This article is more than 2 years old

This article is more than 2 years old

Malcolm Turnbull has admitted the Coalition made a “political mistake” by refusing to set up a royal commission into banks for so long but has defended the decision, arguing it helped put “customers first”.

Turnbull’s attempt to staunch criticism of the government’s delay comes as the Coalition has recovered in the Newspoll, trailing Labor by 49% to 51% in two-party-preferred terms, its best position since September 2016.

Labor has demanded the government establish a compensation scheme for victims of banking misconduct, attempting to seize the initiative as Turnbull government ministers including the financial services minister, Kelly O’Dwyer, struggle to deal with the fallout of the royal commission’s revelations after just three weeks of hearings.

Banking royal commission: Labor asks Turnbull for compensation scheme Read more

At a press conference in Berlin overnight Turnbull conceded in hindsight that “politically, we would’ve been better off setting one up earlier”. “But as it is turned out, I think we put customers first,” he said.

Turnbull argued the Coalition had introduced measures to protect customers and the banks would have argued against them on the basis no reforms should be undertaken until the commission had reported back.

• Sign up to receive the top stories in Australia every day at noon

“You know, whichever way you want to analysis it, you can’t live your life backwards. I made the call and I take responsibility.”

The Coalition’s performance has come under intense scrutiny because a fortnight ago Turnbull recorded his 30th consecutive Newspoll defeat, passing the marker he set for Tony Abbott as one reason to challenge his leadership.

The one-point recovery to 49-51 in Monday’s poll is within its 2.5% margin of error and preferences were the difference, with the primary votes of the Coalition and Labor remaining unchanged on 38% and 37%.

Turnbull’s satisfaction rating jumped from 32% to 36%, while 53% of respondents said they were dissatisfied with his performance, down from 57%.

Bill Shorten’s satisfaction rating also rose slightly, from 32% to 34%, and dissatisfaction with the Labor leader fell from 57% to 54%. Turnbull remained preferred prime minister at 38% to Shorten’s 35%.

Turnbull was in Europe for much of the period when the poll was taken, attending the Commonwealth heads of government meeting and preparing for Anzac Day events.

The political fortnight since the last poll has been dominated by the shocking revelations at the banking royal commission and a messy debate within the Coalition about whether it had discussed potential cuts to the immigration rate.

Among respondents to the Newspoll, 56% said the immigration rate was too high, compared with 28% who said it was about right and 10% who said it was too low.

Turnbull’s limited admission on banks comes as Bill Shorten raises the stakes by calling for the government to offer a full apology.

In a letter to Turnbull the opposition leader said an extension for the inquiry, an apology and compensation scheme were the “least the government can do”.

The former prime minister Tony Abbott and former deputy prime minister Barnaby Joyce have both admitted they were wrong to oppose the royal commission into Australia’s financial sector, after revelations AMP repeatedly lied to the regulator and the Commonwealth Bank continued to charge fees to clients who had died were uncovered by the commission.

The heads of Australia’s biggest banks have also apologised for both the conduct and fighting the inquiry.

After losing 30 Newspolls, can the Coalition be written off? | Ben Raue Read more

Senior government ministers have refused to concede it was wrong in principle to oppose the royal commission. On Sunday O’Dwyer repeatedly deflected questions on the point and defended the delay by telling ABC’s Insiders the government had acted in a “sober and deliberate” manner.

Later, Joyce told ABC that O’Dwyer should have ditched “speaking notes” and taken responsibility for government decisions.

“I know where Kelly is. She’s got the talking points. ‘These are your speaking notes, say this’,” Joyce said.

“Screw them up, throw them away, and speak down the barrel [of the camera] about what’s the truth. This is wrong, we’re going to deal with it, I take responsibility for it, I’m going to act on it and next question.”