Australian students are being forced into poverty and are at risk of dropping out of university because of major delays in processing their Centrelink applications.

Most universities close for the mid-year break next month but many students who applied to Centrelink for financial support at the start of the year are yet to receive a payment.

Melbourne University student Nadege Hamdad is still waiting for her Austudy payment despite applying to Centrelink in February. Credit:Justin McManus

Student advocates say the government welfare agency refuses to provide a timeline for Austudy, Youth Allowance and Abstudy applications, while "huge delays" are leading to a surge in student loans and emergency relief.

"It's across the board," said Stuart Martin, chairman of the national Student Financial Advisers Network. "This is significantly worse than previous years. I've heard cases of [students waiting] even 12 and 14 weeks."