Latvia

Title: Household Budget Survey

GENERAL INFORMATION AND BASIC DEFINITIONS

1. Background

Further information is available from Central Statistical Bureau of Latvia of Lacplesa str 1, Riga, LV-1301, Republic of Latvia, phone: 371 73 66998, fax: 371 78 30137, e-mail: isparite@cbs.lv.
Data have been collected by household survey since 1926.

2. Purpose and coverage

The following purposes are considered to be very important or of some importance:

• to obtain weights for consumer price index
• to estimate household expenditure for national accounts
• to study the general structure of household incomes/expenditures
• to study income/expenditure patterns of disadvantaged groups, including pensioner households, single parent households, etc
• to study income/expenditure disparities among socio-economic groups
• to study consumer behaviour among socio-economic groups
• for general poverty and/or income distribution studies
• for market research purposes
• to estimate food consumption in private household

Lesser importance is attached to:

• to study effects on income and expenditure of policy changes, especially tax changes

Geographic coverage: National without any specific geographic areas excluded.

Population coverage:
The following types of household are included in the data collection:

• one person private households
• private households with more than one person
• households of other foreigners in the country
• armed forces residing in private housing outside military base

The following types of household are excluded in the data collection:

• those in collective housing (such as long term hospitals, prisons, monasteries, military quarters)
• non-resident households of nationals (households of nationals located abroad)
• diplomatic households in the country
• armed forces residing in private housing within military base
• nomadic and other households difficult to reach: homelessness

Units: Dwelling units are not used in the sample selection.

Data are recorded for the household unit which is characterised by:

• one person units
• two or more people living together:
  • sharing a common budget for (at least) food and housing expenditures
• aperson or group of persons related to each other or linked by other ties

Unit members: ¹ Usual residents temporarily living away from the dwelling are included, if away continuously for less than 1 months. Visitors (not usual residents) temporarily living in the dwelling are not included as unit members. Domestic staff living in same dwelling/compound are not included in the unit. Renters living in same dwelling/compound are included in the unit. Boarders living in same dwelling/compound are not included in the unit.

Head of unit: ²
The concept of head of household/other unit is used in this survey and is characterised by:

• acknowledged as such by other household/unit members

3. Reference periods

The time period to which income and/or expenditure statistics refer when released/published is from 01/02 to 12/02. These data are collected in the period from 01/02 to 12/02. This survey is conducted continuously. The statistics are published annually.

SURVEY METHODOLOGY

4. Sample design

The Primary, Secondary and Ultimate Sampling Units are enumeration area/district, address and household respectively.

Stratification:
Areas/districts were stratified using the following criteria:

• rural/urban

The sampling frames for the Primary Sampling Unit (PSU) and Ultimate Sampling Unit (USU) were the list of Census enumeration areas and both, the master sample of households & a set of administrative registers respectively. Primary Sampling Units (PSU) were selected using probability proportional to size. The sample size was 4000 households or other units. The overall response rate for the survey was 74 percent. Errors/biases were minimized by using an updated sampling frame, non -response adjustment methods(calibration by using CLAN).

Enumeration procedure: Enumeration uses a single round survey design in which each reporting unit is enumerated only once. The sample is not divided into representative sub-samples. No action is taken to select a smaller set of reporting units for more detailed questioning.

DATA COLLECTION, CONCEPTS, DEFINITIONS AND CLASSIFICATIONS

5. Income data

Income data are collected. Receipts do not have to be regular and recurring to be considered as income. Income includes receipts resulting from the sale or reduction of assets and/or from incurring liabilities are included in income. Income excludes receipts that are not currently available to the unit.

The following receipts are collected separately:

• wages and salaries
• employee income in-kind provided free or subsidized: housing
• employee income in-kind provided free or subsidized: meals
• employee income in-kind provided free or subsidized: other goods or services (health,education,transport services.)
• profit/loss from unincorporated enterprises (mixed income)
• drawing for own use from unincorporated enterprises³
• goods produced for own consumption , net of inputs
• interest received
• dividends
• rentals (payment received for produced assets e.g. house) , net of expenses
• rents (payment received for un-produced assets e.g. land)
• royalties
• retirement pensions from compulsory social security schemes
• other pensions
• unemployment benefits
• family-related allowances⁴
• sickness benefits
• invalidity benefits
• education-related allowances
• housing allowances
• survivors benefits
• other social insurance benefits
• other social assistance benefits
• regular support received from non-profit institutions serving households: cash, e.g. scholarships
• regular inter-household transfers received from: family, e.g. alimony, child/parental support
• social transfers in kind: medical services
• social transfers in kind: public education
• social transfers in kind: transport subsidies
• social transfers in kind: others

