Police approved a neo-Nazi protest outside NSW parliament on Saturday morning, which involved black-clad men reciting Hitler chants and displaying a banner that stated: “Abolish the Jewish Lobby”.

Newly appointed police commissioner Mal Lanyon ordered a review after permission was given for the gathering in Sydney’s Macquarie, despite new laws from August banning the incitement of racial hatred.

It’s believed those involved were members of the National Socialist Network, which has staged numerous protests over the past couple of years, including anti-immigration rallies in Sydney and Melbourne.

The group of about 60 protesters reportedly expressed antisemitic sentiments, slammed multiculturalism and chanted a Hitler Youth slogan while standing in formation.

Neither Manyon nor Premier Chris Minns was aware that the protest had been approved.

Minns said it was important for him to publicly slam the racist event, even though he did not want to “give these pissants more oxygen”.

“It’s likely the case that we need to give police more legislated powers to stop this kind of naked racism and hatred on Sydney streets,” Minns said after the rally.

“I know holding this media conference does exactly that but the truth of the matter is, I’ve decided that if you give them an inch, they’ll take a mile.

“And does anyone believe this is their last rally? Does anyone think after dipping their toe into racism in Sydney, they’re going to stop here?

“I want them to be met with the clear and unambiguous message from the government, from political leaders, from civic life, from average NSW residents that we’ve got no interest in neo-Nazis in Sydney and in Australia.”

Lanyon conceded police had received notice the rally was going to take place more than a week ago, but said he had been caught off guard by it himself.

“There was a communication error within the police force for which I did not personally know that today’s protest was taking place,” he explained.

“The protest was taken to be authorised,” he said.

“It was assessed by the police area command at the time based on the information that was present.”

The decision had been made by officers charged with dealing with some 2000 protests each year, the commissioner said.

“Obviously (they) need to make an assessment based on what … they were comfortable with … that it was not one that they needed to actually take objection to.”

Lanyon said that process would be fully reviewed.

“I think it’s essential to understand what took place, what was considered, how that was overlaid against the appropriate legislation that exists at the moment,” he said.

NSW Jewish Board of Deputies President David Ossip branded the rally disgraceful.

“The chilling images and despicable words of hate which were uttered today should never find a home or be accepted in our society, especially outside the heart of our democracy,” he said.

-with AAP