Yesterday we had a quick squiz at the fiscal side of the stimulus package in terms of which electorates would be expected to get the largest shares of the stimulus pie – those with high proportions of Family Tax Benefit recipients on the one hand and those seats with high proportions of school kids on the other (We ignored the ceiling insulation led economic recovery component – that data is even too niche for the Census).
Yet that doesn’t quite tell the full story as it ignores what has been happening on the monetary policy side of the equation with falling interest rates. We can pull some figures out of the Census on median weekly family income as well as median monthly mortgage repayments by electorate. After a little bit of data manipulation, we can derive the proportion of median monthly family income that goes to servicing the median monthly home loan circa 2006.
This figure is basically a standard mortgage stress ratio, but also a mortgage relief indicator in terms of which seats have been getting the largest relative benefit from falling interest rates. The higher the proportion of median income used to service the median mortgage, the higher the proportion of income has been returned to the household wallet from recent interest rate reductions.
So now we can use the proportion of the electorate receiving Family Tax Benefit Part A as a broad representation of the incidence of the fiscal benefit, and the proportion of median monthly family income that went to servicing the median monthly home loan in 2006 (the Census data) as a broad representation of the incidence of the interest rate benefit.
We can then run a scatter plot of the fiscal benefit against the interest rate benefit in a spiffy little chart.
Those seats in the top right corner are the ones that are expected to receive the greatest overall relative benefit from the stimulus while the ones in the bottom left are expected to receive the least relative benefit.
Also remember that electorates arent homogeneous, in that there is a fair bit of variation within each electorate – so this chart wont tell the complete and comprehensive story, but merely the broad political story of which seats are getting the best end of the stimulus stick. All 150 seats are in the chart unlike yesterday where Melbourne Ports was wandering out on it’s lonesome and couldnt be included.