity, consistency alongside the need for transparency and resource implications.
The following sections set out the Analytical Framework used in evaluating analysis and methodological decisions and steps through each of the decision processes.
Analytical Framework
An analytical framework was developed by DWP to assist in the evaluation of analysis and the methodological decisions made. Assessments of validity, continuity, sensitivity and consistency were balanced alongside the need for transparency and resource implications on a decision-by-decision basis.
The factors considered were:
Table 1: Analytical framework for the updated Material Deprivation measures
Factor | Assessment |
---|---|
Validity: Effective in capturing those in material deprivation. | Conduct analysis of the groups most likely to be materially deprived as per the decision made and their relationship with alternative measures of poverty (low income and living in a food insecure household) and other characteristics known to be associated with poverty (e.g. disability in the family, savings in the family, family type and so on). |
Continuity: Refinement of measure of material deprivation outweighing any discontinuity in series. | Impact of the decision on the groups of people entered into or removed from material deprivation, in relation to alternative measures of poverty and characteristics associated with poverty. Determining whether refinement of the measure of material deprivation outweighs discontinuity in estimates from FYE 2024. |
Sensitivity: Reacts to changes in the economy and living standards. | How sensitive the new measure is in reflecting historical economic trends, such as increasing following a recession. How the new measure reflects patterns for sub-groups observed by alternative measures of poverty, such as income measures and living in a food insecure household. |
Consistency: Approach can be applied across all questions. | How the decision increases or decreases the ability to apply a common approach across all questions. Evaluating how the different decisions affect the estimates of material deprivation levels for children, working-age adults and pensioners. |
Transparency: Measure estimates and products can be clearly understood by the user. | How to communicate and demonstrate the change in methodology in the published report, tables and methodology report, in Stat-Xplore and other user guidance. How the decision made affects ease of user interpretation and analysis. |
Resources: Deliverable in time-frame and with existing software and staff. | Implications for different methodological approaches alongside the factors above in ensuring the development of these statistics can be implemented within the HBAI FYE 2024 processing period, independently quality-assured by the Institute for Fiscal Studies and deliverable by March 2025. |
Data collection and imputation
For FRS FYE 2024, the survey was designed to ask 75% of households the updated questions and 25% of households the old questions to assess the break in the series.
The Analysis of FYE 2024 estimates based on the old and updated measures section of this report compares FYE 2024 estimates where households were asked the old questions and using the old methodology against FYE 2023 estimates that were based on the old questions and old methodology.
The FRS interviews were carried out by:
- National Centre for Social Research (NatCen)
- Office for National Statistics (ONS)
- Northern Ireland Statistics and Research Agency (NISRA) for Northern Ireland.
Given the target split and the sample sizes of NatCen, ONS, and NISRA, it was logical for NatCen (as the holder of the largest sample) to divide its sample, with half retaining the old questions. ONS and NISRA would move to asking the updated questions only. This meant that no households in Northern Ireland were asked the old questions by NISRA. Further information can be found in the FRS Background and Information Methodology.
Updated Material Deprivation questions
The 29 updated questions present items for each group in Material Deprivation:
- Children: 11 child-based questions and 11 household-based questions
- Working-age adults: 10 working-age adult-based questions and 11 household-based questions
- Pensioners: 8 pensioner-based questions and 11 household-based questions
The following tables list the updated questions asked from FYE 2024 in the FRS. The question wording has been shortened in the table for simplicity in this report – the full question wording can be found in the LSE Review.
Table 2a: List of updated Material Deprivation questions from FYE 2024 - Household level
Child | Working-age Adults | Pensioners | |
---|---|---|---|
Able to pay bills without cutting back on essentials | Yes | Yes | Yes |
Able to put money aside for unexpected expenses | Yes | Yes | Yes |
Cover cost of repair or to replace appliances | Yes | Yes | Yes |
Home in good state of decoration/repair | Yes | Yes | Yes |
Home adequately warm in cold weather | Yes | Yes | Yes |
Home damp free | Yes | Yes | Yes |
Reliable access to internet at home | Yes | Yes | Yes |
Access to computer/tablet | Yes | Yes | Yes |
Adequate access to reliable transport | Yes | Yes | Yes |
Heating/electrics/plumbing in good working order | Yes | Yes | Yes |
Home contents insurance | Yes | Yes | Yes |
Table 2b: List of updated Material Deprivation questions from FYE 2024 - Individual level
Child | Working-age Adults | Pensioners | |
---|---|---|---|
Three meals a day | Yes | Yes | Yes |
Fresh fruit and/or vegetables every day | Yes | Yes | Yes |
Annual break away from home | Yes | Yes | Yes |
Regular money worries at the end of the month | No | Yes | Yes |
Regular payments to workplace or private pension | No | Yes | No |
Appropriate clothes for work/job interview | No | Yes | No |
Regular dental appointments | No | Yes | Yes |
Go out socially at least monthly | No | Yes | Yes |
See friends and family at least monthly | No | Yes | Yes |
Small amount of money for oneself | No | Yes | Yes |
School trips | Yes | No | No |
Place for homework | Yes | No | No |
Enough clothes that they feel comfortable to wear | Yes | No | No |
Organised weekly activity outside school | Yes | No | No |
Friends round monthly | Yes | No | No |
Age suitable toys/games | Yes | No | No |
Enough bedrooms for children 10+ years | Yes | No | No |
Toddler/nursery/playgroup at least weekly | Yes | No | No |
Where the response is ‘No’ to having an item, a set of follow-up questions are asked to collect reasons. These are:
- We/I do not have the money for this.
- This is not a priority on my/our current income.
- Health/disability prevents this.
- We/I do not want/need this.
- It is not relevant to me/us.
- Other reason.
To note:
- More than one reason can be given when responding ‘No’ to a question
- Some updated questions do not have follow-up reasons asked as they have already been defined by simple absence following the LSE Review. These include:
- Regular money worries at the end of the month (note for this question, a response of ‘Yes’ would indicate lacking the item)
- Able to pay bills without cutting back on essentials
- Able to put money aside for unexpected expenses
- Home adequately warm in cold weather
- Home damp free
- Certain child questions may not be relevant to some families depending on the age of children in the family and so are only asked if applicable. These are:
- School trips, Organised weekly activity outside school and Place for homework questions: only asked if child/ren aged 6 years or older, or any children under 6 years of age who attend a primary school or a private or independent school
- Enough bedrooms for children 10+ years question: only asked if 2 or more children of the opposite sex are in the same family (benefit unit) and at least one is aged 10 years or over
- Toddler/nursery/playgroup at least weekly question: only asked if child/ren in benefit unit under 6 and do not attend primary or private school
To reduce the survey burden relative to collecting this information from multiple adults living in the same household, the core set of household-based questions are asked to the first benefit unit (family) in a household containing the household reference person (see the Glossary) and the responses and reasons applied to all individuals in the household.
Additionally, for the question ‘Annual break away from home’, this question is asked in the Working-age Adult or Pensioner section of the questionnaire but asks about partners and dependent children too. The full question is ‘Do you (your partner and your dependent children) have a break away from home at least once a year?’. These responses and reasons are used to derive the child response question and follow-up questions variables for children in the benefit unit (family).
Also, standardised question routing was implemented. Respondents were first asked whether or not they lacked any of the items or activities before being asked a set of follow-up questions to establish why they lacked an item or activity. This was the question routing already in use in the FRS for material deprivation questions for pensioners.
The reason why this routing was introduced was that research informing the development of the UK material deprivation measure for pensioners found evidence that pensioners were reluctant to report that they lack an item due to a financial constraint[footnote 1]. Splitting the question into two parts – first simply asking whether or not respondents lack an item before asking the reason why they lack it – was introduced to reduce under-reporting and informed by cognitive testing of survey questions to establish the best approach[footnote 2].
Only asking the follow-up questions on the reason why respondents lack any of the items after establishing if any of the items are lacked, was introduced because evidence suggests that survey respondents will try and look for short-cuts when responding to surveys[footnote 1]. When it becomes apparent that follow-up questions are asked only when a respondent indicates that they lack items, this creates an incentive for respondents to say that they do not lack items.
Standardising the question routing across all age groups should improve comparability between groups and aid the development of a potential whole population material deprivation measure.
Achieved sample asked old and updated questions
The following table presents the HBAI sample of households asked the old and updated questions by region.
Table 3: Achieved percentage of HBAI households asked the old and updated questions by region for FYE 2024
Region | Old questions | Updated questions |
---|---|---|
North East | 24 | 76 |
North West | 30 | 70 |
Yorkshire and The Humber | 26 | 74 |
East Midlands | 25 | 75 |
West Midlands | 25 | 75 |
East | 27 | 73 |
London | 27 | 73 |
South East | 28 | 72 |
South West | 26 | 74 |
Wales | 26 | 74 |
Scotland | 27 | 73 |
Northern Ireland | 0 | 100 |
United Kingdom | 24 | 76 |
Overall, a 24:76 split was achieved, with Northern Ireland households not asked the old questions as explained above.
To note, the HBAI sample is lower than the achieved FRS sample. Households containing a married adult whose spouse is temporarily absent (away for 12 months or more), whilst within the scope of the FRS, are excluded from HBAI.
Further analysis looking at estimates based on the old and updated measures can be found in the section Analysis of FYE 2024 estimates based on the old and updated measures in this report.
Imputation
As part of the data processing, imputation is required where full information on questions has not been collected during the FRS interview.
Given 24% of HBAI households were asked the old questions, imputation was also carried out for these households for the updated questions. This ensured analysis to inform decisions on the updated methodology was based on all individuals in the FYE 2024 sample. It also allowed the updated material deprivation estimates to be calculated for all individuals in the sample for the HBAI FYE 2024 release and will allow users to easily calculate estimates without needing to isolate to just those households asked the updated questions. These advantages outweighed the risk of error from imputing responses and reasons for 24% of HBAI households. Performance tests were carried out to see if the imputation gave individuals with existing records for the updated questions imputed responses and reasons that were similar to their reported responses and reasons. Results indicated that the imputation process gave high percentages of matches for each question in the region of 70% to 80% accuracy. Users can find further information in the FRS Background and Information Methodology.
For FRS FYE 2024, the FRS variable MDIMP was created to help identify whether an individual in a family was asked the old or updated questions and how records for the updated questions were imputed:
- Asked updated material deprivation questions - no imputation for updated questions.
- Asked updated material deprivation questions - partial imputation for updated questions.
- Not asked old or updated material deprivation questions – full imputation for updated questions.
- Asked old material deprivation questions – full imputation for updated questions.
Users can isolate to just households asked the old questions by using MDIMP=4 in analysis.
Table 4 summarises the percentage in each MDIMP groups for individuals, benefit units (families) and households.
Table 4: Percentage of HBAI individuals by MDIMP group, FYE 2024
Asked updated material deprivation questions - no imputation for updated questions | Asked updated material deprivation questions - partial imputation for updated questions | Not asked updated or old material deprivation questions - full imputation for updated questions | Asked old material deprivation questions - full imputation for updated questions | |
---|---|---|---|---|
Children | 73 | 1 | 1 | 25 |
Working-age adults | 69 | 1 | 6 | 24 |
Pensioners | 75 | 0 | 1 | 23 |
Benefit units (family) | 70 | 1 | 6 | 24 |
Benefit units (families) with children | 73 | 1 | 1 | 25 |
Households | 75 | 1 | 1 | 24 |
It should be noted that every year the FRS does not gather data on a small proportion of:
- working-age adults living in multiple benefit unit households
- working-age adults in a mixed-age couple where the other member of that couple is of pension age
For mixed-age couples, where one adult is a pensioner and one adult is a working-age adult, the approach to asking the updated Material Deprivation questions in the FRS FYE 2024 was designed as follows:
- For old questions: only the pensioner in a mixed-age couple was asked Material Deprivation questions. Therefore, responses to working-age adult questions are imputed
- For the updated questions: the person asked the Material Deprivation questions was randomly chosen:
- If the pensioner was chosen, imputation was required for the working-age adult items questions
- If the working-age adult was chosen, imputation was required for the pensioner items questions
- Imputation may have not been required for household items if there were no missing records, as these are applied across all individuals in the household
Additionally, the table shows there was a very small percentage of partial imputation or full imputation required for responses and reasons for children, pensioner and household questions seen in FRS FYE 2024 data. For context, percentages by benefit unit (family) and by benefit unit (families) with children are also presented.
For the old questions, missing values are imputed using a method called hot-decking. Hot-decking looks at characteristics within a record containing a missing value to be imputed and matches it up to another record with similar characteristics for which the variable is not missing, known as a donor. Further information can be found in the FRS Quality Assessment Report.
For the old questions, the specific variables used for the hot-decking procedure are:
- benefit unit income
- economic status
- number of dependent children
- savings held by the benefit unit
- age that the head of benefit unit left education
- ethnic group of the head of the benefit unit
- family type (couple / single)
- disability in the benefit unit
- government region
For the updated questions, analysis was carried out to determine the best approach for imputation for the updated questions, comparing the existing hot-decking approach with logistic regression. As negligible differences were seen between the two approaches, hot-decking was chosen as:
-
Consistency: There is a precedence of using hot-decking for imputation on the FRS for the old Material Deprivation questions
-
Validity:
- Hot-decking preserves the survey data better, due to using survey responses to impute missing responses
- Hot-decking preserves the existing relationships between the material deprivation questions by enabling the use of the same donor for each question within a question group
-
Resources:
- There are already systems in place to impute missing values using hot-decking
- Hot-decking enables simpler integration of the Material Deprivation reasons follow-up questions
The following table sets out the variables used for the imputation of updated Material Deprivation questions:
Table 5: Variables used for imputation of the updated Material Deprivation questions
Variable | Household Questions | Child Questions | Working-age Adult Questions | Pensioner Questions |
---|---|---|---|---|
Household Food Security | Yes | Yes | Yes | Yes |
Tenure of the household | Yes | Yes | No | Yes |
Total income in the family | Yes | Yes | No | Yes |
Family composition | No | Yes | Yes | Yes |
Total savings in the family | Yes | No | Yes | Yes |
Health condition in the family | Yes | Yes | No | No |
Youngest child in the family | Yes | No | No | No |
Economic status of the family | No | No | Yes | No |
Region of household | No | No | Yes | No |
The following imputation was carried out to ensure all variables for all questions were fully populated for analysis for FYE 2024:
Table 6: Imputation carried out on Material Deprivation questions for FRS FYE 2024
Data Issue | Imputation |
---|---|
Household not asked old or updated questions (around 1% of households). | Impute responses and reasons for updated questions only, as the updated measure will be used from FYE 2024. Impute responses to updated individual and household questions by: Imputing base questions for the response first using a donor. If the imputed response is 1 (Yes), all follow-up questions for reasons will be set to .A. (missing). If the imputed response is 2 (No), identify a donor that has responded ‘No’ and impute their reason. If there are children in the family (benefit unit), impute for updated child-based and household questions. |
Partial records for old questions (2% of households excluding working-age adults in mixed-age couples – see below). | Existing FRS hot decking process to give responses and reasons (for pensioners only) where missing. |
Mixed-age couple asked only one set of old questions (1% of households). | If the old working-age adult questions were asked, use hot-decking to impute responses and reasons to the old pensioner questions. If the old pensioner questions were asked, use hot-decking to impute responses to the old working-age adult questions. Impute responses and reasons for updated questions, including using responses and reasons from old questions asking about lacking similar items. |
Mixed-age couple asked updated questions (3% of households). | If the updated working-age adult questions were asked, use hot-decking to impute responses and reasons to the updated pensioner questions. If the updated pensioner questions were asked, use hot-decking to impute responses and reasons to the updated working-age adult questions. |
Asked old questions only (24% of households) | Use responses and reasons from old questions asking about lacking similar items to impute responses and reasons to the updated questions – see Annex 2 for tables. |
Hot-decking is used in separate stages for the child, working-age adult and pensioner questions:
- For each response question.
- For the follow-up reasons question.
Therefore, one donor is used for the response question and a different donor could be used for the follow-up reasons question.
FRS FYE 2024 was the last year the old questions were asked in the FRS. From April 2024, only the updated material deprivation questions are included in the FRS. Therefore, imputation for the updated questions using responses and reasons from old questions asking about lacking similar items will not be carried out in the future. All other imputation processes used for the updated questions will continue to be used to ensure all variables for all questions are fully populated for analysis.
HBAI variables for analysis
To assist in analysis, new HBAI variables have been created which combine the response and reasons to each updated question.
As more than one reason can be given for responding ‘No’ to a question, a hierarchy of reasons was set out as follows:
-
We/I do not have the money for this.
-
This is not a priority on my/our current income.
-
Health or disability prevents this.
-
Other reason.
-
We/I do not want/need this.
-
It is not relevant to me/us.
This was to ensure that financial constrained lack reasons took precedence, followed by wider constrained lack reasons of health or disability and other reason, followed by reasons of not wanting/needing the item or it not being relevant. This allowed analysis to be carried out by grouping individuals into the above categories.
For example, for the child question ‘Friends round monthly (MDCH7)’, the variable is:
MDCH7_HBAI:
1 = Have item.
2 = We/I do not have the money for this.
3 = This is not a priority on my/our current income.
4 = Health or disability prevents this.
