The role of the government's chief legal adviser, the attorney general, is "not sustainable" and needs reform, says an influential committee of MPs.
Lord Goldsmith found his role under the spotlight
The Constitutional Affairs Committee said confidence had been dented by rows over legal advice on the Iraq war and the ending of the BAE fraud inquiry.
It said advice given to ministers had to be seen to be independent.
Its report said a career lawyer, not a political appointee, should advise the government on legal matters.
Former attorney general Lord Goldsmith, a close friend of Tony Blair, had found himself at the centre of controversy for his role in deciding whether any prosecutions should be brought in the cash-for-honours inquiry.
His successor, Baroness Scotland, has already said she will no longer make key prosecutions in individual criminal cases.
The role includes overseeing prosecutions, advising the government on legal matters, as well as sitting in government as a minister - often attending Cabinet meetings.
The committee recommended the attorney general not attend Cabinet "unless invited for specific discussions" and say his legal functions could be carried out by a career lawyer, rather than a politician, member of the government or political appointee.
"Allegations of political bias, whether justified or not, are almost inevitable given the attorney general's seemingly contradictory positions," the report said.
"This situation is not sustainable."
Its report said the Iraq war advice, cash-for-honours controversy, and that surrounding the decision to end the inquiry into a BAE defence deal with Saudi Arabia in the 1980s, had "compromised or appeared to compromise" the position of the attorney general.
The responsibility for prosecutions was among the "most problematic aspects" of the role, they said.
The committee's Lib Dem chairman Alan Beith MP said the "heart of the problem" was that the attorney general gave legal advice to government and ruled on sensitive prosecutions that might involve government while "sitting in that same government as a Cabinet level office holder".
"Parliament must be able to call to account those who make political decisions in this field, and there needs to be confidence that legal advice and decisions on prosecutions, are not being politicised," said Mr Beith.
He said officials, like the governor of the Bank of England, could be held to account through select committees and said the role should be restructured.
The report said the prosecution role should be "de-politicised" to restore public confidence, legal advice should come from a career lawyer who is not a politician, while the ministerial role should be taken on by a minister in the Ministry of Justice.