The Policy Simulation Model (PSM) is a static microsimulation model which encapsulates the tax and benefits system, and population, of Great Britain. It is based on survey data from the FRS, which is uprated to simulate the current year, together with a few years into the future.
The model is built using SAS and is owned by the GB Department for Work and Pensions. It is used for poverty and scenario analysis and produces outputs including the financial impacts on different demographic groups from hypothetical policy changes to the tax and benefits system.