Now more than ever, it is important to understand how intergenerational equity is changing over time. The Australian Actuaries Intergenerational Equity Index (AAIEI) contributes to this discussion by tracking and assessing 24 indicators across six broad domains that relate to wealth and wellbeing (Economic & Fiscal, Housing, Health & Disability, Social, Education and Environment). For three age groups we track the absolute change, as well as the relative change between age bands, over time.
The absolute level of the AAIEI for an age band is clearly synthetic but indicates whether wealth and wellbeing (as measured by the range of indicators) is getting better or worse over time. Relative movements of different age bands provide insight into how developments over time are affecting various age groups differently; a widening of gaps between age bands can represent a deterioration in intergenerational equity.
The values and movements in the AAIEI are dependent on the weights assigned to the different domains. Ultimately, the choice of domain weights is subjective and not all stakeholders will agree on any single set of weights.
The Interactive Results page on this website allows users to set their own weights for the different domains if they want to explore how that affects the results compared with those presented in the Actuaries Institute Green Paper Mind the Gap - Australian Actuaries Intergenerational Equity Index.