More than $22 million in taxpayer funds will be paid directly to a private foundation hand-picked by the Turnbull government to dispense Australia's largest single Great Barrier Reef funding package, raising fresh questions over the controversial deal.

It has also emerged that the foundation will pocket interest earned on the record-large funding windfall, despite previous claims the interest would be directed back into projects to help rescue the natural wonder.

The Great Barrier Reef Foundation grant is the largest of its kind in Australian history.

The government in April announced it would gift $444 million to the Great Barrier Reef Foundation, a tiny business-focused charity, to fund reef-saving projects. The government did not run a tender process or give other organisations, including its own marine science or reef agencies, opportunity to apply for the funding.

Labor has criticised the deal, saying it was conducted in secret and expert government agencies are already set up to handle such funding.