Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Prime Minister. After watching the Prime Minister's scare campaign on Labor's negative gearing reforms, the Guardian's Lenore Taylor has written:

The only problem for the prime minister who promised evidence-based policy making is that there’s no evidence to support his claim.

Isn't it clear that the Prime Minister's promise of evidence based policy has been completely abandoned? Exactly how is the Prime Minister's campaign different from a campaign that would have been written by his predecessor?

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

The shadow Treasurer is no doubt a man of great ability but he is not in a position to suspend the laws of economics.

Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

There's no evidence.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

He says there is no evidence.

Tony Smith (Speaker) Share this | Link to this | Hansard source

I remind the member for McMahon that he has been warned.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

We have a market—$5.56 trillion of assets, the most important single asset of every Australian homeowning family, which is most Australians. He proposes to remove one–third or more or more of the buyers from that market—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The Prime Minister will resume his seat for a second. The members for Hotham and Scullin need to reflect on the statement I made earlier in question time. I am not going to restate it over and over again. They have both been warned. I can utilise 94(a). I also have another possibility, which is naming. I am not going to restate the point over and over again. The Prime Minister has the call.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

So the honourable member wants to remove one-third of the potential buyers for the most important asset that every Australian family has. He wants us to believe that removing one-third of the buyers will have no impact on prices whatsoever. This defies the fundamental common sense that every Australian knows: where there are more buyers than sellers, prices will go up. The more of those buyers that go, prices will go down. That is what happens in markets. I recognise that the Labor Party—

Mr Dreyfus interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Isaacs is warned.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

That was a brilliant interjection from the member for Isaacs. I have just described what could be termed economics 101—

Mr Dreyfus interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Isaacs has been warned.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

The member for Isaacs says, 'You're making it up'! This is funny in a tragically sad way. The Labor Party believe that the most fundamental principle of economics, supply and demand, is something that we have made up. Really—what is this? Are we going into some kind of soviet economics where markets are denied? Paul Keating would be ashamed of you for that! At least, if you are going to make a shock as big as this, the Labor Party should be the one that is producing the evidence. They should be the ones explaining why you can send a third of the buyers away and prices will not be affected. They are playing a reckless game with Australians' homes.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

My question is to the Treasurer. Will the Treasurer explain how important maintaining housing values is to the confidence of consumers and the business community?

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Mackellar for her question, because she knows how resilient and confident the Australian people are. She knows how confidence is so critical to the performance of our economy—

Mr Feeney interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Batman will cease interjecting.

Mr Feeney interjecting—

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

and most recently we have seen—despite the shocks and volatility in global financial markets—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Batman is warned!

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

Australians' confidence rebound in January, despite all of that. But Australians have their investments and they have their wealth in their homes, and confidence in the value of your home is central to Australian consumer confidence. That is why it is so important that you have policies that are consistent and stable to promote consumer confidence in the value of the home, in the importance and value of having a job—which is what this government is focused on: jobs, growth and confidence, and we are seeing all three as a result of the policies of this government.

It is true that negative gearing has been part of the mainstay of policy in this country for a hundred years. It is not unique to Australia and it does not provide any special treatment. It simply respects the principle, as the former Secretary to the Department of the Treasury, Ted Evans, was saying of the principle that if you are seeking to earn an income then the costs of earning that income can be offset. This is an important taxation principle. It is not a concession. It is not something that is somehow a special incentive. It is just the simple, plain facts of how our tax system works.

What those opposite want to do is trash 100 years of good tax practice and throw that out the window to engage in the politics of envy. What they do not understand is ordinary Australians, mums and dads, are the ones who invest in negative gearing. Two-thirds of those who engage in negative gearing have a taxable income of $80,000 or less.

Ms Plibersek interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Sydney has been warned!

Ms Owens interjecting—

Mr Brendan O'Connor interjecting—

The member for Parramatta and the member for Gorton will cease interjecting. That is your final warning.

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

Let me tell you more. As a percentage of the occupation, some 22.6 per cent of police officers negatively gear. In fact, as a percentage, more police officers negatively gear than specialised tax accountants, management consultants and, even, university lecturers. As a percentage, more ambulance officers and paramedics negatively gear than—

Mr Giles interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Scullin!

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

accountants, financial advisers and economists. As a percentage of people in an occupation, more train and tram drivers negatively gear than solicitors, real estate agents and veterinarians. So on an equity measure, it is a big fail from those opposite because they do not get it, that mums and dads are just investing to put themselves in a better position for their future. What do those opposite have against the ambulance officers, the paramedics, the tram drivers, the police officers? They are trying to get into housing market, but those opposite want to come along and rip one out of three property purchases out of the market. (Time expired)

Chris Bowen (McMahon, Australian Labor Party, Shadow Treasurer) Share this | Link to this | Hansard source

My question is to the Prime Minister. When the Prime Minister deposed the former Prime Minister, he promised a new style of leadership. But writing about the Prime Minister's scare campaign on Labor's negative gearing policy, Paul Kelly in The Australian wrote:

Malcolm is starting to sound like Tony Abbott. This is a classic Abbott sound-bite.

What is the point of the Prime Minister's government if the policies, rhetoric and scare campaigns of the previous Prime Minister are all still with us?

Mr Nikolic interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The member for Bass has been warned!

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

I thank the honourable member for his interesting wander through the press gallery. We started off with Lenore Taylor; now we have moved on to Paul Kelly. We only have 15 minutes left in question time, he is going to have to hurry up because he will leave a lot of disappointed reporters and commentators if he does not get to them.

A government member: What about James Jeffrey?

Yes, what about James Jeffrey? What about Denis Shanahan? David Crowe? Samantha Maiden? Laura Tingle? Malcolm Farr—what about him?

A government member: Laurie Oakes.

Yes. He has left Laurie Oakes off the list. That is a very big call.

This is the fundamental issue: the Labor Party talk about evidence based policy—fair enough. Where is their evidence that reducing the demand for existing housing by at least a third is not going to affect prices? It beggars belief. There may be some strange new factor of which we are not aware, some sort of magical economics that only the shadow Treasurer is alert to. There may be something that the member for Fraser has come up with, as he has made his journey from rational economist to political apparatchik. There may be something that we do not know about but they really should produce it, because Australians are pretty shrewd about property prices. They pay a lot of attention to them. They should because it is their biggest asset. They know that if you take a third of the buyers out of the ring, prices will come down. Everybody understands that. That is what markets do. Everybody understands that except for the Labor Party.

Peter Dutton (Dickson, Liberal Party, Minister for Immigration and Border Protection) Share this | Link to this | Hansard source

And Mark Latham.

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

The current Leader of the Opposition, Mr Shorten, is following in the distinguished footsteps of Mark Latham, another great economic wizard who also proposed a similar idea, I am instructed.

Mr Dutton interjecting—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The minister for immigration!

Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

The fundamental point is this: Labor are putting the value of Australians' homes at risk. If you remove a third of the buyers, a third of the demand, how can anyone seriously believe it will not result in lower prices? That is how prices are set. When there are more buyers and no more sellers, prices go up. When there are more sellers or fewer buyers, prices go down. What Labor do not recognise is that they are tampering with the most important asset of every Australian family. (Time expired)