The Archbishop of Sydney, Glenn Davies, has written a letter to churches defending his diocese's decision to donate $1 million to fund the campaign against same-sex marriage in Australia.

It was confirmed on Monday that his heavily conservative diocese, the largest in the country, had backed the 'no' campaign in Australia's forthcoming postal survey on same-sex marriage that has sparked division within the Australian church.

Davies set out to 'correct some misrepresentations' about his diocese's involvement in the campaign, rejecting accusations of homophobia.

Peter Catt, the dean of St John's Anglican cathedral in Brisbane, highlighted the wide variations in opinions on same-sex marriage within the church, arguing that the money would have been better spent on a less divisive issue.

Similarly, minister Mike Paget of St Barnabas Anglican Church in Sydney took to Facebook to state that despite his 'classical view of marriage' he strongly disagrees with the decision. He regards the donation as 'poor financial stewardship' that is utterly 'out of proportion with our commitments to other causes'.

He added: 'The church is pretty well in lockstep about the need to deal with domestic violence, homelessness, refugee rights. If you have a million dollars why not spend it on something you know can make a material difference?'

Davies responded to criticism that the money would have been better spent tackling social justice initiatives, saying: 'The reality is, however, that our participation in the Coalition for Marriage is not at the expense of our commitment to social justice, but because of it. We believe that the best way for Anglicare and other Christian agencies to serve the social good is for them to be able to operate on the basis of a Christian ethos, and to recruit Christian staff and volunteers.'

Davies hinted that a 'Yes' vote could in fact impede the Church's charitable efforts. He wrote: 'Overseas experience indicates that same-sex marriage leads to government funding and recognition of charitable status being increasingly tied to "equality compliance". Christian agencies overseas have been required by law to hire staff who do not support the Christian ethos of the organisation.'

Minister Andrew Sempell of St James' Church maintained that the donation is not indicative of all Sydney Anglicans' views. He described the 'questionable' decision as an irresponsible use of charitable funds.

Sempell went on to express concerns about the donation's potential repercussions such as further alienating the Church from society, particularly young people.

He concluded: 'As Australians, we are not imposing our views on others, rather we are expressing our views as citizens of the country. As Christians, we are to follow our Lord's instruction to be salt and light in the world. We should not be ashamed to stand up for our convictions, whatever the cost.'