SUBJECTS: Labors housing affordability reforms; Scott Morrison backs BIS Shrapnel and SQM reports; flaws in SQMs modelling; vested property interests make confused arguments against Labors reforms to negative gearing; no Treasury modelling on current falls in house prices.

CHRIS BOWEN, SHADOW TREASURER: Well thanks for coming everyone. A few moments ago the Prime Minister attached himself to SQM modelling on Labor's negative gearing reforms. The Prime Minister endorsed this modelling and engaged in his normal huffing and puffing scare campaign.

There's a few problems for the Prime Minister. Firstly SQM have argued over recent days that they support Labor's negative gearing reforms, that they think Labor's negative gearing reforms would be a good thing, but they think that Labor should not grandfather existing investors but should have some form of grandfathering arrangement for new investors. Is that what Scott Morrison's arguing? Is he arguing that Labor shouldn't grandfather existing investors in our reforms? This is a desperate Prime Minister who will cling to any life raft as he flails around with his desperate shrill scare campaigns.

Now this modelling this analysis assumes somehow or other that if the Liberal Party's re-elected, banks will be freer in their lending, that bank lending standards will become more lax. But if the Labor Party's elected and has negative gearing reform they won't. Now it's up to SQM to explain that assumption but it's a pretty ridiculous assumption. The other thing is that the Prime Minister was just talking about rents and referring to the SQM analysis to argue in his normal ridiculous way that rents will increase under a Labor Government. This is what SQM said last time they entered the debate. Asked would there be a surge in rents Mr Christopher said In our opinion we think no and that is based on what happened in history as well as the fact that if Labor's policy passed it would keep negative gearing on new property.

That's what was said before about Labor's policy by the group that the Prime Minister is attaching himself to today. Now this is a Prime Minister with form here. He attached himself when he was Treasurer he endorsed the thoroughly discredited BIS Shrapnel report into Labor's reforms which had nothing to do with Labor's reforms, really was thoroughly discredited within 24 hours. But what he hasn't attached himself to is the modelling and analysis of the Australian Treasury. He sat on it. He wouldn't release it. It was released under Freedom of Information. It said the impact of Labor's reforms will be modest. He didn't want to hear that so he didn't share it with the Australian people.

And then just recently of course the Treasury again we know only through Freedom of Information called out the Government. When Government Ministers including the Treasurer claimed the Treasury had advised that Labor's negative gearing reforms will put downward pressure on housing prices in a falling market they said: That's not what we said. That's not what we said. The Treasury called it out and effectively belled the cat on the Government's misinformation campaign.

Now Scott Morrison and Josh Frydenberg have one speed, they have one trick. And that is scare and fear. They have no policy agenda for the country. They have no vision. They have no economic narrative, no economic plan to grow the economy, grow wages, get investment going, get productivity growth up. They've got nothing. We've got three Treasurers, three Prime Ministers in five and a half years. Bill Shorten leads a stable united team which is ready for Government which has set out our plans and looks forward to the next election and basing an election campaign around our positive plans while the Liberal Party will engage in fear and smear.

Happy to take any questions.

JOURNALIST: The research out today is in favour of Labors policy but its actually phased in over three years to prevent a shock to the market. Is that something worth considering?

BOWEN: That's not our policy and I note that Mr Christopher has also argued that we shouldn't grandfather existing investors which is also not our policy. We will be grandfathering all existing investors anybody who is invested in good faith we will not be impacting on that investment through changing the laws. We've said that we will announce the start date well before the next election which I will do. But all investments made up until that date are grandfathered and that will continue to be the case.
JOURNALIST: You mentioned the previous SQM modelling was a little bit more modest. Today's figures show though steep rental increases. What do you make of these?

BOWEN: Well again I just point out what he said not long ago in the grand scheme of things he said In our opinion we think no when asked will rents up. Now Mr Christopher hasnt explained the change in position. I mean yes there's been some change in the housing market but that wouldn't explain somehow a difference of impact on rent. Nobody could argue that. So it's up to him to justify his change of position, his change of mind because there's no evidence to support it. I'm afraid he was right the first time.

JOURNALIST: He says that the property market or the market is the worst hes seen since the GFC. Is it the wrong time to be making

BOWEN: No and plenty of economists have pointed out that this is a good time to introduce a reform of course because to the degree that we've had some softening of the market and I note, I just want to make this point on the way through. We don't hear Scott Morrison anymore saying he had a scalpel in the housing market. Remember? I mean he used to say that The Liberal Partys got a scalpel on housing prices, we've got careful reforms. He can't say that anymore.

We know that they didn't even model their changes, didn't even do any analysis. Didnt get the Treasury to do any analysis. He's out there attaching himself to private sector analysis. He didnt ask the Treasury to model the APRA reforms. Now we've seen a softening in the Sydney market of 10 per cent or so. That's not a scalpel. I mean Scott Morrison and Josh Frydenberg say all property price reductions under the Liberal Party a fantastic and under the Labor Party would be a disaster. That's what they say. That's their narrative. Well to your question a number of economists have pointed out that actually with the softening of the market some investors having left the market for reasons thoroughly disconnected from our reforms, obviously we're not in office, it's actually a good time to implement them more smoothly.

JOURNALIST: We are getting a lot closer to the election. When are we going to hear a start-date for these changes?

BOWEN: Well in good time. The people will know when they're voting. Well in good time exactly what date they start.

JOURNALIST: You've been quoted as saying that we've seen a parade of shonky property reports so based on the previous report and todays stats, is that what this is?

BOWEN: Well it doesn't stack up. It's got no evidence to support it. I mean they have to explain. I mean if I changed positions between 2016 and 2019 you are quite right to ask me what's changed to justify the change. I mean that's your job and it's my job to explain. Well they can explain. It's not my job to explain why they've catapulted positions and just completely somersault in their position. There's been some change in the housing market, doesn't change the fundamentals of the rental market. And he pointed out before that. rents did not go up last time negative gearing was reformed. Now he's saying they did. I mean one thing we can't argue about is that one thing that hasn't changed in the last two years is what happened in 1987. So when you've got substandard analysis you have to be able to justify it.

That's all? All good? Thanks for your time.

ENDS