Damien Tudehope denies knowing donations breached electoral laws at ICAC inquiry

Former NSW Liberal minister Damien Tudehope has denied knowing donations from his friend and hotelier Michael O'Hara could have breached the state's electoral funding laws.

Mr Tudehope told the state's corruption inquiry he did not believe payments made by Mr O'Hara, a prohibited donor, were political donations.

Mr Tudehope has not been accused of any wrongdoing and quit the opposition frontbench last month after being called as a witness in the Independent Commission Against Corruption (ICAC) inquiry, codenamed Operation Rosny.

Part of ICAC's probe is examining whether Mr O'Hara made political donations that were not declared and exceeded applicable donation caps.

The commission has previously heard he used a company called Paslibdan Pty Ltd to make the donations, disguised as consultancy payments, to help stack the Liberal Party with conservative members.

Last week, the inquiry was told Mr O'Hara was a prohibited donor because he "built a hospitality empire and has shares in numerous venues around New South Wales".

Mr Tudehope on Tuesday told the inquiry he shared a decades-long friendship and political alliance with Mr O'Hara and introduced him to members of the right-wing Liberal Party factional group the NSW Reformers.

The Reformers are a conservative Christian factional group in the Liberal Party, associated with several key figures in the inquiry.

Mr Tudehope said he supported the group due to their advocacy on conservative social issues and had spoken at the group's events but said he was surprised to learn Mr O'Hara donated tens-of-thousands of dollars.

Under questioning from Counsel Assisting Peggy Dwyer SC, Mr Tudehope said he voted and supported the state's electoral funding laws but did not accept Mr O'Hara was making a political donation for the purposes of the electoral funding.

He said he would never have exposed his friend to legal risk if he believed he was a prohibited donor.

"If you think for one moment ... that I would expose Michael O'Hara to a circumstance where he would have to give evidence in this commission the way that he had to give evidence last week, if you think that I would expose a friend of mine to that level of scrutiny that he was exposed to 83 years of age with stage three for cancer," Mr Tudehope said.

Mr Tudehope also said he was shocked by allegations sham invoices were used to disguise the payments, telling the inquiry there would have been "no reason to cover" them up if the donations were lawful.

Assistant Commissioner Fabian Gleeson SC suggested the conduct could be explained by a single word: "concealment".

"Well, illegal concealment. Call it what you like," Mr Tudehope replied.

Mr Tudehope also rejected claims he pressured members of the Reformers, including Jean-Claude Perrottet, to ramp up recruitment in Sydney's Hills district.

The inquiry also heard that Christian Ellis worked in Mr Tudehope's parliamentary office for about three months in 2019, before his employment was terminated.

Mr Tudehope accepted the decision followed media reporting linking Mr Ellis and Mr Perrottet to alleged branch-stacking activities.

When asked whether "blow back" on this on his office prompted him to "get rid" of Mr Ellis, he agreed.

Request for $50k to recruit new members

The inquiry heard retired Sydney businessman Frits Maré rejected a request from lobbyists Mr Ellis and Mr Perrottet to provide $50,000 to recruit new party members as part of a bid to unseat federal MP Alex Hawke.

In his evidence to the inquiry, the Liberal Party member said the pair proposed using the money to establish a call centre to recruit younger members but had no budget detailing how funds would be spent.

"I never paid the money ... I never caused them to be paid by anyone else or by a corporation, that was the end to it," Mr Maré said.

The commission also heard Mr Perrottet continued contacting Mr Maré after the request was refused, describing the efforts as "persistent" and said he had "no interest in getting involved in factional issues."

Mr Maré said he asked former Liberal, now-independent northern beaches councillor Vincent De Luca, for his view on the request.

Mr De Luca suggested he believed the $50,000 request was intended to "supplement" Mr Ellis and Mr Perrottet's incomes rather than fund branch-stacking.

"I actually thought they were genuine ... They came across as quite dedicated to what they said they were going to do."

Mr Maré is not a person of interest or named in proceedings.

Trip to Fiji

The inquiry also heard former premier Dominic Perrottet knew his brother, Jean-Claude Perrottet, was in Fiji during the 2023 parliamentary inquiry into alleged illegal donations involving Hills Shire Council.

Mr Tudehope said Dominic Perrottet initially told him he did not know where his brother was, before later saying he believed he was in Fiji.

He told the commission he regarded the parliamentary inquiry as politically motivated and did not intervene.

The inquiry heard last week that Jean-Claude Perrottet travelled to Fiji during that 2023 investigation "with financial assistance from others named in allegations".

Dominic Perrottet, who referred the allegations to ICAC in 2022, is not accused of any wrongdoing.

The commission also heard Mr Tudehope's son, James Tudehope, raised concerns after feeling pressured to approve payments to Christian Ellis while working at Catholic Schools NSW.

Mr Tudehope said his son questioned whether the organisation was receiving value for money and believed the invoices were unjustified.

He told the inquiry he advised his son to raise the matter with then-CEO Dallas McInerney and said it did not raise broader concerns for him at the time.

James Tudehope has moved to New Zealand and did not agree to assist with the ICAC probe.

'Self-interests'

NSW Liberal Leader Kellie Sloane again fielded several questions about the inquiry on Tuesday.

"This is what everyone hates about politics ... The idea that politicians are in it for themselves, there's even the backroom operators in it for themselves," Ms Sloane said.

"We need people to come into these roles for the right reasons to serve the interests of the public. Not their self-interests."

Asked whether she was aware any other frontbenchers or MPs had spoken to her about potentially being called to appear before the inquiry, Ms Sloane replied: "No, I don't know of anyone else".

"I just don't know the outcome, I'm not going to pre-empt anything. I'm not going to stand here and pretend I know what's coming, I don't," she said.

"This happened before my time. It involves a lot of people in the backroom of the party. I'm watching it live like anyone else."