Median income runs 8-10% above HBAI FYE 2025; add an HBAI validation suite #487

Finding

On enhanced_frs_2024_25 (release 1.56.16) with policyengine-uk 2.102.3, at period 2024 (= HBAI FYE 2025), the median equivalised household income is well above HBAI's. The HBAI medians come from HBAI FYE 2025 (DWP, 26 March 2026), table 2.1ts, in £ a week.

Because PE's relative line is 60% of its own median, its relative poverty rates overshoot HBAI's and fall outside HBAI's 95% confidence intervals (table 8b):

• All individuals BHC: PE 19.30%, HBAI 15.91% [14.45, 17.64].
• All individuals AHC: PE 23.51%, HBAI 19.64% [17.99, 21.27].

On HBAI's own fixed FYE 2025 line (policyengine-uk#1889: £431.69 BHC / £373.89 AHC a week), PE's absolute rates land inside all eight of HBAI's confidence intervals (four groups × BHC/AHC).

So the bottom of the distribution looks about right, and the median is high. That points at the middle and upper income distribution rather than at benefits. The PE groups follow HBAI's definitions:

• dependent child = under 16, or 16-19 unpartnered, not a benefit-unit head, and in non-advanced education or approved training;
• pensioner = at or over State Pension age.

Proposal

1. Add an HBAI FYE 2025 validation suite at period 2024, using HBAI's confidence intervals as tolerances. Useful targets:

   • medians and quintile medians, with CIs (table 8a);
   • low-income rates by group (tables 1.3a-1.6a, CIs in 8b);
   • counts (1.3b-1.6b, CIs in 8c);
   • rates at 50%, 60% and 70% of median (3.1tr).

   Mark the currently failing checks (median, relative rates) as tracked, so they fail loudly when fixed or when they get worse.

2. Investigate the median gap. Candidates:

   • none of the current calibration targets pins the national disposable-income distribution;
   • the HBAI BHC median of 719.48 could be added as a calibration or validation target.

3. Store each target with its vintage. DWP will revise FYE 2022-25 in March 2027: a Census-based back series, plus a fix to the FRS 2024/25 council tax variable (GROSSCT).

HBAI FYE 2025 data tables: https://assets.publishing.service.gov.uk/media/69c2902a7e02b81c0d1c7762/hbai-data_tables-2025.zip