Ms Higgins reached the agreement with the Commonwealth in December 2022 after her alleged rape in Parliament House in 2019, while she was working in Senator Reynolds' office.
The settlement was referred to the National Anti-Corruption Commission by Senator Reynolds, who questioned the handling of the process by then-attorney-general Mark Dreyfus.
"I am bitterly disappointed by the NACC's decision not to investigate the circumstances surrounding the Commonwealth's multi-million dollar settlement with Ms Higgins," Senator Reynolds said in a statement on Thursday.
The senator claimed she had been given "no opportunity to defend the serious and baseless claims against me" during a mediation process.
"I fail to understand how the Commonwealth and its lawyers could not appreciate the serious and probable consequences of settling such serious allegations on my behalf ... and the message that it would send to the public about the truth of those matters," she said.
Senator Reynolds said it was one of the issues her Federal Court lawsuit against the Commonwealth over the settlement would explore.
The commission found "no corruption issue" with Ms Higgins' payout following an investigation.
"No corruption issue arises, and so there is no basis for any further action by the commission," the watchdog said in a statement.
"There was no inappropriate intervention in the process by or on behalf of any minister.Â
"The then-attorney-general approved the settlement in accordance with the departmental advice.
"Documents produced showed that decisions made in relation to the settlement were based on advice from independent external solicitors and experienced senior and junior counsel."
The commission said there was "no material difference" in the legal advice surrounding the payment during the term of the former coalition government and the current Labor government.
The agreement of the settlement amount within one day during mediation was not unusual.
"It was the culmination of a process which took approximately 12 months. None of this is unusual for a non-litigated personal injury claim," the commission said.
"A critical consideration during the settlement process was avoiding ongoing trauma to Ms Higgins."
Ms Higgins alleged she was raped by Liberal staffer Bruce Lehrmann in a Parliament House office in 2019.
Lehrmann has always denied the allegations.
Charges were brought against Lehrmann in a criminal trial in 2022, but were abandoned after juror misconduct.
A retrial was ruled out because of the potential effect on the mental health of Ms Higgins.
A defamation trial brought on by Lehrmann found that on the balance of probabilities he had raped Ms Higgins.
1800 RESPECT (1800 737 732)
National Sexual Abuse and Redress Support Service 1800 211 028