5 = We/I do not want/need this.
6 = It is not relevant to me/us.
7 = Other reason.
For a question already defined as simple absence, such as the household question, Home adequately warm in cold weather (MDHH5), the HBAI variable is defined as:
MDHH5_HBAI:
1 = Yes.
2 = No.
If the response is ‘2 = No’, the item is lacked.
Note for the question, Regular money worries at the end of the month (MDWA1 and MDPEN1), the HBAI variable is defined as:
MDWA1_HBAI/MDPEN1_HBAI:
1 = No.
2 = Yes.
Therefore, the item is lacked if the response is ‘2 = Yes’.
Annex 5 sets out the description and definitions of the HBAI variables used for analysis for the updated measures.
Analysis throughout this report uses these HBAI variables to indicate that a hierarchy for reasons for responding ‘No’ has been applied to the updated question.
The full list of new HBAI variables that are included in the harmonised HBAI dataset will be available in the Variable Guide at the UK Data Service. A suite of documentation and guidance is also published alongside the dataset. The underlying, original FRS variables will be published in the FRS Benunit dataset as part of the suite of FRS FYE 2024 datasets at the UK Data Service.
Approach to counting the number of items lacked
LSE Recommendation
The LSE Review recommended:
Given the lower complexity and greater transparency of simple count measures, we recommend additional research to establish whether such a measure would have led to substantially different estimates of material deprivation over the last decade. If not, we recommend moving to a simple count measure.
Approaches to measuring material deprivation
A lacked item is where the family does not have an item and this may be due to a particular constraint, such as financial or disability.
For the old measure:
- Children and working-age adult items used a financial constrained lack definition, where the response was ‘Would like to have this but cannot afford this at the moment’
- Pensioner items used a wider constrained lack where the response was ‘No’ and reasons included:
- I do not have the money for this
- This is not a priority for me on my current income
- My health/disability prevents me
- It is too much trouble/too tiring
- There is no one to do this with or help me
- Other reason
- Do not know
The old measure used a prevalence-weighted score which gives greater weight to lacking those items that are more commonly held or where ownership is more widespread. The following diagram summarises the calculation.
Figure 1: Prevalence-weighted score approach
Figure 1 shows for the prevalence-weighted score approach:
- Calculate the weight of the question by the Responses that are “Have this item” divided by All responses from an eligible family.
- Repeat for all questions
- Add up all question weights for the Total Weight of All Questions (Sum of all proportion of responses that are “Have this item” for each question)
- For each question, a score is calculated by the Weight of Question (Proportion of responses that are “Have this item”) divided by the Total Weight of All Questions (Sum of all proportion of responses that are “Have this item” for each question) and multiplied by 100
- Repeat for all questions
- Add up all the scores for all questions
A simple count approach gives each item an equal weight, as summarised in the following diagram:
Figure 2: Simple Count approach
Figure 2 shows for the simple count approach:
- For each question, a count of 1 is given if the item is lacked
- This is repeated for all questions
- Add up all the counts for all the questions
The diagrams indicate the transparency of the simple count, with the calculation simpler to describe and more understandable to the user. In terms of processing, the simple count approach requires less resources (coding and processing time) using current software.
Analysis
The percentage of individuals in material deprivation using the prevalence-weighted score approach and simple count approach were compared over time. This was to assess how similar trends were under the two approaches and whether a simple count approach could have been used.
Children in material deprivation over time
The chart below shows similar percentages of children in material deprivation were seen over time compared with the prevalence-weighted score. Initially, this was with a count of 7 or more items lacked (light orange line) in FYE 2011 and changing to a count of 6 or more items by FYE 2023 (dark orange).
Figure 3: Children in material deprivation using the prevalence-weighted score approach vs. simple count of 6 or more items lacked and 7 or more items lacked, FYE 2011 to FYE 2023
Note: The measurement of material deprivation for FYE 2021 and FYE 2022 was affected by restrictions introduced in response to the coronavirus (COVID-19) pandemic. Estimates are presented as individual data points and users are advised not to make a direct comparison of changes in material deprivation estimates over this period with those published prior to the pandemic and with FYE 2023. A straight line has been created between FYE 2020 and FYE 2023 data points to indicate that these two years are comparable.
Working-age Adults in material deprivation over time
The chart below shows very similar percentages of working-age adults in material deprivation were seen with a count of 3 or more items lacked, compared with the prevalence-weighted score over time.
Figure 4: Working-age adults in material deprivation using the prevalence-weighted score approach vs. simple count of 3 or more items lacked, FYE 2011 to FYE 2023
Note: The measurement of material deprivation for FYE 2021 and FYE 2022 was affected by restrictions introduced in response to the coronavirus (COVID-19) pandemic. Estimates are presented as individual data points and users are advised not to make a direct comparison of changes in material deprivation estimates over this period with those published prior to the pandemic and with FYE 2023. A straight line has been created between FYE 2020 and FYE 2023 data points to indicate that these two years are comparable.
Pensioners in material deprivation over time
The chart below shows similar percentages of pensioners aged 65 and over in material deprivation were seen over time with a count of 4 or more items lacked compared with the prevalence-weighted score over time.
To note, the old Pensioner Material Deprivation questions were asked from FYE 2010, one year before the old Children Material Deprivation questions and old Working-age Adult Material Deprivation questions were asked from FYE 2011, so an additional data point for FYE 2010 is available. Also, the old measure for pensioner material deprivation was for adults aged 65 and over. This means that before FYE 2019, female pensioners aged under 65 were not included. Since the equalisation of State Pension Age from FYE 2019, all pensioners were included in the measure.
Figure 5: Pensioners aged 65 or over in material deprivation using the prevalence-weighted score approach vs. simple count of 4 or more items lacked, FYE 2010 to FYE 2023
Note: The measurement of material deprivation for FYE 2021 and FYE 2022 was affected by restrictions introduced in response to the coronavirus (COVID-19) pandemic. Estimates are presented as individual data points and users are advised not to make a direct comparison of changes in material deprivation estimates over this period with those published prior to the pandemic and with FYE 2023. A straight line has been created between FYE 2020 and FYE 2023 data points to indicate that these two years are comparable.
Evidence from the charts above indicated:
- Sensitivity: Similar trends in a simple count approach were seen compared to prevalence-weighted score approach over time
- Continuity and consistency: The simple count of number of items lacked that aligned with the prevalence-weighted score approach remained the same over time for working-age adult and pensioner items. For child items, from FYE 2011 a simple count of 7 items aligned with the prevalence-weighted score approach but this changed to a count of 6 items by FYE 2023. This indicated that a simple count approach could be consistently applied across child, working-age adult and pensioner questions
Groups associated with material deprivation
The percentage of children, working-age adults and pensioners in material deprivation using the prevalence-weighted score approach and simple count approach were also compared with the following groups associated with material deprivation:
- In a food insecure household
- In absolute low income After Housing Costs (below 60% of FYE 2011 median income)
- In a family where someone is disabled
- In a family with no savings
Overall, analysis found very similar compositions in material deprivation by groups associated with material deprivation for both the prevalence-weighted score approach and simple count approaches. This was seen for children, working-age adults and pensioners in material deprivation.
Decision
The LSE Review recommended:
Given the lower complexity and greater transparency of simple count measures, we recommend additional research to establish whether such a measure would have led to substantially different estimates of material deprivation over the last decade. If not, we recommend moving to a simple count measure.
Based on the above evidence, a simple count measure would not have led to substantially different estimates of material deprivation over the last decade, compared to current prevalence weighting.
Academic papers have concluded that the complex prevalence-weighted approach provides little added value to measuring material deprivation compared to the more transparent, simple count approach:
- Measuring material deprivation among older people: Methodological study to revise the Family Resources Survey questions concludes: “The evidence to date, however, finds that the apparent sophistication of a weighted approach adds something, but not much, to measures based on simple sums, at least in terms of correlations with income and so on.”
- Measuring Poverty Efficiently Using Adaptive Deprivation Scales states: “the correlation between the simple count of items lacked and the prevalence weighted score … is 0.996” concluding that prevalence weighting is very hard to justify on this basis.
Additionally, a paper by the Institute for Fiscal Studies raised concerns about whether the annually updated prevalence-weighted score actually provided a relative measure each year – see Annex 6: The Effect of Annually Updated Prevalence Weights from IFS report on Living Standards, Poverty and Inequality 2012.
The advantages and disadvantages of the approaches are set out in Table 7 below:
Table 7: Advantages and disadvantages of prevalence-weighted score approach compared to the simple count approach
Prevalence-weighted score Approach | Simple Count Approach | |
---|---|---|
Approach | Established HBAI material deprivation approach so no break in the methodology. | Used for EU material deprivation measures. Already break in series for estimates being affected by restrictions introduced in response to the coronavirus (COVID-19) pandemic. |
Setting the threshold | More granular for setting a threshold – score can be out of 100. | Less granular for setting a threshold – must be either 3 or 4 items, for example. Moving the threshold by just one item could lead to a substantial difference in the material deprivation rate. |
Calculation | Complex | Simple |
Evaluating against the analytical framework, a simple count approach:
- Validity: Is effective in capturing a similar composition of groups associated with material deprivation to prevalence-weighting
- Continuity: Provides similar levels of material deprivation, particularly for working-age adult and pensioner questions over the last decade, compared to the current approach.
- Sensitivity: Reacts to changes in economy as well as changes in most common items lacked over time
- Consistency: Can be applied across each set of questions providing a consistent approach for measuring material deprivation
- Transparency: Can be easily presented and explained to the user
- Resources: Requires less coding and processing
Therefore, the decision has been made to use a simple count approach for the updated Material Deprivation measures for children, working-age adults and pensioners.
As a result, the following recommendation for the prevalence-weighted approach from the LSE Review was not pursued:
If prevalence weighting is continued, we recommend a number of items and activities should be given the maximum weight of one irrespective of prevalence rates. The degree of deprivation felt by lacking some items is very unlikely to be affected by prevalence. We recommend further exploratory work to assess the desirability of giving the maximum weight to a damp free home, keeping home adequately warm in cold weather, able to pay bills, three meals a day and daily fresh fruit and/or vegetables.
Approach to defining some items as lacked using simple absence
LSE Recommendations
The LSE Review recommended:
a. We also used simple absence to assess deprivation of ‘having enough bedrooms for children over 10 years not to have to share with a child of a different sex’ in the analysis of the FRS test question data but suggest that further analysis of this item is conducted using the larger sample size which will be available in FRS FYE 2024.
b. Evidence suggests that adaptive preferences mean that people underreport financially constrained lack of necessities. We recommend further research to understand income gradients in people reporting that they, or their children, lack items or activities due to not wanting or needing them. This research could lead to the use of simple absence rather than constrained lack to establish deprivation for a wider set of items or activities.
Analysis
Analysis was carried out to:
- Look at evidence that the question ‘Enough bedrooms for children 10+’ could be defined using simple absence.
- Determine whether other questions could also be defined using simple absence, looking at percentages seen where the reasons for lacking were ‘not wanting/need them’ or ‘not relevant’ by income gradient and groups associated with material deprivation.
The analysis used the HBAI variables where a hierarchy for reasons for responding ‘No’ has been applied to the updated question. See the HBAI variables for analysis section for more information.
Enough bedrooms for children 10+ years (MDCH9_HBAI)
The FRS test question data used in the LSE Review was taken from the FRS FYE 2023 during April, May and June 2022, with analysis based on a sample of 9,000 individuals – see section 5.1. FRS test question dataset of the LSE Review for further information. Therefore, the first recommendation suggested further analysis be based on the larger and full FYE 2024 sample data, where the achieved sample size was 36,000 individuals.
The chart below indicated that for the child question ‘Enough bedrooms for children 10+ years’ (MDCH9_HBAI), very few gave the reasons ‘do not want/need’ or ‘not relevant to me/us’ compared to the financial and wider reasons.
Local Housing Allowance (LHA) and the Housing Allowance element of Universal Credit eligibility criteria requires living in a home with enough bedrooms if two or more children of the opposite sex are aged 10 years or over and in the same family (benefit unit). Therefore, to not have this arrangement would indicate lacking this expected requirement for LHA and UC receipt.
Figure 6: Percentage of children by reason when responding ‘No’ to the question ‘Enough bedrooms for children 10+ years’ (MDCH9_HBAI) for groups associated with material deprivation, FYE 2024
Further analysis evaluating the old questions for FYE 2023 showed very few extra children were captured by ‘Do not want/need this at the moment’ for similar questions ‘Enough bedrooms’ and ‘Warm winter coat’ where the category ‘Does not apply’ could be comparable to ‘Not relevant to me/us’.
Income gradients analysis
The LSE report recommended further analysis to understand income gradients in people reporting that they, or their children, lack items or activities due to not wanting or needing them. An income gradient is when an outcome increases or decreases with income.
This section considers research into under-reporting lacking an item due to financial reasons and then presents analysis of income gradients in the HBAI FYE 2024 data.
Under-reporting lacking an item due to financial reasons
Research has found that the experience of poverty is thought to make people adapt to managing on a lower standard of living and as a result their preferences change and they lower their expectations, no longer wanting items which they see as being out of their reach[footnote 3].
As a result, the respondent may choose not to respond with a financial reason for lacking an item. Instead, the respondent may respond with:
- We/I do not want/need this:
- Due to shame or reluctance to self-identify as “poor” and cannot afford the item
- As they do not consider the item a part of their daily living expectations as they cannot afford it, like an annual holiday
- It is not relevant to me/us: as the item may not seem applicable. For example, the item ‘Home in good state of decoration/repair’ if the family is renting their home. However, if they were responsible for maintenance costs, they may not be able to afford it
The updated questions do have a financial-based follow-up reason ‘This is not a priority on my/our current income’ distinct from the follow-up reason ‘We/I do not have the money for this’. However, a respondent may still prefer to give another, non-financial-related reason.
In these instances, a financial constrained lack definition or a wider constrained lack definition would not capture these individuals as lacking an item. This may result in them not being defined as in material deprivation when they should have been.
Income gradients by questions
A simple absence definition has already been applied to the following updated questions:
- Regular money worries at the end of the month (MDWA1_HBAI and MDPEN1_HBAI)
- Able to pay bills without cutting back on essentials (MDHH1_HBAI)
- Able to put money aside for unexpected expenses (MDHH2_HBAI)
- Home adequately warm in cold weather (MDHH5_HBAI).
- Home damp-free (MDHH6_HBAI)
This means if the response is ‘No’, the item is lacked. Note, if the response is ‘Yes’ to ‘Regular money worries at the end of the month’, the item is lacked (MDWA1_HBAI and MDPEN1_HBAI).
Analysis was carried out to determine whether other questions could also be defined using simple absence, looking at percentages in the reasons for lacking ‘as not wanting/need them’ or ‘not relevant’ by:
- Income gradient (how percentages differed by income quintile AHC)
- Groups associated with material deprivation
For information, reasons for responding ‘No’ to questions can be found in Annex 3.
Child questions income gradients
For the child questions, the table below sets out the number of children in each income quintile AHC and within each quintile, the percentage of children where the reason for lacking an item was given as ‘We/I do not want/need this’ or ‘It is not relevant to me/us’. Questions already defined using simple absence are excluded.
Table 8: Number of children in each income quintile AHC with percentages giving the reasons: ‘We/I do not want/need this’ or ‘It is not relevant to me/us’ by updated Child Material Deprivation questions, FYE 2024
Q1 | Q2 | Q3 | Q4 | Q5 | All | |
---|---|---|---|---|---|---|
All Children (millions) of which (percentages): | 4.2 | 3.6 | 2.8 | 2.2 | 1.8 | 14.6 |
School trips (MDCH1_HBAI) | 3 | 2 | 4 | 2 | 2 | 3 |
Place for homework (MDCH2_HBAI) | 2 | 0 | 0 | 0 | 0 | 0 |
Three meals a day (MDCH3_HBAI) | 2 | 1 | 1 | 1 | 1 | 1 |
Fresh fruit and/or vegetables every day (MDCH4_HBAI) | 4 | 4 | 3 | 2 | 1 | 3 |
Enough clothes feel comfortable wearing (MDCH5_HBAI) | 0 | 0 | 0 | 0 | 0 | 0 |
Organised weekly activity outside school (MDCH6_HBAI) | 10 | 12 | 8 | 6 | 3 | 9 |
Friends round monthly (MDCH7_HBAI) | 9 | 10 | 10 | 7 | 6 | 9 |
Age suitable toys/games (MDCH8_HBAI) | 1 | 1 | 1 | 2 | 1 | 1 |
Enough bedrooms for children 10+ years (MDCH9_HBAI) | 0 | 1 | 0 | 0 | 0 | 0 |
Toddler/nursery/playgroup at least weekly (MDCH10_HBAI) | 6 | 4 | 2 | 4 | 2 | 4 |
Annual break away from home (MDCH11_HBAI) | 2 | 1 | 1 | 2 | 0 | 1 |
Cover cost of repair or to replace appliances (MDHH3_HBAI) | 2 | 1 | 1 | 0 | 0 | 1 |
Home in good state of decoration/repair (MDHH4_HBAI) | 1 | 1 | 1 | 0 | 0 | 1 |
Reliable access to internet at home (MDHH7_HBAI) | 0 | 0 | 1 | 0 | 0 | 0 |
Access to computer/tablet (MDHH8_HBAI) | 2 | 2 | 2 | 0 | 0 | 1 |
Adequate access to reliable transport (MDHH9_HBAI) | 1 | 0 | 0 | 0 | 0 | 0 |
Heating/electrics/plumbing in good working order (MDHH10_HBAI) | 0 | 0 | 0 | 0 | 0 | 0 |
Home contents insurance (MDHH11_HBAI) | 9 | 10 | 6 | 5 | 2 | 7 |
The table indicated very low percentages of children for many items where these responses were given across income quintiles including ‘Enough clothes that they feel comfortable to wear (MDCH5_HBAI)’, ‘Enough bedrooms for children 10+ years (MDCH9_HBAI)’ and ‘Heating/electrics/plumbing in good working order (MDHH10_HBAI)’.
