Malcolm Turnbull’s banks concession isn’t a true mea culpa

In the face of mounting evidence of banking scandals and political ineptitude in defending the Coalition, Malcolm Turnbull has conceded it was a clear political error not to call a banking Royal Commission.

The Prime Minister has also conceded the Coalition “knew what the problem was with the banks” but still resisted calls for a Royal Commission and described the final decision as “regrettable”.

These are massive political concessions forced on a government losing control of the agenda on banking and financial institution wrongdoing and rip offs, and unable to justify its actions.

Bill Shorten and his front bench colleagues Chris Bowen and Jim Chalmers have had a field day since the Royal Commission began revealing the extent of the malfeasance and pent up customer anger and frustration after years of failure was venting against the Coalition.

Despite a marginal improvement in the latest Newspoll survey for the Coalition on a two-party preferred basis — up a point to trail 49 to Labor’s 51 per cent — it was clear the banking scandal is going to continue to unfold and damage the government.

Turnbull’s concession that it would have given the government less “grief” and been less “politically” damaging was not a full admission of a mistake or the mea culpa of someone who really thought he had got it wrong.

Turnbull’s concession of a “clear political error” with “hindsight” was proffered with a claim that he had identified the problem himself two years ago but had resisted the calls for a Royal Commission because it would have delayed reform and legislation and the banks

would have used it as an excuse to defer reforms.

His argument is that the Coalition has been able to introduce reforms already which would have been delayed, the Royal Commission is wider now than it would have been two years ago and the Royal Commission itself can analyse the reforms so far.

Turnbull correctly cites his own speech at a Westpac dinner in 2016 in which he attacked the banks and financial institutions as pointing to the problem and angering the banks.

But there is a big risk here for him because it highlights, as he admits, that the Government “knew what the problem was with the banks” and didn’t follow up on his own strong rhetorical attack with a Royal Commission.

His justification for his decision not to hold a Royal Commission is that it would have been impossible to implement the financial reforms the Coalition has succeeded in passing into law because the banks would have suggested delaying the reforms until the Royal Commission was over.

This was Turnbull’s argument, and Scott Morrison’s, as they were finally forced to make a “regrettable” decision and call a Royal Commission when they faced losing a vote on the floor of the House of Representatives and in the Senate as their own backbenchers joined

Labor’s crusade.

Because the concession falls short of a full admission of error and seeks to continue to justify the decision not to call an inquiry while admitting the Government “knew” there were problems, the justification carries the weight of public acceptance of Turnbull’s political

judgment.

The justification is thin and legalistic, suggests the banks had more power than the government when it came to legislation and ignores the fact that the Coalition was supporting a reintroduction of the Australian Building and Construction Commission, with proposed

legislation, all the way through the Royal Commission into Union Corruption.

Royal Commissions are independent of government and governments are not bound to suspend their business for years for a Royal Commission.

Indeed, as a result of evidence before this Royal Commission the government has rushed out tougher penalties for financial leaders who fail their duty.