Whether it’s accidental lab leaks or deliberate but determined kite-flying practice, the government’s handling of its negative gearing impact has damaged Labour’s brand.

That’s really the feeling from inside parts of the party. What on earth happened this week, is an answer.

Labour’s inability to find out who ordered the Treasury to work on the subject – or even that it was ordered at all – saw the government and Prime Minister Anthony Albanese smeared as tricky, confusing and guilty of treating the electorate with contempt.

If the government has taken a high level decision to at least review the options of how to curb negative gearing tax credits for property investors – they had better come clean and own it.

Instead of most of two days after a story in the Sydney Morning Herald on Wednesday if Labor asked public servants to work out alternatives, Albanese and his treasurer went into full The Thick of It mode.

Like one of Armando Iannucci’s satirical scripts, Albanese and his ministers clung to the present like men on a raft losing air.

“We already have a broad and ambitious housing policy, and those changes are not part of it,” Jim Chalmers said on Friday.

It’s not politics, in other words. Until it happens. It was the same sophistry that preceded the federal government’s decision to curb pension concessions and its review of stage three tax cuts.

For the best part of two years, the latter was not a “current” policy. And so it was.

48 hours of confusion

The original story of negative switching by James Massola and David Crowe kicked off more than 48 hours of confusion as Albanese and Chalmers struggled to get their lines straight.

Albanese’s initial reaction at a press conference in Launceston was that public officials “from time to time” look at policy ideas.

Inside the politics surrounding Labour’s hypothetical negative gearing reforms

He portrayed it as a normal part of the business, Treasury as some sort of Skunk Works, or idea lab, and oops, it looks like one of their experiments has escaped the lab.

Hours later Sydney ABC radio’s Richard Glover pressed the Prime Minister if Chalmers had commissioned the work.

“I don’t know because I’m not the treasurer,” he replied, adding that Chalmers was on his way to China.

Well, you ask him when he lands, Glover countered. “You can ask him yourself,” replied Albanese.

The following morning, Albanese was asked by ABC News Breakfast if he was considering taking negative gearing reform and capital gains tax reform to the next election.

“No, we’re not,” he said.

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Which might have settled things, except that on Friday morning Albanese again referred to the present of current policy and expressly refused to rule out a move to negative exchange rate in the future.

“I say what we’re doing, and I say that’s our focus, and our focus is on that,” Albanese told reporters, perhaps suppressing a Malcolm Tucker leap or three.

Speaking from China, Chalmers admitted on Friday that he was the one who asked finance officials to work out alternatives for negative exchange rate reforms.

“It is not at all unusual for governments or treasurers to be advised on contentious matters that are public, including in Parliament,” he said.

The clock is ticking for Labour

So where does that leave us?

Tellingly, several Labor backbenchers were given the green light to reform negative gearing. Most were from voters threatened by the Greens or Teals.

The idea of ​​rolling back what is seen as an unfair tax break benefiting surgeons and baby boomers has great traction in these places.

But for a different set of voices – Labor MPs with ambition belts – the perception that the government wants to tinker with a deeply popular and reliable middle-class route to the good life is another blow to Labour’s brand.

“It’s very unhelpful in the places we need,” said one Labor MP.

“It’s part of the life plan for a lot of people, the aspirational voters in the suburbs. This is not what people think in Grayndler, Sydney or any of the green seats.

“Now you kick away the ladder”.

One view within Labor is that the story was leaked by the treasurer, who is increasingly worried about his political legacy. The clock is ticking on Labour, with opinion polls suggesting a hung parliament is a distinct possibility.

That could mean it’s now or never for the cashier, the thinking goes.

Certainly, he has struggled to get key parts of his reform agenda into law, including limits on superannuation accounts over $1.6 million and an overhaul of the Reserve Bank of Australia’s governance structures.

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A nudge and a wink

With inflation still too high for the Reserve Bank to cut interest rates, and a May budget that failed to reverse a relentless decline in opinion polls, Chalmers could become one of those treasurers who came and went without much to show for it.

His downgrade in this year’s The Australian Financial Review’s annual power list – published on Friday – from second place to fifth would have stung.

Which is why pushing for negative gearing reforms is seen by some insiders as another move to eventually claim the top job.

It sends a “fairness” signal to the party’s progressive wing, which is growing in influence and importance as a new generation enters politics. And it sends a nudge and a wink to those who want to reform that he can get big rides on the board.

Whether or not this is what has happened this week will no doubt continue to be debated. But the fact that people believe it is possible tells its own story.

Either way, Albanese continues to point out that the key to solving the housing crisis is supply.

Which is a line backed by the housing industry and real estate investors.

The prime minister has shown many times during his first two years that he is unwilling to take risks.

It suggests that any changes Chalmers’ treasury boffins come up with will have to be modest to win over the PM.