The directors of the RSL's major charity nursing home provider voted to pay themselves generous "consulting" payments despite advice they may have breached the law and as the organisation was teetering on financial collapse, an inquiry into the organisation was told on Thursday.

RSL LifeCare, a network of more than 30 nursing homes owned by the veterans' charity, has been under scrutiny since Fairfax revealed its directors, including top NSW public servant Jim Longley, had shared in nearly $2.3 million in "consulting fees" that potentially breached state law.

Former NSW RSL president Don Rowe admitted using his RSL credit card for day-to-day living expenses. Credit:Peter Rae

But at a public inquiry on Thursday, RSL LifeCare chief executive Ron Thompson admitted the charity's board had voted in 2007 to pay itself consulting fees just as the organisation was facing potential collapse.

"The debts owed to veterans when they finally exited [our nursing homes] would not allow the company to survive," said Mr Thompson. "The company was facing [a shortfall] of tens of millions of dollars."