The state's corruption watchdog says it will be forced to shed a quarter of its full-time staff over the next financial year due to inadequate funding, reducing the organisation to its smallest size in its 30-year history.

The NSW Independent Commission Against Corruption has warned that without a funding boost it will be forced to make redundant 31 full-time employees from its 120-strong workforce in order to find savings of $4.7 million in 2020-21.

The ICAC's chief commissioner Peter Hall has previously said funding cuts would have a serious effect on fighting corruption. Credit:Janie Barrett

It is the first time the corruption body has put a staffing figure on the impact of budget pressures, after appealing to the state government earlier this year to address its funding concerns.

The ICAC detailed its concerns in a submission to a NSW parliamentary inquiry, where it said a funding shortfall would have "an immediate and devastating effect on the commission's frontline services and, therefore, its ability to fight corruption".