Prime Minister Malcolm Turnbull has pushed back against renewed moves for a powerful inquiry into Australia's banks, reiterating the government's opposition to a royal commission on the grounds that it would not offer any immediate solutions for the scandal-plagued sector.
Mr Turnbull's rejection of the idea persists even though a commission of inquiry - similar to a royal commission but reporting to the Parliament rather than the government - has emerged as a distinct possibility with the support of a handful of maverick Nationals MPs.
"I can tell you we have as a government decided not to have a royal commission, we made the decision a long time ago, not because we don't believe there is nothing going on in terms of problems with the banks, it is because we want to take action right now and we are," Mr Turnbull told Channel Seven's Sunrise program.
Faced with the prospect of Coalition MPs crossing the floor in defiance of the government's policy, Mr Turnbull's cabinet has discussed the idea of dropping its opposition to a royal commission, The Daily Telegraph reported on Wednesday.
Mr Turnbull refused to detail cabinet discussions and said: "A royal commission would simply be an inquiry, take a long time, cost a lot of money and make some recommendations, which would no doubt be to do precisely what we are already doing."
Following a string of scandals in Australia's financial institutions, the government has strengthened the Australian Securities and Investments Commission and the heads of Australia's big banks are being compelled to appear before a parliamentary committee at least once a year to account for their decisions.
On Monday, Nationals senator Barry O'Sullivan said he was committed to bringing on a commission of inquiry and predicted up to four Coalition MPs could cross the floor in the House of Representatives to support the move. With the support of Labor and the Greens, the successful passage of the bill would be a destabilising blow for the government.
"If both houses of the Parliament think this is a good thing to do and that is the decision, I think the Prime Minister has to sort of sit up and take note and support the parliamentary decision," Senator O'Sullivan said.
A Greens bill to establish a commission of inquiry passed the Senate earlier this year with crossbench and Labor support but has so far fallen short in the lower house.
An absolute majority of 76 MPs would be required to suspend standing orders to bring on debate in the House of Representatives about Senator O'Sullivan's private member's bill. Labor and the crossbench could provide 74 votes, meaning only two votes are needed from the Coalition side.
The inquiry would scrutinise Australia's banking and financial sector and examine the litany of scandals that have plagued Australia's big banks, including the revelations concerning Commonwealth Bank financial planning and CommInsure life insurance.
