Corruption watchdog passes major hurdle

But the crossbench's push to lower the bar for hearings to be held in public was voted down.

The opposition and Greens teamed up to beef up the powers of the inspector to ensure tighter oversight of the commission.

The Greens and independent senators David Pocock and Jacqui Lambie also pushed to lower the "exceptional circumstances" threshold for public hearings but failed.

Labor frontbencher Murray Watt refused to list what an exceptional circumstance would be, saying while he had some examples in mind, he didn't want to "constrain the commission" by defining the term.

"We wanted to preserve the commission's independence by not dictating to them or limiting them as to what the exceptional circumstances might be," he said.

He maintained the government had gotten the balance right between public and private hearings.

Senator Pocock questioned why Labor increased the threshold from the election pledge to have public hearings when it was in the public interest to do so.

A fight over how a commissioner will be selected has also been settled, with the government able to use its majority on a parliamentary committee to tick off the appointment.

The Greens walked away from supporting a coalition amendment that would have required a three-quarters majority, which means any commissioner would need to be agreed on by both the government and opposition.

Shadow attorney-general Julian Leeser said this process would ensure any appointments were made in a bipartisan way and not become politicised but Attorney-General Mark Dreyfus said it amounted to "an effective veto".

Mr Leeser said the coalition had come to the table "in good faith" and supported the establishment of the commission.

Greens senator David Shoebridge said his majority-plus-one proposal removed the government's absolute power and also took away the opposition's chance to veto an appointment.

That amendment failed as well.

Senator Shoebridge said it illustrated parliament was "addicted to executive power".

Prime Minister Anthony Albanese defended the decision, saying the government had consulted widely and adopted all the recommendations of the parliamentary inquiry into the bill.

"We have supported proper processes in order to get a national anti-corruption commission, which the parliament should be proud of," he said.

Senators Shoebridge and Pocock also failed to include pork barrelling and political donations for the purpose of influencing decisions or policy into the definition of corrupt conduct.

Senator Watt responded that the commissioner would be able to investigate systemic corrupt conduct and attempts by third parties to corrupt officials.

The government-controlled lower house is set to tick off the legislation on Wednesday.

It is expected to be up and running by mid-2023.

Australian Associated Press