The peak independent body that advises on the nation's largest infrastructure projects will be revamped.
Reforms for Infrastructure Australia that passed the Senate on Tuesday mean the organisation will get the power to inquire into nationally significant infrastructure projects.
Its functions have also been redefined and a new governance structure will be put in place.
The coalition had allowed the independent body to lose its direction and be stacked with political board appointments, assistant minister Anthony Chisholm said.
"They destroyed Infrastructure Australia as a major economic body and instead used it as a vehicle to give jobs to their mates," he told the Senate on Tuesday.
"They ignored Infrastructure Australia's priority list and instead invested in imaginary car parks rather than major projects that would lay the foundations for the nation's future economic growth."
The minister said Infrastructure Australia would now provide "relevant and timely expert advice" to the government on infrastructure planning and project prioritisation.
It will also remove duplicating work with the state and territories.
The body will be governed by three commissioners appointed by the minister while the CEO will be appointed by the commissioners.
However, the bill failed to enhance the transparency of government decisions after the minister cut funding for dozens of projects, opposition infrastructure spokeswoman Bridget McKenzie said.
"If you want to know why we bother having an infrastructure pipeline, it's so that Australians have the road projects they need to get home swiftly and safely," Senator McKenzie told the Senate.
"That out in the regions we have a road network that allows us to get our fabulous product to ports and to capital cities to market around the world and that our truckies can travel on roads that are safe."
The amended legislation will need to be ticked off by the government-controlled lower house when it sits for the final time this year on Thursday.
Infrastructure Minister Catherine King cut about $7 billion worth of commuter car parks, fast rail and other infrastructure projects, citing a $33 billion budget blowout.
The cuts represented projects that were not realistically going to be delivered with the available funding or had made little to no progress over a significant amount of time, Ms King said.