Tony Abbott, the Liberal Party president and close ally of Opposition Leader Angus Taylor, has accused the Independent Commission Against Corruption of overstepping its remit by becoming involved in an “internal party squabble”.

Abbott, whom Taylor picked as federal president in May, described the religious-right Reformers group as a group of enthusiastic young Christians with a strong sense of mission, and argued there was no suggestion of self-enriching corruption.

Taylor’s long-time friend and supporter, Catholic schools boss Dallas McInerney, is among those being investigated by the ICAC for funnelling Catholic Schools NSW funds to the hard-right Reformers through lobbying companies as illicit donations.

Abbott acknowledged the Reformers, whose key members provided evidence in the first week of Operation Rosny’s hearings, “might have let their enthusiasm get the better of their judgment.”

However, the former prime minister told this masthead the inquiry seemed to involve one faction weaponising the ICAC against another.

“There seems to be a level [of] incredulity directed against people’s Christianity, but my main problem is the factional weaponisation of what’s supposed to be an instrument of justice,” he said.

“I’m surprised that ICAC has allowed itself to be caught up in an internal party squabble that involves no conceivable ‘corruption’ in the sense of people gaining an unfair advantage for themselves, especially this close to a state election.”

The probe into his allies has already been a distraction for Taylor, who remains behind One Nation in the polls. ICAC’s hearings are due to continue for another seven weeks.

The inquiry last week produced a message from McInerney to Reformers members saying he planned to “shake down Angus for 10k”, while another witness said McInerney boasted of securing a pledge for $15,000 from Taylor. Taylor has repeatedly insisted no payment was made.

A key Reformers operative told the commission last week that Abbott, a former prime minister, featured in the group’s first event, in February 2018.

Abbott’s statement represents the firmest defence of the bid to install up to 5000 right-wing members to fight the rival centre-right faction, led by MP Alex Hawke, and generate a more conservative stance on social and cultural issues.

His remarks go further than the limited responses from Taylor to questions last week about the claim that he donated money.

While Taylor has not been called by ICAC and is not accused of wrongdoing, some of his federal colleagues have held informal talks about the process for changing leaders if he was implicated more directly.

The MPs and factional opponents of Taylor, who asked for anonymity to discuss the live inquiry, are not necessarily expecting more damaging revelations about the opposition leader. But they are questioning why he has not distanced himself more forcefully, and are on guard in case there are further claims.

A group of Taylor’s federal colleagues are also frustrated to learn through evidence tendered to the inquiry that Taylor may have had awareness of plots to topple Hawke’s allies, including Sussan Ley and Melissa McIntosh.

Figures close to Taylor in Canberra, who also declined to be named, argue ICAC has cast the activities of staunch Christian activists as inherently sinister when their work mirrored that of other factions.

They point to the Albanese government’s decision to limit public hearings in the federal ICAC, due to fears of reputational damage to MPs who were named but not alleged to have broken the law, as evidence that the ICAC’s hearings are unfair.

Taylor’s allies add that even if a payment to Reformers was made by him or any entity connected to him, it would not prove corruption, although it may have breached disclosure laws.

However, the ICAC’s inquiry is also looking at whether controversial property developer Jean Nassif spent $2 million paying Liberal operatives from the hard-right faction to influence state government and local council planning decisions.

Of these allegations, Abbott said: “Lobbying is not corrupt at least if the lobbyist has no hold over the lobbied.”

Taylor’s deputy leader, Jane Hume, said on Sunday that Taylor was “not a party to any of the matters that ICAC are referring to.”

“He hasn’t been approached by the ICAC and to be honest, I feel that this is so distant from him,” she said on ABC’s Insiders. “I agree with [NSW Premier] Chris Minns on this one... ICAC should be allowed to go through its processes free of political interference, free of commentary from politicians.”

Abbott’s dismissal of the ICAC probe stood in contrast with NSW division president and party moderate Peter Collins. The former NSW opposition leader, who once employed Elliott, said to the Daily Telegraph on Sunday that “every detail should come out … and any member of the Liberal Party that can assist ICAC should”.

“I have been watching in disbelief. That the Liberal Party just let this unfold, let David Elliott’s political career slip away,” he said. “I was absolutely aghast that this happened”.

Minns on Sunday denied the ICAC hearings were a boon for Labor ahead of the NSW election in March. He feared that the issues being aired in ICAC would push voters from establishment parties further towards One Nation.

Further reading

Here are some of the highlights from the first week of our coverage.

• ‘Not to be messed with’: Who is Dr Peggy Dwyer SC, the counsel assisting ICAC?
• How the NSW Reformers infiltrated the Liberal Party
• The ghosts of ICAC’s past haunt the NSW Liberals, writes Kate McClymont
• Opinion:How does Liberal plotting and branch-stacking fit into God’s plan? Malcolm Knox asks