SKY NEWS FIRST EDITION
THURSDAY, 3 MARCH 2016
SUBJECT/S: Discredited BIS Shrapnel report
KIERAN GILBERT: With me to discuss that the Shadow Finance Minister, Tony Burke. Mr Burke, thanks for your time. This is in the Australian today, modelling by BIS Shrapnel and it’s pretty scathing of Labor’s policy. It warns of house prices falling, rent rises going up and even a hit of 175,000 jobs over the next decade under Labor’s plan.
TONY BURKE, MANAGER OF OPPOSITION BUSINESS AND SHADOW FINANCE MINISTER: Well, let’s just take issue exactly with that. This is not modelling and it is not an analysis of Labor’s policy. There’s a series of presumptions in this document that are clearly different to Labor’s policy.
They presume negative gearing would continue for shares, wrong; they presume there’s no changes to the Capital Gains Tax, wrong; they presume losses can’t be carried forward, wrong. You go through the list and you’ve got a series of presumptions that have been built into this that are criticising someone’s policy, but it’s not Labor’s policy that’s been put forward.
On those presumptions, you presume for example negative gearing for shares would be able to continue, that allows them to say there would be a flight of investment away from new property as well. When you put presumptions in that are not Labor’s policy, you can come out with these sorts of figures.
There’s a test here today for Malcolm Turnbull. Yep, he’s got away with it on the front page of some newspapers today, but if he’s serious about wanting to have an intelligent conversation with the Australian people, then he cannot today credibly have his ministers waving around a document that has nothing to do with Labor’s policy. If that’s what we see today -
GILBERT: Is there a chance it could be worse? One of the things they haven’t factored in is Labor’s plans to cut Capital Gains Tax. So if you include the reduction in - cutting the discount…
BURKE: Changes to the discount?
GILBERT: Yes. If you included that this would be an even worse scenario?
BURKE: No, because what they’re presuming here is a concept that by having it continue on shares, the presumption they’ve put in here is you get a flight of investment away from property and then they say ‘hey look, that’s bad for property.’ That’s what they’ve done. That’s why you’ve got the problem here, that’s why what’s modelled here is not Labor’s policy.
Even when you go into the tables, even after they’ve done all of that, it still says values of apartments will continue to rise. It still gives a lie to the claim all you’re property prices are going to go down. Even after doing all of that, they still can’t establish the key plank of Malcolm Turnbull’s fear campaign.
If the Government wants to go around and wave a document that is clearly different to Labor’s policy, then Malcolm Turnbull’s so called ‘intelligent conversation’ with the Australian people, will have completely descended into vaudeville.
GILBERT: Can you guarantee though impacts like rent rises going up and house prices going down – you can’t guarantee that your policy will have a significant impact along those lines can you?
BURKE: There’s only one part of empirical evidence in this entire document: where they go back to what happened in the 80s when there were changes to negative gearing. Even this document acknowledges changes to prices and to rents didn’t deviate from trend. Even this document acknowledges the core of Malcolm Turnbull’s fear campaign is flawed on the one piece of empirical evidence they’ve referred to.
GILBERT: But you can’t give a guarantee over the longer term your changes to negative gearing would see rent rises go up and hurt the people you’re trying to help?
BURKE: The claim being made in the papers today, the claims being made by the Government, is housing prices will soar – they make both claims actually – they say they will go up, they say they will go down; their claims change day-to-day.
At its core Kieran is this principle: the document that’s been released today is not modelling of Labor’s policy. It is not. Our policy is clearly different. The presumptions they’ve put in here have been designed to feed into a conclusion that the Government and certain section of the property sector want.
GILBERT: Mr Burke thanks for your time.