Prime Minister Scott Morrison has caved in to pressure from Labor and the crossbench and will establish a national anti-corruption commission. 

Mr Morrison made the surprise announcement at a media conference about 11am (ADST). He maintained the government had been considering plans for the Commonwealth anti-corruption commission for some time.

“This was an exercise we embarked on in January of this year,” he said.

“We think it is always important to raise the bar and maintain the bar to ensure the public can have confidence in the Commonwealth public administration. These are sensible changes we’re outlining today.”

The minority Morrison government has been under pressure in parliament to introduce a anti-corruption body, but had held out.

Mr Morrison said the government wanted a “robust, resourced, real system”.

During the final sitting weeks of the parliamentary year, Mr Morrison had said his Government was not against a national anti-corruption watchdog but described it as a “fringe issue” being pushed by the Opposition.

On Thursday Mr Morrison said it was crucial the public had confidence in Commonwealth employees and agencies.

The new commission will have two divisions — a law enforcement integrity division and a public sector integrity division.

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“We have looked at all the alternatives and we believe that this is the best way to achieve this, the most sensible, measured, carefully considered way to address these issues,” Mr Morrison said.

Mr Morrison had performed a dramatic about face on the issue last month, when he announced his support for a national anti-corruption commission to avoid a humiliating defeat on the floor of Parliament.

The move followed threats by Coalition MP Llew O’Brien to cross the floor and vote with Labor to legislate the reform.

Labor leader Bill Shorten at the time said the commission should have the “powers of the royal commission”, including to compel witnesses and seize documents.

-more to come