WILLIAMS: Just three hours flight from the Australian east coast, lies a Pacific paradise of such beauty the Spanish once thought it the source of Incan gold. Its population of half a million is spread over a thousand tropical islands, rich in fish and timber. It may look idyllic, but the Solomon Islands is in deep crisis. Many of those involved in four years of ethnic violence, are now in positions of power. Violent crime is rife, arrests virtually unknown, the economy is in a tailspin. All of this is conspiring to create what could become the Pacific region's first failed state.
RICK HOU: It is very unfortunate that this country is now described as a failed state where its nationals can't run it.
WILLIAMS: We report on a troubled Pacific nation, but we also look at a radical plan of intervention that, if adopted, could see armed Australian police in the Solomon Islands. William Morrell is a British Bobby on a mission from Manchester to restore the law. Paid for by the European Union, he was six months ago made Police Commissioner of the sprawling Solomon Islands. His new beat includes remote villages, some with their own languages. With lessons over, it's time for the Commissioner and his wife to enjoy what they thought would be the perfect Pacific posting.
POLICE COMMISSIONER WILLIAM MORRELL: From my sort of distant position in England, looking at the South Pacific, you think everything's really sort of nice. You hear about the Solomon Islands being the land of the happy people, and I suppose it is really, but you dont understand at that distance the tribal rivalries, the pressures and the cultural issues.
WILLIAMS: Those tribal tensions burst into bloody conflict four years ago. A virtual civil war erupted when militants from two rival ethic groups took up arms, many of those involved were police. More than 200 people died in the violence, government was ousted in a coup. In a peace deal, militants were, for a time, made special constables and paid to demobilise or keep the peace. But today in Honiara, that money has stopped and these special constables say they haven't been paid enough.
CONSTABLE: We are all the ex-militants, and after we restored law and order to the country, the government failed to pay a few arrears.
WILLIAMS: Blamed by many for a crime wave, they insist the government owes them thousands of dollars and are prepared to use force to get it.
REX: These boys they are not.. Maybe they will do some criminal activities within this town area.
JOKCHIM GIAFONA: I just want to ask Rex a few questions.
WILLIAMS: Our interview is interrupted by Jokchim Giafona, a government official.
JOKCHIM GIAFONA: Have you been saying that if the government is prepared to pay you 1.3 million, then all the lawlessness in this place would come to an end?
REX: This won't cause any problem in the town. It does not mean that. Yeah?
WILLIAMS: Like many public servants, this father of six has not been paid for months. What's it like for your family?
JOKCHIM GIAFONA: You yourself could imagine if you've not been paid for two pay periods, especially in a place like this country where inflation is so rampant and you've got to feed your family.
WILLIAMS: As the money dries up, gangsters rule a partisan police force powerless to curb the rule of the gun. Moses Su'u is Supreme Commander of the capital's main militia. He keeps a stolen police machine gun for security. Yet even he wants the Solomon's government to govern, or warns of more trouble.
MOSES SU'U: Right now, the government is trying its best but it cant do anything. I'm not a politician, I dont know why but what I see, as a grassroots person is that leaders of government need to do something very quickly -- otherwise it'll be too late in years to come.
WILLIAMS: Among his contacts is Nelson Ne'e Riria, a policeman and one of the militants who launched the coup, a man now haunted by memories of murder.
NELSON NE'E RIRIA: Now what we have experienced is that like a normal human being, when you kill someone, you kill another human being. Your way of thinking is not straight now.
WILLIAMS: Now the father of a two-year-old, Nelson says militants need counselling to stop the violence and the police force needs replacing.
NELSON NE'E RIRIA: I hope a neutral force will come in first, just to start it off because now if you look at the police force, we have all the wantoks, most of our relatives involved in this coup. So once one of our relatives does something wrong, how can you go and arrest your own relative which you've been involved with him during the crisis?
WILLIAMS: Dress rehearsals for the Queen's Birthday belie a disturbing fact; police are part of the crime crisis.
