Friday, March 4, 2016

Who commissioned BIS Shrapnel report on negative gearing; what were their motives?

          There is a old - and yes cynical - saying in the world of consultancy.

He who commissions research and writes the parameters can usually expect a desired outcome.

In the world of journalism, there are also simple checks and balances that apply to the deluge of reports and releases that hit the inboxes of journalists who are more time poor than ever these days.

Usually there is enough of a raised eyebrow from this reporter when a company, organisation or interest group declares it has commissioned research that deals with issues relating to the fortunes of its business.

But there were new questions late on Wednesday when an email from the highly regarded economic forecaster BIS Shrapnel landed in my inbox.

The executive summary outlined potentially catastrophic consequences of mooted changes to the negative gearing of residential investment properties and that the fallout from limiting tax deductibility would "go well beyond any tax saving to the Federal budget".

Given the debate over negative gearing and the fierce lobbying by groups with vested interests to leave it alone, I had a few questions for BIS Shrapel given that I had only received a executive summary riddled with potential headlines.

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?

"Could you just confirm that this is independent research by BIS or has it been commissioned? I just need to know given the various interests in this debate," I asked in an email.

"Totally understandable of course. It has been commissioned, by whom I have not been told, but I’ve been told the information is confidential," came the answer.

"If we were to touch this we’d need to say who it was commissioned by. As you know there are many interests in the negative gearing debate so we need to declare all info where we can," I responded.

I passed on this information about the BIS Shrapnel report to the executive producer of "AM" Ashley Hall given the program's coverage of the political stoush over negative gearing and the government's attack on Labor's policy.

I learned the Treasurer Scott Morrison had been scheduled to appear on AM the next morning so we agreed the questions over the BIS Shrapnel report could be put to him.

Mr Morrison seized on the report as an indictment of the Labor policy. But he told presenter Michael Brissenden the research was valid despite questions over who commissioned and paid for it.

MICHAEL BRISSENDEN: it's also politically convenient for you, for your political argument at the moment. Who commissioned it?

SCOTT MORRISON: I don't know. I mean you'd have to ask BIS Shrapnel. BIS Shrapnel have released reports …

MICHAEL BRISSENDEN: Well, they won't tell us. 

SCOTT MORRISON: Well, that's a matter for them. You'd have to ask them. 

But BIS Shrapnel has been around a long time and people like Frank Gelber, you know, who I knew many, many years ago and you know he's done, he's well respected in the community. 

MICHAEL BRISSENDEN: But they usually don't, they're usually not reluctant to tell us who commissioned any report

SCOTT MORRISON: Well, I have no idea who's commissioned it. 

MICHAEL BRISSENDEN: Isn't that an important detail? People will want to know. This is a central piece of the argument and how can anyone trust it?

SCOTT MORRISON: Well, because it's BIS Shrapnel's report. I mean everybody knows who BIS Shrapnel is. They've set out what their assumptions are, they've set out what their analysis is and they are a respected economic consultancy firm. 

But did Scott Morrison seize on the incendiary findings of the report too early especially given questions about its genesis?

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.

Extract from BIS Shrapnel report

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

An initial suspect, the Property Council of Australia- which has a vested Interest in tearing down negative gearing changes - outright denied it commissioned the report.

Chief executive Ken Morrison told me if the Property Council had commissioned the research it would have certainty put its name to it. And from past experience, journalists phones would have been ringing well ahead heralding the findings.

So who paid for the research? The question is all the more intriguing and important given the sensitively of the matter and suspicions that the warnings of economic Armageddon have been inflated.

All of this is a reminder to journalists to be ever cautious and to nurture a healthy suspicion about media releases, research and spin from stakeholders with vested interests.

It is also a reminder to politicians that the back story to research can be more important than the headlines - especially when no one really knows who commissioned and paid for the spin and what their true motives are.