The following receipts are collected but not separately:

• cash bonuses and gratuities
• commissions and tips
• remuneration for time not worked, e.g. leave pay
• termination and redundancy payments
• employee income in-kind provided free or subsidized: goods or services produced by employer
• regular pensions/annuities from schemes to which employee does not contribute
• old age benefits
• medical reimbursements
• regular inter-household transfers received from: regular inheritances or trusts
• regular inter-household transfers received from: regular cash gifts

The following receipts are not collected:

• employer social security contributions , excluded due to measurement problems
• employee social security contributions , excluded due to measurement problems
• employee income in-kind provided free or subsidized: car/transportation , excluded due to measurement problems
• services produced for own consumption , excluded due to measurement problems
• goods produced for barter , excluded due to measurement problems
• services produced for barter , excluded due to measurement problems
• stock consumed from unincorporated enterprise , excluded due to measurement problems
• services from owner-occupied dwellings , excluded due to measurement problems
• services from other consumer durables (net) , excluded due to measurement problems
• free government dwelling , excluded due to measurement problems
• subsidized government dwelling , excluded due to measurement problems
• food subsidies , excluded due to measurement problems
• regular support received from non-profit institutions serving households: goods and services , excluded due to measurement problems
• regular support received from non-profit institutions serving households: free dwelling , excluded due to measurement problems
• regular support received from non-profit institutions serving households: subsidized dwelling , excluded due to measurement problems
• regular inter-household transfers received from: regular in-kind gifts , excluded for other reasons: data are registered in household purchased gifts
• regular inter-household transfers received from: free dwelling , excluded due to measurement problems
• regular inter-household transfers received from: subsidized dwelling , excluded due to measurement problems
• regular inter-household transfers received from: regular free services , excluded due to measurement problems
• social transfers in kind: cultural and recreational services , excluded due to measurement problems

The following receipts are classified as income from paid employment:

• wages and salaries
• cash bonuses and gratuities
• commissions and tips
• remuneration for time not worked, e.g. leave pay
• termination and redundancy payments
• employee income in-kind provided free or subsidized: housing
• employee income in-kind provided free or subsidized: meals
• employee income in-kind provided free or subsidized: goods or services produced by employer
• employee income in-kind provided free or subsidized: other goods or services (health,education,transport services.)

The following receipts are classified as income from self-employment:

• profit/loss from unincorporated enterprises (mixed income)
• drawing for own use from unincorporated enterprises³
• goods produced for own consumption , net of inputs

The following receipts are classified as property income:

• interest received
• dividends
• rentals (payment received for produced assets e.g. house) , net of expenses
• rents (payment received for un-produced assets e.g. land)
• royalties

The following receipts are classified as employment-related transfer income:

• retirement pensions from compulsory social security schemes
• other pensions
• unemployment benefits
• sickness benefits
• other social insurance benefits

The following receipts are classified as transfer income but not employment-related:

• regular pensions/annuities from schemes to which employee does not contribute
• old age benefits
• family-related allowances⁴
• invalidity benefits
• education-related allowances
• housing allowances
• survivors benefits
• medical reimbursements
• other social assistance benefits
• regular support received from non-profit institutions serving households: cash, e.g. scholarships
• regular inter-household transfers received from: family, e.g. alimony, child/parental support
• regular inter-household transfers received from: regular inheritances or trusts
• regular inter-household transfers received from: regular cash gifts
• social transfers in kind: medical services
• social transfers in kind: public education
• social transfers in kind: transport subsidies
• social transfers in kind: others

The following receipts are excluded due to measurement problems:

• employer social security contributions
• employee social security contributions
• employee income in-kind provided free or subsidized: car/transportation
• services produced for own consumption
• goods produced for barter
• services produced for barter
• stock consumed from unincorporated enterprise
• services from owner-occupied dwellings
• services from other consumer durables (net)
• free government dwelling
• subsidized government dwelling
• food subsidies
• regular support received from non-profit institutions serving households: goods and services
• regular support received from non-profit institutions serving households: free dwelling
• regular support received from non-profit institutions serving households: subsidized dwelling
• regular inter-household transfers received from: free dwelling
• regular inter-household transfers received from: subsidized dwelling
• regular inter-household transfers received from: regular free services
• social transfers in kind: cultural and recreational services

The following receipts are excluded for other reasons:

• regular inter-household transfers received from: regular in-kind gifts

The following receipts are collected using the last month as the reference period:

