New South Wales Health has demanded Hillsong Church immediately stop singing and dancing at a Hunter youth camp.

Video shows hundreds of participants maskless, singing and dancing inside a large tent with performers onstage.

Changes to public health orders came into effect on Tuesday that banned singing and dancing at music festivals, forcing the cancellation of the Grapevine Gathering scheduled for the Hunter Valley this weekend.

"While the order does not apply to religious services, it does apply to major recreation facilities and this event is clearly in breach of both the spirit and intent of the order," Health Minister Brad Hazzard said.

The three-day Hillsong "summercamp" is being held at the Glenrock scout camp south of Newcastle. 

Newcastle MP Tim Crakanthorp said holding the event was "pure arrogance".

"It's very, very disappointing, after we've had two local music festivals cancelled. 

"This is the exact behaviour that health experts have deemed too risky at the moment, yet the organisers of this event seem to feel it's absolutely fine for them to do so.

Hillsong insists event complies with rules

Hillsong defended holding the event and said it was "not similar to a music festival in any way".

"Our camps involve primarily outdoor recreational activities including sports and games," it said in a statement.

"We follow strict COVID procedures and adhere to government guidelines."

In relation to a social media video showing participants singing and dancing, Hillsong said "outdoor Christian services are held during the camp but these are only a small part of the program, and any singing is only a small part of each service".

Hillsong said it followed "strict COVID procedures including providing rapid antigen tests, use of face masks, deep cleaning and sanitisation".

Music industry responds

Pop singer Montaigne shared a video from the camp, commenting that "the double standards" being shown by the Australian government around live entertainment events was "absolutely buck wild" and "took her breath away".

Julia Robinson, managing director of the Australian Festival Association, labelled public health orders dealing with music festivals as "inconsistent".

"[We're] seeing that in other sectors and other settings that singing and dancing might actually be allowed, but the risk to health might be seen as being similar to a music festival.

More events planned

According to Hillsong's website, summercamps are designed to equip kids with "life tools and to encounter the presence of God in a powerful way that will anchor our families deeper in Jesus whilst having lots of fun".

Similar events are being held in Queensland, Victoria, Tasmania and Western Australia later this month. 

A ticket to the four-day event at Glenrock scout camp costs $314.