Marriage for money

Intimacy for money is a taboo, which is why when newspapers want to dramatise student poverty they talk about student prostitutes or, in The Age today, fake marriages to qualify as ‘independent’ for Youth Allowance:

JOHAN Stutt never planned on getting married at the age of 18 – let alone to someone he didn’t love. Some might say it was a matter of survival.

Stories like this have been around for decades – 20 years ago there were ‘TEAS marriages’ [Tertiary Education Assistance Scheme, a Youth Allowance predecessor], though usually in the version of the story at the time between gays and lesbians, whose marriage rights weren’t worth anything anyway (another reason for gay marriage – reduce welfare rorting!).

But a quick check of the marriage statistics shows that this is not likely to be a growing problem. The teen marriage rate is in long-term decline, and teenage men have a less than 1% probability of getting married for any reason. In 2006, there were 423 marriages by men aged 19 or under (and at a guess, most of them will never enrol in any degree).

We don’t need to worry much about this kind of Youth Allowance rorting, as not many people who would marry someone they did not love. It’s the easy work/earnings test I want to tighten up, and I am quoted saying that right at the end of The Age article. Unsurprisingly, I am the only person going on the record suggesting that in some cases we spend too much, rather than too little, on student income support.

10 thoughts on “Marriage for money

  1. Well out of the blue there appears to be bipartisan support for an increase in the old age pension. You can’t blame the students for trying to get a piece of the action. However, I think the chances that either side of politics will seriously consider increasing youth allowance are remote.

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  2. “Well out of the blue there appears to be bipartisan support for an increase in the old age pension”

    Whatever gets votes I guess — do old people really need more money than students? It seems to me the reverse is true given that things like family homes are not taken into account in assets testing.

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  3. I agree with you Andrew that very few people would find it necessary to get married in order to qualify for YA – but that is in part because there are other ways to do it, such as the too-easy work/earnings criteria that you would like to change.

    From my point of view if you tighten up all of the other avenues to independent status too much, you would likely get an increase in sham marriages. If, to take an extreme example, it was the only way to be recognised as independent, I suspect you might be quite surprised at what happened to the teenage marriage rate.

    On your assumption that very few of the 423 men aged 19 and under getting married were likely to enrol in a degree, it wouldn’t at all surprise me to find that the majority of the 423 were in fact already enrolled and doing it to get YA. (According to a presentation at the recent AIFS conference, marriage is going out backwards in a big way among men and women with lower levels of education.)

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  4. I reckon the lousy part of YA isn’t the criteria for independence but the very poorly conceived and designed parental means test (including the incoherent “actual means test”) which gives powerful incentives to people to qualify themselves as independent.

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  5. It’s not just that there is a financial incentive to be independent it’s that for many lower-middle income families, it’s a necessity because they really can’t afford to support their children through university.

    But I think Andrew agrees with us about the PIT, DD. He (like most of the Education Dept bureaucracy) just doesn’t like kids from middle-higher income families getting YA. Me, I’m not so fussed about that – I reckon that even young people with rich parents are entitled to their financial independence at some point, and if you don’t give it to them through YA they will come looking for it elsewhere in the income support system, like unemployment benefits.

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  6. “you don’t give it to them through YA they will come looking for it elsewhere in the income support system, like unemployment benefits.”

    But not that many people genuinely do this. According to ABS Education and Work 2007, 21,000 bachelor-degree students are unemployed, or about 3.2% of all such students – which is pretty much what we would expect even without any welfare rorting.

    A few thousand people rorting benefits is much cheaper than extending entitlements to hundreds of thousands of people who do not need them.

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  7. Andrew – the extent to which students show up as unemployed in ABS stats is not indicative of whether they get unemployment benefits – the two things are independent of each other. While it’s true that you have to meet a test of ‘unemployment’ (which does not preclude working part-time, by the way) to qualify for unemployment benefits, I don’t believe that this would prove an insurmountable obstacle to an intelligent young person.

    I also don’t really think you have strong evidence that there are ‘hundreds of thousands’ of young people getting YA who don’t really need it – that’s a pretty strong claim, especially since I thought we had agreed that the current parental income test is not an adequate reflection of parental capacity to provide financial support to their student children. In my experience, most people who believe that the current arrangements are an obvious rort are relying almost entirely on anecdotal evidence – depending on the circles that one moves in, this will be more or less persuasive.

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  8. bg – ABS has a stringent definition of unemployed that is consistent with keeping u/e benefits, but only 2.6% of u/grads reported Centrelink benefits other than YA or family allowances in 2006 in the AVCC student finances survey, which is less than ABS unemployment figures.

    I was not saying that hundreds of thousands rort the system; there were only 125,000 YA beneficiaries in mid-2007. I am saying that relaxing the eligibility criteria – such as lowering the age of independence to 18, as suggested in the media today, would be (legalised) rorting. The current system costs about $1 billion a year.

    I have better than anecdotal but still circumstantial evidence of YA for the rich, in the oddly large increases in uni attendance in high income households between ages 18 and 19. The data is at p.32 of the U of M submission (pdf) to the Bradley review.

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  9. A few people would find it purely necessary to get married right now for YA. I think student income support must be resolved first before getting maried or whatsoever.

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