MARY-LOUISE O'CALLAGHAN: The police force has been completely compromised by their involvement in the coup and the subsequent behaviour of many of the police, regularly going down to Treasury and to government offices demanding funds and special allowances, and alleged payment for alleged operations.
WILLIAMS: Mary-Louise O'Callaghan has reported on the Pacific for 15 years, much of it from her home in Honiara where she's seen criminal elements effectively take over government.
MARY-LOUISE O'CALLAGHAN: The people running the country are only running the country because the people with the guns feel it's in their interest for those people to be there. The system has collapsed in terms of representing anything that the ordinary person wants, I think you would have found yourself from the people you've spoken to, enormous support amongst the grassroots of Solomon Islands for return to rule of law.
WILLIAMS: It's in this environment Commissioner Morrell is trying to restore order for a government that he says doesnt work.
POLICE COMMISSIONER WILLIAM MORRELL: Certainly law and order is a very important aspect because then it will provide the environment where other things can function and at the moment that's not happening. Government is not functioning properly and there's a lot of intimidation within the various ministries.
WILLIAMS: Are police officers still involved in acts of intimidation in Honiara?
POLICE COMMISSIONER WILLIAM MORRELL: I'm sure they are, yes.
WILLIAMS: But Commissioner Morrell's problems dont rest there. In a vast archipelago, he has virtually no money to re-energise a corrupted force, let alone fight crime.
POLICE COMMISSIONER WILLIAM MORRELL: Guadalcanal Province is an example. There's about 40 police officers, only half of them have got uniforms. There are no vehicles, there are no boats, so they get reports of crime, they can't actually attend those reports.
WILLIAMS: Nonetheless, it was with remarkable speed police acted in this case, the beheading of an Australian, Lance Gerbach, at a Seventh Day Adventist hospital on Malaita Island. These pictures of the murder scene, show that Lance was cut down while working at the site of a new shop for the hospital. They were taken by Doctor Bruce Hands, who believes Lance was killed simply because another church official refused an islander free passage on a cargo vessel.
DR BRUCE HANDS: Lance wasn't involved in that at all whatsoever. All sorts of nasty threats were made and the mentality of course, you know all the culture, the mentality, whatever else is commonly, if you have difficulty getting at one person for trying to square off the score, it's pretty common practice well, if you can't get at that guy, you get at someone who's in some way connected with him to square off the score.
WILLIAMS: Police video shows plain clothes officers bringing in an alleged accomplice but the main suspect remains free, possibly protected by relatives. Many heard of the beheading, but few would know of another equally chilling and unpunished murder. Sir Fred Soaki was the Solomon Island's first indigenous Police Commissioner. In February, he was in a restaurant when a former police officer walked in and shot him dead point blank. Sir Fred's wife, Lady Ethel, can't believe he's gone just as they were about to enjoy retirement.
LADY ETHEL: I saw in him many good things -- he was very nice -- that's why I married him. Today I miss him very much.
WILLIAMS: But what's most disturbing, in fact extraordinary, is that Sir Fred's killer was captured, escaped and now lives openly and unchallenged on Malaita. Lady Ethel blames the collusion of certain police.
LADY ETHEL: I think if the police weren't involved, they would go after this man and bring him back. But I think it looks like some police were backing this one.
WILLIAMS: It's likely both killers are being protected by relatives, or wantoks, as they're known -- a deep tribal loyalty that overrides all else, even police ethics. You have now two killers on the run on Malaita Island, one shot a former Police Commissioner, the other one has just beheaded an Australian missionary; why can't you catch them?
POLICE COMMISSIONER WILLIAM MORRELL: It's not like a normal urban environment where there is good intelligence systems, you dont have that influence of the wantoks.
WILLIAMS: So they're being protected?
POLICE COMMISSIONER WILLIAM MORRELL: I dont know they're being -- I mean to some extent I suspect they're being protected -- but the bush areas are very difficult to operate in, particularly when you've got people who may retaliate with firearms.
