Though the Bradley report fails on the key funding issue, not all of it is bad.
Earlier in the year, we debated the ‘independence’ test for Youth Allowance. I thought it should be tightened to exclude those satisfying a soft work test, but really still living at home dependent on their affluent parents.
The report provides new information on this issue. It shows (p.52) that ‘independent at home’ has been the only growing class of YA recipients over the last few years, though there was a small lift in other categories over 2006-07. Work Bruce Chapman carried out for the review using HILDA data found that 36% of Youth Allowance recipients were in households earning more than $100,000 a year. By contrast, only 32% of recipients were in households earning less than $50,000 a year. It’s quite a small sample (136 students), but supports other evidence that YA has turned into middle-class welfare rather than a program that assists genuinely needy people to attend university.
Sensibly, the Bradley report recommends abolishing these ‘independence’ categories, but lowering the age of automatic independence from 25 to 22. Money would be diverted to increasing how much parents can earn from $31,400 to $42,500, increasing the amount students can earn, and increasing benefits by an unspecified amount. Existing rorters of YA can, however, rest easy – current recipients will be ‘grandfathered’ out.