About 12 countries have temporarily halted their funding of UNRWA due to the allegation.
Australian Foreign Minister Penny Wong has spoken out in favour of a permanent ceasefire in the Gaza war.
The conflict has spread to Lebanon, where the Hezbollah militia has been firing rockets across the Israeli border in support of Hamas.
Nigeria was invited to the emergency joint Arab-Islamic summit in the Saudi capital Riyadh to discuss the war in the Gaza Strip.
It urged both parties to exercise utmost restraint and prioritise the safety and well-being of civilians.
German citizens were among the roughly 200 captives being held by the group in Gaza.
The federal government says it will do everything humanly possible to ensure that Nigeria returns to UNESCO governing board.
He also warned that ongoing military operations would have “military and humanitarian repercussions” that could spiral out of control.
The UN Security Council is expected to consider a draft resolution led by Brazil, calling for a humanitarian ceasefire in the Israel-Hamas war.
The UN secretary general said the Middle East was on the “verge of the abyss” as he urged Islamist Hamas to release the hostages it took immediately.
