Understanding Society User Support

Many thanks for your enquiry. The Understanding Society team is looking into it and we will get back to you as soon as we can.

Best wishes,
Stephanie Auty - Understanding Society User Support Officer

Dear David,

Apologies for the delay in this response.

There are three sources of change between the latest release and the previous release.

1. We did not impute missing incomes for the new IEMB sample at the wave 6 release, but did do so for waves 6 and 7 at the wave 7 release.

2. Our imputation procedures for missing data impute for all waves together so as to preserve the relationships between variables for the same individual across time. This means that previous wave imputations will be replaced and it is probable that the new value will be different from the old (though overall distributions and relationships should be preserved). This means that any respondent individuals with missing data on any component is likely to have a different estimated income compared with the last release, and any household containing proxy respondents or adult non-respondents, whose income will be imputed, will have a different total.

3. We did a considerable amount of work with the Department for Work and Pensions (DWP) to review and improve our income derived variable code. This resulted in a number of changes to the computation of income variables. The changes covered the following issues:
- A better estimation of contributions to employer organised pension schemes
- Correction of the estimate of when respondents reached state pension age and therefore ceased making national insurance contributions
- A different basis for determining whether participants were partially contracted out from NI contributions
- Inclusion of Class 2 NI contributions for the self-employed
- Inclusion of the taper in the personal allowance for high earners
- Inclusion of a deflator for self-employed profits to bring this to current earnings/price levels (profits are normally reported one or more years in arrears).
- Correction of the calculation of monthly amounts for a small number of employees with non-standard period of receipt
- Modification of the estimation code for converting net to gross amounts: this is an iterative process and the number of iterations was increased.
- Modifications to the calculation of Child benefit receipts to take better account of changes in rates at which this was paid.

These changes together led to what were normally rather small changes in estimated gross and net income for a large proportion of cases with labour income.

Best wishes,
Stephanie Auty - Understanding Society User Support Officer