WILLIAMS: It's into this environment Commissioner Morrell is today trying to extend the rule of law. It invites a truly tribal reception, and a very pukka response.
MORRELL: How are you? Nice to see you all.
WILLIAMS: Aola Village is one of the many that was wracked by ethnic violence. As a sign of some progress, Commissioner Morrell is here to declare it weapons free. Formalities provide cover to check those pesky lines, then it's on with the show. The young men who took up arms listened sceptically. Many guns have been handed in but some remain, they say, for self-defence. There's no permanent police post here.
AOLA VILLAGE MALE: A lot of us know guns stay around here but of course we dont know which houses they are in. We're just here because the government and everyone told us to be here -- but we dont feel the same about it as you who've come to attend.
WILLIAMS: While the youth keep their guns, their chiefs no longer have control over them. Among them leaders of the village women, like Bernadette Gatu are tired of living with what she sees as violent men's business.
BERNADETTE GATU: As is the case in similar conflicts elsewhere, it is the men who do all the planning and cause all the damages and it is the women and children who suffer most and do everything within their means to keep families going.
WILLIAMS: Stopping the violence along these stunning shores is just one of the many needs. I asked another of Aola's female leaders, Tina Tavoria, to show me the village clinic. So how many people would this area look after?
TINA TAVORIA: Say about 5,000 or more.
WILLIAMS: 5,000 people would come here, this would be treating people. What's this section?
TINA TAVORIA: This is the maternity ward.
WILLIAMS: The maternity ward, but there's nothing in there.
TINA TAVORIA: Bare beds.
WILLIAMS: Bare beds and scales.
TINA TAVORIA: Yes.
WILLIAMS: Does that mean that babies are at risk?
TINA TAVORIA: Very much at risk.
WILLIAMS: Have you had baby deaths because of the lack of supplies?
TINA TAVORIA: Say about 10 or 20.
WILLIAMS: Over what period?
TINA TAVORIA: Over 5 years or 4 years since the tension.
WILLIAMS: The women blame government mismanagement and corruption.
TINA TAVORIA: I dont know where the government is spending all the money and it should spend it on those things, the basic needs of the people.
POLICE COMMISSIONER WILLIAM MORRELL: Its absolutely political, well the ethnic violence is just an excuse to cause further tension and it is used by certain individuals
WILLIAMS: By politicians?
POLICE COMMISSIONER WILLIAM MORRELL: Politicians and other power brokers within the community, to create the sort of tension to allow them to carry on with their criminal activity.
WILLIAMS: Like many parts of this country, the Commissioner's visit brings hope to a village that feels forgotten. But as he returns to the capital, it's in the knowledge of a far deeper problem, the government is now defaulting on huge borrowed sums the country is broke.
RICK HOU, Central Bank Governor: The government is at a point where it can't service debt, it can't look after social services, health, the education sector. It's not keeping up with even salaries and wages for its workers. The government is no longer able to look after itself financially, so you know bankrupt.
WILLIAMS: As the nation leaps towards economic disaster, no case highlights the breakdown of order more than the one involving this angry mob. These people are some of the 30,000 victims of a pyramid money scam, gathering today outside court for the appearance of one of its organisers. But in May, they were here, outside the Central Bank, demanding its Governor force the banks to open accounts for the scheme.
RICK HOU: It went as far as people coming in here and actually threatening my staff, giving out sort of threats like this evening we will go to the governor's house and kill him and chase him wherever he goes.
WILLIAMS: Remarkably, police could not secure this country's Central Bank.
RICK HOU: We have an angry mob, we have the police already advising us that this is bad and the indications are that it will cause very, very serious disruptions and that the police won't be able to handle it.
WILLIAMS: Only when the banks threatened to close down for good, did the crisis abate, but until then, the government had been on the mob's side, condoning what the Central Bank had called fraud. All this raises the question where is parliament, well it's closed. It last sat in December and won't sit again until November. The official reason, the government can't pay the power bill. Opposition MP, Joses Tuhanuku, thinks that's just an excuse.