Adaptive preference could account for giving these reasons for other items, with notably higher percentages for lower quintiles for ‘Home contents insurance’ and deprioritising more ‘social’ items, such as ‘Organised weekly activity outside school’, ‘Friends round monthly’ and ‘Toddler/nursery/playgroup at least weekly’.
Working-age adults income gradients
For the working-age adult questions, the table below sets out the number of working-age adults in each income quintile AHC and within each quintile, the percentage of working-age adults where the reason for lacking an item was given as ‘We/I do not want/need this’ or ‘It is not relevant to me/us’. Questions already defined using simple absence are excluded.
Table 9: Number of working-age adults in each income quintile AHC with percentages giving the reasons: ‘We/I do not want/need this’ or ‘It is not relevant to me/us’ by updated Working-age Material Deprivation questions, FYE 2024
Q1 | Q2 | Q3 | Q4 | Q5 | All | |
---|---|---|---|---|---|---|
All Working-Age Adults (millions) of which (percentages): | 7.5 | 6.9 | 8.0 | 8.9 | 9.4 | 40.9 |
Regular payments to workplace or private pension (MDWA2_HBAI) | 18 | 15 | 13 | 11 | 11 | 13 |
Three meals a day (MDWA3_HBAI) | 9 | 9 | 9 | 6 | 6 | 8 |
Fresh fruit and/or vegetables every day (MDWA4_HBAI) | 7 | 8 | 7 | 5 | 4 | 6 |
Appropriate clothes for work/job interview (MDWA5_HBAI) | 3 | 3 | 2 | 1 | 0 | 2 |
Regular dental appointments (MDWA6_HBAI) | 7 | 6 | 5 | 4 | 5 | 5 |
Annual break away from home (MDWA7_HBAI) | 5 | 3 | 3 | 3 | 2 | 3 |
Go out socially at least monthly (MDWA8_HBAI) | 6 | 7 | 7 | 6 | 5 | 6 |
See friends and family at least monthly (MDWA9_HBAI) | 1 | 2 | 3 | 1 | 1 | 1 |
Small amount of money for oneself (MDWA10_HBAI) | 1 | 1 | 0 | 1 | 0 | 1 |
Cover cost of repair or to replace appliances (MDHH3_HBAI) | 2 | 2 | 1 | 1 | 1 | 1 |
Home in good state of decoration/repair (MDHH4_HBAI) | 1 | 0 | 1 | 0 | 0 | 1 |
Reliable access to internet at home (MDHH7_HBAI) | 1 | 1 | 1 | 0 | 0 | 1 |
Access to computer/tablet (MDHH8_HBAI) | 4 | 3 | 3 | 1 | 0 | 2 |
Adequate access to reliable transport (MDHH9_HBAI) | 1 | 1 | 0 | 0 | 0 | 0 |
Heating/electrics/plumbing in good working order (MDHH10_HBAI) | 0 | 0 | 0 | 0 | 0 | 0 |
Home contents insurance (MDHH11_HBAI) | 11 | 12 | 8 | 6 | 6 | 8 |
The table showed very low percentages seen across all income quintiles for several questions including ‘Heating/electrics/plumbing in good working order (MDHH10_HBAI)’.
Adaptive preference could account for reasons for the remaining items, with notably higher percentages for quintile 1 for ‘Home contents insurance’ and ‘regular payments to workplace or private pension’ amongst lower deciles and genuine choice amongst higher deciles. Further analysis indicated a higher percentage of working-age adults without children giving these reasons for ‘regular payments to workplace or private pension’ compared to those with children.
There is also a higher percentage for ‘Three meals a day’ and for ‘Fresh fruit and/or vegetables every day’ compared to percentages for children above.
Pensioner income gradients
For the pensioner questions, the table below sets out the number of working-age adults in each income quintile AHC and within each quintile, the percentage of working-age adults where the reason for lacking an item was given as ‘We/I do not want/need this’ or ‘It is not relevant to me/us’. Questions already defined using simple absence are excluded.
Table 10: Number of pensioners in each quintile of income AHC with percentages giving the reasons: ‘We/I do not want/need this’ or ‘It is not relevant to me/us’ by updated Pensioner Material Deprivation questions, FYE 2024
Q1 | Q2 | Q3 | Q4 | Q5 | All | |
---|---|---|---|---|---|---|
All Pensioners (millions) of which (percentages): | 1.8 | 3.0 | 2.7 | 2.3 | 2.3 | 12.1 |
Annual break away from home (MDPEN2_HBAI) | 12 | 11 | 8 | 8 | 6 | 9 |
Fresh fruit and/or vegetables every day (MDPEN3_HBAI) | 5 | 6 | 5 | 5 | 2 | 4 |
Three meals a day (MDPEN4_HBAI) | 11 | 11 | 9 | 10 | 9 | 10 |
Regular dental appointments (MDPEN5_HBAI) | 11 | 11 | 5 | 7 | 4 | 8 |
Small amount of money for oneself (MDPEN6_HBAI) | 1 | 1 | 1 | 0 | 0 | 1 |
Go out socially at least monthly (MDPEN7_HBAI) | 13 | 10 | 8 | 8 | 6 | 9 |
See friends and family at least monthly (MDPEN8_HBAI) | 2 | 2 | 1 | 1 | 1 | 2 |
Cover cost of repair or to replace appliances (MDHH3_HBAI) | 1 | 0 | 0 | 0 | 0 | 0 |
Home in good state of decoration/repair (MDHH4_HBAI) | 0 | 0 | 0 | 0 | 0 | 0 |
Reliable access to internet at home (MDHH7_HBAI) | 17 | 15 | 9 | 5 | 1 | 9 |
Access to computer/tablet (MDHH8_HBAI) | 23 | 20 | 13 | 8 | 3 | 13 |
Adequate access to reliable transport (MDHH9_HBAI) | 4 | 3 | 2 | 1 | 0 | 2 |
Heating/electrics/plumbing in good working order (MDHH10_HBAI) | 0 | 0 | 0 | 0 | 0 | 0 |
Home contents insurance (MDHH11_HBAI) | 11 | 7 | 4 | 4 | 1 | 5 |
The table showed very low percentages seen across all income quintiles for some questions including ‘Heating/electrics/plumbing in good working order (MDHH10_HBAI)’.
Adaptive preference or personal choice could account for these reasons for several of the remaining items, with notably higher percentages across quintiles for ‘Home contents insurance’, as well as higher percentages in lower quintiles for ‘Access to computer/tablet’ and ‘Reliable access to internet at home’.
Analysis by groups associated with material deprivation
Further analysis was carried out by groups associated with material deprivation to provide further evidence in the decision-making process for in scope to be defined as simple absence for all questions.
Two questions were identified and the analysis for these items are presented below.
Enough clothes that they feel comfortable to wear (MDCH5_HBAI)
The chart below indicated no children across different groups were captured giving reasons other than financial for lacking ‘Enough clothes that they feel comfortable to wear’(MDCH5_HBAI).
Conceptually, respondents are unlikely to have a reason to not want or need their children to have comfortable clothes or for comfortable clothes not be relevant to them or their children.
Figure 7: Percentage of children by reason for responding ‘No’ to the question ‘Enough clothes that they feel comfortable to wear’ (MDCH5_HBAI) by groups associated with material deprivation, FYE 2024
Heating/electrics/plumbing good working order (MDHH10_HBAI)
Analysis indicated that very few individuals across different groups associated with material deprivation were captured responding ‘We/I do not want/need this’ or ‘It is not relevant to me/us’.
The exception was for working-age adults in social and private rented accommodation where they may not consider this item their responsibility and so do not consider this item relevant to them. However, if they were responsible for maintenance costs, they may not be able to afford it. Analysis by accommodation is presented in the chart below.
Conceptually, having heating/electrics/plumbing in good working order is essential for decent living standards.
Figure 8: Percentage of individuals by reason when responding ‘No’ to the question ‘Heating/electrics/plumbing good working order’ (MDHH10_HBAI) by accommodation, FYE 2024
Decisions
The follow-up questions for the updated material deprivation questions allow respondents to indicate their reasons for lacking an item. The decision to define a question using simple absence may be suitable when conceptually there is no other reason for lacking an item other than a financial constraint and where adaptive preferences have been made by the respondent. However, lacking some items may be due to personal choice, including choosing not to have certain items such as ‘Reliable access to internet at home’ or choosing not to ‘Go out socially at least monthly’.
Three questions were identified as within scope to be defined using simple absence. Considering the advantages of changing the three questions to a simple absence definition against the analytical framework:
- Validity:
-
Child question: Does your child/do your children have enough clothes that they feel comfortable to wear? (MDCH5_HBAI): Conceptually there is no reason not to want this item other than due to financial constraint, with FYE 2024 data indicating very few giving a wider reason
-
Child question: Are there enough bedrooms for every child of 10 or over of a different sex to have their own bedroom? (MDCH9_HBAI): This was recommended as a question to be considered as simple absence in the LSE Review and is an eligibility criterion for Local Housing Allowance (LHA) and Housing Allowance element of Universal Credit. Therefore, to not have this arrangement indicates lacking this expected requirement for LHA and UC receipt. Back-series analysis of responses to a similar old question also suggested the item could have been defined as simple absence
-
Household question: Are the heating, electrics, plumbing and drains in good working order? (MDHH10_HBAI): Conceptually there is no reason other than financial to not want or need this item. FYE 2024 data showed non-trivial percentages of working-age adults in private or social rented accommodation that ‘did not want/need this item’ or ‘it was not relevant to them’. This could be due to considering this maintenance their landlord’s responsibility. However, their choice of housing could indicate financial restrictions and so simple absence would capture those with adaptive preferences who should be defined as lacking the item. Back-series analysis of responses to a similar old question also suggested the item could have been defined as simple absence
-
- Resources: By defining these three questions as simple absence, there is also the advantage that the reason follow-up questions can be removed from the FRS questionnaire as they are not adding value and will save time during the interview and in subsequent data processing
Considering the disadvantages:
- Consistency: These questions would be inconsistent with most questions that are not defined as simple absence. However, there are already five other questions that do not have follow-up reasons questions:
- Regular money worries at the end of the month (MDWA1_HBAI and MDPEN1_HBAI)
- Able to pay bills without cutting back on essentials (MDHH1_HBAI)
- Able to put money aside for unexpected expenses (MDHH2_HBAI)
- Home adequately warm in cold weather (MDHH5_HBAI)
- Home damp-free (MDHH6_HBAI)
- Transparency: It may be less transparent to the user why some questions are defined as simple absence and some by a constrained lack. However, the HBAI Quality and Methodology Information Report will signpost users to this report for more information
Given the advantages, the decision has been made to define the following questions as simple absence and remove follow-up reason questions from future FRS questionnaires:
- Child question: Does your child/do your children have enough clothes that they feel comfortable to wear? (FRS variable MDCH5 and HBAI variable MDCH5_HBAI)
- Child question: Are there enough bedrooms for every child of 10 or over of a different sex to have their own bedroom? (FRS variable MDCH9 and HBAI variable MDCH9_HBAI)
- Household question: Are the heating, electrics, plumbing and drains in good working order? (FRS variable MDHH10 and HBAI variable MDHH10_HBAI)
Determining whether the remaining questions could be defined using a financial constrained lack approach or wider constrained lack approach was carried out later in the decision process after the Composite Measure of Living Standards was developed. These decisions are set out later in this report.
Development of a Composite Measure of Living Standards to identify the Material Deprivation thresholds
LSE Recommendation
The LSE Review recommended:
For the statistical modelling, we recommend DWP does not rely on household income alone to test which thresholds are best at discriminating between deprived and non-deprived groups. We recommend the development of a composite standard of living measure which could include information on savings, debts and food security, and recognises differences in needs/costs faced by different household types. For example, single parent households or where any household member has a long-standing illness or disability.
In response to this recommendation, a Composite Measure of Living Standards was developed to serve as a practical tool for use in statistical modelling. It was used to inform judgements as to where thresholds for Material Deprivation could be set, rather than to produce a comprehensive, ideal measure of Living Standards for publication.
Development of the Composite Measure of Living Standards
The Composite Measure of Living Standards comprised of multiple living standards indicators.
- Living in food insecure household
- Net household income after housing costs
- Savings in the family
- Priority debt in the family (where families could lose their home, have their energy supply cut off, lose essential goods or go to prison if not repaid)
Analysis of Variance (ANOVA) and logistic regression models were used to identify an upper and lower bound for material deprivation thresholds for children, working-age adults and pensioners, rather than to identify a single optimal threshold. This was partly in recognition that a single ‘optimal’ threshold will not exist and thresholds emerging from statistical models will be heavily influenced by the choice of indicators against which they are judged.
A composite score of living standards was calculated using two iterations to represent a lower and higher case scenario in relation to the thresholds identified:
- Iteration 1: Score: 0 to 1 (very low standard of living to higher standard of living)
- Iteration 2: Score: 0 to 1 (very low standard of living to moderate standard of living or more). For this indicator, anyone with savings or income above the median are given the maximum score of 1.
The statistical analysis identified the following optimum range of Material Deprivation thresholds:
- Financial constrained lack definition:
- Children: Between 2 or more items lacked and 4 or more items lacked
- Working-age adults: Between 4 or more items lacked and 6 or more items lacked
- Pensioners: Between 2 or more items lacked and 4 or more items lacked
- Wider constrained lack definition:
- Children: Between 3 or more items lacked and 4 or more items lacked
- Working-age adults: Between 5 or more items lacked and 7 or more items lacked
- Pensioners: Between 3 or more items lacked and 5 or more items lacked
Detailed information on the development of Composite Measure of Living Standards and the statistical analysis carried out is set out in Annex 4.
Decisions
The updated Material Deprivation methodology aims to provide users with a transparent way of measuring material deprivation. The use of the Composite Measure of Living Standards introduces complexity to the methodology once more, after the prevalence-weighted score approach to counting the number of items lacked was removed. Therefore, to decide whether to use the ranges informed by the measure, it was assessed against the factors in the analytical framework.
The advantages of using of a Composite Measure of Living Standards were:
- Validity: Recommended in the LSE review, the composite measure provides a statistically informed starting range on where to assess and set the threshold in each group.
- Consistency: The approach can be applied across all groups, identifying an appropriate range of thresholds for each group independently, reflecting differences in the material deprivation measure across age groups.
- Resources: The ranges have been produced in a one-off process using the FYE 2024 to inform a threshold range for each group. The chosen threshold will then be used in subsequent publications to estimate material deprivation.
The disadvantages of using the measure were:
- Validity: The thresholds suggested by this kind of analysis will be influenced by choices over how the measure was formed. For instance, using income alone would lead to much lower proposed thresholds than living in a food insecure household, which would identify thresholds at a higher number of items. This is why the approach was used to identify a range of appropriate thresholds, rather than selecting a single optimal threshold
-
Transparency:
- The process is quite complex so moves away from a measure fully focussing on simple methodology. Other iterations, such as those which weighted indicators differently, added further complexity for little added benefit and resulted in little to no change in the thresholds identified
- There were concerns from the FRS Expert Advisory Group about the added value of the composite measure in setting the threshold. Analysis by income gradient and composition of groups associated with material deprivation might provide enough evidence to inform the decisions
- Resources: The time required to run the statistical tests. However, the tests were run as a one-off process and will not be repeated each publication year
The composite measure was developed following the recommendation from the LSE review. Whilst a technically and conceptually complex process, it did provide some statistical evidence that meant the threshold choice was not entirely arbitrary.
Therefore, the decision was made to use these ranges as a starting point in analysis for defining the Material Deprivation measures and setting the Material Deprivation thresholds detailed in the next sections of this report.
Approach to choosing financial constrained lack or wider constrained lack definitions for the Material Deprivation measures and setting the Material Deprivation thresholds
LSE Recommendation
The LSE Review recommended:
It was not within the remit of the Review to recommend optimum thresholds for the revised measures; data collected in the FRS for the first year, rather than the smaller FRS test question dataset, is required for this. However, the Review assessed different methodological approaches and recommended using a combination of statistical analysis and judgement to determine where the new thresholds are set. To provide full transparency to users, documentation detailing the decisions made, and why, should be published alongside the statistics.
Analysis
The decisions on how to define the Material Deprivation measures and setting the Material Deprivation thresholds were made collectively by comparing measures for a financial constrained lack definition and wider constrained lack definition within the ranges identified from the composite standard of living measure recommendations. Consideration was needed to strike the right balance between capturing those with adaptive preferences who should be defined as in material deprivation against excluding those who lack items due to personal choice and should therefore not be captured by the definition.
