The
Development Planning Unit
Government of the British Virgin Islands

Household Income and Expenditure Survey 1996

In the territory there were socio-economic changes in eighties and nineties. Since the first survey in 1983, there were sustained and moderate price increases. In addition public servants received salary increases during the period. Therefore a survey was needed to review the changes. The 1983 survey covered only two weeks and non-response rate was very high so there was a need for a comprehensive survey of household incomes and expenditures spread over a longer period to cover seasonal variations and with the whole BVI coverage.

The Household Income and Expenditure Survey 1994-1995 was launched in July 1994. The survey was executed by the Development Planning Unit (DPU) in collaboration with the Commonwealth Fund for Technical Cooperation (CFTC) and the National Household Survey Capability Programme (NHSCP) of the United Nations. During the course of 1994 and 1995, approximately 300 households were selected randomly from the Enumeration Districts of the BVI according to the 1991 round of Population and Housing Census. 

The main objectives of this survey were as follows:

• To obtain weights and other useful data for planning the collection of statistics or the construction or revision of consumer price indices;

• To furnish data on levels and distribution of household income, consumption and expenditure that may be used for the analysis of changes in levels of living over time and disparities among households in various socio-economic groups, geographic areas, urban and rural districts;

• To provide data for assessing the impact of household living conditions of existing or proposed economic or social programmes;

• To provide data for compiling household accounts in the system of national accounts and balances; and

• To provide data for estimating the distributive effects of direct or indirect taxation and social benefits for formulating fiscal policies and studying the incidence of taxation.

COVERAGE
The Survey of Household Expenditure was designed to cover the whole of the British Virgin Islands. There was adequate coverage for all enumeration districts. In the sample design each household had an equal chance of selection and the number of households selected in any district was proportional to its population. Since the survey was one of private households, all persons living in hotels, boarding houses, homes for the aged and in institutions were excluded.

CHOICE OF SAMPLE
The various considerations and alternatives were examined with respect to the choice of sample to be used for selecting households in the survey. After careful examination of the various options, it was decided in the interest of economizing on the use of scarce financial and technical resources and time, to use systematic sampling . In this approach all households in the British Virgin Islands were listed and 5 percent of them were selected. In the selection process a random number between 1 and 20 was selected and thereafter every twentieth household on the list within the ED were included in the sample.

HIGHLIGHTS

• The overall response rate was 76%, which was not bad considering the nature of the survey.

In the UK, some 10,000 households are selected each year to take part in the Family Expenditure Survey and about 70% co-operate fully.

• Average household size was just over 3 persons per household. The proportion of one adult household was one-fourth.

• 36% of households were headed by women.

• 44% of occupied dwelling units were apartment or flat, followed by undivided private house (43%).

• Almost half of the households were living in leased or rented dwelling units. The proportion of Owner occupied was 44%.

• 63% of the owner-occupied homes were not insured.

• 95% of dwelling units had flush type of toilet facility compared with 90% in 1991.

• 85% of dwelling units had Water supply-piped in house/yard, compared with 77% in 1991.

• 99% of dwelling units had electricity and refrigerator.

• 97% had television compared to 87.5% in 1991.

• Over 84% had telephone facility.

• Only 4% had air conditioner.

• The proportion of expenditure on food was 27%.

HOUSEHOLD EXPENDITURE
The household expenditure in details was reported by 195 households out of 218 who were covered for the ‘ household schedule ’ . The imputed annual expenditure of all households in the sample by major groups are shown in the following table. The percentage distribution of group expenditure was calculated from these data. The average annual per household expenditure was calculated by dividing the ‘Annual Expenditure of all households in sample’ by number of households in the sample (195). The monthly figure is simply derived by dividing annual figure by 12.

Average Annual/ Monthly Household Expenditure

We could use the above figures and estimate the following:

Final consumption expenditure of households during survey period 1994-95 as $165million. Average per capita consumption (during the same period) = $ 8,500 per annum.

HOUSEHOLD INCOME
Information received for income was in several cases incomplete or not stated. Only 326 individuals belonging to 185 households reported income. The total gross income reported was estimated as $ 5,111,279. Therefore the following were calculated based on the above information.

Average Monthly Household Income of $ 2,302 in 1994/95 was 3.8 times of $ 605 reported in 1983 survey. Average household expenditure per month of $ 2,115 was 1.5 times of $ 1,439 reported in 1983. It appears that income in 1983 survey was highly underreported, because it was not even half of the average expenditure. If we apply the inflation during the period 1983 to 1995, which was in the range of 40% to average expenditure of $ 1,439, we get $ 2,015. This means that for the same basket of goods and services as in 1983, it costed around $ 2,015 in early 1995. The average expenditure of $ 2,115 as reported in 1994/95 survey was 5% higher and it was for a different consumption basket (1994/95).

AVERAGE ANNUAL HOUSEHOLD INCOME BY INCOME GROUPS

As shown in the above table, Average Annual Household Income was $ 27,629. The median income and the modal income were calculated as $ 20,687 and $ 19,287 respectively. If we disregard the highest and the lowest income groups in order to exclude extreme values, the average annual household income was $ 24,581. The income distribution suggests inequality. Households with income $ 10,000 or less were 18.3% but there share in total income was 4.6%. Households with income $ 50,000 or more constituted 13.5% but there share in total income was 38%.

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