In the 1983 BIS Shrapnel did economic modelling for Keating on the effects of banning negative gearing, which Labor ignored and went on to stop negative gearing in 1985, which ended up being a debacle which Labor had to reverse in 1987.

In 2015 BIS modelled a scenario similar to Labor's policy announced earlier this year for a financial institution and gave labor, specifically Bowen's dept the findings.

http://www.theaustralian.com.au/national-affairs/treasury/labor-ignored-property-negative-gearing-warnings/news-story/3fb63715d3f6ddd3e0798c22c65b6ab3?sv=d193d6f4a60debedfa862316fee56c78

"BIS Shrapnel’s report — which found limiting negative gearing to new houses could lead to lower house prices, rent rises of up to 10 per cent, cost the budget more than it saved and cause unemployment to rise — sparked a political furore when it was publicly released last month.

The identity of the firm that commissioned the report was not released at the time, prompting Mr Bowen to claim it was by “an anonymous vested interest”. In attacking the document, Labor did not reveal it had received the advice last year from Bongiorno & Partners while it was developing its negative gearing policy.

“You’ve got Chris Bowen saying that he doesn’t know who commissioned these reports and now he’s saying even this morning that he wasn’t briefed on it, but it turns out his office was briefed on it,” the Resources Minister told Sky News."

This is worse groundhog day, Labor gets a report from one of the best modelling agencies in the country, ignores it because the findings contradict its populist policy, then gets a half arsed modelling from a single academic that gives the answers it wants, then proposes a wild negative gearing policy that all economics and history shows will be a complete disaster.

Then when the BIS report is leaked to the media Chris Bowen in a fit of rank hypocrisy and dishonesty rubbishes the report and denies knowledge of it.

"An independent think tank has described as "manifestly ridiculous" a report containing predictions about dramatic drops in real estate values and economic activity if a policy like Labor's proposed negative gearing plan were adopted.

The report by BIS Shrapnel says rents would rise by as much as 10 per cent, the number of new homes being built would drop 4 per cent and gross domestic product (GDP) would shrink by $19 billion a year.


Labor's proposal is to abolish negative gearing for established dwellings, which would prevent investors claiming net rental losses against salary income. Any number of new homes could be negatively geared.

BIS Shrapnel would not say who commissioned the modelling and on Thursday clarified that the report was prepared before Labor's policy was announced.

Grattan Institute chief executive John Daley said the report and its underlying assumptions "did not pass the giggle test" and were "manifestly ridiculous"."

http://www.afr.com/news/politics/bis-shrapnels-negative-gearing-report-is-manifestly-ridiculous-20160302-gn8sv0#ixzz45fP06W83

"Also, unusually, I noticed there was no declaration on whether the research had been commissioned or conducted independently by BIS Shrapnel.

So I put the question to BIS Shrapnel and the answers raised a few suspicions about the spin of the study and how we should handle a hot report that missed a vital factor - who commissioned it and what outcome were they looking for?"

"Shortly after, the author of the report revealed it had actually been written in 2015 and was not related to Labor's negative gearing policy.

And still, a very big question remains over who commissioned the research."

http://www.abc.net.au/news/2016-03-04/ryan-negative-gearing-report:-who-commissioned-it-and-why/7220228

Sorry, SM...I missed it - who commissioned the report?

I have stated many times that neither the Left or Right have the interests of the electorate at heart. So I read with amusement as a Right automaton accuses the Left of being dishonest liars. Then I read with further amusement as a Left automaton rebukes the claim with indignation while describing the emperor’s new clothes with vigour......lololololol.

The return from rental property is very poor and the risks are high.

Tenants are fortunate to be riding on the backs of the aspirational mums and dads investors who provide the lion's share of rentals. They are prepared to put their own unpaid hours into improvements and repairs, sacrificing their own quality of life and security.

The cynical class war of Shorten and Labor could easily provoke a run of investment money away from rental housing. The sector is already showing weaknesses.

Once started the run will quickly gather pace. Once confidence is lost in the sector (and the confidence is based on mythical returns spruiked by the white shoe brigade) the money will be spent on better things and will never return.

Crazy leftist ideologues believe that large institutions such as superannuation funds and insurance companies can be forced by a Labor government into taking up the slack and replace the thousands of small investors following their (small investors) departure from the scene.

For argument's sake, just say that such risk averse and return conscious institutions could be coerced by Labor to put shareholders' money into holding and managing rental property (history shows they wouldn't touch residential rental property with a very long stick), their very first demands of government would be rental regulations and subsidies that allow them to manage efficiently, effectively and profitably. There is no way in hell the corporate world would accept such high risks and management nightmares without having the risks reduced and without being properly recompensed, all upfront.

So, just forgetting the necessary legislative change to lower risk and improve the manageability of rentals, where does the money come from?

All politicians are liars, not just Labor politicians. No politician will stop lying. They will lie whenever it suits them, and they get away with it because the average voter has the memory and concentration span of a goldfish.

Let's not be stupid enough to think there will not be winners and losers in Labor's plan. This not to say that once a transition is made life will go on as in countries without NG, but the transition itself will be painful, especially for those holding investment property (including those not NG) seeing their asset value fall (owner-occupiers aren't as fussed, they buy/sell/move the same market).

From the critique of the BIS report comes "For every property that is no longer owned by an investor, there is one more property owned by an owner-occupier. Therefore there is one less renter and one less rental property. There is no change in the supply and demand for rental property, and therefore no change in rents."

What of renters who can't/don't wish to buy? Whatever, this concedes that the market is driven by supply and demand, not negative gearing, so why the attack on NG on non-new construction while quarantining other investment classes?

The land tax gravy train will derail and owner-occupiers will eventually be asked pick up the tab, along with the intro of death duties, or higher GST, perhaps. Residential construction will slow if rents don't rise sufficiently for the investor business case (including resale considerations), meaning un/underemployment and lower tax collections. There will grow higher occupy per existing dwelling.

Anyway, as long as all this is understood, let's pin back our ears and go boldly forward! Let envy rule.