The NSW Independent Commission against Corruption (ICAC) is investigating allegations that Catholic Schools NSW (CSNSW) made illegal political donations to the NSW Liberal party at the behest of its chief executive Dallas McInerney.

The Commission is investigating whether people linked to the conservative Christian Liberal factional group NSW Reformers solicited money from prohibited donors and disguised political donations through companies and sham invoices to build their influence.

McInerney has stood aside from his role after the ICAC announced it was investigating whether the organisation made donations, arranged and approved by him, that were not declared, exceeded the legal limit, and were used for Liberal Party recruitment and/or membership renewal.

He told the NSW corruption watchdog yesterday he sought money from federal Opposition Leader Angus Taylor, but not to support a conservative faction. 

Taylor is not accused of any wrongdoing and has repeatedly denied making a payment.

Independent Education Union of Australia (IEUA) NSW/ACT Branch Secretary Carol Matthews said union members support full transparency and accountability in the use of public funding by non-government schools.

“IEU members would be deeply concerned if any public funding for non-government schools has been diverted from its intended purpose,” she said.

“This is because teachers and school staff face ongoing workload pressures and resourcing constraints.”

The ICAC has heard evidence that up to $265,000 in Catholic Schools NSW funding may have been diverted to the Reformers via two consultancy arrangements.

It has also heard evidence that members of the Reformers employed by Catholic Schools NSW recruited and renewed members to the Liberal party during work time.

Matthews said public funding for non-government schools should be used to improve student academic outcomes and enhance the learning experience for students.

“Responsible school expenditure includes professional learning for school staff, development of curriculum materials, support for students with disabilities, and adequate pay and working conditions for staff who deliver quality education,” she said.

The NSW Government closely scrutinises expenditure at the individual school level and at the school proprietor level to ensure funding is used solely for the operation of each school, IEUA said.

“However, similar scrutiny is not applied to organisations such as Catholic Schools NSW that receive funding on behalf of Catholic diocesan schools,” Matthews said.

“Regardless of the findings of ICAC in this matter, there should be greater scrutiny of bodies such as Catholic Schools NSW, which receive public funding on behalf of non-government schools.”