The NSW corruption watchdog is being forced to hire temporary investigators to meet demand after last year's funding cut by the state government and has commissioned a consultant to advise it how to rectify the situation.

The Independent Commission Against Corruption is preparing to ask the NSW government for a funding boost of around $2.5 million to meet the staffing shortfalls and help it take a "proactive" position on graft detection.

ICAC Chief Commissioner Peter Hall, QC says "at the moment, current demands can't be satisfactorily met by existing numbers".

On Monday ICAC chief commissioner Peter Hall outlined to a parliamentary committee the impact of the agency cutting the number of investigative teams from four to three after an $800,000 funding cut in the 2016-17 budget.

Mr Hall said there were "inevitably peaks and troughs" in the level of demand on the agency.