JOSES TUHANUKU: My conclusion is that it's not a question of money, my conclusion is that they just do not have any business to present to parliament. In other words they're not working, this government is not functioning.
WILLIAMS: Australia's interests are now directly threatened by a failing state on our doorstep, desperately seeking cash from any source.
HUGH WHITE: Things going bad in the Solomons can cause real problems for Australia. It can generate trans-national crime, it can be a base for trans-national crime, it could even under some circumstances be a base for terrorism against Australia.
JOSES TUHANUKU: It is in the best interests of Australia and New Zealand and everybody to see that we have proper democratic government in the region, so that we will protect the whole region against the activities of terrorists. The government has been proposing that we should sell Solomon Island passports to people who are not even citizens and that is something that terrorists would very much like to get hold of.
WILLIAMS: Serious security risk or just plain crime, there's not much the police here can do. Already short of vehicles, they rarely have enough fuel to patrol Honiara, even on a Saturday night when the beer flows and the fights follow. Given the lack of resources, it was with extreme concern in November, right after the Bali bombing, that Solomon Island and Federal Police tracked two groups of suspicious Pakistani nationals travelling through Honiara, one group in a chartered plane one of their organisers has been detained in the United States. The chance of a failed state on Australias doorstep is now ringing alarm bells at the highest levels. Last week Australias prime minister John Howard flew in Solomon Island's Prime Minister Sir Allan Kemakeza for talks on sending in an armed Australian intervention force.
JOHN HOWARD: [Addressing media] Obviously there are security issues and there are economic issues and both have to be considered.
SIR ALLAN KEMAKEZA: [Addressing media] The officials will be looking at the nitty gritty of the issue and as I said teams will be sent down and I'm very happy indeed with the response I've had so far.
WILLIAMS: But details of the plan have been drawn up here, at the Australian Strategic Policy Institute led by former Deputy Defence Secretary, Hugh White. He calls for an aggressive Australian led police force.
HUGH WHITE: It's a job that can be done primarily by police of a force of about 50 to 100 well armed, well equipped, well trained police from a number of different countries could go in there and pacify Honiara, get that culture of guns off the street in about a year.
WILLIAMS: Would that require the willingness to sustain casualties if that came down to it?
HUGH WHITE: I think --you certainly need pretty robust policing and I think it would be important, our plan suggests that military forces should be available to back up the police if that would be necessary.
POLICE COMMISSIONER WILLIAM MORRELL: I dont think there's a simple solution that you can just transfer 100 police across and dump them in the Solomon Islands and that's going to solve your problems. It's not.
WILLIAMS: But that's why the Australian plan calls for a second step a UN style administration, a mini East Timor, to run the judiciary, gaols and even the government's finance ministry for 10 years, to get the country back on its feet. Remarkably, the plan has support from the highest office in the land, the Governor-General.
GOVERNOR-GENERAL SIR JOHN INI LAPLI: I have read it and my position is that if that can happen, then it's a way forward to assist the Solomon Islands.
WILLIAMS: But with overtones of neo-colonialism, would the people want it?
GOVERNOR-GENERAL SIR JOHN INI LAPLI: I would think so. I mean theyre the comments we are hearing, is that they want something done to law and order so that they can move around freely.
TINA TAVORIA: We really need finance and law and order to be restored so we need help from overseas.
MOSES SU'U: It would be good if Australia would come would come and help the government to restore law and order. That's a good idea.
WILLIAMS: But why would Solomon Islanders surrender such a significant part of national sovereignty.
MARY-LOUISE O'CALLAGHAN: They're sick and tired and frightened of where this is all going and really they dont feel they're giving up much, they've already lost their police force and their treasury; it's not functioning in the interests of the nation.
WILLIAMS: It would mean a pre-emptive intervention like never before, a major shift in Australia's Pacific policy. But in the face of a deepening crisis, it could be a nation's last hope before it's too late.
