Chris Smith:
He’s the chief economist and a senior fellow with the Institute of Public Affairs, columnist with the Australian newspaper as well, Adam Creighton, welcome to the programme.
Adam Creighton:
Good morning, Chris.
Chris Smith:
What a week it’s been for news, it’s just been coming thick and fast.
Adam Creighton:
Indeed.
Chris Smith:
Now, what is it about labour governments who seem obsessed with attacking negative gearing on property in this country? There’s news today that claims that treasury is examining the application of a limit now on negative gearing. Don’t they realise Labour voters are into negative gearing too?
Adam Creighton:
Yeah, certainly that’s true. Actually, if you go through the list of MPs, their property holdings, it’s actually Labour MPs that have more investment monies than the Liberal MPs actually. So, look, I don’t know whether this one will get up, although, I did note in these proposals that have been canvased that there’d be a cap of two negatively geared properties, which actually might mean that all the Labour MPs are okay because they only have two.
Chris Smith:
Right.
Adam Creighton:
But look, the proposal that’s out there in the media today that there’s a cap of two is just another complexity in the tax system, very, very silly idea really, and as you suggest, it’s been around for many, many years to change these rules. A negative gearing is not a policy, it’s just how the tax system has always worked since income tax came in in 1915. It’s not a policy, it’s not just for property, you can do it for shares, you can do it for anything. It just means your losses are set against your income, which is a pretty standard feature of most tax systems. The reality is that it’s the housing construction, it’s supply that is the big problem. We’ve just had the 2025 figures for new housing approvals, it came in 194,000. Now, that’s 20% down on 2015, it was 10 years ago.
So, 10 years ago, we could build 20% more houses in a year than we can now. And of course, the population now is many millions greater. So, there’s your problem, and that’s a serious one that relates to workforce, the right mix of skills, the industrial relations system. But there’s no desire clearly to do anything about that, it’s just soundbites about tax and trying to hit so called rich people.
Chris Smith:
But yeah, they’ve got their eyes on this capital gains tax, what are your thoughts on that?
Adam Creighton:
Well, look, that’s going to make even less difference. It might not be an ideal system to have an arbitrary 50% reduction after 12 months. In fact, I’d argue the system we had before that, from 1985 to 1899 was probably better, because that just stripped down inflation. So, you only paid tax on the real increase in your asset. But if they increase the tax on capital gains further, people just won’t sell their properties.
Chris Smith:
Nope.
Adam Creighton:
And there’s all this nonsense about the discount being associated with a huge increase in prices, but before 1985, we didn’t have any capital gains tax at all, and houses were much cheaper. New Zealand has no capital gains tax at all, and they’ve had extremely expensive house prices, just like we have. So, the point is it’s not the capital gains tax regime, it’s other factors. So, it’s really just a tax grab on the government’s behalf, and it’s actually really worrying in the lead up to the budget that this is just going to be a series of tax increases and no real reform.
Chris Smith:
Yeah. Yeah. You’ve written today about this high speed rail project in The Australian, I see that like me, you’re a fan, but I noticed today that New South Wales is not playing financial ball yet.
Adam Creighton:
Yeah. Yeah. Look, I am a fan because I’m sure we’ve all ridden in the beautiful trains in Europe at some point in our lives, and it’s a wonderful experience.
Chris Smith:
Incredible.
Adam Creighton:
And we don’t have that here. And earlier this year, I got the train from Melbourne to Sydney for the first time, just to try it out, and look, it took 11 hours, and I was shocked that there was no Wi-Fi on the train at all, and there were no power points even. You couldn’t even charge anything if you wanted to, even in first class. And I just thought, gosh, we’re a rich country, and we’ve got all this debt, and we haven’t even upgraded the carriages from 1985 on this very important network. So, look, I’d love to see more spend on rail, but that said, Australia has a terrible track record with spending on infrastructure, they always blow out massively in cost.
But look, in theory, I’d love to see something like this, and I think also it’d be something for Australians to get excited about, to be proud of, because at the moment, let’s face it, the country’s pretty depressed.
Chris Smith:
Yeah. And there’s no-
Adam Creighton:
And we haven’t thought anything substantial for years.
Chris Smith:
… nothing big ticket nature. No, you’re exactly right. And yet we’ve had a great history in the ’60s, et cetera.
Adam Creighton:
Exactly.
Chris Smith:
Where we built the big ticket numbers, didn’t we?
Adam Creighton:
Yeah, look, that’s right. And it’s all very well for people to say, oh, it’s too expensive, and look, it probably is, but who cares? The Opera House was 1,400% over budget, and I don’t think anyone would say we shouldn’t have built that. The Eurostar tunnel between France and Britain, that was 200% over budget, and of course no one over there would say, oh, we shouldn’t have built that.
Chris Smith:
No.
