Australian National University Vice-Chancellor Brian Schmidt says both major political parties have been guilty of political interference in the grants process which can "corrupt knowledge".
Professor Schmidt referenced acting federal Education Minister Stuart Robert's decision to veto several projects recommended for grant funding by the independent Australian Research Council.
The Nobel Prize winner said Australia needed an apolitical allocation of research funding and called for a review of the ARC.
"(The ARC) is so foundational to our future and the nation's future and it's clearly not working," he said in his recent state of the university address.
The Senate on Wednesday voted to refer a bill seeking to amend the Australian Research Council Act 2001 to remove ministerial discretion in relation to the approval of research grants to the education and employment legislation committee.
The motion, moved by Greens senator Mehreen Faruqi, comes after the party first called for new laws to remove ministerial discretion in the approval of grants recommended by the ARC in 2018.
Senator Faruqi said researchers and universities are "fed-up" with ministerial veto powers.
"Political interference has no place in research funding," she said.
"By hearing from university communities, academics, researchers and unions, the Senate will be forced to confront the real-world, damaging impact the veto has."
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