Credits: Solomons Crisis
Reporter: Evan Williams
Camera: Brett Ramsay
ACSResearch: Dorothy Wickham
Editor: Simon Brynjolffssen
RICK HOU: It is very unfortunate that this country is now described as a failed state where its nationals can't run it.
WILLIAMS: We report on a troubled Pacific nation, but we also look at a radical plan of intervention that, if adopted, could see armed Australian police in the Solomon Islands. William Morrell is a British Bobby on a mission from Manchester to restore the law. Paid for by the European Union, he was six months ago made Police Commissioner of the sprawling Solomon Islands. His new beat includes remote villages, some with their own languages. With lessons over, it's time for the Commissioner and his wife to enjoy what they thought would be the perfect Pacific posting.
POLICE COMMISSIONER WILLIAM MORRELL: From my sort of distant position in England, looking at the South Pacific, you think everything's really sort of nice. You hear about the Solomon Islands being the land of the happy people, and I suppose it is really, but you dont understand at that distance the tribal rivalries, the pressures and the cultural issues.
WILLIAMS: Those tribal tensions burst into bloody conflict four years ago. A virtual civil war erupted when militants from two rival ethic groups took up arms, many of those involved were police. More than 200 people died in the violence, government was ousted in a coup. In a peace deal, militants were, for a time, made special constables and paid to demobilise or keep the peace. But today in Honiara, that money has stopped and these special constables say they haven't been paid enough.
CONSTABLE: We are all the ex-militants, and after we restored law and order to the country, the government failed to pay a few arrears.
WILLIAMS: Blamed by many for a crime wave, they insist the government owes them thousands of dollars and are prepared to use force to get it.
REX: These boys they are not.. Maybe they will do some criminal activities within this town area.
JOKCHIM GIAFONA: I just want to ask Rex a few questions.
WILLIAMS: Our interview is interrupted by Jokchim Giafona, a government official.
JOKCHIM GIAFONA: Have you been saying that if the government is prepared to pay you 1.3 million, then all the lawlessness in this place would come to an end?
REX: This won't cause any problem in the town. It does not mean that. Yeah?
WILLIAMS: Like many public servants, this father of six has not been paid for months. What's it like for your family?
JOKCHIM GIAFONA: You yourself could imagine if you've not been paid for two pay periods, especially in a place like this country where inflation is so rampant and you've got to feed your family.
WILLIAMS: As the money dries up, gangsters rule a partisan police force powerless to curb the rule of the gun. Moses Su'u is Supreme Commander of the capital's main militia. He keeps a stolen police machine gun for security. Yet even he wants the Solomon's government to govern, or warns of more trouble.
MOSES SU'U: Right now, the government is trying its best but it cant do anything. I'm not a politician, I dont know why but what I see, as a grassroots person is that leaders of government need to do something very quickly -- otherwise it'll be too late in years to come.
WILLIAMS: Among his contacts is Nelson Ne'e Riria, a policeman and one of the militants who launched the coup, a man now haunted by memories of murder.
NELSON NE'E RIRIA: Now what we have experienced is that like a normal human being, when you kill someone, you kill another human being. Your way of thinking is not straight now.
WILLIAMS: Now the father of a two-year-old, Nelson says militants need counselling to stop the violence and the police force needs replacing.
NELSON NE'E RIRIA: I hope a neutral force will come in first, just to start it off because now if you look at the police force, we have all the wantoks, most of our relatives involved in this coup. So once one of our relatives does something wrong, how can you go and arrest your own relative which you've been involved with him during the crisis?
WILLIAMS: Dress rehearsals for the Queen's Birthday belie a disturbing fact; police are part of the crime crisis.
MARY-LOUISE O'CALLAGHAN: The police force has been completely compromised by their involvement in the coup and the subsequent behaviour of many of the police, regularly going down to Treasury and to government offices demanding funds and special allowances, and alleged payment for alleged operations.