Adam Creighton:
The Suez Canal was 2000% over budget, no one would say, oh, we shouldn’t have built the Suez Canal. These things are expensive, and because it’s capital spending, not consumption, it’s far less of a worry to have cost overruns, because these are permanent investments that last forever. It’s not like NDIS or welfare, which is just frivolous spending.
Chris Smith:
Yeah, straight down the gurgler. All right. Now, this might teach the PM not to favour FM music jocks and podcasters when deciding which interviews to accept, his one word description of Grace Tame, the former Australian of the year, has led to a controversy, an apology, of all things, and a smack from Tame herself. Oops.
Adam Creighton:
Well, look, it’s just such a minor issue to me. I think the Prime Minister’s comment was reasonable.
Chris Smith:
Yes.
Adam Creighton:
I don’t know Grace. She has done some good things-
Chris Smith:
She is difficult.
Adam Creighton:
But to apologise and grovel, I think was a bit embarrassing for the prime minister to do that.
Chris Smith:
Yes.
Adam Creighton:
So what? He said difficult. So what? I find that extraordinary, she has this huge platform in this country, and sadly, in my view, she’s becoming more and more left wing all the time, screaming out, ” Globalise the Intifada” last week, I think at some rally, and it’s kind of disappointing to watch, but I just think the prime minister shouldn’t have to apologise for working-
Chris Smith:
No. He should have said, well, she should thank her lucky stars I didn’t say what I really thought.
Adam Creighton:
Yeah, exactly.
Chris Smith:
And the other thing about Grace Tame, tonight there’s another pro Palestinian rally to argue that they should be allowed to say, globalise the Intifada, this is the aim of the protest tonight. And you know what they’re doing? This will be a special treat for the crowd, they’re reading a statement written by Grace Tame.
Adam Creighton:
It’s just hilarious. Also, what does Grace Tame have to do with the Middle East? This is one of the funniest things, more generally here, we’ve got all these extremely passionate people about Middle Eastern affairs, and they don’t have a Middle Eastern gene in their body. They’re not Arabs, they’re not Jews, and yet they’re so passionate about something on the other side of the world that, let’s face it, they don’t really know much about. So, I think we should laugh at these people as much as anything else.
Chris Smith:
Very true. All right. Your colleague in the IPA, John Roskam, has written a piece in the AFR today, pointing out something I’ve mentioned a few times this year, that the Liberal Party moderates in this country, who have been making the party Labour light for so long, they have always said in an argument about where the party was heading that, “Oh, don’t worry, the liberal base would never leave, they’ll have no reason to go anywhere.”
Adam Creighton:
Yes.
Chris Smith:
Well, hasn’t that smacked them in the face?
Adam Creighton:
Yeah, look, it certainly has. I thought the surge in primary support for One Nation might dissipate, but it’s still hovering around 25, 30% on some polls greater than Labour even, and certainly greater than the coalition, basically, on all of them now. So, that’s the Liberals plus Nationals. So, the base certainly has deserted them for the time being. And I think it’s because they don’t really stand for anything at the moment. I tweeted a few days ago that One Nation has way more policies on their website than the Liberal Party, in fact, the Liberal Party, they haven’t updated their policies at all since the election last year, and they’ve had plenty of time, there’s really no excuse for that.
Chris Smith:
No.
Adam Creighton:
So, there’s nothing new. So, no wonder. And John Roskam, he rightly talks about free speech. One Nation is the only party that is dedicated to removing those horrible any free speech laws, but the Liberal Party doesn’t even talk about it. And yet, that’s meant to be one of their core principles. So, I think Angus Taylor is definitely an improvement, a vast improvement, I’d say, but they really need to sort out what they believe in.
Chris Smith:
I’ve got a theory about this. I think a lot of that strong support for One Nation, which we’re seeing consistently poll after poll, territory, state after state, I think a lot of this has got to do with the fact that a lot of Liberal Party supporters want to lodge a really strong loud protest vote at the next federal election. They’ve decided, Adam.
Adam Creighton:
Well, look, I think that could well be right. And the big test, well, the first big test is going to be the South Australian election. Very interesting, I think, in three weeks time. I think One Nation’s running someone in every lower house seat, and they’re polling there about 20% or so. Let’s see what happens. But then the bigger one, of course, is Victoria later in the year.
Chris Smith:
And then Farrer.
Adam Creighton:
Yes, yes, yes, of course, Farrer is going to be extraordinary federal test. And I suspect… Well, I don’t know, I’m not a political expert, but One Nation will probably win the seat, I think, and that will send an earthquake, because I think many people and the libs especially still think this is just all going to go away, it’s a flash in the pan, but I don’t think it is.
Chris Smith:
No, it’s not. Adam Creighton, thank you so much, enjoy your weekend.
Adam Creighton:
Indeed. Thanks, Chris.
Chris Smith:
Good on you. Columnist with the Australian newspaper, chief economist with the Institute of Public Affairs.
This transcript of Adam Creighton on 2SM Morning with Chris Smith from 27 February 2026 has been edited for clarity.