For the old children and working-age adults material deprivation measures, a financial constrained lack definition was used. A single question was asked, most with the response options ‘Yes’ and ‘No’ responses which identified the reason for lacking (Want but can’t afford, don’t want/need, does not apply).
For the old pensioner questions, as well as the initial question with ‘Yes’ or ‘No’ response options, a follow-up question to determine reasons for responding ‘No’ was asked for most old pensioner items. A wider constrained lack definition was used for the old pensioner material deprivation measure, which was also focused on pensioners aged 65 and over. This meant that before FYE 2019, female pensioners aged under 65 were not included. Since the equalisation of State Pension Age from FYE 2019, all pensioners were included in the measure.
With reasons for responding ‘No’ collected in the FRS for the updated questions, analysis was carried out to evaluate whether a financial constrained lack measure or a wider constrained lack definition was now more suitable for the updated children, working-age adults, and pensioner measures.
To determine this, for each set of children, working-age adults and pensioner questions, two measures were created using:
- Financial constrained lack definition where questions were not defined using simple absence. This captures those responding with ‘We/I do not have the money for this’ and ‘This is not a priority on my/our current income’
- Wider constrained lack definition where questions were not defined using simple absence. As well as capturing those responding with a financial reason for lacking an item, it also captures those responding with ‘Health or disability prevents this’ or ‘Other reason’
From this, a count of items lacked was calculated for each measure.
Thresholds within the ranges identified from the Composite Measure of Living Standards analysis for each measure were assessed by income as well as looking at groups associated with material deprivation:
- In a food insecure household
- In absolute low income AHC (below 60% of FYE 2011 median income)
- In a family where someone is disabled
- In a family with no savings
- In rented accommodation
The following section sets out the analysis carried out for children, working-age adults and pensioner measures to decide which definition to use and where to set the threshold to define an individual to be in material deprivation.
Children
The chart below presents the percentage of children that were identified within the threshold ranges for each measure:
- Financial constrained lack: Between 2 or more items lacked and 4 or more items lacked
- Wider constrained lack: Between 3 or more items lacked and 4 or more items lacked
It shows that moving the threshold up or down by a single item can lead to vastly different percentages of children in material deprivation under each definition. With the same number of items lacked, a wider constrained lack definition will capture more children than a financial constrained lack definition as it is also including those who responded ‘Health or disability prevents this’ or ‘Other reason’ for lacking the item.
The percentage for a wider constrained lack of 5 or more items is also presented, as explained below.
Figure 9: Percentage of children by number of items lacked for the updated questions for threshold ranges informed by the Composite Measure of Living Standards, FYE 2024
The thresholds were also compared by income decile AHC, as presented in the chart below. A higher percentage of children were in material deprivation in the lower deciles as expected but with more captured in decile 2 than decile 1 for both for the financial constrained lack definition and wider constrained lack definition. This indicated the percentages of children captured in material deprivation were sensitive to the thresholds, increasing as the threshold of items lacked increased for both measures. Broadly similar percentages of children were captured in material deprivation as the income decile increased, irrespective of the definition.
Figure 10: Composition of children in material deprivation within each threshold of a Financial Constrained Lack measure (Fin) and Wider Constrained Lack measure (Wid) by income decile AHC, FYE 2024
Further analysis looked at groups associated with material deprivation for all thresholds in the range under each definition, as set out in the table below. This was to assess how sensitive the composition of children in material deprivation was in these groups within the definition and across definitions. For example, of those children in material deprivation under a financial constrained lack definition of 2 or more items, 36% were in a food insecure household. This increased to 43% under a definition of 3 or more items and to 52% under a definition of 4 or more items. Across definitions, of those children in material deprivation under a lack of 4 or more items, 52% were in a food insecure household using a financial constrained lack definition compared to 48% under a wider constrained lack definition, as more children in a food secure household were captured under a wider constrained lack definition.
Table 11: Analysis of Child Material Deprivation Financial Constrained Lack (Fin) thresholds and Wider Constrained Lack (Wid) thresholds by groups associated with material deprivation, FYE 2024
Fin 2+ | Fin 3+ | Fin 4+ | Wid 3+ | Wid 4+ | Wid 5+ | |
---|---|---|---|---|---|---|
Percentage of children in material deprivation of which: | 49 | 37 | 28 | 42 | 31 | 24 |
In Food Secure Household | 64 | 56 | 48 | 59 | 52 | 43 |
In Food Insecure Household | 36 | 43 | 52 | 40 | 48 | 56 |
Not in a low income family (absolute low income AHC) | 60 | 55 | 50 | 57 | 53 | 49 |
In a low income family (absolute low income AHC) | 40 | 45 | 50 | 43 | 47 | 51 |
In a family where no one is disabled | 48 | 44 | 40 | 45 | 42 | 39 |
In a family where someone is disabled | 52 | 56 | 60 | 55 | 58 | 61 |
Owner/Occupier | 27 | 22 | 16 | 23 | 18 | 14 |
Social Rented | 38 | 42 | 46 | 41 | 45 | 48 |
Private Rented | 35 | 36 | 38 | 36 | 37 | 38 |
No savings in the family | 36 | 41 | 46 | 38 | 44 | 45 |
Savings in the family | 64 | 59 | 54 | 62 | 56 | 55 |
Considerations when defining the child material deprivation measure were to ensure that:
- The definition captured the financial aspect of material deprivation, unless evidence from analysis and conceptually a wider constrained lack definition was more representative
- The threshold was not too low so as to reduce sensitivity
- The threshold was not set too high to reflect fewer items may be lacked by a family who should be captured in material deprivation, but not all questions are relevant to them. For example, some items are focussed on children of school age only so will not be applicable to those with only pre-school children
Reviewing the charts and table above, for the financial constrained lack definition, 28% of children were in material deprivation using a simple count of 4 or more items lacked. This threshold is the highest of the range for a financial constrained lack measure for children but is not set too low. Focusing on a similar threshold that is not too low for a wider constrained threshold, only a threshold of 4 or more items lacked was available from the range informed by the Composite Measure of Living Standards analysis. To compare the impact of a wider constrained lack on the percentages of children captured in material deprivation at a higher threshold to the financial constrained lack definition, a threshold of 5 or more items was also analysed (though this felt out of the range informed by the composite measure).
With the same number of items lacked, a wider constrained lack definition captured more children than a financial constrained lack definition as it included those who responded ‘Health or disability prevents this’ or ‘Other reason’ for lacking the item. This resulted in 31% of children in material deprivation, compared to 28% using the financial constrained lack definition. A threshold of one item higher (5 or more items lacked) for a wider constrained lack definition reduced the percentage to 24% of children.
The percentages by income decile AHC were similar (within 5 percentage points) the financial constrained lack definition of 4 or more items and the wider constrained lack definition of 4 or more items and 5 or more items.
Analysis by groups associated with material deprivation for these three measures showed broadly similar percentages of children in material deprivation are captured under each definition (within 5 percentage points).
Working-age adults
The chart below presents the percentage of working-age adults that were identified within the threshold ranges for each measure.
- Financial constrained lack: Between 4 or more items lacked and 6 or more items lacked
- Wider constrained lack: Between 5 or more items lacked and 7 or more items lacked
It showed that moving the threshold up or down by a single item can lead to different percentages of working-age adults in material deprivation under each definition, though this is less sensitive than for the thresholds analysed for child material deprivation. With the same number of items lacked, a wider constrained lack definition captured more working-age adults than a financial constrained lack definition as it also including those who responded ‘Health or disability prevents this’ or ‘Other reason’ for lacking the item.
Figure 11: Percentage of working-age adults by number of items lacked for the updated questions for threshold ranges informed by the Composite Measure of Living Standards, FYE 2024
The thresholds were also compared by income decile AHC, as presented in the chart below. A higher percentage of working-age adults were in material deprivation in the lower deciles as expected, with highest percentages in decile 1. Broadly similar percentages were captured as the threshold increased within each definition and across definitions. This suggested that, overall, the percentage of working-age adults in material deprivation was less sensitive to the definition used and threshold of items lacked, compared to children.
Figure 12: Composition of working-age adults in material deprivation within each threshold of a Financial Constrained Lack measure (Fin) and Wider Constrained Lack measure (Wid) by income decile AHC, FYE 2024
Further analysis was carried out by groups associated with material deprivation and included ‘by children in the family’ group for all thresholds in the range under each definition, as set out in the table below. This was to assess how sensitive the composition of working-age adults in material deprivation was in these groups within the definition and across definitions. For example, of those working-age adults in material deprivation under a financial constrained lack definition of 4 or more items, 37% were in a family with no savings. This increased to 40% under a definition of 5 or more items and to 43% under a definition of 6 or more items. Across definitions, of those working-age adults in material deprivation under a lack of 5 or more items, 40% were in a family with no savings using a financial constrained lack definition compared to 38% under a wider constrained lack definition, as more working-age adults in a family with savings were captured under a wider constrained lack definition. Increasing to 6 or more items lacked for a wider constrained lack definition increased this to 41% of working-age adults in a family with no savings.
Table 12: Analysis of Working-age Adult Material Deprivation Financial Constrained Lack (Fin) thresholds and Wider Constrained Lack (Wid) thresholds by groups associated with material deprivation, FYE 2024
Fin 4+ | Fin 5+ | Fin 6+ | Wid 5+ | Wid 6+ | Wid 7+ | |
---|---|---|---|---|---|---|
Percentage of working-age adults in material deprivation of which: | 28 | 23 | 18 | 27 | 21 | 17 |
In Food Secure Household | 61 | 54 | 48 | 59 | 53 | 46 |
In Food Insecure Household | 37 | 44 | 50 | 39 | 46 | 53 |
Not in a low income family (absolute low income AHC) | 66 | 63 | 62 | 65 | 63 | 60 |
In a low income family (absolute low income AHC) | 34 | 37 | 38 | 35 | 37 | 40 |
In a family where no one is disabled | 48 | 45 | 43 | 46 | 43 | 41 |
In a family where someone is disabled | 52 | 55 | 57 | 54 | 57 | 59 |
Owner/Occupier | 32 | 28 | 26 | 30 | 28 | 25 |
Social Rented | 37 | 40 | 44 | 39 | 42 | 45 |
Private Rented | 31 | 31 | 30 | 31 | 30 | 30 |
No savings in the family | 37 | 40 | 43 | 38 | 41 | 44 |
Savings in the family | 63 | 60 | 57 | 62 | 59 | 56 |
No children in the family | 59 | 57 | 57 | 59 | 58 | 58 |
Children in the family | 41 | 43 | 43 | 41 | 42 | 42 |
Considerations when defining the working-age adult material deprivation measure were to ensure that:
- The definition captured the financial aspect of material deprivation, unless evidence from analysis and conceptually a wider constrained lack definition was more representative.
- Was not too low so as to reduce sensitivity
- Was set higher than for the child material deprivation threshold, as working-age adults with children are more likely to prioritise child items over working-age adult items and so will report lacking fewer items
- Gave a lower material deprivation rate compared to children to reflecting the higher disadvantage and deprivation experienced by children compared to working-age adults
Reviewing the charts and table above, for the financial constrained lack definition, 23% of working-age adults were in material deprivation using a simple count of 5 or more items lacked. With the same number of items lacked, a wider constrained lack definition captured more working-age adult than a financial constrained lack definition as it is also included those who responded ‘Health or disability prevents this’ or ‘Other reason’ for lacking the item. This resulted in 27% of working-age adults in material deprivation, compared to 23% using the financial constrained lack definition. A threshold of one item higher (6 or more items lacked) for a wider constrained lack definition reduced the percentage to 21% of working-age adults.
The percentages by income decile AHC are similar (within 5 percentage points) between the financial constrained lack definition of 5 or more items and the wider constrained lack definition of 5 or more items and 6 or more items.
The analysis by groups associated with material deprivation showed broadly similar percentages of working-age adults in material deprivation were captured under these three measures (within 5 percentage points). The exception was for household food security, where more working-age adults in food secure households were captured using a wider constrained lack definition of 5 or more items and less in food insecure households. We would expect more working-age adults in food insecure households to be in material deprivation than in food secure households.
Pensioners
The chart below presents the percentage of pensioners that were identified within the threshold ranges for each measure:
- Financial constrained lack: Between 2 or more items lacked and 4 or more items lacked
- Wider constrained lack: Between 3 or more items lacked and 5 or more items lacked
It shows that moving the threshold up or down by a single item can lead to vastly different percentages of pensioners in material deprivation under each definition. With the same number of items lacked, a wider constrained lack definition captured more pensioners than a financial constrained lack definition as it included those who responded ‘Health or disability prevents this’ or ‘Other reason’ for lacking the item.
Figure 13: Percentage of pensioners by number of items lacked for the updated questions for threshold ranges informed by the Composite Measure of Living Standards, FYE 2024
The thresholds were also compared by income decile AHC, as presented in the chart below. A higher percentage of pensioners were in material deprivation in the third decile whereas higher percentages in material deprivation were seen in decile 2 and decile 1 for children and working-age adults respectively. Broadly similar percentages were captured as the threshold increased within each definition and across definitions. This suggested that, overall, the percentage of pensioners captured in material deprivation was less sensitive to the definition used and threshold of items lacked, compared to children.
Figure 14: Composition of pensioners in material deprivation within each threshold of a Financial Constrained Lack measure (Fin) and Wider Constrained Lack measure (Wid) by income decile AHC, FYE 2024
Further analysis looked at groups associated with material deprivation, including additional groups, ‘by pensioner aged under 80 and 80 or over’ and ‘by age-band of the pensioner’. This was carried out for all thresholds in the range under each definition. This was to assess how sensitive the composition of pensioners in material deprivation was in these groups within the definition and across definitions. For example, of those pensioners in material deprivation under a financial constrained lack definition of 2 or more items, 67% were in a family where someone was disabled. This increased to 71% under a definition of 3 or more items and to 73% under a definition of 4 or more items. Across definitions, of those pensioners in material deprivation under a lack of 4 or more items, 73% were in a family where someone was disabled using a financial constrained lack definition, compared to 74% under a wider constrained lack definition. Increasing to 5 or more items lacked for a wider constrained lack definition increased this to 76% of pensioners in a family where someone was disabled.
Table 13: Analysis of Pensioner Material Deprivation Financial Constrained Lack (Fin) thresholds and Wider Constrained Lack (Wid) thresholds by groups associated with material deprivation, FYE 2024
Fin 2+ | Fin 3+ | Fin 4+ | Wid 3+ | Wid 4+ | Wid 5+ | |
---|---|---|---|---|---|---|
Percentage of pensioners in material deprivation of which: | 24 | 16 | 11 | 23 | 15 | 10 |
In Food Secure Household | 88 | 82 | 75 | 87 | 82 | 75 |
In Food Insecure Household | 12 | 17 | 24 | 12 | 18 | 25 |
Not in a low income family (absolute low income AHC) | 76 | 73 | 72 | 76 | 75 | 74 |
In a low income family (absolute low income AHC) | 24 | 27 | 28 | 24 | 25 | 26 |
In a family where no one is disabled | 33 | 29 | 27 | 27 | 26 | 24 |
In a family where someone is disabled | 67 | 71 | 73 | 73 | 74 | 76 |
Owner/Occupier | 61 | 54 | 50 | 59 | 53 | 47 |
Social Rented | 28 | 33 | 37 | 30 | 35 | 40 |
Private Rented | 11 | 13 | 12 | 12 | 12 | 13 |
No savings in the family | 20 | 23 | 27 | 21 | 24 | 27 |
Savings in the family | 80 | 77 | 73 | 79 | 76 | 73 |
Pensioner aged under 80 | 75 | 75 | 78 | 71 | 75 | 77 |
Pensioner aged 80 or over | 25 | 25 | 22 | 29 | 25 | 23 |
Pensioners aged 65-69 | 27 | 29 | 31 | 25 | 29 | 31 |
Pensioners aged 70-74 | 25 | 24 | 25 | 24 | 24 | 26 |
Pensioners aged 75-79 | 23 | 21 | 21 | 22 | 22 | 21 |
Pensioners aged 80-84 | 15 | 15 | 15 | 15 | 15 | 14 |
Pensioners aged 85+ | 10 | 10 | 7 | 14 | 10 | 9 |
Considerations when defining the working-age adult material deprivation measure were to ensure that:
-
The definition captured the financial aspect of material deprivation, unless evidence from analysis and conceptually a wider constrained lack definition was more representative
-
Was not too low so as to reduce sensitivity
-
Was set at the same threshold as children to provide consistency across these two groups if evidence supported this
Reviewing the charts and table above, for the financial constrained lack definition, 11% of pensioners were in material deprivation using a simple count of 4 or more items lacked. This threshold is the highest of the range for a financial constrained lack measure for pensioners but is not set too low. With the same number of items lacked, a wider constrained lack definition captured more pensioners than a financial constrained lack definition as it also included those who responded ‘Health or disability prevents this’ or ‘Other reason’ for lacking the item. This resulted in 15% of pensioners in material deprivation, compared to 11% using the financial constrained lack definition. A threshold of one item higher (5 or more items lacked) for a wider constrained lack definition reduced the percentage to 10% of pensioners.