• wages and salaries
• cash bonuses and gratuities
• commissions and tips
• remuneration for time not worked, e.g. leave pay
• termination and redundancy payments
• employee income in-kind provided free or subsidized: meals
• regular pensions/annuities from schemes to which employee does not contribute
• retirement pensions from compulsory social security schemes
• old age benefits
• other pensions
• unemployment benefits
• family-related allowances⁴
• sickness benefits
• invalidity benefits
• education-related allowances
• survivors benefits
• other social insurance benefits
• regular support received from non-profit institutions serving households: cash, e.g. scholarships
• social transfers in kind: transport subsidies
• social transfers in kind: others

The following receipts are collected using the last 12 months as the reference period:

• employee income in-kind provided free or subsidized: housing
• employee income in-kind provided free or subsidized: other goods or services (health,education,transport services.)
• profit/loss from unincorporated enterprises (mixed income)
• interest received
• dividends
• rentals (payment received for produced assets e.g. house) , net of expenses
• rents (payment received for un-produced assets e.g. land)
• royalties
• housing allowances
• medical reimbursements
• other social assistance benefits
• regular inter-household transfers received from: family, e.g. alimony, child/parental support
• regular inter-household transfers received from: regular inheritances or trusts
• regular inter-household transfers received from: regular cash gifts
• social transfers in kind: medical services
• social transfers in kind: public education

The reference period for:

• employee income in-kind provided free or subsidized: goods or services produced by employer was only transport services
• drawing for own use from unincorporated enterprises³ was (3)
• goods produced for own consumption , net of input was 2 weeks

Income data were collected combining of both previous methods. Components of income for an individual were collected directly from each individual or from one person reporting for all individuals. Negative values (business losses) were included when computing self-employment income, income from agricultural production activities in household.

6. Expenditure data

Data collection method:
Diaries are used to collect expenditure data and are maintained for forth weeks(2 weeks-intensive, next 2 weeks-less intensive) .

Diaries are used to collect expenditure on the following items:

• food
• alcohol, tobacco
• other household non-durables (such as newspapers, batteries)
• clothing, footwear
• other personal non-durables (such as perfumes)
• household services (such as plumber)
• personal services (such as driving lessons, haircuts)
• housing,water,gas,electricity

Interviews are used to collect expenditure data with the respondent completing the interview by a mix of recall and using documentation.

Data for the following expenditure items are collected by referring:

• to expenditures in last 12 months:
  • other durable goods

Data for the following expenditure items are not collected by interview because they are collected by diary:

• food
• other household non-durable goods
• clothing, footwear
• other personal non-durable goods
• housing
• households services
• personal services

The following types of expenditure items are classified as 'Household consumption expenditure':

• non-durable goods purchased
• durable goods purchased (except housing)
• own produced non-durable goods
• in-kind goods received from other households
• financial services (including fees for financial advice, brokerage fees)
• non-life insurance premiums (e.g. vehicle, housing, other property, medical) , gross of claims
• gambling expenditure , gross of winnings
• out of pocket health expenditure , net of claims
• out of pocket education expenditures , net of refunds
• out of pocket transport expenditures , net of refunds
• housing maintenance, minor repairs
• purchase of gifts of goods and services given to others outside the household
• second hand goods purchased
• expenditure abroad

The following types of expenditure items are classified as 'Actual Household consumption':

• income in-kind receipts of goods
• income in-kind receipts of services
• social transfers in-kind of goods and services from government and non-profit institutions serving households

The following types of expenditure items are classified as 'Non-consumption household expenditure':

• life insurance premiums , gross of claims
• licences and fees (e.g. driver's licence, hunting licence, vehicle registration)
• regular cash payments to others outside the household
• non-regular cash payments to others outside the household

The following types of expenditure items are classified as 'Non-household expenditure':

• occupational expenditures
• other business-related expenditures

The following types of expenditure items are classified as 'Investment/liability expenditure':

• purchase price of owner-occupied housing
• major repairs, conversions and extensions to owner-occupied housing
• valuables : diamonds, non-monetrary gold, platinum, silver paint, jewellery, fashioned out of precious stones
• investment-related expenditures (e.g. purchase of shares/stocks)

The following types of expenditure items are excluded due to measurement problems:

• mortgage repayments, including interest
• services of owner-occupied housing
• own-produced durable goods
• own-produced services
• services from durables owned (except housing)
• in-kind services received from other households
• interest payments (excluding mortgage interest payments)
• compulsory transfers to governments (e.g. contributions to government old age and disability insurance program, taxes)

The following types of expenditure items are collected on an 'acquisitions' basis:

