Wealth and Assets in Scotland 2006 - 2012

2. Household Wealth in Scotland

This chapter presents aggregate household wealth over the three survey waves and breaks this down by its four components of financial, property, physical and pension wealth.

2.1 Aggregate household wealth

Key points:

• Total household wealth in Scotland in 2010/12 was £714 billion, an increase of 2.4 per cent compared with 2008/10. This is a lower rate of growth than the 4.5 per cent increase between 2006/08 and 2008/10.
• The increase in overall wealth was driven by increases in pension and physical wealth. Both these components of wealth increased in value in each wave between 2006/08 and 2010/12.
• Property wealth increased between 2008/10 and 2010/12, but remained below the 2006/08 value.
• Net financial wealth decreased between 2008/10 and 2010/12, although remained above the 2006/08 value.
• Pension wealth made up the biggest component of total wealth in 2010/12 with 42 per cent, followed by property wealth with 32 per cent. Physical and financial wealth made up a smaller proportion with 14 and 12 per cent respectively.

2.1.1 Aggregate total wealth

As shown in Table 2.1, aggregate total wealth of all private households in Scotland in 2010/12 was £714 billion. This was an increase of 2.4 per cent compared with 2008/10, a lower rate of growth than the 4.5 per cent increase between 2006/08 and 2008/10.

Table 2.1 Breakdown of aggregate total wealth, by components, 2006/08 - 2010/12 (£Billion)

Source: Wealth and Assets Survey, ONS

Note: Values are presented as current values (i.e. the value at time of interview) and have not been adjusted for inflation.

As can be seen in table 2.1, physical and pension wealth increased consistently over the three survey waves. Property wealth fell between 2006/08 and 2008/10, before increasing in 2010/12. However, the value of property wealth in 2010/12 remained below the 2006/08 value. Financial wealth increased substantially between 2006/08 and 2008/10, and then fell in 2010/12, but remained above the 2006/08 value.

2.1.2 Components of total wealth

Chart 2.1 shows the relative contribution of each of the four wealth components to aggregate total wealth. In 2010/12, the component making the largest contribution was private pension wealth, accounting for 42 per cent of all household wealth, followed by net property wealth, accounting for 32 per cent. Physical wealth made up 14 per cent of total household wealth in 2010/12 and financial wealth made the smallest contribution of the four components (12 per cent).

Chart 2.1: Components of total wealth, 2010/12

Source: Wealth and Assets Survey, ONS

Private pension wealth made up a larger component of total household wealth in Scotland than in Great Britain (GB) as a whole, where it made up 38 per cent of the total. Property wealth contributed less to total wealth in Scotland than in GB as a whole, where it made up 37 per cent.

The relative distribution of types of wealth within the total showed very little change between 2006/08 and 2010/12. Property wealth made up slightly less of the total, falling from 34 to 32 per cent, while pension and physical wealth contributed slightly more, increasing from 41 to 42 per cent and from 13 to 14 per cent respectively. Financial wealth contributed the same proportion of total wealth across the period, at 12 per cent.