The composition of pensioners in material deprivation for 4 or more items lacked for a financial constrained lack definition against the similar wider constrained lack definition thresholds identified above. This is presented by decile of income AHC.
The percentages are similar (within 5 percentage points) indicating that the financial constrained lack measure of 4 or more items is as effective (valid) in capturing more pensioners in the lower income deciles as the wider constrained lack of 4 or more items and 5 or more items. This supports the continued use of the financial constrained lack definition which is focused on the financial aspect of material deprivation for pensioners.
The percentages by income decile AHC are similar (within 5 percentage points) between the financial constrained lack definition of 4 or more items and the wider constrained lack definition of 4 or more items and 5 or more items.
The analysis by groups associated with material deprivation showed similar percentages of pensioners in material deprivation were captured under these three measures (within 5 percentage points). The exception is for household food security, where more pensioners in food secure households would be captured using a wider constrained lack definition of 4 or more items and less in food insecure households. We would expect more pensioners in food insecure households to be in material deprivation than in food secure households.
Research showed one of the reasons the old pensioner material deprivation measure used a wider constrained lack definition was that older pensioners are less likely to self-identify as poor and so were more likely to respond with other reasons for lacking an item[footnote 1]. So, the old measure captured:
- This is not a priority for me on my current income
- My health/disability prevents me
- It is too much trouble/too tiring
- There is no one to do this with or help me
- Other reason
However, broadly similar levels of pensioners in older age groups were captured using the financial constrained lack option and wider constrained lack option for the updated questions, as presented in the table above and chart below.
Figure 15: Composition of pensioners in material deprivation within each threshold by age-band of pensioners for the updated questions, FYE 2024
A further assessment evaluated the characteristics of pensioners captured in material deprivation when:
- In the ‘Financial Constrained Lack of 4 or more items measure but not in the Wider Constrained Lack of 5 or more items measure’
- In the ‘Financial Constrained Lack of 4 or more items measure and in the Wider Constrained Lack of 5 or more items measure’
- Not in the ‘Financial Constrained Lack of 4 or more items measure but in the Wider Constrained Lack of 5 or more items measure’
Looking at the percentages of pensioners captured in material deprivation in each, 72% were in both measures, with 17% only in the Financial Constrained Lack of 4 more items and the remaining 11% in the Wider Constrained Lack of 5 or more items group. Analysis was carried out by groups associated with material deprivation. Broadly speaking, this analysis indicated that a wider constrained lack definition may not add value in capturing more pensioners with adaptive preferences who should be defined as in material deprivation. It also indicated that using a financial constrained lack definition would limit including individuals who lack items due to personal choice and should therefore not be captured by the definition.
Decisions
Defining the Material Deprivation measure
Evidence from analysis indicated that a financial constrained lack definition could be used for the updated measures for children, working-age adults and pensioners.
Considering the advantages against the analytical framework:
- Validity:
- The financial constrained lack definition captures the financial aspect of material deprivation
- For pensioners, evidence suggested marginal to no impact of using a wider constrained lack definition for pensioners by income gradient, age group and age-band and by groups associated with material deprivation
- Improvements to the data collection methodology have been made to more accurately capture financial reasons for lacking an item, as well as updated items included for the measure
- Continuity: The same definition for child and working-age adult questions would continue to be used, compared to the old measures
- Sensitivity:
- Back-series analysis indicated the financial constrained lack definition reacted to changes over time so should continue for updated methodology
- As the ‘other’ reason would no longer be included in the pensioner definition, estimates would be less sensitive to this ‘black box’ reason that became a dominant response in FYE 2021 and FYE 2022 during the COVID-19 period
- Consistency: There would be a consistent definition for child, working-age adult and pensioner measures and identifying a lacked item for questions not already defined as simple absence
- Transparency: Easily explained to users
- Resources: Simpler processing
Considering the disadvantages:
- Validity: The financial constrained lack may not be as effective in capturing those in material deprivation who are reluctant to respond with a financial reason for lacking an item
- Continuity: For pensioner material deprivation, it moves away from previous pensioner definition created to capture those reluctant to respond with a financial reason
However:
- Standardised question routing was applied for all groups to optimise accurate responses by asking all questions first and then follow-up questions after
- Evidence suggested marginal to no impact of using a wider constrained lack definition for pensioners by income gradient, age group and age-band and by groups associated with material deprivation
Given the advantages, the decision has been made to define all measures using a financial constrained lack definition.
Setting the Material Deprivation Thresholds
Analysis identified the following Material Deprivation thresholds for the updated measures:
- Children: 4 or more items lacked
- Working-age adults: 5 or more items lacked
- Pensioners: 4 or more items lacked
Considering the advantages of these thresholds against the Analytical Framework:
- Validity: Each threshold lies within the range informed by the Composite Measure of Living Standards analysis but also considers that:
- The threshold is not set too low so as to reduce sensitivity
- Not all questions for the children group are relevant to all families with children e.g. some items are focussed on children of school age only so will not be applicable to those with only pre-school children. Therefore, the threshold was also not set too high to reflect that fewer items may be lacked by a family to be captured in material deprivation
- The threshold for working-age adults is set at one item higher than for children as research indicates that working-age adults prioritise items for their children over their own items and so report lacking fewer items. Setting the threshold at 6 or more items would have drawn a material deprivation rate less consistent with historical levels and a threshold of 4 or more items gives a higher material deprivation rate than for children, which contradicts the higher disadvantage and deprivation experienced by children
- There are fewer questions asked for pensioner-specific items compared to working-age adult, so a threshold of 4 or more items reflects this
- Continuity: The refinement of the measure of material deprivation outweighs the discontinuity from FYE 2024. The updated questions are more relevant to society today and an improved data collection methodology has been applied in the FRS to help identify those lacking an item
- Resources: The thresholds are straight-forward to apply in the processing codes
Considering the disadvantages:
-
Consistency: The threshold for the working-age adult group is one item higher compared to the children and pensioner groups
-
Transparency: A different threshold for the working-age adult group may not be clear for users to understand
However, this technical report provides clear rationale behind the decision for the working-age adult group. The HBAI Quality and Methodology Information Report also sets out which thresholds are used for each group.
Given the advantages, the decision has been made to set the updated Material Deprivation thresholds as:
- Children: 4 or more items lacked
- Working-age adults: 5 or more items lacked
- Pensioners: 4 or more items lacked
These thresholds will be used for the updated Material Deprivation measures for FYE 2024 estimates and in subsequent publications.
For FYE 2024, this gives the following percentages of individuals in material deprivation:
- Children: 28%
- Working-age adults: 23%
- Pensioners: 11%
Presentation of estimates in the HBAI FYE 2024 release
LSE Recommendations
The recommendations from the LSE Review were:
a. To provide full transparency to users, documentation detailing the decisions made, and why, should be published alongside the statistics.
b. To gain a clearer picture of poverty trends, we recommend that alongside the HBAI low-income series and the combined low income and material deprivation series (a legal requirement for the child poverty measure), DWP publishes new HBAI headline series on material deprivation alone. Currently DWP release this measure via their online dissemination tool, Stat-Xplore, including the standalone metric in the publication would also meet some users concerns about the combined measure conflating two concepts (low income and material deprivation).
c. We recommend DWP headline statistics for combined measures are based on After Housing Costs and not Before Housing Costs income. This is a more realistic measure of the resources available to spend on necessities and consistent with other HBAI headline series.
Decisions
This report fulfils the first recommendation to provide full transparency to users on the decisions made in developing the updated Material Deprivation measures.
To meet the other recommendations, changes have been made to the main HBAI report and charts, associated publication tables and datasets available to users.
Note that single year estimates are not published in the UK HBAI Statistics by region and ethnicity due to volatility in sample sizes and coverage. Historically, a three-year average has been applied (with a change to three-year averages based on two data points to exclude 2020/21 in more recent years). As FYE 2024 is the first year of estimates based on the updated measures, estimates are not published in the HBAI FYE 2024 release. Further information on material deprivation-based estimates published by country following the update can be found in the publications for Wales, Scotland and Northern Ireland.
The changes made are:
Main Report
- Commentary:
- Reports headline estimates based on FYE 2024 questions and updated measure
- Presents estimates based on material deprivation alone.
- Presents estimates using combined low income AHC and material deprivation (in addition to BHC-based estimates) for children and working-age adults
- Provides caution to not compare FYE 2024 results with FYE 2023 and the back-series
- Provides information on FYE 2024 estimates based on the old questions and old methodology and directs users to the Technical Report for further analysis
Charts
- Presents a structural break in the series at FYE 2024 using a dotted, vertical line
- Does not present the FYE 2024 estimate based on the old questions and old methodology
- Presents FYE 2024 estimates based on FYE 2024 questions and updated measure as a single dot
Main Publication Tables
- Trends and time-series tables do not present estimates based on the old questions and old methodology
- A space has been made between the old series and updated series and no year-on-year change presented for FYE 2024 compared to FYE 2023
- Relabelling ‘New suite of questions’ to ‘2010/11 suite of questions’ and labelling ‘2023/24 suite of questions’ for updated series for children and working-age adult tables. Similar edits have been made for pensioner tables
- Footnotes added to inform users of the change and how to interpret estimates
Technical Report
- A section evaluates estimates for FYE 2024 based on the old questions and old methodology as well as the year-on-year changes against FYE 2023
Technical Report Tables
- A suite of tables has been published alongside the Technical Report containing tables with FYE 2023 and FYE 2024 estimates based on the old measures and the year-on-year changes, along with confidence intervals. These tables mirror Trends tables produced in the Main Publication Tables for estimates based on Material Deprivation i.e. Combined low income and material deprivation BHC/AHC for relative and absolute low income with a footnote added to inform users on how to interpret estimates
- A separate workbook also contains all underlying data used in the production of charts, tables and diagrams used in the Technical Report
Stat-Xplore
- Does not present FYE 2024 estimates based on the old questions and old measure
- Presents estimates based on the FYE 2024 material deprivation questions and updated measure as a continuation in the breakdowns available with an annotation (footnote) added to explain the break in the series
HBAI harmonised dataset available at the UK Data Service
- Includes variables for FYE 2024 estimates based on the FYE 2024 questions and updated measure
- Includes variables for FYE 2024 estimates based on the old questions and old measure
Analysis of FYE 2024 estimates based on the old and updated measures
Analysis was carried out to assess a break in the series for estimates based on material deprivation measures for FYE 2024. Estimates based on the updated measures are not directly comparable against FYE 2023, as different questions and methodologies were applied – see the Executive Summary for more information.
This analysis focussed on comparing the HBAI FYE 2023 sample with 25,000 households and the HBAI FYE 2024 sample asked the old questions with 4,000 households (24% of the HBAI FYE 2024 households). Material deprivation estimates for these samples used the old questions and the old methodology. An assessment was made on how similar the compositions of these samples were. This was to be able to compare estimates of material deprivation between the two years had the old questions and old methodology been maintained.
Estimates based on the updated measures are presented in the main HBAI report and publication tables. FYE 2024 estimates based on the old measures provided in this analysis should not be reported.
A separate set of Trends tables with estimates for FYE 2023 and FYE 2024 where households were asked the old questions can be found in the accompanying ODS supported tables that can be downloaded via the HBAI homepage (see Directory of Tables link on this web page).
Analysis of compositions for the overall FYE 2024 sample of 17,000 households and estimates based on the updated measures are discussed at times in this part of the report but it should not be inferred that these material deprivation estimates are comparable to the FYE 2023 estimates or FYE 2024 estimates based on the old measures.
Comparisons looked at demographic and economic characteristics within each sample for those in material deprivation, as well as the risk of being in material deprivation by these groups. Comparisons by region have not been presented due to volatility in sample sizes and coverage of single-year regional estimates in UK HBAI Statistics. Users can find further information on response rates by region in the FRS Background and Information Methodology.
To note, the HBAI sample is lower than the achieved FRS sample. Households containing a married adult whose spouse is temporarily absent (away for 12 months or more), whilst within the scope of the FRS, are excluded from HBAI.
Analysis
The following table presents the sample size of children, working-age adults and pensioners as well as households in the three samples.
Table 14: Sample sizes in HBAI FYE 2023 and HBAI FYE 2024
FYE 2023 | FYE 2024 (asked old questions) | FYE 2024 | |
---|---|---|---|
Children | 11,000 | 2,000 | 8,000 |
Working-age adults | 29,000 | 5,000 | 20,000 |
Pensioners | 13,000 | 2,000 | 9,000 |
All households | 25,000 | 4,000 | 17,000 |
Overall key findings were:
- Composition of samples by type: The overall composition of children, working-age adults and pensioners did not change across the three samples at around 22%, 60% and 18% respectively
- Interview mode (face-to-face vs. telephone): Only 5% of households asked the old questions in FYE 2024 were interviewed by telephone. This compares to 28% of households in the FYE 2023 sample and 15% of households in the FYE 2024 sample
The next sections present findings from analysis of the overall compositions of children, working-age adults and pensioners who are in material deprivation.
Additional analysis evaluated the percentage in material deprivation by:
- Demographic groups:
- Receipt of Universal Credit (UC) or equivalent in the family
- Accommodation type
- Family type for the family (benefit unit)
- Disability within the family (benefit unit)
- Economic groups:
- Savings in the family
- Relative low income After Housing Costs (AHC)
- Quintile of income AHC
- Economic status of the household
Children
The composition of the FYE 2024 sample asked the old questions was slightly more volatile for children in material deprivation compared to the FYE 2023 sample. There were fewer children in relative low income AHC, in the bottom income quintile AHC and in households where all adults were in work. There were also higher percentages of children in a family with no savings and living in the social rented accommodation, compared to the FYE 2023 sample.
Compositions were broadly similar between the samples for family type and disability in the family, while the FYE 2024 sample asked the old questions had a higher percentage of children in material deprivation in a family in receipt of UC or equivalent, compared to the FYE 2023 sample.
Chart 16 below presents the percentage of children in material deprivation overall and by different demographic groups for each sample. For the FYE 2024 sample asked the old questions, 19% of children were in material deprivation compared to 21% in FYE 2023.This decrease was not statistically significant (see accompanying Technical Report tables via the HBAI homepage). Fewer children were in material deprivation by the different demographic groups.
Material deprivation estimates for the FYE 2024 sample in Chart 16 are presented for information only and should not be compared to the other estimates, due to different questions and different methodologies.
Figure 16: Percentage of children in material deprivation by demographic groups for each HBAI sample
Chart 17 below presents the percentage of children in material deprivation in the three samples, along with confidence intervals around each estimate. This chart should be used for information only. Further estimates can be found in the accompanying Technical Report tables via the HBAI homepage.
The FYE 2024 estimates based on the updated measure are not comparable to the FYE 2023 estimates based on the old measure. The FYE 2024 estimates based on the updated measure are presented in the main HBAI report and publication tables so the estimates presented here for FYE 2024 using the old measure should not be reported.
Figure 17: Percentage of children in material deprivation for FYE 2023, FYE 2024 asked old questions and FYE 2024 with confidence intervals
Working-age adults
Overall, the composition of the FYE 2024 sample of working-age adults in material deprivation asked the old questions were closely aligned with the FYE 2023 sample across different demographic and economic groups.
Working-age adults in material deprivation were less likely to be in a family in receipt of UC or equivalent in the FYE 2024 sample asked the old questions, compared to the FYE 2023 sample.
Chart 18 below presents the percentage of working-age adults in material deprivation overall and by different economic groups for each sample. For the FYE 2024 sample asked the old questions, 22% of working-age adults were in material deprivation compared to 22% in FYE 2023. Similar percentages of working-age adults were also seen in material deprivation by the different demographic groups.
Material deprivation estimates for the FYE 2024 sample in Chart 18 are presented for information only and should not be compared to the other estimates, due to different questions and different methodologies.
Figure 18: Percentage of working-age adults in material deprivation by economic groups for each HBAI sample
Chart 19 below presents the percentage of working-age adults in material deprivation in the three samples, along with confidence intervals around each estimate. This chart should be used for information only. Further estimates can be found in the accompanying Technical Report tables via the HBAI homepage.
The FYE 2024 estimates based on the updated measure are not comparable to the FYE 2023 estimates based on the old measure. The FYE 2024 estimates based on the updated measure are presented in the main HBAI report and publication tables so the estimates presented here for FYE 2024 using the old measure should not be reported.
Figure 19: Percentage of working-age adults in material deprivation for FYE 2023, FYE 2024 asked old questions and FYE 2024 with confidence intervals
Pensioners
The composition of pensioners in material deprivation in FYE 2024 sample asked the old questions broadly aligned with the FYE 2023 sample.
Overall, pensioners in material deprivation were more likely to be in couple families and to be owner-occupiers in the FYE 2024 sample asked the old questions, compared to the FYE 2023 sample where the majority were in single families and a higher proportion were in the social rented sector.
Chart 20 below presents the percentage of pensioners in material deprivation overall and by different demographic groups for each sample. For the FYE 2024 sample asked the old questions, 8% of pensioners were in material deprivation compared to 8% in FYE 2023. Within social rented accommodation, private rented accommodation and in a family where someone is disabled, fewer pensioners were seen in material deprivation in the FYE 2024 sample asked the old questions, compared to the FYE 2023 sample. Within single and pensioner couple groups, more pensioners were seen in material deprivation in the FYE 2024 sample asked the old questions, compared to the FYE 2023 sample.
