Computation of the Gini Coefficient

Ms Irene Ng Phek Hoong asked the Minister for Trade and Industry (a) if he can provide the data used in the computation of the Gini coefficient and key household income trends for citizens; and (b) what is the Gini coefficient for the last five years, excluding permanent residents from the computation.

Among citizen employed households, the median monthly household income from work per household member increased from $1,860 in 2011 to $1,990 in 2012. This represents a 7.2% increase in nominal terms, and 2.4% in real terms.

Over a longer period, from 2007 to 2012, the cumulative increase in median monthly household income from work per household member for citizen employed households was 13.9% in real terms, higher than the 7.9% in the preceding five-year period. Most deciles of citizen employed households saw higher growth in real monthly household income from work per household member between 2007 and 2012, compared to the preceding five-year period.

In 2012, the Gini coefficient for citizen employed households was 0.4671. After adjusting for Government transfers and taxes, the Gini coefficient declined by 0.022 to 0.445 in 2012, reflecting the redistributive effect of Government transfers. The Gini coefficient (both before and after adjusting for Government transfers and taxes) for citizen employed households was also lower than that for resident employed households in 2012, indicating lower income inequality among citizen employed households. The coefficients for the last five years are provided in Exhibit A1.

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