A senior Catholic bishop is hitting back at Steve Bannon, Donald Trump's former chief strategist, after the far-right spokesman accused the Catholic Church of being economically motivated to oppose deporting immigrants.

Cardinal Timothy Dolan, the Archbishop of New York, said it was a 'preposterous and rather insulting statement' not worthy of a proper response after the Catholic bishops vociferously opposed Trump rescinding the Deferred Action for Childhood Arrivals (DACA) programme.

The backlash comes after Bannon said the US Catholic Church had an 'economic interest' in 'unlimited illegal immigration' and that was the main reason it opposed the move announced earlier this week.

'To come to grips with the problems in the church, they need illegal aliens – they need illegal aliens to fill the churches, Bannon said in a CBS 60 Minutes interview.

'They have an economic interest in unlimited immigration, unlimited illegal immigration.'

A Catholic himself, Bannon said: 'As much as I respect Cardinal Dolan and the bishops on doctrine, this is not doctrine.'

He added: 'I totally respect the Pope, and I totally respect the Catholic bishops and cardinals on doctrine. This is not about doctrine, this is about the sovereignty of a nation and, in that regard, they're just another guy with an opinion.'

But Cardinal Dolan came back strongly saying 'that's insulting and that's just so ridiculous'.

'Well, as a matter of fact he may be right,' he said on Sirius XM's Catholic Channel on Thursday. 'This is not an issue of Catholic doctrine because it comes from the Bible itself and we Catholics are people of the book.

'And the Bible is so clear, so clear, that to treat the immigrant with dignity and respect, to make sure that society is just in its treatment of the immigrant is a biblical mandate,' Dolan continued. 'It's clear from the lips of Jesus when he said, "Whatsoever you do to the least of my brothers, you do to me. When I was a stranger," meaning an immigrant or a refugee, "you welcomed me."'

With one in four US Catholics foreign born and 34 per cent Hispanic, according to the Pew Research Center, the issue is particularly pertinent for the bishops.

Following the decision to scrap DACA the US Catholic bishops issued a strongly worded statement saying the decision is 'unacceptable and does not reflect who we are as Americans'.

'Today, our nation has done the opposite of how Scripture calls us to respond. It is a step back from the progress that we need to make as a country,' the statement read. 'Today's actions represent a heartbreaking moment in our history that shows the absence of mercy and good will, and a short-sighted vision for the future.'