Equivalised income is a measure of household income that takes account of the differences in a household's size and composition, and thus is equivalised or made equivalent for all household sizes and compositions. It is used for the calculation of poverty and social exclusion indicators.
The equivalised income is calculated by dividing the household’s total income from all sources by its equivalent size, which is calculated using the modified OECD equivalence scale. This scale attributes a weight to all members of the household:
- 1.0 to the first adult;
- 0.5 to the second and each subsequent person aged 14 and over;
- 0.3 to each child aged under 14.
The equivalent size is the sum of the weights of all the members of a given household.