WILLIAMS: Mary-Louise O'Callaghan has reported on the Pacific for 15 years, much of it from her home in Honiara where she's seen criminal elements effectively take over government.
MARY-LOUISE O'CALLAGHAN: The people running the country are only running the country because the people with the guns feel it's in their interest for those people to be there. The system has collapsed in terms of representing anything that the ordinary person wants, I think you would have found yourself from the people you've spoken to, enormous support amongst the grassroots of Solomon Islands for return to rule of law.
WILLIAMS: It's in this environment Commissioner Morrell is trying to restore order for a government that he says doesnt work.
POLICE COMMISSIONER WILLIAM MORRELL: Certainly law and order is a very important aspect because then it will provide the environment where other things can function and at the moment that's not happening. Government is not functioning properly and there's a lot of intimidation within the various ministries.
WILLIAMS: Are police officers still involved in acts of intimidation in Honiara?
POLICE COMMISSIONER WILLIAM MORRELL: I'm sure they are, yes.
WILLIAMS: But Commissioner Morrell's problems dont rest there. In a vast archipelago, he has virtually no money to re-energise a corrupted force, let alone fight crime.
POLICE COMMISSIONER WILLIAM MORRELL: Guadalcanal Province is an example. There's about 40 police officers, only half of them have got uniforms. There are no vehicles, there are no boats, so they get reports of crime, they can't actually attend those reports.
WILLIAMS: Nonetheless, it was with remarkable speed police acted in this case, the beheading of an Australian, Lance Gerbach, at a Seventh Day Adventist hospital on Malaita Island. These pictures of the murder scene, show that Lance was cut down while working at the site of a new shop for the hospital. They were taken by Doctor Bruce Hands, who believes Lance was killed simply because another church official refused an islander free passage on a cargo vessel.
DR BRUCE HANDS: Lance wasn't involved in that at all whatsoever. All sorts of nasty threats were made and the mentality of course, you know all the culture, the mentality, whatever else is commonly, if you have difficulty getting at one person for trying to square off the score, it's pretty common practice well, if you can't get at that guy, you get at someone who's in some way connected with him to square off the score.
WILLIAMS: Police video shows plain clothes officers bringing in an alleged accomplice but the main suspect remains free, possibly protected by relatives. Many heard of the beheading, but few would know of another equally chilling and unpunished murder. Sir Fred Soaki was the Solomon Island's first indigenous Police Commissioner. In February, he was in a restaurant when a former police officer walked in and shot him dead point blank. Sir Fred's wife, Lady Ethel, can't believe he's gone just as they were about to enjoy retirement.
LADY ETHEL: I saw in him many good things -- he was very nice -- that's why I married him. Today I miss him very much.
WILLIAMS: But what's most disturbing, in fact extraordinary, is that Sir Fred's killer was captured, escaped and now lives openly and unchallenged on Malaita. Lady Ethel blames the collusion of certain police.
LADY ETHEL: I think if the police weren't involved, they would go after this man and bring him back. But I think it looks like some police were backing this one.
WILLIAMS: It's likely both killers are being protected by relatives, or wantoks, as they're known -- a deep tribal loyalty that overrides all else, even police ethics. You have now two killers on the run on Malaita Island, one shot a former Police Commissioner, the other one has just beheaded an Australian missionary; why can't you catch them?
POLICE COMMISSIONER WILLIAM MORRELL: It's not like a normal urban environment where there is good intelligence systems, you dont have that influence of the wantoks.
WILLIAMS: So they're being protected?
POLICE COMMISSIONER WILLIAM MORRELL: I dont know they're being -- I mean to some extent I suspect they're being protected -- but the bush areas are very difficult to operate in, particularly when you've got people who may retaliate with firearms.
WILLIAMS: It's into this environment Commissioner Morrell is today trying to extend the rule of law. It invites a truly tribal reception, and a very pukka response.
MORRELL: How are you? Nice to see you all.
