Former Labor minister Eddie Obeid has been suspended from the Labor party, as two former Labor premiers prepare to give evidence at the Independent Commission Against Corruption (ICAC) hearing in Sydney today.

New South Wales ALP leader John Robertson moved to have Mr Obeid suspended after the ICAC hearing yesterday heard that taxpayers had missed out on tens of millions of dollars due to a scheme designed to benefit Mr Obeid's family.

Former premiers Nathan Rees and Morris Iemma are due to give evidence at the inquiry today.

Neither man is accused of any wrongdoing, but both have been critical of the power wielded by Mr Obeid during their premierships.

Yesterday the opening day of the inquiry was told that corruption in the state could have been at a level "unexceeded since the days of the Rum Corps".

In a dramatic opening address, Counsel-Assisting Geoffrey Watson SC told the hearing that Mr Obeid and his family may have made $100 million from former mining minister Ian Macdonald's decision to open a mining area in the Byalong Valley.

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Former New South Wales premier Morris Iemma has told a corruption inquiry the strong relationship between former Labor ministers Ian Macdonald and Eddie Obeid was well known in caucus.

Mr Iemma was giving evidence at an Independent Commission Against Corruption (ICAC) inquiry into allegations related to the issue of mining licences around 2007 and 2008.

The inquiry has heard Mr Obeid's associates may have profited to the tune of hundreds of millions of dollars from decisions made by Mr Macdonald, the former mining minister, and that Mr Obeid may have had access to leaked information.

Mr Iemma said it was well known in the caucus that the two MPs worked well together.

He said Mr Obeid once tried to have Frank Sartor dumped from the planning portfolio and suggested Mr Macdonald would be more suitable because he would be better at "dealing with stakeholders".