In a swift development following high-stakes testimony before New South Wales’ top anti-corruption body, the chief executive of the state’s peak Catholic schools authority has been removed from his post over allegations tied to illegal electoral funding and Liberal Party branch stacking. Dallas McInerney, who led Catholic Schools NSW (CSNSW) — the organization representing 594 schools and 274,000 students across the state — was formally terminated by the CSNSW board just days after giving evidence to the New South Wales Independent Commission Against Corruption (ICAC).
The ongoing ICAC investigation centers on claims that McInerney violated state electoral funding laws by funneling financial resources through CSNSW to a quiet, conservative-leaning faction within the NSW Liberal Party. The faction, known as the Reformers, has been accused of engaging in branch stacking — a practice of packing local party branches with aligned members to shift internal power dynamics — specifically to amplify conservative and Christian voices within the party. The inquiry has also heard that multiple individuals linked to the Reformers faction, including one associate not formally named in the probe, carried out factional political work while on the CSNSW payroll.
McInerney first stepped back from his leadership role earlier this year when his name was first linked to the corruption investigation. During his recent testimony, he stated publicly that he intended to cooperate fully with ICAC’s inquiry and sought to clear himself of all allegations of wrongdoing.
The CSNSW board announced its decision in an official statement this week, confirming that it had unanimously voted to terminate McInerney’s employment after concluding it had lost confidence in his ability to lead the organization moving forward. To maintain operational stability, the board confirmed interim chief executive Peter Yates will remain in the acting role until a permanent replacement can be recruited and appointed.
Notably, counsel assisting the ICAC inquiry, Peggy Dwyer SC, made clear in her opening remarks that there is no suggestion the CSNSW board or the broader organization bears responsibility for the actions under investigation, nor that board members had any prior knowledge of McInerney’s alleged conduct. Even so, the CSNSW statement emphasized that the allegations at the center of the inquiry remain a source of deep concern for the organization and its key stakeholders. In response to the probe, the board has committed to conducting a full, independent external review of CSNSW’s operational governance and procedures to address any gaps that may have allowed the alleged conduct to occur.