Sensitivity Analysis HLFS compared with Census It is worth recalling at this point that the figures in Table 4 are based on a poverty threshold set at 60 percent and using the 2013 Census. We move next to HLFS households for the year 2013, where unfortunately, we do not have any information on WfF and AS and therefore can only link households with their respective EMS data. Using the HLFS data, we find an in-work poverty prevalence (excluding WfF and AS) of 9.4 percent. The respective figure when using the 2013 Census for calculating in-work poverty prevalence and excluding WfF and AS is 9.2 percent. Alternative poverty thresholds We replicated all figures in Table 4 using the 50 percent threshold – a common alternative poverty threshold – and the respective numbers can be found in Appendix Table A 2. At this lower threshold, the proportion of working households that are classified as poor decreases to 4.7 percent (and the overall poverty rate drops to 12.4 percent). To identify how the in-work poverty prevalence reacts to changes in the definition of the poverty threshold, we calculated the in-work poverty rate for each percentage point in the range between 30 percent and 90 percent of the median net equivalised household income. The visualisation of these results is shown in Figure 1 (both with and without the inclusion of WfF and AS). The interrelation is not linear, indicating that the in-work poverty rate increases at a slower pace for lower poverty thresholds and faster at a higher poverty threshold. For example, if the poverty threshold moves from 40 to 41 percent, in-work poverty increases by 0.12 percentage points. However, when moving from 80 to 81 percent, in-work poverty increases by 0.48 percentage points. Figure 1. Interrelation of poverty threshold and in-work poverty rate 25% In-work poverty rate 20% 15% 10% 5% 0% 30% 40% 50% 60% 70% 80% Poverty threshold (percent of median equivalised income) All income sources Excluding WfF and AS Source: IDI 2019. Notes: ‘WfF’ is Working for Families tax credit; ‘AS’ is Accommodation Supplement. Page 20 90%

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