WILLIAMS: Aola Village is one of the many that was wracked by ethnic violence. As a sign of some progress, Commissioner Morrell is here to declare it weapons free. Formalities provide cover to check those pesky lines, then it's on with the show. The young men who took up arms listened sceptically. Many guns have been handed in but some remain, they say, for self-defence. There's no permanent police post here.
AOLA VILLAGE MALE: A lot of us know guns stay around here but of course we dont know which houses they are in. We're just here because the government and everyone told us to be here -- but we dont feel the same about it as you who've come to attend.
WILLIAMS: While the youth keep their guns, their chiefs no longer have control over them. Among them leaders of the village women, like Bernadette Gatu are tired of living with what she sees as violent men's business.
BERNADETTE GATU: As is the case in similar conflicts elsewhere, it is the men who do all the planning and cause all the damages and it is the women and children who suffer most and do everything within their means to keep families going.
WILLIAMS: Stopping the violence along these stunning shores is just one of the many needs. I asked another of Aola's female leaders, Tina Tavoria, to show me the village clinic. So how many people would this area look after?
TINA TAVORIA: Say about 5,000 or more.
WILLIAMS: 5,000 people would come here, this would be treating people. What's this section?
TINA TAVORIA: This is the maternity ward.
WILLIAMS: The maternity ward, but there's nothing in there.
TINA TAVORIA: Bare beds.
WILLIAMS: Bare beds and scales.
TINA TAVORIA: Yes.
WILLIAMS: Does that mean that babies are at risk?
TINA TAVORIA: Very much at risk.
WILLIAMS: Have you had baby deaths because of the lack of supplies?
TINA TAVORIA: Say about 10 or 20.
WILLIAMS: Over what period?
TINA TAVORIA: Over 5 years or 4 years since the tension.
WILLIAMS: The women blame government mismanagement and corruption.
TINA TAVORIA: I dont know where the government is spending all the money and it should spend it on those things, the basic needs of the people.
POLICE COMMISSIONER WILLIAM MORRELL: Its absolutely political, well the ethnic violence is just an excuse to cause further tension and it is used by certain individuals
WILLIAMS: By politicians?
POLICE COMMISSIONER WILLIAM MORRELL: Politicians and other power brokers within the community, to create the sort of tension to allow them to carry on with their criminal activity.
WILLIAMS: Like many parts of this country, the Commissioner's visit brings hope to a village that feels forgotten. But as he returns to the capital, it's in the knowledge of a far deeper problem, the government is now defaulting on huge borrowed sums the country is broke.
RICK HOU, Central Bank Governor: The government is at a point where it can't service debt, it can't look after social services, health, the education sector. It's not keeping up with even salaries and wages for its workers. The government is no longer able to look after itself financially, so you know bankrupt.
WILLIAMS: As the nation leaps towards economic disaster, no case highlights the breakdown of order more than the one involving this angry mob. These people are some of the 30,000 victims of a pyramid money scam, gathering today outside court for the appearance of one of its organisers. But in May, they were here, outside the Central Bank, demanding its Governor force the banks to open accounts for the scheme.
RICK HOU: It went as far as people coming in here and actually threatening my staff, giving out sort of threats like this evening we will go to the governor's house and kill him and chase him wherever he goes.
WILLIAMS: Remarkably, police could not secure this country's Central Bank.
RICK HOU: We have an angry mob, we have the police already advising us that this is bad and the indications are that it will cause very, very serious disruptions and that the police won't be able to handle it.
WILLIAMS: Only when the banks threatened to close down for good, did the crisis abate, but until then, the government had been on the mob's side, condoning what the Central Bank had called fraud. All this raises the question where is parliament, well it's closed. It last sat in December and won't sit again until November. The official reason, the government can't pay the power bill. Opposition MP, Joses Tuhanuku, thinks that's just an excuse.
JOSES TUHANUKU: My conclusion is that it's not a question of money, my conclusion is that they just do not have any business to present to parliament. In other words they're not working, this government is not functioning.
