Thanks for taking the time to report this bug and helping to make Ubuntu 
better.  This is not a bug, but rather expected behavior:
https://wiki.ubuntu.com/SecurityTeam/Policies#Permissive%20Home%20Directory%20Access

Please feel free to report any other bugs you may find.

** This bug is no longer flagged as a security vulnerability

** This bug is no longer flagged as a security vulnerability

** Changed in: adduser (Ubuntu)
       Status: New => Invalid

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https://bugs.launchpad.net/bugs/675560

Title:
  Home dirs shouldn't be world readable

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