Prime Minister Tony Abbott says he wasn't lobbied by a friend to allow private colleges to access government subsidies.
The federal budget introduced direct financial grants for students taking courses in private colleges and TAFEs.
Les Taylor, chairman of the Whitehouse Institute of Design in Sydney, has made donations to the NSW Liberal Party and has known Mr Abbott for many years.
He has also given Mr Abbott, when he was opposition leader, clothing on two occasions which have been declared on the members' interest register.
However, an institute scholarship worth up to $60,000 given to one of Mr Abbott's daughters, Frances, has not been declared on the register.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
Mr Abbott has previously declared other matters relating to his children, such as trips, accommodation and tickets to sporting events, on the public register.
Mr Abbott said questions about his daughter's scholarship was "a bit of dirt digging" and that she had earned it on merit.
"I think families should be left out of it," he told reporters in Sydney on Friday.
Asked whether he was personally lobbied by Mr Taylor for private college subsidies, Mr Abbott said: "No, I wasn't."
Mr Abbott said he had complied with the parliament's disclosure rules.
The Whitehouse Institute is a member of the Australian Council for Private Education and Training, which before the budget lobbied the government for extending commonwealth supported places beyond public universities.
In a statement on Friday, the institute said it would not disclose details of individual scholarship decisions because it had a duty to protect the privacy of former and current students.
It awarded all scholarships on merit.
"At no time has the institute lobbied the prime minister on issues of education policy or the accreditation of Whitehouse courses," chief executive Ian Tudor said.
