The National Union of Students (NUS) has condemned the Australian government for “failing hundreds of thousands of 18 to 21 year-olds denied access to financial support” by the independence requirements of Centrelink’s Youth Allowance in their October 5 Locked out of Youth Allowance report.

Drawing upon a 2022 survey of 673 students affected by the Age of Independence rule and Centrelink payment rates, it found that ineligibility for Youth Allowance had a negative impact on 60% of surveyed students’ academic achievement, 35% of students’ job prospects, and 23% of students’ physical health.

“Right now, the Australian Government’s Centrelink system provides essential income support for people over 22, but is failing hundreds of thousands of 18 to 21 year-olds denied access to financial support. All young people should be able to study with a safety net to pay for rent, books, and food,” says the report.

Beyond exclusion from Youth Allowance, the report also attacks the means-testing of income support for young people as “keeping their income deliberately below the poverty line”.

Describing how students are experiencing “a number of intersecting crises” in the form of inflation, casualisation, rental affordability and wage stagnation, the report makes four demands in response:

1. Lower the Age of Independence from 22 to 18
2. Lift social security payments to above the poverty line (at least $88 per day)
3. Adjust Youth Allowance (and other social security payments) with the cost of living
4. Update rent assistance payments to reflect and grow in line with market rents

These intersecting crises are compounded for students who are LGBTQIA+, Indigenous, disabled, experiencing family violence, or caretakers, according to the report.

“I would have probably, as a disabled person, been able to work less and focus more on my education,” said one anonymous survey respondent, reflecting on how Youth Allowance would have helped them. “I ended up having to study part time and take time off in order to work and pay rent.” 

The majority of students under the age of 22 are unable to access Youth Allowance due to being under the Age of Independence. To qualify for Youth allowance, these students are subjected to a parental income test that can exclude students whose parents surpass the income threshold as “dependent”. Because claiming independence younger than 22 requires a police report, psychologist’s statement or statutory declaration from the parents, many students who are not truly dependent on their parents are still evaluated by the parental income test.

Tara, aged 21, describes one such instance of this: “The only reason I was not eligible [for Youth Allowance] was because my parents earn over the threshold, but it’s not like I see that money or receive their income. My parents are smokers and drinkers so a lot of their money goes there, not to me. I understand that Centrelink’s logic is that I receive support from my parents, but I don’t.”

The report condemns this as age-based discrimination: “Young people are expected to take on the responsibilities of adulthood from the age of 18 whether that be voting, getting their full driver’s licence, paying taxes, drinking alcohol or joining the army. For all these purposes the Australian Government considers them an adult, with all of the responsibility to take care of themselves. Yet for Centrelink purposes they are not considered an adult and independent from their parents.”

For the 121 respondents who were successful in accessing Youth Allowance, the majority reported positive impacts on their financial wellbeing, mental health, housing stability, academic achievement and educational experience.

“It would have been harder for me to move out of home, more time saving before I moved out and needing to work much harder … If I hadn’t received Youth Allowance it probably would have meant that university wouldn’t have been achievable for me,” said Jesse, aged 23.

Yet, even those who can access Youth Allowance as an independent are not necessarily well-off. The maximum payment is $13,790 per annum, plus rent assistance if eligible. In contrast, the Australian (Henderson) poverty line is $31,786 for singles with housing costs; Youth Allowance is less than 60% of this figure.

The report concludes by making four recommendations in addition to its four demands:

1. Remove age based pay discrimination by abolishing junior employee rates
2. Review the Disability Support Pension to ensure students with a disability have access to financial support while they study
3. Introduce new policies targeting rental and housing affordability in Australia
4. Fund further research to be conducted into international student poverty and what policy supports should be put into place to ensure that international students are appropriately supported

The full report is available here.

Graphic courtesy of the National Union of Students