slush (n.)

1640s, "melting snow, snow and water," perhaps from a Scandinavian source (compare Norwegian and Swedish slask "slushy ground;" obsolete Danish slus "sleet"), all probably imitative of the sound of sloshing. It is attested by 1772 as "sludge, watery mire."

Slush fund is first attested 1839, from an earlier sense of slush "refuse fat from the cook's galley of a ship" (1756); the money from the sale of a ship's slush became a cook's prerequisite; on a man-of-war the money was distributed among the officers.

It is sometimes a considerable sum, which may be expended at the discretion of the commanding officer or a board of officers, without accounting for it to any higher authority. [Century Dictionary]

The extended meaning "money collected for bribes and to buy influence" is first recorded 1874, no doubt with suggestions of "greasing" palms. Related: Slush-money. The galley slush also was used as grease, hence slush (v.) "grease (a mast) with slush."