Emily Barber receives Youth Allowance but her payments will soon be reduced due to her parents income, despite her living out of home and receiving no parental support. (Source: TikTok/Getty)
At 19 years old, Emily Barber is legally an adult. She’s moved out of home and pays her own rent and bills, while juggling her full-time university studies. But to Centrelink, she is still considered a “dependent”.
Under the current Youth Allowance rules, students and apprentices are considered dependent on their parents until they are 22 years old unless they meet certain work or other criteria. This means their payment rate is impacted by their parents’ income, even if, like Barber, they don’t receive any financial support from them.
“I feel when somebody is living out of home, they are independent. At the end of the day, I’m going to graduate from my degree when I’m 21 and in the eyes of Centrelink, I’m still going to be dependent on my family,” the Melbourne student told Yahoo Finance.
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Barber is currently in her first year studying a Bachelor of Biomedical Sciences and moved away from her parents’ home to be closer to her university campus. She lives with a friend and they split the $400 per week rent, plus bills and grocery costs.
She has been receiving Youth Allowance since April this year, but was recently advised her parents’ income meant her payment would be decreasing by around $150 per fortnight.
Services Australia asks Youth Allowance recipients who are dependents to provide their parents’ or guardians’ income each year, which then determines their payment rate.
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Barber said she’d like to see the independence rules changed for university students. (Source: Supplied/AAP)
The Youth Allowance rate is currently up to $663.30 per fortnight for recipients who are 18 or older and need to live away from their parents’ home.
Currently, your rate of payment will be reduced by 20 cents for every dollar of parental income over $65,189. This is known as the Parental Income Free area and is indexed annually.
Barber said she already doesn’t have “much leftover at all” after her $200 per week rent is paid, plus bills and other living costs.
She’s been trying to find a casual or part-time job and has completed a barista course and a first aid course. She said she’s applied for “anything, everything, anywhere” but has been knocked back for 50 jobs in the last month.
If her Youth Allowance payment is reduced, Barber said it’s likely she wouldn’t be able to afford to rent and will need to move back home to her parents’ place, which is an hour and a half away from her campus by car.
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Barber believes the current Centrelink system is “utterly unfair” and the “system needs to change” so people are considered independent if they are living out of home.
The National Union of Students has long been campaigning for changes to the independence rules and wants to see the age of independence lowered from 22 to 18.
The Australian University Accord Final Report, released in 2024, said the Parental Income Free Area was “set too low” and recommended it be raised to $68,857 and indexed annually to the higher of growth in the CPI or Male Total Average Weekly Earnings.
It raised concerns that current independence testing arrangements were “disadvantaging school leavers who need to move away from home to study”.
It found most students satisfying the workforce participation criteria to be considered independent were regional and remote students, which suggested they could be delaying their uni studies so they could access the rate.
You will be considered independent through work if you worked an average of 30 hours a week for at least 18 months within a two-year period.
There’s also “reviewable” criteria for independence, such as if you are in a situation where it is unreasonable to live at home due to “extreme circumstances”.
The number of students receiving Youth Allowance has decreased over the last 20 years, dropping from 275,000 students in June 2025 to 162,000 in May this year. That’s despite an increase in overall students going to university.
A Department of Social Services spokesperson told Yahoo Finance Youth Allowance was designed to contribute towards students’ living expenses while they were studying.
“Means testing, including the parent income test, directs income support payments to students most in need of financial assistance,” the spokesperson said.
“Students and apprentices aged under 22 years are generally considered financially dependent on their parents.
“Students and apprentices under the age of 22 can be considered independent for Youth Allowance – and secure the higher rate – by demonstrating they are financially self-supporting for 18 months prior or are unable to live at home or have been married or in a long-term de facto relationship or have a dependent child.”
The spokesperson noted the government provided a range of other assistance to students, including the 20 per cent reduction of student loan debt.
Students and apprentices are currently able to earn $528 per fortnight before their payments reduce. They can also accrue income bank credits for each dollar of this unused income up to $13,200 for students and $1,000 for apprentices.
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