By Dilina Kulathunga
In an interesting revelation, the latest Household Income and Expenditure Survey (HIES) showed Sri Lanka’s poorest 20 percent households live on a monthly income of Rs.10, 245 while the richest 20 percent receive a monthly income of Rs.121, 368.
Meanwhile the middle 60 percent of the households live on a monthly income of Rs. 32, 595.      

Through the latest survey carried out covering a period of 12-months from July 2012 to June 2013, the Department of Census and Statistics (DCS) have found the average income earned by a household with the size of 3.9 earns an income of Rs. 45,878. This is an increase from Rs.36,451 or 26 percent from three years ago when the survey was carried out in 2009/10.

Despite the stark rise in the nominal income levels of the households, the real incomes during the same period have moved up only by just 3 percent to Rs.27, 115.

But the Central Bank boasts of maintaining single digit inflation during the last 68 months.
Western province led by Colombo district shows the highest monthly household income of Rs.77, 723 rising from Rs.51,070 three years ago.
The lowest household income is seen in Mullaitivu district – Rs. 23,687 – but the comparatives are unavailable as this was the first HIES conducted covering all 25 districts.

While both Northern and Eastern provinces lag behind the rest, with household incomes of Rs.34,286 and Rs.30,676, the results show that the two provinces have transformed well,  significantly increasing income levels within a span of just three years. Meanwhile the household per capita income which is calculated by dividing the total household income by the household members, has risen by 50 percent since 2009/10 to Rs. 11, 819.

Despite Sri Lanka’s household size being 3.9, the real income earners in a household is 1.8 and accordingly such an earning is measured at Rs. 25, 963. However an income receiver in Colombo district earns at least Rs. 40, 620 a month, the highest in any district.

Meanwhile, Sri Lanka’s income inequality measured by Gini coefficient has slightly improved to 0.48 in 2012/13 from 0.49
in 2009/10.

However, quite interestingly, the highest income inequality or the highest Gini coefficient of 0.53 is reported in Moneragala district in the Uva province. The province is going for elections tomorrow.

The lowest income inequality is recorded by the Mannar and Anuradhapura districts with Gini coefficient of 0.37.

In her march to an upper middle income economy by 2020 with an estimated per capital of US $ 7,000, the biggest challenge Sri Lanka is faced with is to ensure that economic benefits are shared equally, if not reasonably among all.