Material deprivation estimates for the FYE 2024 sample in Chart 20 are presented for information only and should not be compared to the other estimates, due to different questions and different methodologies.
Figure 20: Percentage of pensioners in material deprivation by demographic groups for each HBAI sample
Chart 21 below presents the percentage of pensioners in material deprivation in the three samples, along with confidence intervals around each estimate. This chart should be used for information only. Further estimates can be found in the accompanying Technical Report tables via the HBAI homepage.
The FYE 2024 estimates based on the updated measure are not comparable to the FYE 2023 estimates based on the old measure. The FYE 2024 estimates based on the updated measure are presented in the main HBAI report and publication tables so the estimates presented here for FYE 2024 using the old measure should not be reported.
Figure 21: Percentage of pensioners in material deprivation for FYE 2023, FYE 2024 asked old questions and FYE 2024 with confidence intervals
Annex 1: Material Deprivation questions
This annex provides further information on:
- FYE 2011-based questions for children and working-age adults with FRS variable names and links to the methodology for the old measures
- FYE 2010-based questions for pensioners with FRS variable names and links to the methodology for the old measure
- Updated questions for children, working-age adults, pensioners and households with FRS variable names
Old Material Deprivation questions for children and working-age adults
The FYE 2011-based questions for children and working-age adults were:
Table A1: Old Material Deprivation Questions for children and working-age adults with FRS variable names
Question | Child response variable | Working-age Adult response variable |
---|---|---|
Holiday away from home one week a year not with relatives | ADDHOL | ADDHOL |
Enough money to keep home in decent state of decoration | ADDDEC | ADDDEC |
Have contents insurance | ADDINS | ADDINS |
Regular savings of £10 or more a month | ADDMON | ADDMON |
Money to replace worn out furniture | ADEPFUR | ADEPFUR |
Replace or repair broken major electrical goods | AF1 | AF1 |
Small amount of money to spend each week on yourself | AFDEP2 | AFDEP2 |
Keep up with bills and any regular debt repayments | ADDBTBL | ADDBTBL |
Keep home warm enough | HOUSHE1 | HOUSHE1 |
Have a warm, winter coat | CDPCOAT | n/a |
Eat fresh fruit and/or vegetables every day | CDEPVEG | n/a |
Family holiday away from home for at least one week a year | CDEPHOL | n/a |
Enough bedrooms for every child of 10 or over of a different sex to have their own bedroom | CDEPBED | n/a |
Leisure equipment | CDEPEQP | n/a |
Celebrations on special occasions | CDEPCEL | n/a |
Attend at least one regular organized activity a week outside school | CDEPACT | n/a |
Do a hobby or leisure activity | CDEPLES | n/a |
Have friends round for tea or a snack once a fortnight | CDEPTEA | n/a |
Go to toddler group / nursery / playgroup at least once a week? | CPLAY | n/a |
Go on school trips | CDEPTRP | n/a |
Outdoor space/facilities nearby to play safely | CDELPLY | n/a |
For most questions, the responses were:
- Have this
- Would like to have this but cannot afford this at the moment
- Do not want / need this at the moment
- Does not apply
For ‘Keep up with bill and any regular debt repayments’, the responses were:
- Yes
- No
For ‘Keep home warm enough’, the responses were:
- Yes
- No
- Does not apply
To note:
Some child-based questions were only asked if applicable to the family:
- CDEPBED: only asked if 2 or more children of the opposite sex were in the same family (benefit unit) and at least one was aged 10 years or over
- CPLAY: Only asked if children in benefit unit were aged under 6 and did not attend primary or private school
- CDEPTRP: Only asked if there were any dependent children in the Benefit Unit aged 6 years or older, or any children under 6 years of age who attended a primary school or a private or independent school
More information is available in the HBAI FYE 2023 Quality and Methodology Information Report on the methodology used for the old Children Material Deprivation measure and old Working-age Adults Material Deprivation measure.
Old Material Deprivation questions for pensioners
The FYE 2010-based questions for pensioners were:
Table A2: Old Material Deprivation Questions for pensioners with FRS variable names for responses and reasons
Pensioner question | Response variable | Reason variables |
---|---|---|
At least one filling meal a day | OAMEAL | MEALNT1 – MEALNT9 |
Go out socially at least once a month | OAOUT | OUTNT1 – OUTNT9 |
See your friends or family at least once a month | OAFRND | FRNDNT1 – FRNDNT9 |
Take a holiday away from home for a week or more at least once a year | OAHOL | HOLNT1 – HOLNT9 |
Able to replace your cooker if it broke down | OACOOK | COOKNT1 – COOKNT9 |
Home kept in a good state of repair | OAHOME | HOMENT1 – HOMENT9 |
Heating, electrics, plumbing and drains kept in good working order | OAHEAT | HEATNT1 – HEATNT9 |
Have a damp-free home | OADAMP | DAMPNT1 – DAMPNT9 |
Home kept adequately warm | OAWARM | WARMNT1 – WARMNT9 |
Without cutting back on essentials, able to pay regular bills | OABILL | BILLNT1 – BILLNT9 |
Telephone (landline) to use if needed | OAPHON | PHONNT1 – PHONNT9 |
Access to a car or taxi if needed | OATAXI | TAXINT1 – TAXINT9 |
Have your hair done or cut regularly | OAHAIR | HAIRNT1 – HAIRNT9 |
Have a warm waterproof coat | OACOAT | COATNT1 – COATNT9 |
Able to pay an unexpected expense of £200 | OAEXPNS | OAHOWPY1 – OAHOWPY6 |
For most questions, the responses were:
- Yes
- No
If the response = 2 (No), they were asked the follow-up question later in the interview (i.e. after answering all the questions on whether or not they have items, they were asked the follow-up questions for all items they responded no to). The reasons were:
- I do not have the money for this
- This is not a priority for me on my current income
- My health/disability prevents me
- It is too much trouble/too tiring
- There is no one to do this with or help me
- This is not something I want
- It is not relevant to me
- Other reason
- Do not know
For ‘Able to pay an unexpected expense of £200’, the responses were:
- Yes
- No
and if the response = 1 (Yes), the reasons were:
- I would use my own income but would need to cut back on essentials
- I would use my own income but would not need to cut back on essentials
- I would use my savings
- I would use a form of credit (e.g. credit card or take out a loan)
- I would get the money from friends or family as a gift or loan
- Other
More information is available in the HBAI FYE 2023 Quality and Methodology Information Report on the methodology used for the old Pensioner Material Deprivation measure.
Updated Material Deprivation questions for children
The updated Material Deprivation questions for children with FRS variables for responses and reasons are:
Table A3a: Updated Material Deprivation questions for children with FRS variables for responses and reasons - Household-level
Child questions | Response variables | Reasons variables |
---|---|---|
Able to pay bills without cutting back on essentials | MDHH1 | n/a |
Able to put money aside for unexpected expenses | MDHH2 | n/a |
Cover cost of repair or to replace appliances | MDHH3 | MDHH3R1-MDHH3R6 |
Home in good state of decoration/repair | MDHH4 | MDHH4R1-MDHH4R6 |
Home adequately warm in cold weather | MDHH5 | n/a |
Home damp free | MDHH6 | n/a |
Reliable access to internet at home | MDHH7 | MDHH7R1-MDHH7R6 |
Access to computer/tablet | MDHH8 | MDHH8R1-MDHH8R6 |
Adequate access to reliable transport | MDHH9 | MDHH9R1-MDHH9R6 |
Heating/electrics/plumbing in good working order | MDHH10 | MDHH10R1-MDHH10R6 |
Home contents insurance | MDHH11 | MDHH11R1-MDHH11R6 |
Table A3b: Updated Material Deprivation questions for children with FRS variables for responses and reasons - Individual-level
Child questions | Response variables | Reasons variables |
---|---|---|
School trips | MDCH1 | MDCH1R1-MDCH1R6 |
Place for homework | MDCH2 | MDCH2R1-MDCH2R6 |
Three meals a day | MDCH3 | MDCH3R1-MDCH3R6 |
Fresh fruit and/or vegetables every day | MDCH4 | MDCH4R1-MDCH4R6 |
Enough clothes that they feel comfortable to wear | MDCH5 | MDCH5R1-MDCH5R6 |
Organised weekly activity outside school | MDCH6 | MDCH6R1-MDCH6R6 |
Friends round monthly | MDCH7 | MDCH7R1-MDCH7R6 |
Age suitable toys/games | MDCH8 | MDCH8R1-MDCH8R6 |
Enough bedrooms for children 10+ years | MDCH9 | MDCH9R1-MDCH9R6 |
Toddler/nursery/playgroup at least weekly | MDCH10 | MDCH10R1-MDCH10R6 |
Annual break away from home | MDCH11 | MDCH11R1-MDCH11R6 |
The question wording has been shortened in the table for simplicity – the full question wording can be found in the LSE Review.
Responses are:
- Yes
- No
Reasons are:
- We/I do not have the money for this
- This is not a priority on my/our current income
- Health / disability prevents this
- We/I do not want/need this
- It is not relevant
- Other reason
To note:
- More than one reason can be given when responding ‘No’ to a question
- Some updated questions do not have follow-up reasons asked as they have already been defined by simple absence following the LSE Review. These include:
- Able to pay bills without cutting back on essentials (MDHH1)
- Able to put money aside for unexpected expenses (MDHH2)
- Home adequately warm in cold weather (MDHH5)
- Home damp free (MDHH6)
- To reduce the survey burden relative to collecting this information from multiple adults living in the same household, the core set of household-based questions are asked to the first benefit unit (family) in a household containing the household reference person (see Glossary) and the responses and reasons applied to all individuals in the household
- Additionally, for the question ‘Annual break away from home’, this question is asked in the Working-age Adult or Pensioner section of the questionnaire but asks about partners and dependent children too. The full question is ‘Do you (your partner and your dependent children) have a break away from home at least once a year?’ and is recorded in the variables MDWA7 for working-age adults and MDPEN2 for pensioners, along with the variables for the follow-up questions. These responses and reasons are used to derive the child variable MDCH11 and variables for the follow-up questions for children in the benefit unit (family)
- Some child-based questions are only asked if applicable to the family:
- School trips (MDCH1), Place for homework (MDCH2) and Organised weekly activity outside school (MDCH6): Only asked if child/ren aged 6 years or older, or any children under 6 years of age who attend a primary school or a private or independent school
- Enough bedrooms for children 10+ years (MDCH9): only asked if 2 or more children of the opposite sex are in the same family (benefit unit) and at least one is aged 10 years or over
- Toddler/nursery/playgroup at least weekly (MDCH10): Only asked if child/ren in benefit unit under 6 and do not attend primary or private school
Updated Material Deprivation questions for working-age adults
The updated Material Deprivation questions for working-age adults with FRS variables for responses and reasons are:
Table A4a: Updated Material Deprivation questions for working-age adults with FRS variables for responses and reasons - Household-level
Working-age adult questions | Response variables | Reasons variables |
---|---|---|
Able to pay bills without cutting back on essentials | MDHH1 | n/a |
Able to put money aside for unexpected expenses | MDHH2 | n/a |
Cover cost of repair or to replace appliances | MDHH3 | MDHH3R1-MDHH3R6 |
Home in good state of decoration/repair | MDHH4 | MDHH4R1-MDHH4R6 |
Home adequately warm in cold weather | MDHH5 | n/a |
Home damp free | MDHH6 | n/a |
Reliable access to internet at home | MDHH7 | MDHH7R1-MDHH7R6 |
Access to computer/tablet | MDHH8 | MDHH8R1-MDHH8R6 |
Adequate access to reliable transport | MDHH9 | MDHH9R1-MDHH9R6 |
Heating/electrics/plumbing in good working order | MDHH10 | MDHH10R1-MDHH10R6 |
Home contents insurance | MDHH11 | MDHH11R1-MDHH11R6 |
Table A4b: Updated Material Deprivation questions for working-age adults with FRS variables for responses and reasons - Individual-level
Working-age adult questions | Response variables | Reasons variables |
---|---|---|
Regular money worries at the end of the month | MDWA1 | n/a |
Regular payments to workplace or private pension | MDWA2 | MDWA2R1-MDWA2R6 |
Three meals a day | MDWA3 | MDWA3R1-MDWA3R6 |
Fresh fruit and/or vegetables every day | MDWA4 | MDWA4R1-MDWA4R6 |
Appropriate clothes for work/job interview | MDWA5 | MDWA5R1-MDWA5R6 |
Regular dental appointments | MDWA6 | MDWA6R1-MDWA6R6 |
Annual break away from home | MDWA7 | MDWA7R1-MDWA7R6 |
Go out socially at least monthly | MDWA8 | MDWA8R1-MDWA8R6 |
See friends and family at least monthly | MDWA9 | MDWA9R1-MDWA9R6 |
Small amount of money for oneself | MDWA10 | MDWA10R1-MDWA10R6 |
The question wording has been shortened in the table for simplicity – the full question wording can be found in the LSE Review.
Responses are:
- Yes
- No
Reasons are:
- We/I do not have the money for this
- This is not a priority on my/our current income
- Health / disability prevents this
- We/I do not want/need this
- It is not relevant
- Other reason
To note:
- More than one reason can be given when responding ‘No’ to a question
- Some updated questions do not have follow-up reasons asked as they have already been defined by simple absence following the LSE Review. These include:
- Regular money worries at the end of the month (MDWA1) - note for this question, a response of ‘Yes’ would indicate lacking the item
- Able to pay bills without cutting back on essentials (MDHH1)
- Able to put money aside for unexpected expenses (MDHH2)
- Home adequately warm in cold weather (MDHH5)
- Home damp free (MDHH6)
- To reduce the survey burden relative to collecting this information from multiple adults living in the same household, the core set of household-based questions are asked to the first benefit unit (family) in a household containing the household reference person (see Glossary) and the responses and reasons applied to all individuals in the household
Updated Material Deprivation questions for pensioners
The updated Material Deprivation questions for pensioners with FRS variables for responses are reasons are:
Table A5a: Updated Material Deprivation questions for pensioners with FRS variables for responses and reasons - Household-level
Pensioner questions | Response variables | Reasons variables |
---|---|---|
Able to pay bills without cutting back on essentials | MDHH1 | n/a |
Able to put money aside for unexpected expenses | MDHH2 | n/a |
Cover cost of repair or to replace appliances | MDHH3 | MDHH3R1-MDHH3R6 |
Home in good state of decoration/repair | MDHH4 | MDHH4R1-MDHH4R6 |
Home adequately warm in cold weather | MDHH5 | n/a |
Home damp free | MDHH6 | n/a |
Reliable access to internet at home | MDHH7 | MDHH7R1-MDHH7R6 |
Access to computer/tablet | MDHH8 | MDHH8R1-MDHH8R6 |
Adequate access to reliable transport | MDHH9 | MDHH9R1-MDHH9R6 |
Heating/electrics/plumbing in good working order | MDHH10 | MDHH10R1-MDHH10R6 |
Home contents insurance | MDHH11 | MDHH11R1-MDHH11R6 |
Table A5b: Updated Material Deprivation questions for pensioners with FRS variables for responses and reasons - Individual-level
Pensioner questions | Response variables | Reasons variables |
---|---|---|
Regular money worries at the end of the month | MDPEN1 | n/a |
Annual break away from home | MDPEN2 | MDPEN2R1-MDPEN2R6 |
Fresh fruit and/or vegetables every day | MDPEN3 | MDPEN3R1-MDPEN3R6 |
Three meals a day | MDPEN4 | MDPEN4R1-MDPEN4R6 |
Regular dental appointments | MDPEN5 | MDPEN5R1-MDPEN5R6 |
Small amount of money for oneself | MDPEN6 | MDPEN6R1-MDPEN6R6 |
Go out socially at least monthly | MDPEN7 | MDPEN7R1-MDPEN7R6 |
See friends and family at least monthly | MDPEN8 | MDPEN8R1-MDPEN8R6 |
The question wording has been shortened in the table for simplicity – the full question wording can be found in the LSE Review.
Responses are:
- Yes
- No
Reasons are:
- We/I do not have the money for this
- This is not a priority on my/our current income
- Health / disability prevents this
- We/I do not want/need this
- It is not relevant
- Other reason
To note:
- More than one reason can be given when responding ‘No’ to a question
- Some updated questions do not have follow-up reasons asked as they have already been defined by simple absence following the LSE Review. These include:
- Regular money worries at the end of the month (MDPEN1) - note for this question, a response of ‘Yes’ would indicate lacking the item
- Able to pay bills without cutting back on essentials (MDHH1)
- Able to put money aside for unexpected expenses (MDHH2)
- Home adequately warm in cold weather (MDHH5)
- Home damp free (MDHH6)
- To reduce the survey burden relative to collecting this information from multiple adults living in the same household, the core set of household-based questions are asked to the first benefit unit (family) in a household containing the household reference person (see Glossary) and the responses and reasons applied to all individuals in the household
Annex 2: Similar old questions used to impute responses and reasons for updated questions for FYE 2024
Where a family was asked the old Material Deprivation questions, responses and reasons (for old pensioner questions only) were used to inform the imputation of responses and reasons for the updated questions for FYE 2024.
