Some parents say they have evidence the federally-funded National School Chaplaincy program is being used to push religion to public school students.

The controversy is now headed for the High Court, and there is also a Federal Government review and an ombudsman's investigation.

In 2007 the Howard government introduced federal funding for chaplains to work in schools, with the proviso they were not to evangelise or proselytise.

But the New South Wales Parents and Citizens Association says there is evidence chaplains are proselytising in public schools and students are being encouraged to join religious activities and prayer meetings.

Council of State School Organisations NSW president Helen Walton says her association is receiving more and more information about proselytising incidences.

"When the chaplaincy role was sold to us, it was also sold to us in terms of the fact that it was not a religious-based position," she said.

"It was purely a welfare-based position. Our concern is that it's moved beyond that now, that we now have information that some of these people in schools are actually having religious activities, prayer meetings, and encouraging students to come along."

The United Christian Education Foundation is the chaplaincy provider at Ulladulla High School on the New South Wales South Coast.

A newsletter on its website reads: "There is much to be thankful for as we look back on another year of bringing the great news of Jesus to the precious young people at Ulladulla High School. The other week a Year 7 boy put up his hand and said, 'I asked Jesus into my life the other day'.

"A Year 8 girl told me about the peace she now has since becoming a Christian," the newsletter continues.

Proselytising is against the federal Education Department's guidelines on chaplaincy, but some students at the Ulladulla school believe the chaplain is there to convert them.

"[It is] basically to make people become of his religion. That's it really. To convert children to their religion," said Max, a Year 8 student.

Nick, a maths teacher at the primary school nearby, was shocked when the chaplain came to his school and invited the children to pray.

"The chaplain was addressing the Year 6 children, a majority of those children would be going to the local high school and he did say that he was available for children there, and they can come to him and pray with him, or if not, he would pray for them," he said.

Allegations of evangelism by the United Christian Education Foundation prompted former High Court judge Michael Kirby to write a letter to the school principal. It was leaked to the ABC.

"I was surprised to see these claims, given the great importance attached in the Education Acts of New South Wales to the secular quality of public education in the state," the letter reads.

"Would you please inform me of whether the claims in the UCEF website are correct; what part you have permitted this organisation to play in the school apart from the one hour of scripture lessons protected by the Act; and whether these involvements of religious viewpoints in the school are known to, and approved by, the Department of Education and Training of the state?"

The chaplaincy provider refused an interview invitation and the school principal confirmed one allegation of proselytising was investigated and the chaplain was reminded about his code of conduct. The chaplain says he does not proselytise at the school.

Federal Education Minister Peter Garrett says his department takes these matters seriously.

"It's very clear in the existing guidelines that it is not the role of the chaplain to proselytise. If there are isolated incidences where this may or may not have happened it clearly is in breach of the guidelines," he said.

However Mr Garrett concedes the guidelines in general could be clearer. Changing them will be considered in his current review of the chaplaincy scheme.

- For the full story, tune into Radio National's Background Briefing on Sunday at 9:00am.