Mr Temby also called for the new commission to have a broad definition of corrupt conduct and the power to initiate its own inquiries. The questions over the new proposal set the scene for an election row to decide the policy, with the Coalition now joining Labor in advocating a new commission but the major parties split on its scope. Opposition Leader Bill Shorten dismissed Mr Morrison’s announcement in favour of the Labor proposal for a national integrity commission that has the powers of a royal commission and the discretion to hold public hearings. Mr Morrison’s supporters rejected claims he had backflipped on the commission after he dismissed the anti-corruption idea as a “fringe issue” in Parliament less than three weeks ago. The Coalition repeatedly rebuffed the Labor policy put forward in January but the Sydney Morning Herald and The Age revealed last month that the government had prepared its own policy in June, only to have it derailed by the leadership spill against Malcolm Turnbull.

Mr Morrison argued the NSW Independent Commission Against Corruption had damaged reputations with public hearings that did not lead to criminal convictions, saying he did not want the federal body to engage in “show trials”. Loading Mr Shorten said he was pleased the government had agreed with Labor on the need for an anti-corruption commission but that the Coalition policy was not “fair dinkum” about the problem. At issue are questions about funding, public hearings, whether corruption is limited to criminal conduct and whether the new commission would have “retrospective” powers over matters from the past. Mr Charles, who has joined 33 other former judges in putting forward plans for a federal ICAC, said the $125 million in funding for Mr Morrison's commission over four years was “totally inadequate”. Labor promised $58.7 million for its commission.

Mr Charles also said the definition of corruption should go beyond crimes because some activity was “borderline” and the commission might be prevented from launching investigations under the government proposal. “Much corruption is not criminal at all,” he told Sky News. “If you have a government which is receiving very large political donations but which is then favouring those who made donations… that is a form of corruption which does not necessarily involve crime at all.” Mr Charles said this form of corruption could be dealt with by exposure even if it never went to a prosecution before a court. The Commonwealth Integrity Commission is not expected to be legislated by the time of the federal election, which is due by May 18, because the government is calling for public submissions by February 1 and will then refer the final design to an expert panel.

The proposal is for the CIC to have two divisions, one focused on law enforcement agencies and the second on public administration including the conduct of politicians. The law enforcement division will have the power to compel the production of documents, question people, hold public or private hearings, arrest suspects, enter and search premises, seize evidence, undertake controlled operations and assumed identities, and undertake integrity testing. The public sector division would not be able to hold public hearings. It would have the power to compel the production of documents, question people and enter and search premises. The government’s discussion paper said the public sector division would not be able to make findings of corruption, criminal conduct or misconduct at large. It would instead refer matters for prosecution. In another constraint, it would be up to government agencies including departments and various authorities to refer matters to the CIC.

“The CIC will not investigate direct complaints about ministers, members of Parliament or their staff received from the public at large,” the discussion paper said. Attorney-General Christian Porter. Credit:Alex Ellinghausen Contrary to some commentary on Thursday afternoon, the CIC would have the power to investigate matters from the past including any suspected corruption in the current or previous governments. However, this will depend upon applying existing criminal laws to conduct that may be revealed in future. Attorney-General Christian Porter said there would be no retrospectivity with the new crimes to be legislated alongside the new commission.

The new crimes include the aggravated offence of “repeated public sector corruption” to deal with deliberate and repeated activity, and the offence of “failure to report public sector corruption”. These will add to more than 40 corruption-related crimes that already existing and will be investigated by the new body. Transparency International Australia chief executive Serena Lillywhite welcomed the government decision but signalled a debate ahead over the details. “It is important that Australia adopts the best model for the new commission so that we don’t end up with a toothless tiger,” she said. Griffith University professor of public law AJ Brown said the government plan was more detailed than the Labor proposal but questioned the “dual system” of having two divisions with different powers.