The heads of some of the country's leading scientific facilities say they were caught by surprise late last year to discover that funding for world-renowned research infrastructure was linked to the passage of university fee deregulation.
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Education Minister Christopher Pyne has said that $150 million funding for the National Collaborative Research Infrastructure Strategy (NCRIS) - which has been described as the "backbone of research in Australia" - is contingent on the government's stalled higher education reforms passing the Senate.
NCRIS facilities directly employ 1700 highly skilled staff at 27 sites across the country.
Labor and the Greens have accused the government of trying to "blackmail" the Senate.
Astronomer and Nobel laureate Brian Schmidt said this week that the cuts would be a "hit to research like I have never seen in the 20 years I have been in Australia".
"It really is the foundations of the research we do across the country, across all disciplines so it will have an enormous effect and it is something we cannot let happen," he said.
Rosie Hicks, chief executive of the Australian National Fabrication Facility (ANFF), told Senate hearings on Friday: "There was an announcement made in the May budget but the funds have never flowed."
Ms Hicks said it was "not the understanding" at the time of the budget that NCRIS funding was linked to savings in the government's higher education proposals.
Ms Hicks said the ANFF – which, among other innovations, developed a new patch that removes the need for vaccines to be refrigerated – would begin closing down from June if funding is not found.
Seventy-five jobs would be lost and staff have already begun asking for references, she said.
Tim Clancy, director of the Terrestrial Ecosystem Research Network, said it was his impression that the one-year extension of NCRIS funding announced in the budget was guaranteed.
Professor Clancy said it became clear to him when the government's bills were introduced into Parliament that the funding was tied to Senate support for fee deregulation.
Professor Clancy said the uncertainty over future funding was "crippling" and that morale was low, especially among junior staff.
A spokesman for Mr Pyne said: "Since the May 2014 budget it has been clear that funding for NCRIS and the Future Fellows scheme, de-funded by Labor, were part of the higher education reform package and were funded through savings measures within the reform package.
"Minister Pyne has said this repeatedly over many months."
Michael Dobbie, chief executive of the Australian Phenomics Network (APN), said: "We will lose everything that we've worked for [if NCRIS funding ceases].
"It's extremely frustrating."
The APN provides Australian and international researchers with mouse models for the study of a variety of diseases ranging from cancer and diabetes, to immunological and blood disorders.
Dr Dobbie said the network was in the middle of a major five-year research study that would re-locate to Texas if NCRIS funding dries up.
Independent Senator Nick Xenophon said Mr Pyne was playing "undergraduate politics" and that Australia would become an "international laughing stock" if research facilities close.
