E&OE TRANSCRIPT
TELEVISION INTERVIEW
SKY NEWS AM AGENDA
THURSDAY, 25 OCTOBER 2018
 
SUBJECT/S: US political violence; Labor’s plans for housing affordability; negative gearing; Rudd memoirs.
 
KIERAN GILBERT: With me now, the Shadow Finance Minister Jim Chalmers joining Laura and I on the program. First of all, your reaction to this very concerning attempted political violence in the United States. Because the Greens are saying that this is a result of inflammatory language from the President and others, what are your thoughts?
 
JIM CHALMERS, SHADOW MINISTER FOR FINANCE: It was very concerning, what we're seeing in the United States. Obviously, we'll hear more about it as the day goes on. We'll hear more about what the people, or the person's motivations were in doing such a horrible thing. I think it's important that public figures, no matter where they are around the world, are careful with their language. I don't get into a commentary about President Trump or others as Richard Di Natale did, but I think all of us - everybody in the public sphere - need to be careful with language. We need to be diligent, and we need to get to the bottom of what's happened here. 
 
LAURA JAYES: Back home to your signature policy. Now there's increasing debate over this. What is this policy on negative gearing and capital gains tax actually designed to do, Jim Chalmers?
 
CHALMERS: It's designed to level the playing field so that when first home buyers rock up to auctions around Australia, they're not disadvantaged by being forced to compete with a taxpayer-subsidised investor who might already have six or seven properties. So it's designed to level the playing field. We do have, despite the recent softening in some of the big markets Australia, an enduring housing affordability problem, which won't go away. Part of the problem is when you're trying to buy your first house - particularly young people, but not exclusively young people - it's very hard for them because they're competing with people who have an advantage subsidised by the taxpayer and we don't think that should happen.
 
GILBERT: But is now the time to be implementing such a policy, given that softening market that you spoke of?
 
CHALMERS: You make housing policy at the federal level for the long-term. There are other instruments in the medium-term that the Reserve Bank has or the regulators have, and we're seeing some of the impact of those shorter-term measures on the market at the moment. The APRA regulation is one of the main reasons why we're seeing this softening in the housing market.
 
GILBERT: But can you guarantee this won't exacerbate the softening?
 
CHALMERS: The Grattan Institute, the McKell Institute, they've both said that our policy would have a modest impact on prices. Even the Treasury modelling shows that some of the wild claims being made by the Liberal Party are wrong as well. So our policy would have a modest impact on prices. The main reason why it would only have a modest impact, is if you are negatively gearing a property right now, you can keep that under us and we're only proposing to end negative gearing for existing properties. And that will have an important benefit for the construction sector too. 
 
JAYES: A modest impact you say, as you point to this modelling. That still means that existing homeowners might lose money on their property. Is that right?
 
CHALMERS: No, the conclusion that the independent experts have reached is that there'll still be growth in housing prices under our policy. It would just be more modest. That's been out in the public domain now for some time. We've had this policy since 2015, as you know. You and I, and Kieran and I, we've talked about this time and time again. We've made that policy, we've put it on the table, we've said why - because we want to level the playing field.
 
GILBERT: But it's interesting because we have spoken about it a lot, but not in the context of people not showing up at auctions and the auction rates being very poor right now in spring, when normally they're running hot. This is a difficult one to sell, isn't it? I know you talk about the long-term policy, but the short-term politics are tough.
 
CHALMERS: I don't necessarily agree with that, Kieran. We've won this argument now for some years, and I think people do understand that even with a bit of softening in some of the major markets - that's not necessarily a permanent thing for starters. But what has been a permanent feature of our community for so long now is it's hard for first home buyers to get a toe hold into the market, and we want to address that.
 
JAYES: The modelling you point to says a modest impact, but we also heard from Master Builders yesterday...
 
CHALMERS: Oh, come on.
 
JAYES: ...and they're talking about effects to the broader economy. Do you dispute that there's any impact on jobs?
 
CHALMERS: I think there'll be a positive impact on construction jobs, because we're incentivising the construction of new homes, because people can negatively gear properties that are newly built. That Master Builders modelling really shouldn't get the sort of attention that it has received for one simple reason: it doesn't model Labor's policy. It doesn't take into account that if you are negatively gearing now, you can continue to do so. We will not be taking negative gearing off anyone. Our policy applies to future investments. It's dishonest in the extreme for the Liberal Party to be touting this modelling which doesn't even model Labor's policy.
 
GILBERT: But the head of Master Builders spoke to us yesterday and she said the reason they didn't was because they were modelling prospective investment, not past investment, hence their modelling stands.
 
CHALMERS: No, the assumptions that they begin their modelling with are not an accurate reflection of the changes that we intend to make. That's up to them, that's fine. I'm not hopping into the Master Builders. My concern is that Josh Frydenberg and Scott Morrison have been touting this dodgy modelling as they cling desperately to an argument that is just totally wrong. There will still be modest house price growth under our policy. We want to deal with housing affordability issues, and we do that for the long-term, not for the near-term.
 
JAYES: It seems Kevin Rudd is still preoccupied with the politics of the past. He wrote about you in his second volume. I think there's a couple more to come. Do you refute what he's written about you, Jim Chalmers?
 
CHALMERS: I'm not really interested in doing that, Laura. I haven't read the book. I've obviously seen parts of it that others have identified. I'm not going to go into the bits I disagree with or the bits I agree with. I'm actually really proud of the small role I played in that period. I'm especially proud of what Kevin Rudd and Wayne Swan and others were able to achieve for Australia during the Global Financial Crisis. Kevin is entitled to put his view forward. I'm entitled to spend my time doing other things than reading it.
 
GILBERT: Jim Chalmers, we appreciate your time, catch you soon.
 
CHALMERS: Thank you.
 
ENDS