WILLIAMS: Australia's interests are now directly threatened by a failing state on our doorstep, desperately seeking cash from any source.
HUGH WHITE: Things going bad in the Solomons can cause real problems for Australia. It can generate trans-national crime, it can be a base for trans-national crime, it could even under some circumstances be a base for terrorism against Australia.
JOSES TUHANUKU: It is in the best interests of Australia and New Zealand and everybody to see that we have proper democratic government in the region, so that we will protect the whole region against the activities of terrorists. The government has been proposing that we should sell Solomon Island passports to people who are not even citizens and that is something that terrorists would very much like to get hold of.
WILLIAMS: Serious security risk or just plain crime, there's not much the police here can do. Already short of vehicles, they rarely have enough fuel to patrol Honiara, even on a Saturday night when the beer flows and the fights follow. Given the lack of resources, it was with extreme concern in November, right after the Bali bombing, that Solomon Island and Federal Police tracked two groups of suspicious Pakistani nationals travelling through Honiara, one group in a chartered plane one of their organisers has been detained in the United States. The chance of a failed state on Australias doorstep is now ringing alarm bells at the highest levels. Last week Australias prime minister John Howard flew in Solomon Island's Prime Minister Sir Allan Kemakeza for talks on sending in an armed Australian intervention force.
JOHN HOWARD: [Addressing media] Obviously there are security issues and there are economic issues and both have to be considered.
SIR ALLAN KEMAKEZA: [Addressing media] The officials will be looking at the nitty gritty of the issue and as I said teams will be sent down and I'm very happy indeed with the response I've had so far.
WILLIAMS: But details of the plan have been drawn up here, at the Australian Strategic Policy Institute led by former Deputy Defence Secretary, Hugh White. He calls for an aggressive Australian led police force.
HUGH WHITE: It's a job that can be done primarily by police of a force of about 50 to 100 well armed, well equipped, well trained police from a number of different countries could go in there and pacify Honiara, get that culture of guns off the street in about a year.
WILLIAMS: Would that require the willingness to sustain casualties if that came down to it?
HUGH WHITE: I think --you certainly need pretty robust policing and I think it would be important, our plan suggests that military forces should be available to back up the police if that would be necessary.
POLICE COMMISSIONER WILLIAM MORRELL: I dont think there's a simple solution that you can just transfer 100 police across and dump them in the Solomon Islands and that's going to solve your problems. It's not.
WILLIAMS: But that's why the Australian plan calls for a second step a UN style administration, a mini East Timor, to run the judiciary, gaols and even the government's finance ministry for 10 years, to get the country back on its feet. Remarkably, the plan has support from the highest office in the land, the Governor-General.
GOVERNOR-GENERAL SIR JOHN INI LAPLI: I have read it and my position is that if that can happen, then it's a way forward to assist the Solomon Islands.
WILLIAMS: But with overtones of neo-colonialism, would the people want it?
GOVERNOR-GENERAL SIR JOHN INI LAPLI: I would think so. I mean theyre the comments we are hearing, is that they want something done to law and order so that they can move around freely.
TINA TAVORIA: We really need finance and law and order to be restored so we need help from overseas.
MOSES SU'U: It would be good if Australia would come would come and help the government to restore law and order. That's a good idea.
WILLIAMS: But why would Solomon Islanders surrender such a significant part of national sovereignty.
MARY-LOUISE O'CALLAGHAN: They're sick and tired and frightened of where this is all going and really they dont feel they're giving up much, they've already lost their police force and their treasury; it's not functioning in the interests of the nation.
WILLIAMS: It would mean a pre-emptive intervention like never before, a major shift in Australia's Pacific policy. But in the face of a deepening crisis, it could be a nation's last hope before it's too late.
Credits: Solomons Crisis
Reporter: Evan Williams
Camera: Brett Ramsay
ACSResearch: Dorothy Wickham
Editor: Simon Brynjolffssen