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How Australia’s Welfare State Fails Students

If you’re reading this, then chances are you don’t have a great deal of money. You’ve perhaps achieved a ramshackle balance between shitty casual work and uni—that balance constantly teetering between failing an assessment or getting fired. Most of the money you do make goes toward rent or savings for moving out. The rest of the money you blow on pints at the Clyde to drink away your financial woes.

But it doesn’t have to be this way.

For a short while in Australia, it wasn’t. Under the Whitlam government of the 1970s, education came to be conceived of as a social right, something the government would guarantee to all in the name of human betterment. We received free uni from it, and the generous Tertiary Education Allowances Scheme. Although it excluded some through its means-testing requirements, for the first time in its history, Australia had student income support that was not based on academic merit or aiding the wartime effort. It was income support meant to truly help all Australians receive the education they wanted.

Unfortunately, the Whitlam era was a short-lived departure from the Australian norm of the government not giving-a-shit about those not in full-time work. Because the thing with the Australian welfare state is that it’s what Francis Castles calls a “wage-earner’s welfare state” ––a welfare state that guarantees an adequate standard of living for those with stable employment through wage regulation but leaves behind those not in work.

Looking at how the welfare state treats students is important not just because this is Farrago and we’re all students; it’s important because education is the cornerstone of economic mobility within society. Therefore, the status of student-targeted welfare can be an indicator for the overall efficacy of the welfare system and the broader fairness of the economy. And it’s certainly the case in Australia––shifts in the welfare system’s treatment of students are often a reflection of its treatment of all citizens.

Because the labour movement deemed the working family the basic unit of society, it was this archetype the welfare state was built to support. The Harvester Judgment of 1907 established the courts as the arbiters of wages and working conditions, an authority that was employed to ensure that wages were sufficient for a male worker to provide for his family. For those who fit this traditionalist mould, the system worked quite well. However, for those who faced institutional obstacles in attaining employment—mainly women, the disabled, racial minorities, and immigrants—there were severe issues. By constructing itself as a wage-earner’s welfare state, Australian welfare immediately excludes any individuals who do not earn a wage. Today, the percentage of Australians not in the workforce sits at 33.6%. Contrary to what you might hear in some right-wing rag, those 33.6% are not all dole bludgers. They’re mostly people who we don’t want to work because they’re children, elderly or disabled. Thus, a welfare state built for the purposes of supporting wage-earners is not a welfare state capable of providing for all Australians, particularly students.

Although the Australian welfare state has undergone multpile evolutions over the past decades, its legacy as being designed for wage earners continues to reverberate today. Earlier, I mentioned Whitlam’s Tertiary Education Allowances Scheme and how, despite its means-testing, it ushered in a new era of accessible education. Over the course of the Hawke-Keating government, this scheme was replaced with Austudy, before the Howard government brought in the Youth Allowance in 1998 to replace Austudy for students 25 years and under. Importantly, 1996 saw Keating’s Labor implement the Actual Means Test (AMT) for Austudy. The Youth Allowance has remained since 1998 and so has the means-testing; in fact, the means-testing has mostly grown more restrictive since. Today, full receipt of the Youth Allowance as a dependent requires your parents to together earn $56,137 or less according to the AMT—an amount barely above the poverty line. Here, the assertion that welfare for students is reflective of the health of the broader welfare state certainly holds true: the stringent means-testing measures brought in for students paralleled those implemented by the governments of the ‘80s and ‘90s for pensioners and the unemployed. The most damning parallel of all is that Newstart, Rent Assistance and Youth Allowance have not increased in real terms for over 25 years. Such stagnancy is often justified on the basis that the welfare system ought to be designed to encourage people into work—after all, “the best form of welfare is a job” according to old mate, Scott Morrison. However, this ignores the all-important statistic mentioned earlier: 33.6% of the population aren’t in the workforce and, in many cases, probably shouldn’t be. For students especially, it ignores the impossibility of balancing full-time work with full-time study. And echoing in Morrison’s words is the regressive logic of the wage-earner’s welfare state: get a job or fuck off.

The common refrain of the means-testing advocate is that means-testing is necessary for keeping the welfare state lean, ensuring money goes where it is needed the most. Yet, while it is true that the means-testing measures for the Youth Allowance do generally target the financially vulnerable, there are many who slip through the cracks. The Youth Allowance operates through dividing its potential recipients into two categories: independents and dependents. Independents are those who are either 22 and older or meet the conditions for reviewable independence, which largely revolves around not having parents capable of supporting you. If you’re independent, then you’re not subject to the parental means test. Instead, you’re subjected to one or more of a suite of other means tests, including the personal assets test, personal income test, and partner income test. Services Australia also is very clear on their website that “you’re not independent just because you don’t live with your parents or guardians, or they don’t support you.” Which raises the question: what the hell is the point of the parental means test if not to exclude those who are supported by well-off parents? Those that don’t meet these independence criteria are dependents and they are subject to the parental means test, meaning that your payments are reduced by 20c for every dollar your parents earn over $56,137.

What this parental means test does is presume a certain kind of relationship between the parents and the youth that allows many to miss out on potentially vital welfare payments. First, it assumes that the parents are supporting the youth—yet, at the same time says that the means test applies even when the youth is not supported. Such is the incoherence of the Australian means-testing regime. Second, it assumes that this is a healthy relationship. It is technically possible to be granted reviewable independence if it is unreasonable for you to live at home. However, this requires multiple signed forms, including one to be signed by an independent third party. It additionally requires a massive leap of faith by the youth, as they may leave home, potentially without savings, only to find that they are deemed ineligible for independence. It also ignores the many family dynamics that may be unhealthy or harmful in ways that are less obvious to third parties, but which still affect the wellbeing and academic capacity of the youth. The current means-testing regime is therefore one that facilitates the continuation of abusive home dynamics and undermines student welfare’s purpose as a method by which to liberate the student from financial issues that could hurt their educational prospects.

One University of Melbourne student’s story exemplifies how the welfare state fails students experiencing domestic abuse:

“People who require welfare to survive are accused of being bludgers. In fact, my abusive home situation is what prevented me from working for many years. The existing means-testing regime essentially wants me to run away from home, only to be accused of still benefiting from my parent’s income, all while relying on temporary housing and services.”

Apparent also in this story is another contradiction in the means-testing system: when you turn 18 you bear all the responsibilities of an independent adult, yet the welfare state treats you like you are still a child living off allowances from your parents. Welfare is meant to free people, to grant them the autonomy to live without compulsion by market forces. However, as this student’s story demonstrates, Australia’s welfare state does the opposite: it forces victims to rely on their abusers until they turn 22. Even beyond victims, it encourages all students to rely on support from their parents when university is a time for them to start fostering the self-sufficiency they’ll need for the rest of their lives

I’ve outlined a rather depressing situation over the course of this article. However, let it not be said I am a pessimist: a better future is possible for students and Australians. It starts with understanding that our problems are interlinked, that the stringency of our means-testing regime is killing the wellbeing of not just students, but all of us. We need a militantly pro-welfare coalition across all segments of Australian society to evolve ourselves beyond the wage-earner’s welfare state. We need to revive what the Whitlam government so briefly brought to life in the ‘70s: a conception of extensive social rights upheld by a universal welfare state, as necessary for human self-actualisation. It’s a long and arduous road, but if we’ve done it before then we can do it again. And if we pull it off, then maybe those pints at the Clyde will be for celebration instead of sorrow.

Farrago's magazine cover - Edition Five 2022


Our last print edition of 2022 is here! This wild, visionary edition is filled with burning nostalgia, glittering hope, and tantalising visions of the future, past, and present.

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