• non-durable goods purchased
• durable goods purchased (except housing)
• purchase price of owner-occupied housing
• housing maintenance, minor repairs
• second hand goods purchased
• expenditure abroad
• valuables : diamonds, non-monetrary gold, platinum, silver paint, jewellery, fashioned out of precious stones

The following types of expenditure items are collected on a 'use' basis:

• income in-kind receipts of services
• own produced non-durable goods
• in-kind goods received from other households

The following types of expenditure items are collected on a 'payments' basis:

• major repairs, conversions and extensions to owner-occupied housing
• social transfers in-kind of goods and services from government and non-profit institutions serving households
• financial services (including fees for financial advice, brokerage fees)
• non-life insurance premiums (e.g. vehicle, housing, other property, medical) , gross of claims
• life insurance premiums , gross of claims
• licences and fees (e.g. driver's licence, hunting licence, vehicle registration)
• gambling expenditure , gross of winnings
• out of pocket health expenditure , net of claims
• out of pocket education expenditures , net of refunds
• out of pocket transport expenditures , net of refunds
• regular cash payments to others outside the household
• non-regular cash payments to others outside the household
• purchase of gifts of goods and services given to others outside the household
• investment-related expenditures (e.g. purchase of shares/stocks)
• occupational expenditures
• other business-related expenditures

The following types of expenditure items are collected on a mixed basis:

• income in-kind receipts of goods (for food)

Classification: COICOP is used for classifying expenditure and has 341 separate categories at the finest level.

7. Other Data Collection Issues

The following other topics are covered:

• demographic characteristics
• education attainment of members
• employment status of members
• occupation of members
• ownership of selected durable goods
• housing characteristics

Households are not requested to indicate whether durable goods are new or second-hand when their acquisition is recorded.

Non-response: Non-response households (refusals and non-contacts) are substituted.

Non-response is reduced using the following measures:

• more than one repeat visits
• other incentives : small gifts
• other measures : noticing letters, informative blooklet on HBS

Reporting errors are reduced using the following measures:

• careful instrument design
• adequate cues or props for prompting
• quality control

DATA PROCESSING, ANALYSIS AND DISSEMINATION

Answers are pre-coded on data collection forms to the extent possible.

The responses are edited by the following:

• field supervisors
• office staff

Extreme values are deleted. In-kind receipts and consumption of own production are included in the estimates. In-kind receipts are valued using: the respondent's estimate. Consumption of own production is valued using: the respondent's estimate.

Treatment of owner-occupied housing: Values of owner-occupied housing are not included in the total income/expenditure estimates.

Treatment of selected groups/values in analysis: Some households/units are excluded from analysis because of incomplete response. Missing values are imputed only on some occasions . Supplementary sources are not used to adjust estimates for under- or over-reporting. No groups are excluded from data analysis.

Weighting:
Weighting factors are used to adjust for:

• sampling
• non-response
• bench-marking , population and housing census data 2000

Sampling errors: Sampling errors are computed for major aggregates and these sampling errors are available on request.

Tabulation and Analysis: Statistics are presented showing averages per month and statistics are analysed and tabulated for households only.

The following classifications are used for tabulation and analysis of income statistics:

• age of reference person or head of household
• sex of reference person or head of household
• occupation of reference person or head of household
• other characteristic of reference person or head of household, attained education level of reference person
• income percentiles, quintiles
• principal source of household income
• expenditure percentiles
• household size
• structure of household
• other characteristic of household, attained education level of reference person
• other classification, regions, urban, rural, larges cities, capital Riga

The following classifications are used for tabulation and analysis of expenditure statistics:

• age of reference person or head of household
• sex of reference person or head of household
• occupation of reference person or head of household
• other characteristic of reference person or head of household, attained education level of reference person
• income percentiles, quintiles
• principal source of household income
• expenditure percentiles
• household size
• structure of household
• other characteristic of household, attained education level of reference person
• other classification, regions, urban, rural, larges cities, capital Riga

Documentation and Dissemination:
Published survey reports: annualy"Report on the results of the Household budget survey"-Annualy statistical bulletin"HH budget, 1997, 1998, 1999, 2000, 2001
Published methodological information: the Hh Budget Survey Individual Data Sets User Manual-E.Vaskis, J.Lapins "Hh Surveys in Latvia", 01/97-02/02

Additional statistics (or special tables on request) are available for public use, free of charge (governmental institutions) and with charges (others). Separate tables are published for household with children. Files of unidentifiable unit data are available (or available on request) for public use, free of charge (for public administration and universities) and with charges (for others).