ISA Follower, they have to do that to stay under the Player Points cap.
Should Uni be allowed to squirrel Aust Schoolboys away in Colts 2?
Nothing in the rules to prevent them doing it. In fact the Player Points Cap system actually requires them to do so. If the player in question gets jack of playing 2's and not having an opportunity to star in Colts 1's, then he is free to go to a club like Wests who are well under the Player Points Cap and play regular Colts 1.
If it is Servo Pulver's boy you are talking about, he hails from Mosman, and I presume that he would have some "loyalty" to Norths although he has probably been locked up in the Shore system and unavailable for club footy with Norths juniors for quite some time.
Norths Colts 1 at 34 Player Points last week with some of their number also at U20 camp probably can't really afford to have him in Colts 1. Would he go to Gordon, historical enemies of Norths, particularly given the situation that Colts there have? I think not. Neighbours Manly already have hometown boy Fabian Natoli at Colts 1 #9, keeping him in Colts 2.
Uni may deserve some stick from time to time, but probably not over Servo's boy.
EDIT:
The Management, coaches and volunteers at Parramatta are to be congratulated for their efforts to resurrect their Colts Programme, particularly given where they were last year.
I predict that their Colts 1 performance over the year will not disappoint. Uni, Manly and Norths appear to be tough gigs, and the reality is that there are no easy games in Colts 1 or 2 (except vs The Bye in Colts 2).