Last week, the Senate Standing Committee on Economics called for a royal commission into the Australian Securities and Investment Commission and the Commonwealth Bank over the financial fraud scandal. (You can read the committee’s report here.)
In other words, the key recommendation of one parliamentary inquiry is that the government should establish an even bigger inquiry.
Royal commissions have an almost magical, mythical status in Australian politics. They have become less a means to an end, and more an end in themselves.
There are already three royal commissions ongoing at the Commonwealth level: one into institutional responses to the sexual abuse of children, another into the Rudd government’s home insulation scheme, and the third into trade union governance and corruption.
It’s been 20 years since there have been this many commissions going at the same time.
Yet there’s only one real public policy reason to choose a royal commission over any other form of inquiry – their coercive powers.
Royal commissions awkwardly span the gap between executive government and the judiciary. They’re formed by the government of the day according to its whim. See, for instance, the royal commission into pink batts – an incredible precedent for new governments to punish the policy decisions of previous governments.
But while royal commissions are creatures of the executive – that is, driven by politics – they’re also empowered with the sort of coercive powers only granted to apolitical courts.
They can summon witnesses. They can compel those witnesses to produce documents. They can force testimony – even self-incriminating testimony, eliminating the right to silence in the process. They can apply for search warrants. (In the Northern Territory, no warrant is even needed. Any member of a commission can enter any building they want and take what they please.)
As the Law Council of Australia told a 2009 inquiry into royal commissions, the Commonwealth Royal Commission Act “removes or significantly dilutes the traditional common law protections usually afforded to witnesses”.
This makes them exceptionally powerful. Even for undoubtedly worthy subjects of investigation (and who could question the virtue of an inquiry into institutional responses to child sexual abuse?) it should be of serious concern that royal commissions throw basic legal rights out the door. Even the worst people have rights.
Do these coercive powers uncover ‘hidden truths’, as many advocates of royal commissions suggest? Maybe. But royal commissions have lower standards of procedural fairness than courts. They can admit hearsay, for instance. They are as likely to uncover untruths as traditional courts are to miss hidden truths.
In his book Royal Commissions and Public Inquiries in Australia, Scott Prasser distinguishes between royal commissions whose purpose is to advise on policy questions and those that are inquisitorial; that is, those which investigate and expose wrongdoing. All three current commissions take the latter form.
But we already have elaborate and expensive law enforcement and judicial systems to investigate, expose, and finally prosecute wrongdoing.
Every inquisitorial royal commission is a tacit admission that the existing legal system isn’t working. More prosaically, every inquisitorial royal commission should be focused on law-enforcement failure.
One survivor told the child abuse royal commission that “the police don’t listen to children”. Another was told by police “we can’t do anything” and that the issue of sexual abuse was too much of a “hot potato”. Whatever comes out of that royal commission, changes in the way the police handle abuse allegations are likely to have the most long-term importance.
While the ability to coerce testimony may be the only real policy reason to form a royal commission, there are a whole lot of political ones.
Nobody ever made headlines by calling for an interdepartmental review. When a government appoints a royal commission, it is trying to tell the public that there is no limit to how seriously it takes a given issue. The government looked at its menu and chose the crown jewels – a royal inquiry.
When the royal commission into union corruption was announced earlier this year, the unions were quick to denounce it as a witch-hunt.
The metaphor was more correct than was perhaps intended. Once formed, royal commissions are impossible to control.
Usually governments have a good idea about the result they’ll get from an independent inquiry. They write the terms of reference. They choose who heads the inquiry. Did anybody doubt that the Gillard government’s inquiry into media regulation would propose new media regulation?
By contrast, the Fraser government wouldn’t have expected its royal commission into the Federated Ship Painters and Dockers Union to delve into corporate ‘bottom of the harbour’ tax evasion schemes. Royal commissions are fishing expeditions, and heavily armed ones at that.
So why a royal commission into ASIC and the Commonwealth Bank?
ASIC is one of our most heavily empowered regulators (I’ve been banging on about this in the Drum for a while, for instance here, here, here, and here). If any regulator deserved to have its feet held against the fire, it would be ASIC.
Yet, as the Coalition Senator David Bushby pointed out in a dissenting appendix (page 457 onwards), we already have an inquiry looking at the structure of financial regulation.
The Financial System Inquiry isn’t draped in the Queen’s regalia, sure. It can’t coerce testimony.
But isn’t that a good thing? The cultural status of the royal commission has obscured its very real dangers to the rule of law and civil liberties.