Australia's new anti-corruption watchdog will have "teeth" to investigate criminal behaviour from MPs, federal police and public servants.
But new offences of aggravated corruption will not be retrospective, and public hearings may only be held in some cases.
The newly-announced Commonwealth Integrity Commission will prepare briefs of evidence for prosecutors, but will not have the power to instigate its own investigations.
"This is a real proposal, with real resources, real teeth," Prime Minister Scott Morrison told reporters in Sydney on Thursday.
"These are sensible changes we're outlining today. They learn the lessons, I think, from many of the failed experiments we've seen at a state jurisdiction level.
"I have no interest in establishing kangaroo courts."
Labor leader Bill Shorten said the proposal was not "fair dinkum" because its powers did not go far enough.
"(Mr Morrison) said tackling anti-corruption was a fringe issue 17 days ago, and now he's come up with a fringe answer," Mr Shorten told reporters.
The new body will be split into two parts - one investigating corruption in law enforcement, and the other investigating the public sector.
The current Australian Commission for Law Enforcement Integrity will be wrapped up into the new body, and given more responsibility to investigate bodies like the tax office.
It will have stronger powers, due to the higher-risk nature of investigating law enforcement agents with significant ability to hide their corruption.
The public sector integrity division will investigate government departments, parliamentarians and their staff, the staff of federal judicial officers, and in some circumstances organisations that get federal money.
Attorney-General Christian Porter said new offences will be created, including "aggravated corruption by a public sector official".
He said the commission will not be a star chamber running show trials where guilt is already presumed.
Work on the new commission has been under way since January.
Labor, the Greens and independents pressured the coalition into passing a motion in parliament in November calling for an integrity commission to be set up.
The coalition aims to avoid the problems the NSW and West Australian anti-corruption bodies have faced by splitting the commission's powers over its two divisions.
Law Council of Australia president Morry Bailes strongly welcomed the new commission.
"(But it is) essential the coercive powers exercised by the CIC through private chamber hearings are not abused and that there are rights enshrined to protect legal professional privilege," Mr Bailes said.
The government has asked for public feedback by February 1, before laws creating the commission are introduced to parliament.
