Financial Stress
Last Updated:
2008
Update Frequency:
every 3 years Indicator Rationale
The most common approach to measuring and defining poverty is the low income approach. It has been suggested that an alternative approach, or one that could be combined with measures of low income in order to improve measurement of economic well-being, is to assess poverty and disadvantage by measuring "financial stress". A symptom of "financial stress" is the inability to raise a moderate sum of money to deal with an emergency of the kind created by the need to pay an unexpected bill.
Data Source
Indicators of Community Strength data were collected in telephone surveys conducted in 2008 and involved 450 individuals over the age of 18 in each of the 79 Local Government Areas (LGAs) across Victoria. These data were collected as part of the Victorian Population Health Survey which was conducted at the LGA level for the first time in 2008.
The Indicators of Community Strength data were previously collected in 2006 and 2004 by the then Department of Victorian Communities. However, the Indicators of Community Strength and Victorian Population Health Surveys were combined in 2008 to reduce the burden of surveying on Victorian communities and to give the indicators an institutional home into the future. The Victorian Population Health Survey has a substantially better survey methodology that includes a larger sample, the use of primary approach letters, interpreters and a different method of calculation. This means the 2008 Indicators of Community Strength data are not comparable with the previous 2004 and 2006 data. Therefore, the earlier data have been removed from Community Indicators Victoria at the request of the Victorian Department of Planning and Community Development.
Measure
People Who Could Raise 2000 Dollars in Two Days in an Emergency: expressed as a percentage of the adult population.
For 2008, the response category "Yes" has been used to derive the measure.
Survey Question
Could you raise $2000 within two days in an emergency?
2008 response categories - Yes; No
A question of this nature may be particularly sensitive to differences in methodologies between particular surveys. DPCD has noted the difference between the total Victorian result for this question from the 2004 DPCD survey (63%) and that from the Victorian Population Health Survey (VPHS) (82% in the corresponding survey). It is thought that the longer VPHS may allow more time for the interviewer to establish trust with the respondent before asking what may be a sensitive question for some respondents.
References
Long, S (2006). Transcript from The World Today, ABC Local Radio
Melbourne Institute of Applied Economic and Social Research, Inequalities of Aussie Wealth. September 2005. Issue 9.