FRS FYE 2024 was the last year the old questions were asked in the FRS. From April 2024, only the updated material deprivation questions will be included in the FRS. Therefore, imputation for the updated questions using similar responses and reasons (for pensioners) to old questions will not be carried out. All other imputation processes used for the updated questions will continue to be used to ensure all variables for all questions are fully populated for analysis.
Children
For the updated child questions imputation, similar old questions used were:
Table A6: Old Material Deprivation questions for children used to impute responses and reasons for updated questions
Old child question | Response variables | Updated child question | Response and reasons variables |
---|---|---|---|
Enough money to keep home in decent state of decoration | ADDDEC | Home good state of decoration/repair | MDHH4, MDHH4R1 – MDHH4R7 |
Have contents insurance | ADDINS | Home contents insurance | MDHH11, MDHH11R1 – MDHH11R7 |
Replace or repair broken major electrical goods | AF1 | Cover cost of repair or to replace appliances | MDHH3, MDHH3R1 – MDHH3R7 |
Keep up with bills and any regular debt repayments | ADDBTBL | Able to pay bills without cutting back on essentials | MDHH1, MDHH1R1 – MDHH1R7 |
Keep home warm enough | HOUSHE1 | Home adequately warm in cold weather | MDHH5 |
Eat fresh fruit and/or vegetables every day | CDEPVEG | Fresh fruit and/or vegetables every day | MDCH4, MDCH4R1 – MDCH4R7 |
Family holiday away from home for at least one week a year | CDEPHOL | Annual break away from home | MDCH11 (based on MDWA7 or MDPEN2). MDCH11R1 – MDCH11R7 |
Enough bedrooms for every child of 10 or over of a different sex to have their own bedroom | CDEPBED | Enough bedrooms for children 10+ years | MDCH9, MDCH9R1 – MDCH9R7 |
Leisure equipment | CDEPEQP | Age suitable toys/games | MDCH8, MDCH8R1 – MDCH8R7 |
Attend at least one regular organised activity a week outside school | CDEPACT | Organised weekly activity outside school | MDCH6, MDCH6R1 – MDCH6R7 |
Have friends round for tea or a snack once a fortnight | CDEPTEA | Friends round monthly | MDCH7, MDCH7R1 – MDCH7R7 |
Go to toddler group / nursery / playgroup at least once a week? | CPLAY | Toddler/nursery/playgroup | MDCH10, MDCH10R1 – MDCH10R7 |
Go on school trips | CDEPTRP | School trips | MDCH1, MDCH1R1 – MDCH1R7 |
Working-age Adults
For the updated working-age adult questions imputation, similar old questions used were:
Table A7: Old Material Deprivation questions for working-age adults used to impute responses and reasons for updated questions
Old child or working-age adult question | Response variables | Updated working-age adult question | Response and reasons variables |
---|---|---|---|
Family holiday away from home for at least one week a year | CDEPHOL (if children in the family) | Annual break away from home | MDWA7, MDWA7R1 – MDWA7R6 |
Holiday away from home one week a year not with relatives | ADDHOL (if no children in the family) | Annual break away from home | MDWA7, MDWA7R1 – MDWA7R6 |
Enough money to keep home in decent state of decoration | ADDDEC | Home in good state of decoration/repair | MDHH4, MDHH4R1 – MDHH4R6 |
Have contents insurance | ADDINS | Home contents insurance | MDHH11, MDHH11R1 – MDHH11R6 |
Replace or repair broken major electrical goods | AF1 | Cover cost of repair or to replace appliances | MDHH3, MDHH3R1 – MDHH3R6 |
Small amount of money to spend each week on yourself | AFDEP2 | Small amount of money for oneself | MDWA10, MDWA10R1 – MDWA10R6 |
Keep up with bills and any regular debt repayments | ADDBTBL | Able to pay bills without cutting back on essentials | MDHH1, MDHH1R1 – MDHH1R6 |
Keep home warm enough | HOUSHE1 | Home adequately warm in cold weather | MDHH5 |
Pensioners
For updated pensioner questions imputation, similar old questions used were:
Table A8: Old Material Deprivation questions for pensioners used to impute responses and reasons for updated questions
Old pensioner question | Response and reasons variables | Updated pensioner question | Response and reasons variables |
---|---|---|---|
At least one filling meal a day | OAMEAL, MEALNT1 – MEALNT9 | Three meals a day | MDPEN4, MDPEN4R1 – MDPEN4R7 |
Go out socially at least once a month | OAOUT, OUTNT1 – OUTNT9 | Go out socially at least monthly | MDPEN7, MDPEN7R1 – MDPEN7R7 |
See your friends or family at least once a month | OAFRND, FRNDNT1 – FRNDNT9 | See friends and family at least monthly | MDPEN8, MDPEN8R1 – MDPEN8R7 |
Take a holiday away from home for a week or more at least once a year | OAHOL, HOLNT1 – HOLNT9 | Annual break away from home | MDPEN2, MDPEN2R1 – MDPEN2R7 |
Able to replace your cooker if it broke down | OACOOK, COOKNT1 – COOKNT9 | Cover cost of repair or to replace appliances | MDHH3, MDHH3R1 – MDHH3R7 |
Home kept in a good state of repair | OAHOME, HOMENT1 – HOMENT9 | Home in good state of decoration/repair | MDHH4, MDHH4R1 – MDHH4R7 |
Heating, electrics, plumbing and drains kept in good working order | OAHEAT, HEATNT1 – HEATNT9 | Heating/electrics/plumbing in good working order | MDHH10, MDHH10R1 – MDHH10R7 |
Have a damp-free home | OADAMP, DAMPNT1 – DAMPNT9 | Home damp free | MDHH6 |
Home kept adequately warm | OAWARM, WARMNT1 – WARMNT9 | Home adequately warm in cold weather | MDHH5 |
Without cutting back on essentials, able to pay regular bills | OABILL, BILLNT1 – BILLNT9, PHONNT1 – PHONNT9 | Able to pay bills without cutting back on essentials | MDHH1 |
Access to a car or taxi if needed | OATAXI, TAXINT1 – TAXINT9 | Adequate access to reliable transport | MDHH9, MDHH9R1 – MDHH9R7 |
Able to pay an unexpected expense of £200 | OAEXPNS, OAHOWPY1 – OAHOWPY6 | Able to put money aside for unexpected expenses | MDHH2 |
Annex 3: Reasons for responding ‘No’ to updated questions
This annex presents the percentage giving each reason when responding ‘No’ to each question for child, working-age adult and pensioner questions for information. Charts exclude questions that already use the simple absence definition. The analysis used the HBAI variables where a hierarchy for reasons for responding ‘No’ has been applied to the updated question. See the HBAI variables for analysis section for more information.
Figure 22: Percentage of children by reason when responding ‘No’ to the updated Child Material Deprivation questions, FYE 2024
Figure 23: Percentage of working-age adults by reason when responding ‘No’ to the updated Working-age Adult Material Deprivation questions, FYE 2024
Figure 24: Percentage of pensioners by reason when responding ‘No’ to the updated Pensioner Material Deprivation questions, FYE 2024
Annex 4: Development of the Composite Measure of Living Standards
This annex sets out the development of the Composite Measure of Living Standards following the recommendation in the LSE Review:
For the statistical modelling, we recommend DWP does not rely on household income alone to test which thresholds are best at discriminating between deprived and non-deprived groups. We recommend the development of a composite standard of living measure which could include information on savings, debts and food security, and recognises differences in needs/costs faced by different household types. For example, single parent households or where any household member has a long-standing illness or disability.
The Composite Measure of Living Standards was developed to serve as a practical tool for use in statistical modelling. It was used to inform judgements as to where thresholds for Material Deprivation should be set, rather than to produce a comprehensive, ideal measure of Living Standards for publication.
Living Standards can be understood as a spectrum ranging from very low levels, associated with subsistence/destitution, to very high levels, associated with comfort, wealth and affluence, as set out in the diagram below.
Figure 25: The Living Standards (LS) Spectrum
Figure 25 presents the Living Standards (LS) spectrum:
- Bottom of the spectrum: Decreasing Living Standards with insufficient resources to meet basic needs: food, shelter, clothing (Destitution)
- Moving up the spectrum: Lacking what you need for an acceptable standard of living (Material Deprivation)
- Moving further up the spectrum: Sufficient resources to afford some luxuries and a wider range of choice (Acceptable standard of living)
- Towards top of the spectrum: Increasing Living Standards with increasing resources, extensive access to luxuries, greater freedom and choice
Features for the Composite Measure of Living Standards
Following a literature review, analysis of the HBAI back-series and FYE 2024 data, and discussion with the FRS Expert Advisory Group, the agreed features for the Composite Measure of Living Standards were:
A narrow definition to measure living standards
Narrow definitions tend to focus on material wellbeing or welfare. They typically relate to the extent of access to goods, services, and activities granted through material means. Broad definitions include consideration of non-material dimensions such as health, family and social life, safety, and environment contributing to an individuals’ standard of living. A narrow conceptualisation of living standards was deemed necessary due to the comparative ease of developing the measure and the data available within the FRS.
Include both direct and indirect measures of living standards
Direct measures capture actual outcomes in relation to accessing goods, services, and activities. Material deprivation is an example of a direct measure of living standards.
Indirect measures capture an individual’s material resources, especially income, which are suggestive of the likely standard of living enjoyed by members of a household.
Each measure can tell us about a different aspect of living standards. Whilst direct measures can tell us about how people actually live, indirect measures can tell us whether individuals have the means to live otherwise.
Using multiple living standards indicators
The approach to modelling optimal material deprivation thresholds is based on the Poverty and Social Exclusion PSE-UK method which used income to identify deprivation thresholds.
Under our approach, we modelled thresholds using a range of indicators individually, as well as the developed composite measure comprised of multiple living standards indicators. Models were used to identify an upper and lower bound for material deprivation thresholds for children, working-age adults and pensioners, rather than to identify a single optimal threshold. This is partly in recognition that a single ‘optimal’ threshold will not exist and thresholds emerging from statistical models will be heavily influenced by the choice of indicators against which they are judged.
The 2 indirect indicators of material resources were:
- Relative net income After Housing Costs
- Savings in the family
The 2 direct indicators of a low standard of living were:
- Living in a food insecure household
- Priority debt in the family (where families could lose their home, have their energy supply cut off, lose essential goods or go to prison if not repaid)
Under this approach, Analysis of Variance (ANOVA) and logistic regression models can be used to identify the thresholds which maximise between group differences and minimises within group differences and are therefore best at differentiating between materially deprived and non-materially deprived groups. Comparisons can be made between models using different material deprivation thresholds i.e. 1 or more items lacked, 2 or more items lacked etc.
From the ANOVA models, we are interested in the F-values as:
- F-values tell us the ratio of between group variance to within group variance in the dependent variable. We are looking for the threshold with the highest F-value, which would be the threshold where the difference in the mean of the dependent variable between each group (above/below the threshold) is greatest compared to the variability within each group
From the logistic regression we are interested in two values: the likelihood ratio Chi-square value and Cox and Snell Pseudo R-squared value
- The likelihood ratio Chi-square value compares the likelihood of being materially deprived (being above the material deprivation threshold) under the model to the likelihood under a null model (one without predictors). We are looking for the model with the highest Chi-square value, as this indicates that there is a greater difference between the observed (likelihood in our model) and expected frequencies (likelihood in the null model)
- The Cox and Snell Pseudo R-squared gives us an indication of how well the model fits the data. We want to find the model with the highest R-squared value, as this indicates that the given indicator/measure is better able to predict material deprivation when the threshold is set at the given level
We would expect that both the ANOVA and logistic regression models identify similar material deprivation thresholds, although these may change depending on the properties of the indicators used to assess the threshold.
Using a composite score of living standards
The following diagram highlights how the four indicators contribute to the composite score of living standards.
Figure 26: Diagram showing how the four indicators contribute to the composite score of living standards (LS)
Figure 26 shows:
- Lower Living Standards score:
- Indirect Measures: Very low income, in income poverty, no/negligible savings
- Direct Measures: Household food insecure (basic needs not met), behind on priority bills
- Moving between a lower and higher Living Standards score:
- Indirect Measures: Increasing incomes, not in income poverty, may have some savings
- Direct Measures: Household food secure, not behind on priority bills
- Higher Living Standards score:
- Indirect Measures: Extensive resources, evidence of high income and/or savings
- Direct Measures: Household food secure, not behind on priority bills
Alongside modelling the material deprivation thresholds using indicators individually, we also formed a composite measure which combined the four indicators into a single score.
The composite score is built on the assumption that where individuals are found to be poor across multiple indicators, we can make a more secure assertion that their living standards are low.
A very low score would mean that individuals have insufficient resources (both very low income and savings). It would also mean that there is evidence that basic needs are not consistently met (they are food insecure), and they face immediate financial difficulty (they are in arrears with priority bills).
As scores increase, people may score lower for some indicators but higher for others. Here, claims to a low standard of living are less secure.
As scores increase to the maximum, resources are extensive (both income and savings are high). There is also evidence that their most basic needs are consistently met (they are in a food secure household), and they are free from priority debt.
Calculating the composite score of living standards
The approach was modelled on the Human Development Index (HDI) methodology, which involves rescaling indicators to have a minimum value of 0 and a maximum value of 1 and then taking the mean across indicators.
Each indicator is rescaled between 0 (representing the minimum for that indicator) and 1 (representing the maximum), as presented in the calculation below.
Figure 27: Indicator score calculation
Figure 27 shows the Indicator score calculation is the actual value minus the minimum value divided by the maximum value minus the minimum value.
The composite score is the mean of the indicator scores, as presented in the calculation below:
Figure 28: Composite score calculation
Figure 28 shows the Composite score calculation is the Income indicator score plus the Savings indicator score plus the Household Food Security indicator score plus the Debt indicator score and divided by 4.
Iterations for analysis
During the modelling of material deprivation thresholds, multiple model iterations were analysed. These iterations included modelling thresholds based on each indicator independently, as well as different versions of the composite measure (for instance, applying different weights to the component indicators).
The two iterations presented in this report represent a lower and higher case scenario in relation to the thresholds identified:
- Iteration 1: Score: 0 to 1 (very low standard of living to higher standard of living)
- Iteration 2: Score: 0 to 1 (very low standard of living to moderate standard of living or more). For this indicator, anyone with savings or income above the median are given the maximum score of 1
Each indicator is given equal weight.
Iteration 1
Iteration 1 has the following scores:
- Score: 0 to 1 (very low standard of living to higher standard of living)
- Score of 0 = in the bottom percentile for income (after equivalisation and housing/disability cost deductions), and in the bottom percentile for savings, and living in a household which has been in priority debt in the last 30 days, and has very low household food security status
- Score of 1 = in the top percentile for income and savings, and living in a household which has been free of priority debt in the past 30 days, and has high food security status
The minimum and maximum values for Iteration 1 are set out in the following table.
Table A9: Minimum and maximum values for iteration 1
Indicator | Description | Minimum Value | Maximum Value |
---|---|---|---|
Income Percentile | Income percentile is the individual’s percentile rank for net equivalised household income (after housing costs) excluding income from DLA, PIP and AA. | 0 | 99 |
Savings Percentile | Savings percentile is the individual’s percentile rank for total savings within the (family) benefit unit. | 8 | 99 |
Household Food Security Status | Household food security status is a categorical variable where a value of 0 indicates very low food security, 1 indicates low food security, 2 indicates marginal food security, and 3 indicate high food security (reordered version of the original FOODSEC_STATUS variable). | 0 | 3 |
Priority Debt | A flag indicating whether the individual lives in a household which is free of ‘priority debt’. This includes being behind with electricity/gas/other fuel bills, council tax, and rent or mortgage payments. The lowest value (0) indicates being in priority debt, whilst (1) indicates being free of priority debt. | 0 | 1 |
Iteration 2
For Iteration 2, scores were capped, so that anyone with savings or income above the median are given the maximum score of 1 for this indicator. This changes the nature of the measure, as it gives a score of low living standards between 0 and 1, with a score of 1 indicating a moderate standard of living or better. This leads to a large amount of ‘1’ scores but means the variation in scores is between low and moderate living standards rather than the whole spectrum.
The scores are:
- Score: 0 to 1 (very low standard of living to moderate standard of living)
- Score of 0 = in the bottom percentile of household incomes (equivalised, AHC, with disability benefits deducted), and in the bottom percentile of savings, and living in a household which has been in priority debt in the last 30 days, and with very low food security status
- Score of 1 = in the top 50% of household incomes and savings and living in a household which is free of priority debt in the last 30 days, and with high food security status
The minimum and maximum values for Iteration 2 are set out in the following table.
Table A10: Minimum and maximum values for iteration 2
Indicator | Description | Minimum Value | Maximum Value |
---|---|---|---|
Income Percentile | Income percentile is the individual’s percentile rank for net equivalised household income (after housing costs) excluding income from DLA, PIP and AA. | 0 | 49 |
Savings Percentile | Savings percentile is the individual’s percentile rank for total savings within the family (benefit unit). | 8 | 49 |
Household Food Security Status | Household food security status is a categorical variable where a value of 0 indicates very low food security, 1 indicates low food security, 2 indicates marginal food security, and 3 indicate high food security (reordered version of the original FOODSEC_STATUS variable). | 0 | 3 |
Priority Debt | A flag indicating whether the individual lives in a household which is free of ‘priority debt’. This includes being behind with electricity/gas/other fuel bills, council tax, and rent or mortgage payments. The lowest value (0) indicates being in priority debt, whilst (1) indicates being free of priority debt. | 0 | 1 |
The range of thresholds identified by these models are highlighted in the following section. These were used to narrow down a range of potential thresholds from which decisions were informed by subsequent analysis and judgement.
Threshold Analysis
ANOVA and logistic regression analysis was carried out for each iteration and for both a financial constrained lack measure and wider constrained lack measure. Analysis was carried for the children, working-age adults and pensioners questions using FYE 2024 data.
The following tables present the outputs for the ANOVA F-value, logistic regression likelihood ratio Chi-square value (LR Chi-sq), Cox and Snell Pseudo R-squared value (C & S R2) and the percentage in material deprivation, with the highest values highlighted in bold font.
Table A11: Statistical analysis outputs for children for FYE 2024 for a Financial Constrained Lack definition
Iteration 1 F-value | Iteration 1 LR Chi-sq | Iteration 1 C&S R2 | Iteration 2 F-value | Iteration 2 LR Chi-sq | Iteration 2 C&S R2 | Percentage in Material Deprivation | |
---|---|---|---|---|---|---|---|
1+ | 3489.7 | 3333.5 | 0.355 | 3150.1 | 3056.1 | 0.331 | 64 |
2+ | 5614.3 | 4292.6 | 0.431 | 5430.9 | 3993.7 | 0.409 | 49 |
3+ | 6437.9 | 4277.5 | 0.430 | 6640.8 | 4127.9 | 0.419 | 37 |
4+ | 5975.2 | 3712.9 | 0.386 | 6349.3 | 3691.2 | 0.385 | 28 |
5+ | 5111.1 | 3138.0 | 0.338 | 5328.6 | 3115.1 | 0.336 | 20 |
6+ | 3591.3 | 2308.9 | 0.262 | 3735.1 | 2319.5 | 0.263 | 15 |
7+ | 2808.1 | 1852.0 | 0.216 | 2886.1 | 1858.5 | 0.217 | 11 |
8+ | 2019.9 | 1382.7 | 0.166 | 2064.2 | 1390.1 | 0.167 | 7 |
Table A12: Statistical analysis outputs for children for FYE 2024 for a Wider Constrained Lack definition
Iteration 1 F-value | Iteration 1 LR Chi-sq | Iteration 1 C&S R2 | Iteration 2 F-value | Iteration 2 LR Chi-sq | Iteration 2 C&S R2 | Percentage in Material Deprivation | |
---|---|---|---|---|---|---|---|
1+ | 2753.2 | 2802.1 | 0.308 | 2474.8 | 2597.3 | 0.289 | 69 |
2+ | 4697.0 | 3846.3 | 0.397 | 4448.7 | 3564.7 | 0.374 | 53 |
3+ | 6122.3 | 4283.4 | 0.431 | 6132.1 | 4058.4 | 0.414 | 42 |
4+ | 6297.5 | 3989.4 | 0.408 | 6635.4 | 3922.4 | 0.403 | 31 |
5+ | 5616.1 | 3462.2 | 0.366 | 5868.4 | 3419.1 | 0.362 | 24 |
6+ | 3943.8 | 2527.9 | 0.283 | 4098.3 | 2525.7 | 0.283 | 17 |
7+ | 3150.2 | 2062.2 | 0.238 | 3252.9 | 2067.1 | 0.238 | 13 |
8+ | 2313.7 | 1564.9 | 0.186 | 2373.8 | 1572.5 | 0.187 | 9 |
Table A13: Statistical analysis outputs for working-age adults for FYE 2024 for a Financial Constrained Lack definition
Iteration 1 F-value | Iteration 1 LR Chi-sq | Iteration 1 C&S R2 | Iteration 2 F-value | Iteration 2 LR Chi-sq | Iteration 2 C&S R2 | Percentage in Material Deprivation | |
---|---|---|---|---|---|---|---|
1+ | 5060.8 | 5418.0 | 0.242 | 4109.4 | 4645.0 | 0.211 | 67 |
2+ | 9634.6 | 8242.8 | 0.344 | 8255.4 | 7115.7 | 0.305 | 48 |
3+ | 13004.9 | 9487.6 | 0.384 | 11930.5 | 8436.5 | 0.350 | 36 |
4+ | 14274.0 | 9373.2 | 0.381 | 13675.2 | 8498.3 | 0.352 | 28 |
5+ | 15267.5 | 9202.2 | 0.375 | 15192.3 | 8504.0 | 0.353 | 23 |
6+ | 14617.4 | 8395.3 | 0.349 | 14922.6 | 7902.3 | 0.332 | 18 |
7+ | 13043.6 | 7317.8 | 0.312 | 13523.3 | 6996.1 | 0.301 | 14 |
8+ | 10740.2 | 6056.8 | 0.266 | 11257.6 | 5880.5 | 0.260 | 11 |
Table A14: Statistical analysis outputs for working-age adults for FYE 2024 for a Wider Constrained Lack definition
Iteration 1 F-value | Iteration 1 LR Chi-sq | Iteration 1 C&S R2 | Iteration 2 F-value | Iteration 2 LR Chi-sq | Iteration 2 C&S R2 | Percentage in Material Deprivation | |
---|---|---|---|---|---|---|---|
1+ | 3274.8 | 3801.6 | 0.177 | 2718.9 | 3399.7 | 0.160 | 76 |
2+ | 7655.7 | 7173.2 | 0.307 | 6573.7 | 6317.6 | 0.276 | 56 |
3+ | 11191.2 | 8886.5 | 0.365 | 10016.7 | 7859.6 | 0.331 | 42 |
4+ | 13422.5 | 9417.6 | 0.382 | 12504.5 | 8429.2 | 0.350 | 33 |
5+ | 14813.0 | 9422.7 | 0.382 | 14432.6 | 8615.8 | 0.356 | 27 |
6+ | 14934.5 | 8897.1 | 0.366 | 14988.8 | 8276.7 | 0.345 | 21 |
7+ | 14700.3 | 8305.8 | 0.346 | 15104.0 | 7847.9 | 0.331 | 17 |
8+ | 12436.9 | 7019.6 | 0.302 | 12985.4 | 6758.4 | 0.292 | 14 |
Table A15: Statistical analysis outputs for pensioners for FYE 2024 for a Financial Constrained Lack definition
Iteration 1 F-value | Iteration 1 LR Chi-sq | Iteration 1 C&S R2 | Iteration 2 F-value | Iteration 2 LR Chi-sq | Iteration 2 C&S R2 | Percentage in Material Deprivation | |
---|---|---|---|---|---|---|---|
1+ | 1643.2 | 1502.8 | 0.160 | 1263.8 | 1179.2 | 0.128 | 45 |
2+ | 2449.5 | 1969.4 | 0.205 | 2118.5 | 1559.7 | 0.166 | 24 |
3+ | 2546.7 | 1931.4 | 0.201 | 2388.9 | 1550.0 | 0.165 | 16 |
4+ | 2428.5 | 1765.5 | 0.186 | 2474.0 | 1463.9 | 0.157 | 11 |
5+ | 2100.0 | 1478.6 | 0.158 | 2243.0 | 1260.7 | 0.136 | 8 |
6+ | 1816.7 | 1238.3 | 0.134 | 2029.2 | 1093.3 | 0.119 | 6 |
7+ | 1524.0 | 1004.8 | 0.110 | 1728.2 | 903.2 | 0.100 | 4 |
8+ | 1318.6 | 834.1 | 0.093 | 1500.5 | 755.0 | 0.084 | 3 |
Table A16: Statistical analysis outputs for pensioners for FYE 2024 for a Wider Constrained Lack definition
Iteration 1 F-value | Iteration 1 LR Chi-sq | Iteration 1 C&S R2 | Iteration 2 F-value | Iteration 2 LR Chi-sq | Iteration 2 C&S R2 | Percentage in Material Deprivation | |
---|---|---|---|---|---|---|---|
1+ | 1218.6 | 1196.0 | 0.130 | 856.7 | 900.5 | 0.100 | 59 |
2+ | 2021.5 | 1750.0 | 0.184 | 1646.0 | 1394.7 | 0.150 | 35 |
3+ | 2461.5 | 1963.4 | 0.204 | 2207.6 | 1591.1 | 0.169 | 23 |
4+ | 2393.6 | 1815.1 | 0.190 | 2300.0 | 1484.8 | 0.159 | 15 |
5+ | 2163.6 | 1578.8 | 0.168 | 2199.3 | 1317.6 | 0.142 | 10 |
6+ | 1927.5 | 1366.1 | 0.147 | 2058.6 | 1176.0 | 0.128 | 7 |
7+ | 1661.1 | 1138.3 | 0.124 | 1856.5 | 1014.6 | 0.111 | 6 |
8+ | 1411.6 | 931.0 | 0.103 | 1588.4 | 836.4 | 0.093 | 4 |
Range of Material Deprivation Thresholds
The statistical analysis from the Composite Measure of Living Standards identified the following optimum range of Material Deprivation thresholds:
- Financial constrained lack definition:
- Children: Between 2 or more items lacked and 4 or more items lacked
- Working-age adults: Between 4 or more items lacked and 6 or more items lacked
- Pensioners: Between 2 or more items lacked and 4 or more items lacked
- Wider constrained lack definition:
- Children: Between 3 or more items lacked and 4 or more items lacked
- Working-age adults: Between 5 or more items lacked and 7 or more items lacked
- Pensioners: Between 3 or more items lacked and 5 or more items lacked
These ranges were used as a starting point in analysis for defining the Material Deprivation measures and setting the Material Deprivation thresholds as set out in the main body of this report.
Annex 5: HBAI variables for analysis
The following tables set out the description and definitions of the HBAI variables used for analysis for the updated measures. The codes for the definitions are then listed. The HBAI variables use a hierarchy for reasons for responding ‘No’ to the updated question. See the HBAI variables for analysis section for more information.
Table A17: Child questions: Description and definition of HBAI variables used for analysis
HBAI Variable Name | Description | Definition |
---|---|---|
MDCH1_HBAI | School trips | Financial constrained lack (some children only) |
MDCH2_HBAI | Place for homework | Financial constrained lack (some children only) |
MDCH3_HBAI | Three meals a day | Financial constrained lack |
MDCH4_HBAI | Fresh fruit and/or vegetables every day | Financial constrained lack |
MDCH5_HBAI | Enough clothes feel comfortable wearing | Simple absence |
MDCH6_HBAI | Organised weekly activity outside school | Financial constrained lack (some children only) |
MDCH7_HBAI | Friends round monthly | Financial constrained lack |
MDCH8_HBAI | Age suitable toys/games | Financial constrained lack |
MDCH9_HBAI | Enough bedrooms for children 10+ years | Simple absence (some children only) |
MDCH10_HBAI | Toddler/nursery/playgroup at least weekly | Financial constrained lack |
MDCH11_HBAI | Annual break away from home | Financial constrained lack |
The decodes for the descriptions are:
Financial constrained lack (some children only):
0 = Question not applicable to family with children.
1 = Have item.
2 = We/I do not have the money for this.
3 = This is not a priority on my/our current income.
4 = Health or disability prevents this.
5 = We/I do not want/need this.
6 = It is not relevant to me/us.
7 = Other reason.
-9 = Not applicable as no children in family.
If the response is 2 or 3, the item is lacked due to a financial constraint.
Financial constrained lack:
1 = Have item.
2 = We/I do not have the money for this.
3 = This is not a priority on my/our current income.
4 = Health or disability prevents this.
5 = We/I do not want/need this.
6 = It is not relevant to me/us.
7 = Other reason.
-9 = Not applicable as no children in family.
If the response is 2 or 3, the item is lacked due to a financial constraint.
Simple absence:
1 = Yes.
2 = No.
If the response is 2, the item is lacked.
Table A18: Working-age adult questions: Description and definition of HBAI variables used for analysis
HBAI Variable Name | Description | Definition |
---|---|---|
MDWA1_HBAI | Regular money worries at the end of the month | Simple absence (reverse coded) |
MDWA2_HBAI | Regular payments to workplace or private pension | Financial constrained lack |
MDWA3_HBAI | Three meals a day | Financial constrained lack |
MDWA4_HBAI | Fresh fruit and/or vegetables every day | Financial constrained lack |
MDWA5_HBAI | Appropriate clothes for work/job interview | Financial constrained lack |
MDWA6_HBAI | Regular dental appointments | Financial constrained lack |
MDWA7_HBAI | Annual break away from home | Financial constrained lack |
MDWA8_HBAI | Go out socially at least monthly | Financial constrained lack |
MDWA9_HBAI | See friends and family at least monthly | Financial constrained lack |
MDWA10_HBAI | Small amount of money for oneself | Financial constrained lack |
The decodes for the descriptions are:
Financial constrained lack:
1 = Have item.
2 = We/I do not have the money for this.
3 = This is not a priority on my/our current income.
4 = Health or disability prevents this.
5 = We/I do not want/need this.
6 = It is not relevant to me/us.
7 = Other reason.
-9 = Not applicable as individual is not a working-age adult.
If the response is 2 or 3, the item is lacked due to a financial constraint.
Simple absence (reverse coded):
1 = No.
2 = Yes.
If the response is 2 (Yes), the item is lacked.
Table A19: Pensioner questions: Description and definition of HBAI variables used for analysis
HBAI Variable Name | Description | Definition |
---|---|---|
MDPEN1_HBAI | Regular money worries at the end of the month | Simple absence (reverse coded) |
MDPEN2_HBAI | Annual break away from home | Financial constrained lack |
MDPEN3_HBAI | Fresh fruit and/or vegetables every day | Financial constrained lack |
MDPEN4_HBAI | Three meals a day | Financial constrained lack |
MDPEN5_HBAI | Regular dental appointments | Financial constrained lack |
MDPEN6_HBAI | Small amount of money for oneself | Financial constrained lack |
MDPEN7_HBAI | Go out socially at least monthly | Financial constrained lack |
MDPEN8_HBAI | See friends and family at least monthly | Financial constrained lack |
The decodes for the descriptions are:
Financial constrained lack:
1 = Have item.
2 = We/I do not have the money for this.
3 = This is not a priority on my/our current income.
4 = Health or disability prevents this.
5 = We/I do not want/need this.
6 = It is not relevant to me/us.
7 = Other reason.
-9 = Not applicable as individual is not a pensioner.
If the response is 2 or 3, the item is lacked due to a financial constraint.
Simple absence (reverse coded):
1 = No.
2 = Yes.
If the response is 2 (Yes), the item is lacked.
Table A20: Household questions: Description and definition of HBAI variables used for analysis
HBAI Variable Name | Description | Definition |
---|---|---|
MDHH1_HBAI | Able to pay bills without cutting back on essentials | Simple absence |
MDHH2_HBAI | Able to put money aside for unexpected expenses | Simple absence |
MDHH3_HBAI | Cover cost of repair or to replace appliances | Financial constrained lack |
MDHH4_HBAI | Home in good state of decoration/repair | Financial constrained lack |
MDHH5_HBAI | Home adequately warm in cold weather | Simple absence |
MDHH6_HBAI | Home damp free | Simple absence |
MDHH7_HBAI | Reliable access to internet at home | Financial constrained lack |
MDHH8_HBAI | Access to computer/tablet | Financial constrained lack |
MDHH9_HBAI | Adequate access to reliable transport | Financial constrained lack |
MDHH10_HBAI | Heating/electrics/plumbing in good working order | Simple absence |
MDHH11_HBAI | Home contents insurance | Financial constrained lack |
The decodes for the descriptions are:
Financial constrained lack:
1 = Have item.
2 = We/I do not have the money for this.
3 = This is not a priority on my/our current income.
4 = Health or disability prevents this.
5 = We/I do not want/need this.
6 = It is not relevant to me/us.
7 = Other reason.
If the response is 2 or 3, the item is lacked due to a financial constraint.
Simple absence:
1 = Yes.
2 = No.
If the response is 2, the item is lacked.
The full list of new HBAI variables that are included in the harmonised HBAI dataset will be available in the Variable Guide at the UK Data Service. A suite of documentation and guidance is also published alongside the dataset. The underlying, original FRS variables will be published in the FRS Benunit dataset as part of the suite of FRS FYE 2024 datasets at the UK Data Service.
-
McKay, S. (2008) ‘Measuring material deprivation among older people: Methodological study to revise the Family Resources Survey questions’, Working Paper No 54, Department for Work and Pensions. ↩ ↩2 ↩3
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Legard, R., Gray M. and Blake, M. (2008) ‘Cognitive testing: older people and the FRS material deprivation questions’, Working Paper No 55, Department for Work and Pensions. ↩
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Guio, A-C., Gordon, D. and Marlier, E. (2012) ‘Measuring material deprivation in the EU: Indicators for the whole population and child specific indicators’, Eurostat Methodologies and Working Papers, Luxembourg: Publication Office of the EU. ↩